P l m a n r t P r e s Condensed Interim P v t d Financial ... Mahmood Agha Safdar M. Hayat Qureshi...

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2nd Floor, Mustafa Center, 45-F, Main Market, Gulberg II, Lahore.

Noon Sugar Mills Limited

Prin

ted

at S

alm

an

Art P

ress (P

vt.) L

td.

Condensed Financial Information

for the Nine Months Ended

Interim

30 June 2011(Un-Audited)

1

In The Name of Allah, The Most Beneficent, The Most Merciful

Condensed for the Nine Months Ended 30 June 2011 (Un-Audited)

Interim Financial Information

Corporate Information

Directors’ Review

Condensed Interim Balance Sheet

Condensed Interim Profit and Loss Account

Condensed Interim Cash Flow Statement

Condensed Interim Statement of Changes in Equity

Notes to the Condensed Interim Financial Information

CONTENTS

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3

4

6

8

9

10

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CORPORATE INFORMATION

3

BOARD OF DIRECTORS Adnan Hayat Noon (Chairman / Chief Executive) K. Iqbal TalibAmjad Mahmood AghaSafdar M. Hayat QureshiSalman Hayat NoonZaheer Ahmad KhanAsif Hussain Bukhari

AUDIT COMMITTEE (Chairman)Salman Hayat NoonZaheer Ahmad KhanAsif Hussain Bukhari

MANAGEMENT K. Iqbal Talib Managing DirectorNaveed Akhtar Resident DirectorKamran Zahoor Chief Financial Officer

SECRETARY Syed Anwar Ali

AUDITORS Hameed Chaudhri & Co.,Chartered Accountants

LEGAL ADVISERS Hassan & Hassan (Advocates)

BANKERS Allied Bank LimitedHabib Bank LimitedMCB Bank LimitedStandard Chartered Bank (Pakistan) LimitedUnited Bank Limited

HEAD OFFICE 2nd Floor, Mustafa Center,45-F, Main Market, Gulberg II, LahoreTel. # (042) 35788472-3

REGISTERED OFFICE 1st Floor, Alfalah Building,Shahrah-e-Quaid-e-Azam, Lahore.

SHARES DEPARTMENT 66 – Garden Block, New Garden Town, Lahore.Tel. # (042) 35831462 Email: [email protected]

MILLS Bhalwal, District Sargodha.

WEBSITE www.noonsugar.net

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DIRECTORS' REVIEW

DEAR MEMBERS

Your directors are pleased to present the condensed un-audited interim financial information of the Company for the third quarter ended 30 June 2011.

FINANCIAL RESULTS

Sales of the Company, during the period under review, improved by 83.56% and reached to Rupees 2,260 million as compared with Rupees 1,231 million for the same period of the last year. Gross profit was Rupees 323 million as compared to Rupees 20 million of last period, resulting from higher production of sugar & ethanol and improved selling price of both products, combined with more efficient usage of resources and cost curtailment efforts by the management. After tax profit for the period is Rupees 64 million against a loss of Rupees 139 million, for the same period in 2010, yielding an EPS of Rupees 3.90 per share as compared with loss per share of Rupees 8.42 in the same period, last year.

OPERATIONAL RESULTS

Sugar DivisionNine months ended 30 June

2011 2010

Start of season 29-11-2010 20-11-2009End of season 24-03-2011 25-02-2010Duration (Days) 116 98Sugarcane C rush (M. Tons) 600,385 294,534Recovery (%) 7.70 7.28Sugar produced (M. Tons) 46,180 21,444Molasses produced(M. Tons) 31,750 14,921Recovery of molasses (%) 5.29 5.07

Sugar segment performed comparatively better in the 1st half of the year owing to supply and demand imbalance carried over from production shortfall during last year to the early months of the season when sugar rates remained comparatively high. A marked declining trend however, set in before close of the season, which persisted throughout the quarter under review. The situation was further compounded when the Govt. changed the levy of Sales Tax from base rate of Rs. 28.88 per kg of sugar to actual selling rate of sugar w.e.f. March 15, 2011 and also raise the rate of SED from 1% to 2.5%. This additional tax component of approximately Rs. 190 per bag of sugar was not absorbed by the market for the remaining period of the quarter under review.

Distillery Division

Operating period (Days)Molasses processed(M. Tons)Ethanol produced (Litres)Average yield

Nine months ended 30 June2011 2010

21150,219

12,743,501254

14928,054

6,877,728245

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Lahore: 28 July 2011

For and on behalf of the Board

K. Iqbal TalibManaging Director

Zaheer Ahmad KhanDirector

The performance of distillery segment improved considerably in the 3rd quarter owing

to an improved selling price of ethanol in the international market, which is

traditionally indexed with the market trend of fossil oil, and 7,500 M. Tons of ethanol

was exported as compared to 2,560 M. Tons during the same period in 2010. This

segment therefore, made a positive contribution to the Company's profitability.

However, three days per week suspension in supply of sui-gas seriously affected both,

the capacity utilization restricting contribution from distillery operations to your

company.

FUTURE OUTLOOK

Attractive returns to the growers in the last two seasons combined with organized cane

development efforts by your mill to discriminate and improve both, the quality and

yield of cane, particularly in the gate supply area of the mill, is beginning to show the

desired results, and an average of 17% increase in acreage is reported, with share of

variety cane having doubled to 40%, since the last crushing season, which should

hopefully make a significant improvement in average sucrose recovery of your mill.

Adequate measures have been taken for a planned BMR at the plant to achieve a

through put to consistently handle upto 10,000 TCD as well as to improve overall

milling and processing efficiency of the plant. Plans are also underway to complete the

arrangements for export of surplus power during the crushing season.

A separate scheme is also being studied seriously, to install an independent co-

generation unit at the distillery, which is also aimed at solving the environmental

problem associated with it.

ACKNOWLEDGEMENT

The Board is thankful to the valuable members and bankers for their trust and

continued support to the Company. The Board would also like to place on record its

appreciation to all employees of the Company for their dedication, diligence and hard

work.

6

CONDENSED INTERIM BALANCE SHEET

Un-audited30 June,

2011Note

200,000

165,175

739,217

EQUITY AND LIABILITIES

SHARE CAPITAL AND RESERVES

Authorised capital

Issued, subscribed and

paid-up capital

Reserves

Accumulated loss (135,649)

768,743

7 -

-

48,884

48,884

8 197,446

59,256

9 1,812,355

7 -

-

10 39,944

2,109,001

NON-CURRENT LIABILITIES

Long term finances

Long term deposits

Staff retirement

benefits - gratuity

CURRENT LIABILITIES

Trade and other payables

Accrued mark-up

Short term finances

Current portion of:

- long term finances

- lease finances

Taxation

CONTINGENCIES AND

COMMITMENTS 11 2,926,628

(Rupees in thousand)

Audited30 Sep.,

2010

200,000

165,175

739,217

(200,075)

704,317

-

1,123

49,757

50,880

84,482

23,448

522,976

132,143

729

17,346

781,124

1,536,321

The annexed notes form an integral part of this condensed interim financial information.



1,055,083

16,989

45,119

882

3,713

1,121,786

64,926

1,493,274

116,645

27,718

1,764

6,271

39,358

31,163

1,781,120

23,722

Un-audited30 June,

2011

Audited30 Sep.,

2010

1,117,599

17,054

45,086

847

1,286

1,181,872

61,990

160,060

16,872

23,235

879

4,214

24,850

38,627

330,727

23,722

Note

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13

14

15

ASSETS

NON-CURRENT ASSETS

Property, plant and equipment

Investment property

Investments

Loans and advances

Deposits

CURRENT ASSETS

Stores, spares and loose tools

Stock-in-trade

Trade debts - unsecured,considered good

Loans and advances

Deposits and prepayments

Other receivables

Income tax refundable,advance income tax and tax deducted at source

Cash and bank balances

INVESTMENTS

CLASSIFIED AS

HELD FOR SALE

AS AT 30 JUNE 2011

2,926,628 1,536,321


The Chief Executive is out of Pakistan and in his absence these condensed interim financial information have been signed by two Directors as required under section 241(2) of the Companies Ordinance, 1984.

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Oct. - Jun. Oct. - Jun.Mar. - Jun.

2011

Mar. - Jun.

2010 2011 2010

623,015 334,372 2,259,834 1,231,101

544,963 329,781 1,936,445 1,211,271

78,052 4,591 323,389 19,830

17,347 5,439 42,528 17,949

19,223 16,125 55,235 52,125

(759) 246 7,550 1,266

(2,402) (2,195) (6,833) (3,433)

33,409 19,615 98,480 67,907

44,643 (15,024) 224,909 (48,077)

64,309 34,566 140,558 83,410

(19,666) (49,590) 84,351 (131,487)

432 - 2,644 4,802

(19,234) (49,590) 86,995 (126,685)

6,193 7,292 22,598 12,335

(25,427) (56,882) 64,397 (139,020)

- - - -

(25,427) (56,882) 64,397 (139,020)

(1.54) (3.44) 3.90 (8.42)

------------------- Rupees -------------------

------------ (Rupees in thousand) -------------

Nine months endedFor the 3rd Quarter

SALES - Net

COST OF SALES

GROSS PROFIT / (LOSS)

DISTRIBUTION AND MARKETING COST

ADMINISTRATIVE EXPENSES

OTHER OPERATING EXPENSES

OTHER OPERATING INCOME

PROFIT / (LOSS) FROM OPERATIONS

FINANCE COST

PROFIT / (LOSS) BEFORE SHARE OF

PROFIT FROM AN ASSOCIATED

COMPANY AND TAXATION

SHARE OF PROFIT FROM AN

ASSOCIATED COMPANY - Net of taxation

PROFIT / (LOSS) BEFORE TAXATION

TAXATION

PROFIT / (LOSS) AFTER TAXATION

OTHER COMPREHENSIVE INCOME

TOTAL COMPREHENSIVE INCOME /

(LOSS) FOR THE PERIOD

EARNINGS / (LOSS) PER SHARE


Note

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CONDENSED INTERIM PROFIT & LOSS ACCOUNT (UN-AUDITED)FOR THE QUARTER AND NINE MONTHS ENDED 30 JUNE 2011

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9

CASH FLOW FROM OPERATING ACTIVITIES

Profit / (loss) for the period - before share of profit of an

Associated Company and taxation

Adjustments for non-cash charges and other items:

Depreciation on operating fixed assets and investment property

Gain on sale of operating fixed assets - net

Unclaimed and other payable balances written-back

Staff retirement benefits - gratuityProvision for workers' welfare fundProvision for workers' (profit) participation fundInterest / mark-up income

Provision against slow moving stores and spares inventory

Finance cost

CASH FLOW FROM OPERATING ACTIVITIES - Before working capital changes

(Increase) / decrease in current assets:

Stores, spares and loose toolsStock-in-trade

Trade debts

Loans and advances

Deposits and prepayments

Other receivables

Increase in trade and other payables

CASH OUTFLOW FROM OPERATING ACTIVITIES - Before taxation Income tax paid

Staff retirement benefits (gratuity) - paid

Long term deposits from employees - net

Loans and advances - net

Deposits - net

CASH OUTFLOW FROM OPERATING ACTIVITIES - After taxation

CASH FLOW FROM INVESTING ACTIVITIES

Property, plant and equipment acquired

Sale proceeds of operating fixed assetsInterest / mark-up received

Dividend received

NET CASH OUTFLOW FROM INVESTING ACTIVITIES

CASH FLOW FROM FINANCING ACTIVITIESLong term finances - net

Lease finances

Short term financesFinance cost paid

Dividend paid

NET CASH INFLOW FROM FINANCING ACTIVITIES

NET INCREASE IN CASH AND CASH EQUIVALENTSCASH AND CASH EQUIVALENTS - At beginning of the period

CASH AND CASH EQUIVALENTS - At end of the period

84,351 (131,487)

86,896 94,691

(62) (312)

(138) -

2,350 7,109

1,721 -4,530 -(238) (367)

890 1,153

140,558 83,410

320,858 54,197

(3,826) (2,013)(1,333,214) (451,937)

(99,773) (999)

(4,483) (6,227)

(885) 673

(2,057) (2,730)

106,856 116,513

(1,337,383) (346,720)

(1,016,525) (292,523)

(14,508) (7,713)

(3,223) (8,933)

(1,123) (230)

(35) 91

(2,427) (521)

(1,037,841) (309,829)

(25,621) (5,767)

1,368 725

238 367

2,640 -

(21,375) (4,675)

(132,143) (103,571)

(729) (1,464)

1,289,379 509,811

(104,750) (72,128)

(5) (14,872)

1,051,752 317,776

(7,464) 3,27138,627 9,766

31,163 13,037

30 June, 30 June, 2011 2010


Nine months ended


CONDENSED INTERIM CASH FLOW STATEMENT (UN-AUDITED)FOR THE NINE MONTHS ENDED 30 JUNE, 2011






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CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UN-AUDITED)

FOR THE NINE MONTHS ENDED 30 JUNE, 2011

Balance as at 01 October, 2009

Total comprehensive loss

for the period

Loss after taxation for the

nine months ended 30 June, 2010

Transactions with owners:

Final cash dividend for the year

ended 30 September, 2009

at the rate of Rs.1 per share

Nominal value of bonus

shares issued

Effect of items directly

credited in equity by an

Associated Company

Total transactions with owners

Balance as at 30 June, 2010

Balance as at 01 October, 2010

Total comprehensive income

for the period

Profit after taxation for the

period ended 30 June, 2011

Transactions with owners:

Effect of items directly

credited in equity by an

Associated Company

Balance as at 30 June, 2011

Capital Revenue

150,159 134,233 620,000 754,233 60,963 965,355

- - - - (139,020) (139,020)

- - - - (15,016) (15,016)

15,016 (15,016) - (15,016) - -

- - - - 32 32

15,016 (15,016) - (15,016) (14,984) (14,984)

165,175 119,217 620,000 739,217 (93,041) 811,351

165,175 119,217 620,000 739,217 (200,075) 704,317

- - - - 64,397 64,397

- - - - 29 29

165,175 119,217 620,000 739,217 (135,649) 768,743

Unapprop- riated profit /

(accumulated loss)

Reserves

Share premium account

General Sub-total

------------------------ (Rupees in thousand) ------------------------

TotalSharecapital



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FOR THE NINE MONTHS ENDED 30 JUNE, 2011

Noon Sugar Mills Ltd. (the Company) was incorporated in the year 1964 as a Public Company and its shares are quoted on the Stock Exchanges in Pakistan. It is principally engaged in production and sale of white sugar and spirit. The Company's Mills are located at Bhalwal, District Sargodha and its Head Office at 2nd Floor, Mustafa Centre, 45-F, Main Market, Gulberg II, Lahore.

1.

This condensed interim financial information has been presented in condensed form in accordance with approved accounting standards as applicable in Pakistan for interim financial reporting and is being submitted to the shareholders in accordance with the requirements of section 245 of the Companies Ordinance, 1984. This condensed interim financial information does not include all of the information required for full annual financial statements and should be read in conjunction with the audited annual financial statements of the Company as at and for the year ended 30 September, 2010.

2.

The accounting policies and methods of computation adopted for the preparation of this condensed interim financial information are the same as those applied in the preparation of audited annual financial statements of the Company for the preceding year ended 30 September, 2010.

3.

Amendments to certain existing standards and new interpretations on approved accounting standards effective during the current period were not relevant to the Company's operations and did not have any impact on the accounting policies of the Company.

4.

The Company is inter-alia, engaged in manufacturing of sugar for which the season begins in October / November and ends in March / April. Therefore, majority of expenses are incurred and production activities are undertaken in first half of the Company's financial year thus increasing volume of inventories and financing at the end of the first half.

5. SEASONALITY OF OPERATIONS

Provisions in respect of taxation, retirement benefit obligations, workers' welfare fund and workers' (profit) participation fund are estimated and these are subject to final adjustments in the annual audited financial statements.

6. PROVISIONS

NOTES TO AND FORMING PART OF THE CONDENSEDINTERIM FINANCIAL INFORMATION (UN-AUDITED)

AuditedYear-ended

30 Sep.,

2010

75,000

57,143

132,143

75,000

57,143

132,143

-

Un-auditedNine months ended

30 June,

2011

-

-

-

-

-

-

-


7. LONG TERM FINANCES - Secured

United Bank Ltd. (UBL)

MCB Bank Ltd. (MCB)

Less: current portion grouped under current liabilities:

- UBL

- MCB

Trade and other payables include trade creditors aggregating Rs. 110.243 million (30 September, 2010: Rs.65.711 million).

8. TRADE AND OTHER PAYABLES

Short term finance facilities available from various commercial banks under mark-up arrangements aggregate to Rs.2.035 billion (30 September 2010: Rs.1.841 billion). These facilities, during the period, carried mark-up at the rates ranging from 10% to 15.71% (30 September 2010: 8.00% to 15.84%) per annum. The aggregate facilities are secured against charge on current and fixed assets and pledge of sugar stocks. These facilities are expiring on various dates by January, 2012.

9. SHORT TERM FINANCES - Secured

In view of available unused tax losses provisions made during the current and preceding periods represent minimum tax payable under section 113 and final tax deducted at source on realisation of foreign exchange proceeds under section 154 of the Income Tax Ordinance, 2001.

10. TAXATION

There has been no significant change in the status of contingencies as reported in the preceding published annual financial statements of the Company for the year ended 30 September, 2010.

11. CONTINGENCIES AND COMMITMENTS

11.1

12

AuditedYear-ended

30 Sep.,

2010

1,216,649

-

14,577

116

-

162

455

252

1,508-

1,022

34

18,126

1,107,994

9,605

1,117,599

12.1 Operating fixed assets

Opening book value

Additions during the period:

Buildings on freehold land

Plant and machinery

Laboratory equipment

Other equipment

Electric installations and fittings

Office equipment

Furniture and fixtures

Vehicles-additions-transfer from leased assets

Farm tractors

Farm equipment

1,107,994

980

22,122

-

1,437

320

1,251

118

5,0086,572

243

-

38,051


30 June,

2011

Note

12.1 1,051,336

3,747

1,055,083


12. PROPERTY, PLANT AND EQUIPMENT

Operating fixed assets

Capital work-in-progress - at cost

Guarantee given to Sui Northern Gas Pipelines Ltd. by a commercial bank on behalf of the Company outstanding as at 30 June, 2011 was for Rs.10.392 million (30 September 2010: Rs.10.392 million). The guarantee is valid upto 03 October, 2011.

11.2

The High Court of Sindh, Karachi, during the current period, has allowed the Company's application and sale certificate has been issued to the Company in respect of factory / plant known as Northern Chemicals. It is held that in case the Court comes to a conclusion that the Company is liable to pay stamp duty on plant and machinery as well, the Company shall pay the same within fifteen days from decision of the appeal. In this regard, the Company has provided a bank guarantee in favour of Nazir of High Court of Sindh for the amount of Rs.2.400 million.

11.3

13

14


30 June,

2011

AuditedYear-ended

30 Sep.,

2010


Book value of leased vehicles

transferred to owned vehicles

Book value of assets disposed-off during the period / year

Book value of assets written-off during the year

Depreciation charge for the period / year

Closing book value

13. INVESTMENTS - Quoted

Noon Pakistan Ltd. (NPL - an Associated Company)

2,200,000 (30 September, 2010: 2,200,000)

non-voting ordinary shares of Rs.10 each - cost

Equity held 17.36% (30 September, 2010: 17.36%)

Post acquisition profit brought forward including effect of items directly credited in equity by NPL

Profit for the period / year - net of taxation

Dividend received during the period

(6,572)

(1,306)

-

(86,831)

1,051,336

20,000

25,115

2,644

(2,640)

45,119

-

(578)

(1)

(126,202)

1,107,994

20,000

18,053

7,033

-

45,086

Fair value of investments as at 30 June, 2011 was Rs.32.494 million (30 September, 2010: Rs.31.900 million).

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14. STOCK-IN-TRADE

Raw materials - molasses

Work-in-process:

- sugar

- molasses

Finished goods:

- sugar

- spirit

Other stocks - (Fair Price Shop and Depot)


30 June,

2011

AuditedYear-ended

30 Sep.,

2010


198,589

5,627

4,927

10,554

1,216,601

66,572

1,283,173

958

1,493,274

19,449

3,430

39

3,469

99,313

37,571

136,884

258

160,060

There has been no significant change in the status of 'investments classified as held for sale' as reported in the preceding published audited financial statements of the Company for the year ended 30 September, 2010.

15. INVESTMENTS CLASSIFIED AS HELD FOR SALEPioneer Cement Ltd.

The Company has related party relationship with its Associated Companies, employee benefit plans, its directors and key management personnel. Transactions with related parties are carried-out on arm's length basis.

16. TRANSACTIONS WITH RELATED PARTIES

Aggregate transactions with Noon Pakistan Ltd. during the period were as follows:

Sale of sugar (Rupees in thousand)

Dividend received (Rupees in thousand)

Bonus shares received (No. of shares)

30 June, 2011

30,582

2,640

-

30 June, 2010

30,098

-

200,000

Nine months endedUn-audited

Remuneration paid to key management personnel during the period aggregated Rs.15.311 million (30 June, 2010: Rs. 8.289 million).

-

16

Figures in the condensed interim financial information have been rounded-off to the nearest thousand Rupees except stated otherwise.

19. GENERAL

2011 2010 2011 2010 2011 2010 2011 2010

1,865,013 1,038,154 654,899 324,736 (260,078) (131,789) 2,259,834 1,231,101

1,717,701 1,090,983 478,822 252,077 (260,078) (131,789) 1,936,445 1,211,271

147,312 (52,829) 176,077 72,659 0 0 323,389 19,830

4,106 863 38,422 17,086 0 0 42,528 17,949

47,178 38,037 8,057 14,088 0 0 55,235 52,125

51,284 38,900 46,479 31,174 0 0 97,763 70,074

96,028 (91,729) 129,598 41,485 0 0 225,626 (50,244)

---------------------------------------- Rupees in thousand ----------------------------------------

30 June,

--------------------------------------------------------------- Un-audited ---------------------------------------------------------

30 June, 30 June, 30 June,

For nine months ended

Sugar DistilleryElimination of inter

segment transactionsTotal

For nine months ended For nine months ended For nine months ended

(7,550) (1,266)

6,833 3,433

224,909 (48,077)

(140,558) (83,410)

2,644 4,802

(22,598) (12,335)

64,397 (139,020)

Sales - net

Cost of sales

Gross profit / (loss)

Distribution and marketing cost

Administrative expenses

Segment results

Unallocatable income and expenses:

Other operating expenses

Other operating income

Profit / (loss) from operations

Finance cost

Share of profit from an Associated Company

Taxation

Profit / (loss) after taxation

17. SEGMENT INFORMATION

This condensed interim financial information was authorised for issue in the Board of Directors' meeting held on 28 July, 2011.

18. DATE OF AUTHORISATION FOR ISSUE




P l m a n r t P r e s Condensed Interim P v t d Financial ... Mahmood Agha Safdar M. Hayat Qureshi...

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