GHANDHARA NISSAN LIMITED · Mr. Mohammad Zia Mr. Muhammad ... of other vehicles under contract...

Quarterly ReportSeptember 30th, 2017(Un-audited)

GHANDHARA NISSAN LIMITED

Contents

CompanyProfile

02 04Directors'ReportEnglish

Directors'ReportUrdu

05 06BalanceSheet

07 08Statement ofCash Flows

09 10Statement ofChanges inEquity

Notes to theFinancialsStatementStandalone

ConsolidatedDirectors’ ReportEnglish

16 17ConsolidatedDirectors’ ReportUrdu

1918ConsolidatedBalance Sheet

ConsolidatedProfit & Loss

20ConsolidatedStatement ofCash Flows

ConsolidatedStatement of Changes in Equity

21 22ConsolidatedNotes to theFinancialsStatement

Profit &Loss

Company Profile

Board of Directors

Mr. Raza Kuli Khan Khattak ChairmanLt. Gen. (Retd.) Ali Kuli Khan Khattak President Mr. Ahmed Kuli Khan Khattak Chief Executive OfficerMr. Mushtaq Ahmed Khan (FCA) Mr. Jamil A. Shah Syed Haroon Rashid Mr. Mohammad Zia Mr. Muhammad Saleem Baig Mr. Polad Merwan Polad

Company Secretary

Mr. Muhammad Sheharyar Aslam

Registered Office

F-3, Hub Chowki Road, S.I.T.E., Karachi

Bankers of the Company

National Bank of Pakistan Faysal Bank Limited Habib Bank Limited Allied Bank Limited United Bank LimitedSoneri Bank Limited MCB Bank Limited The Bank of Tokyo – Mitsubishi, Ltd. Industrial & Commercial Bank of China Summit Bank Limited The Bank of Punjab The Bank of Khyber

Chief Financial Officer

Mr. Muhammad Umair

Factory

Truck / Car Plants Port Bin Qasim, Karachi

Audit Committee

Mr. Mohammad Zia ChairmanLt. Gen. (Retd.) Ali Kuli Khan Khattak MemberMr. Jamil A. Shah MemberMr. Polad Merwan Polad Member

Human Resource & Remuneration Committee

Lt. Gen. (Retd.) Ali Kuli Khan Khattak ChairmanMr. Ahmed Kuli Khan Khattak MemberMr. Muhammad Zia MemberMr. Jamil A. Shah MemberNIB Bank Limited

Askari Commercial Bank LimitedMeezan Bank LimitedBank Al Habib Limited Bank Alfalah IslamicAl Baraka Bank (Pakistan) Limited

Quarterly Report September 2017

02


03

Auditors

M/s. Shinewing Hameed Chaudhri & Co. M/s. Junaidy Shoaib AsadChartered Accountants Chartered Accountants5th Floor, Karachi Chambers 1/6, Block-6, P.E.C.H.S, Mohtarma LaeeqHasrat Mohani Road Begum Road, Off Shahrah-e-Faisal

Near Nursery Flyover, Karachi ihcaraK

Legal & Tax Advisors

Ahmed & Qazi AssociatesAdvocates & Legal Consultants404 Clifton Centre, CliftonKarachi

Shekha & MuftiChartered AccountantsC-253, P.E.C.H.S., Block 6Off Shahrah-e-FaisalKarachi

Share Registrars

T.H.K. Associates (Pvt.) Ltd.

NTN:

0802990-3

Sales Tax Registration No:

12-03-8702-001-46

1st Floor, 40-C,Block-6, P.E.C.H.SKarachi-75400


04

------------- Rupees ‘000 -------------

Directors’ ReportYour Directors are pleased to present the Quarterly Report alongwith the standalone �nancial statements of Ghandhara Nissan Limited for the First Quarter ended September 30, 2017.

Financial Results

The �nancial results for the quarter ended September 30, 2017 are summarized below:

During the quarter, sales of JAC Trucks in CBU form have started contributing to company’s revenue stream.

Related Party Transactions

All transactions with related parties have been executed at arm’s length and have been disclosed in the �nancial statements.

Future Outlook

The Company is already gearing itself to commence the local assembly of JAC Trucks in near future. With a good market repute of Dongfeng products coupled with an overwhelming response for JAC Trucks, the company will continue its focus on delivering value to its stakeholders.

The directors are also grateful to the Principals, customers, vendors and other business associates for their continued patronage and support.

For and on behalf of the Board of Directors

Revenue

Gross Pro�t

Operating Pro�t

Net Pro�t

Earnings Per Share (Rupees)

2017 2016

Quarter ended September 30

527,521

152,760

139,358

95,678

2.13

1,333,080

245,132

188,192

128,491

2.86

Karachi Dated: October 23, 2017

Ahmed Kuli Khan KhattakChief Executive Officer

Jamil A. ShahDirector


05


30 30------------- -------------


06

Condensed Interim Balance SheetAs at September 30, 2017

Note

(Un-Audited)September 30,

2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------ASSETSNon current assetsProperty, plant and equipmentIntangible assetsLong term investmentsLong term loansLong term depositsDue from Subsidiary Company

Current assetsStores, spares and loose toolsStock-in-tradeTrade debtsLoans and advancesDeposits and prepaymentsOther receivablesAccrued interest/mark-upBank balances

Non current assets classi�ed as held for saleTotal assetsEQUITY AND LIABILITIESShare capital and reservesAuthorised capital80,000,000 (June 30, 2016: 80,000,000) ordinary shares of RS.10 eachIssued, subscribed and paid-up capital45,002,500 (June 30, 2016: 45,002,500) Ordinary shares of Rs.10 each Share premiumUnappropriated pro�tTotal equitySurplus on revaluation of �xed assetsLiabilitiesNon current liabilitiesLiabilities against assets subject to �nance leaseLong term depositsDeferred liabilitiesDeferred taxation

Current liabilitiesTrade and other payablesAccrued mark-upCurrent portion of liabilities against assetssubject to �nance leaseTaxation - net

Total liabilitiesContingencies and commitmentsTotal equity and liabilties

The annexed notes from 1 to 14 form an integral part of these �nancial statements.

1,985,348 46

242,630 9,468

19,266 488,240

2,744,998

80,386 196,406 197,295

67,728 28,077 15,233

9,943 388,842 983,910

- 3,728,908

800,000

450,025 40,000

1,416,495 1,906,520

981,296

49,490 9,611

5 277,253 336,359

414,870 715

17,046

72,102 504,733 841,092

- 3,728,908

1,983,445 50

242,630 9,546

19,266 313,140

2,568,077

86,474 277,690 181,088

49,773 16,625 18,082

7,669 514,390

1,151,791 137,909

3,857,777

800,000

450,025 40,000

1,313,543 1,803,568

988,570

53,699 9,611

6 282,527 345,843

628,809 347

18,474

72,166 719,796

1,065,639 -

3,857,777

5

6

7

8

9



September 30,2017

September 30,2016

Condensed Interim Profit and Loss Account (Un-audited) For the Quarter ended September 30, 2017

Note ----------- Rupees ‘000 -----------

----------- Rupees ‘000 -----------

Revenue

Cost of sales

Gross pro�t

Distribution cost

Administrative expenses

Other income

Other expenses

Pro�t from operations

Finance cost

Pro�t before taxation

Taxation

Pro�t after taxation

Earnings per share - basic and diluted


527,521

(374,761)

152,760

(11,305)

(49,694)

57,727

(10,130)

139,358

(2,675)

136,683

(41,005)

95,678

2.13

1,333,080

(1,087,948)

245,132

(10,994)

(49,758)

17,626

(13,814)

188,192

(1,973)

186,219

(57,728)

128,491

2.86

10


07



September 30,2017

September 30,2016


08

Condensed Interim Cash Flow StatementFor the Quarter ended September 30, 2017

----------- Rupees ‘000 -----------CASH FLOWS FROM OPERATING ACTIVITIESPro�t before taxationAdjustments for non-cash charges and other items: Depreciation and amortisation Interest income Finance cost Gain on disposal of property, plant and equipment Exchange loss Provision for gratuityOperating pro�t before working capital changes(Increase) / decrease in current assets: Stores, spares and loose tools Stock-in-trade Trade debts Loans and advances Deposit and prepayments Other receivables

Increase in trade and other payablesCash (used in)/generated from operations Gratuity and compensated absences paid Long term loans Finance cost paid Taxes paidNet Cash (used in)/ generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES Fixed capital expenditure Proceeds from disposal of property, plant and equipment Interest income received Interest bearing advance to subsidiaryNet cash (used in) / generated from investing activities

CASH FLOWS FROM FINANCING ACTIVITIES Lease �nances - net Dividend paidNet cash generated from / (used in) �nancing activitiesNet increase/(decrease) in cash and cash equivalentsCash and cash equivalents - at beginning of the periodCash and cash equivalents - at end of the period


136,683

24,623 (14,916)

1,970 (36,509)

- 1,921

113,772

6,088 81,284

(16,207) (17,955) (11,452)

2,849 44,607

(213,928) (55,548)

(1,922) 78

(1,602) (46,343)

(105,337)

(30,017)

177,913 12,642

(175,100) (14,562)

(5,637) (11)

(5,648) (125,548) 514,390 388,842

186,219

22,115 (12,701)

1,286 (6)

188 3,272

200,373

(3,896) 13,081

(153,550) (59,345) (56,643) 12,098

(248,255) (269,559) (317,441)

(3,283) (445)

(1,592) (38,670)

(361,431)

(7,823) 15

12,701 108,058 112,951

(2,910)

- (2,910)

(251,390) 375,408 124,017



Condensed Interim Statement of Changes in Equity (Un-audited) For the Quarter ended September 30, 2017

------------------------------ Rupees ‘000 ------------------------------

Balance as at 1 July, 2016 - Audited

Transaction with owners

Pro�t for the periodOther comprehensive loss

Surplus on revaluation of �xed assets realised during the period(net of deferred taxation) on account of incremental depreciation

Balance as at Sept 30, 2016 - Unaudited

Balance as at 1 July, 2017 - Audited

Final dividend for the year ended June 30, 2017

Pro�t for the periodOther comprehensive loss

Surplus on revaluation of �xed assets realised during the period(net of deferred taxation) on account of incremental depreciation

Balance as at Sept 30, 2017


Share capital

Sharepremium

TotalUnappro-priated

pro�t

450,025

- - -

-

450,025

450,025

- - -

-

450,025

40,000

- - -

-

40,000

40,000

- - -

-

40,000

1,111,191

128,491 -

128,491

7,273

1,246,956

1,313,543

-

95,678 -

95,678

7,274

1,416,495

1,601,216

128,491 -

128,491

7,273

1,736,981

1,803,568

-

95,678 -

95,678

7,274

1,906,520




09


10

Notes to the Condensed Interim Financial Information (Un-audited) For the Quarter ended September 30, 2017

1. THE COMPANY AND ITS OPERATIONS

Ghandhara Nissan Limited (the Company) was incorporated on August 8, 1981 in Pakistan as a private limited company and subsequently converted into a public limited company on May 24, 1992. The Company is a subsidiary of Bibojee Services (Private) Limited (which holds 62.32% (June 30, 2016: 62.32%) issued, subscribed and paid-up capital of the Company). The registered o�ce of the Company is situated at F-3, Hub Chauki Road, S.I.T.E., Karachi. Its manufacturing facilities are located at Port Qasim, Karachi. The Company's shares are listed on Pakistan Stock Exchange Limited.

The principal business of the Company is assembly / progressive manufacturing of Nissan passenger Cars, UD Trucks and Buses, JAC trucks import and sale, import and marketing of Nissan vehicles, import and sale of Dongfeng Complete Built-up Trucks and assembly of other vehicles under contract agreement.

2. BASIS OF PREPARATION

The Companies Act, 2017 has been promulgated with e�ect from May 31, 2017, however the Securities and Exchange Commission of Pakistan (SECP) through its Circular # 23 of 2017 dated October 4, 2017 (the Circular), has directed the companies whose �nancial year ends on or before December 31, 2017 shall prepare their �nancial statements in accordance with the provisions of the repealed Companies Ordinance, 1984 (the Ordinance). Further, The Institute of Chartered Accountants of Pakistan through its Circular # 17 of 2017 dated October 6, 2017, has issued clari�cation on the Circular and stated that preparation of �nancial statements in accordance with the Ordinance includes:

- Annual �nancial statements of companies whose �nancial year closes on or before December 31, 2017; and - Interim �nanacial statements of companies for the periods ending on or before December 31, 2017. This condensed interim �nancial information of the Company for the quarter ended September 30, 2017 is un-audited and has been prepared in accordance with the requirements of the International Accounting Standard 34 - 'Interim Financial Reporting' and provisions of and directives issued under the Companies Ordinance, 1984 (the Ordinance). In case where requirements di�er, the provisions of or directives issued under the Ordinance have been followed. This condensed interim �nancial information does not include all the information required for annual �nancial statements and therefore should be read in conjunction with the audited annual �nancial statements of the Company for the year ended June 30, 2017. 3. ACCOUNTING POLICIES

The accounting policies and the methods of computation adopted in the preparation of this condensed interim �nancial information are consistent with those applied in the preparation of audited annual �nancial statements for the year ended June 30, 2017. There are certain new International Financial Reporting Standards (standards), amendments to published standards and interpretations that are mandatory for the �nancial year beginning on July 1, 2017. These considered not to be relevant or to have any signi�cant e�ect on the Company's �nancial reporting and operations and are, therefore, not disclosed in this condensed interim �nancial information. 4. ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of condensed interim �nancial information requires management to make judgements, estimates and assumptions that a�ect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may di�er from these estimates. In preparing this condensed interim �nancial information, the signi�cant judgements made by management in applying the Company’s accounting policies and the key sources of estimation and uncertainty were the same as those that applied to the audited annual �nancial statements for the year ended June 30, 2017.


11


Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

5.1

5.1.1

1,893,151

92,197

1,985,348

1,920,332

63,113 1,983,445

5. PROPERTY, PLANT AND EQUIPMENT Operating �xed assets CWIP

1,920,332

933

(3,495)

(24,619)

1,893,151

-

317

85

-

-

305

-

226

933

1,846,454

309,256

(140,203)

(95,175)

1,920,332

207,980

39,442

14,710

4,300

32,523

6,188

3,042

1,071

309,256

5.1 Operating �xed assets Net book value at beginning of the period / year Additions during the period / year Disposals, costing Rs.6,378 thousand (June 30, 2017: Rs.172,393 thousand) - at net book value Depreciation charge for the period / year Net book value at end of the period / year

5.1.1 Additions to property, plant and equipment during the period / year: Leasehold land Plant and machinery Furniture and �xtures Assembly Jigs Vehicles-Owned Vehicles-Leased Other equipment O�ce equipment Computers


12



2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

149,995

92,635

1,875

(1,875)

-

242,630

149,995

92,635

1,875

(1,875)

-

242,630

6. LONG TERM INVESTMENTS Subsidiary Company - at cost Ghandhara DF (Private) Limited 14,999,500 (June 30, 2017: 14,999,500) ordinary shares of Rs.10 each Equity held: 99.99% (June 30, 2017: 99.99%) Break-up value per share on the basis of latest �nancial statements is Rs.18.32(June 30, 2016: Rs.24.05) Associated Company - at cost Ghandhara Industries Limited 5,166,168 (June 30, 2016: 5,166,168) ordinary shares of Rs.10 each Equity held: 24.25% (June 30, 2017: 24.25%) Fair value: Rs.2,576.161 million (June 30, 2017: 3,358.577 million) Others - available for sale Automotive Testing & Training Center (Private) Limited 187,500 (June 30, 2017: 187,500) ordinary shares of Rs.10 each - cost Provision for impairment

7. DUE FROM SUBSIDIARY COMPANY - Interest bearing, unsecured The Company, during the period, approved cash advance limit of Rs.800 million to Ghandhara DF (Private) Limited (Subsidiary Company) for its working capital requirements. This advance is unsecured and has been granted for a period of three years. It carries mark-up at rate of six months KIBOR +3.00% and is receivable on quarterly basis .

----------- Rupees ‘000 -----------8. BANK BALANCES Cash at banks in: - current accounts - deposits accounts - term deposits receipts Provision for doubtful bank balances

81,237 10,517

301,000 392,754

(3,912)

388,842

202,785 10,517

305,000 518,302

(3,912)

514,390


13


Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

----------- Rupees ‘000 -----------

----------- Rupees ‘000 -----------

10.1

89 16

457

35 16

259

9.2 Commitment in respect of irrevocable letters of credit 9.3 Outstanding bank guarantees 9.4 Corporate guarantee against letter of credit to banks utilised by subsidiary company

10. COST OF SALES

Finished goods at beginning of the period Cost of goods manufactured Purchases - trading goods Finished goods at end of the period

10.1 Cost of goods manufactured Raw materials and components consumed Factory overheads

213,001

133,876

141,098

274,974

487,975

(113,214)

374,761

-

133,876

133,876

898,520

133,253

1,031,773

113,586

1,031,773

19,650

1,051,423

1,165,009

(77,061)

1,087,948


14


Un-audited Quarter ended

----------- Rupees ‘000 -----------

11. TRANSACTIONS WITH RELATED PARTIES 11.1 Signi�cant transactions with related parties are as follows:

September 30,2017

Name Nature oftransaction September 30,

2016

(i) Holding Company Bibojee Services (Private Limited

(ii) Subsidiary Company

Ghandhara DF (Private) Ltd

(iii) Associated Companies

The General Tyre and Rubber Company of Pakistan Limited

Ghandhara Industries Limited

Gammon Pakistan Limited

(iv) Others

UD Trucks Corporation,

Staff provident fund

Key management personnel

Rent of Corporate OfficeRent of showroom

(ii) Subsidiary Company

Contract assembly charges Advance for issue of shares Sale of parts Purchase of parts Interest bearing advance Repayment against long-term advance Mark-up accrued on advance Guarantee commission

Purchase of tyres

Contract assembly chargesPurchase of partsSale of partsBody fabricationRent of Head OfficeOffice rent

RoyaltyPurchases of complete knock down kitsContribution made

Remuneration and other benefits

1,500-

118,855-

2,39244

558,200368,100

9,8031,130

-

219,37536-

660750

-

-1,969

17,310

1,3503,000

7,634-

169265

223,742331,800

11,064739

13,582

53,633-3

676-

750

-

4,307697,531

1,757

19,215




15



2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

45,210 221 864

7,528

17,088

11.2 Period / year end balances are as follows: Receivables from related parties Trade debts Loans and advances Other receivables Accrued markup Payable to related parties Trade and other payables

114,683 242

1,130 9,803

26,621

12. FINANCIAL RISK MANAGEMENT

The Company's activities expose it to a variety of �nancial risks: credit risk, liquidity risk and market risk (including currency risk, interest rate risk and other price risk). The condensed interim �nancial information does not include all �nancial risk management information and disclosures required in the audited annual �nancial statements and should be read in conjunction with the audited annual �nancial statement for the year ended June 30, 2017. There has been no change in Company's sensitivity to these risks since June 30, 2017 except for general exposure to �uctuations in foreign currency and interest rates. There have been no change in the risk management policies during the period. There have been no signi�cant changes in the business or economic circumstances during the period that would have a�ected the fair values of the �nancial assets of the Company. Further, no re-classi�cations in the categories of �nancial assets have been made since June 30, 2017.

13. CORRESPONDING FIGURES

In order to comply with the requirements of International Accounting Standard 34 - 'Interim Financial Reporting', corresponding �gures in the condensed interim balance sheet comprise of balances as per the audited annual �nancial statements of the Company for year ended June 30, 2017 and the corresponding �gures in the condensed interim pro�t and loss account, condensed interim cash �ow statement and condensed interim statement of changes in equity comprise of balances of comparable period as per the condensed interim �nancial information of the Company for the quarter ended September 30, 2016.

14. DATE OF AUTHORIZATION FOR ISSUE This condensed interim �nancial information was authorized for issue on October 23, 2017 by the Board of Directors of the Company.


16

Directors’ ReportThe directors are pleased to present their report together with consolidated �nancial statements of Ghandhara Nissan Limited (GNL) and its subsidiary Ghandhara DF (Pvt.) Limited (GDFPL) for the quarter ended 30th September 2017.

The Company has annexed consolidated �nancial statements alongwith its standalone �nancial statements in accordance with the requirements of the International Financial Reporting Standard-10 (Consolidated Financial Statements).

The consolidated �nancial statements show turnover of Rs.984.3 million, gross pro�t of Rs.237.4 million and pro�t after tax of Rs.182.6 million for the period ended 30th September 2017.

The above performance has been achieved as a result of signi�cant contribution from the Dongfeng trucks, commencement of sales of model X-200 of JAC and substantial increase in the contract assembly business.

Ghandhara DF (Pvt.) Limited

GDFPL has shown a substantial improvement during the quarter. The revenue has increased by 57% to Rs.478.0 million during the quarter. This is a result of overwhelming e�orts by GDFPL in promoting the Chinese brand nationwide and providing the customers with quality and after sales service.

For and on behalf of the Board of Directors





17


18

Condensed Interim Consolidated Balance SheetAs at September 30, 2017

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------ASSETS Non current assets Property, plant and equipment Intangible assets Long term investments Long term loans Long term deposits Current assets Stores, spares and loose tools Stock-in-trade Trade debts Loans and advances Deposits and prepayments Other receivables Taxation - net Cash and bank balances Non current asset classi�ed as held for sale Total assets EQUITY AND LIABILITIES Share capital and reserves Authorised capital 80,000,000 (June 30, 2017: 80,000,000) ordinary shares of Rs.10 each Issued, subscribed and paid-up capital 45,002,500 (June 30, 2017: 45,002,500) ordinary shares of Rs.10 each Share premium Items credit directly in equity by an Associate Unappropriated pro�tEquity attributable to shareholders of the Holding Company Non-controlling interest Total equity Surplus on revaluation of �xed assets Liabilities Non current liabilities Liabilities against assets subject to �nance lease Long term deposits Deferred liabilities Deferred taxation

Current liabilities Trade and other payables Accrued mark-up Current portion of liabilities against assets subject to �nance lease Taxation - net Total liabilities Contingencies and commitments Total equity and liabilities

The annexed notes 1 to 13 form an integral part of this consolidated condensed interim �nancial information.

1,993,439 237

897,497 9,468

19,266 2,919,907

80,386 804,018 666,202

72,154 49,732 94,575 13,241

437,528 2,217,836

- 5,137,743

800,000

450,025 40,000 68,903

2,007,951 2,566,879

31 2,566,910 1,382,153

82,675 9,611

5 277,612 369,903

781,626 715

36,436 -

818,777 1,188,680

5,137,743

1,992,030 258

857,012 9,546

19,266 2,878,112

86,474 699,540 516,167

51,235 31,372 89,761

- 573,693

2,048,242 137,909

5,064,263

800,000

450,025 40,000 68,426

1,818,045 2,376,496

26 2,376,522 1,389,904

92,194 9,611

6 282,843 384,654

870,479 347

38,313 4,044

913,183 1,297,837

5,064,263

6

7

8



September 30,2017

September 30,2016

Condensed Interim Consolidated Profit and Loss Account (Un-audited) For the Quarter ended September 30, 2017

Note ----------- Rupees ‘000 -----------

Quarter ended

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

Revenue Cost of sales Gross pro�t Distribution cost Administrative expenses Other income Other expenses Pro�t from operations Finance cost

Share of pro�t of an Associate Pro�t before taxation Taxation Pro�t after taxation Other comprehensive income Items that will not be reclassi�ed to pro�t or loss Total comprehensive income for the year Attributable to: - Shareholders of the Holding Company - Non-controlling interest

Earnings per share - basic and diluted


984,264

(746,819)

237,445

(13,037)

(55,434)

46,942

(10,130)

205,786

(2,712)

203,074

40,485

243,559

(60,922)

182,637

-

182,637

182,632

5

182,637

4.06

1,629,543

(1,342,267)

287,276

(11,532)

(50,833)

6,545

(13,814)

217,643

(2,256)

215,387

58,650

274,037

(66,675)

207,361

-

207,361

207,361

-

207,361

4.61

9

10


19




20

Condensed Interim Consolidated Cash Flow Statement (Un-audited) For the Quarter ended September 30, 2017



September 30,2017

September 30,2016

----------- Rupees ‘000 -----------CASH FLOWS FROM OPERATING ACTIVITIESPro�t before taxationAdjustments for non-cash charges and other items: Depreciation and amortisation Interest income Finance cost Amortization of gain on sale and lease back Gain on disposal of property, plant and equipment Exchange loss Share of pro�t of an Associated Company Provision for gratuityOperating pro�t before working capital changes(Increase) / decrease in current assets: Stores, spares and loose tools Stock-in-trade Trade debts Loans and advances Deposit and prepayments Other receivables

Increase/(decrease) in trade and other payablesCash (used)/generated from operations Gratuity and compensated absences paid Long term loans Finance cost paid Taxes paidNet cash (used)/generated from operating activities

CASH FLOWS FROM INVESTING ACTIVITIES Fixed capital expenditure Proceeds from disposal of property, plant and equipment Interest income received Interest bearing advance to subsidiaryNet cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES Lease �nances - net Dividend paidNet cash generated from/(used in) �nancing activitiesNet decrease in cash and cash equivalentsCash and cash equivalents - at beginning of the periodCash and cash equivalents - at end of the period


243,559

25,134 (10,433)

2,712 (1)

(36,509) -

(40,485) 1,921

185,898

6,088 (104,478) (150,035)

(20,919) (18,360)

(4,814) (292,518)

(88,853)(195,473)

(1,922) 78

(2,344) (83,438)

(283,099)

(30,017) 177,913

10,445 -

158,341

(11,396) (11)

(11,407) (136,165) 573,693 437,528

274,037

22,668 (12,701) 13,372

- (6)

188 (58,650)

2,968 241,877

(3,896) 267,958 (145,044)

(59,345) (152,987)

31,178 (62,135)

(468,642)(288,900)

(3,283) (445)

(13,677) (52,724)

(359,030)

(7,823) 15

12,699 108,058 112,949

(2,910) -

(2,910) (248,991) 394,789 145,798

Quarter ended

Condensed Interim Consolidated Statement of Changes in Equity (Un-audited)

For the Quarter ended September 30, 2017

----------------------------------------- Rupees ‘000 -----------------------------------------

Balance as at 1 July, 2016

Total comprehensive income for the quarter ended September 30, 2016Pro�t for the periodOther comprehensive income

Surplus on revaluation of �xed assets realised during the period (net of deferred taxation) on account of incremental depreciationE�ect of item directly credited in equity by an Associated CompanyBalance as at 30 September, 2016 Balance as at 1 July, 2017

Total comprehensive income for the quarter endedSeptember 30, 2017

Pro�t for the periodOther comprehensive income

Surplus on revaluation of �xed assets realised during the period (net of deferred taxation) on account of incremental depreciationE�ect of item directly credited in equity by an Associated Company

Balance as at 30 September, 2017


Share capital

Sharepremium

Total Non-controlling

interest

Unappro-priated

pro�t

Item credited directly in

equity by anAssociate




21

450,025

- - -

-

- 450,025

450,025

- -

-

-

-

450,025

1,863,095

207,361 -

207,361

7,273

477 2,078,206

2,376,496

182,632 -

182,632

7,274

477

2,566,879

11

- - -

- -

11

26

5 -

5

-

-

31

40,000

- - -

-

- 40,000

40,000

- -

-

-

-

40,000

66,516

- - -

-

477 66,993

68,426

- -

-

-

477

68,903

1,306,554

207,361 -

207,361

7,273

- 1,521,188

1,818,045

182,632 -

182,632

7,274

-

2,007,951


22

Notes to the Condensed Consolidated Interim Financial InformationFor the Quarter ended September 30, 2017

1. THE GROUP AND ITS OPERATIONS 1.1 The Group consists of Ghandhara Nissan Limited (the Holding Company) and Ghandhara DF (Private) Limited (the Subsidiary Company). 1.2 Ghandhara Nissan Limited Ghandhara Nissan Limited (the Holding Company) was incorporated on August 8, 1981 in Pakistan as a private limited company and subsequently converted into a public limited company on May 24, 1992. The registered o�ce of the Holding Company is situated at F-3, Hub Chuki Road, S.I.T.E., Karachi. Its manufacturing facilities are located at Port Qasim, Karachi. The Holding Company's shares are listed on Pakistan Stock Exchange Limited. Bibojee Services (Private) Limited is the ultimate holding company of the Group.

The principal business of the Holding Company is assembly / progressive manufacturing of Nissan passenger Cars, UD Trucks and Buses, JAC trucks import and sale, import and marketing of Nissan vehicles, import and sale of Dongfeng Complete Built-up Trucks and assembly of other vehicles under contract agreement. 1.3 Ghandhara DF (Private) Limited Ghandhara DF (Private) Limited (the Subsidiary Company) was incorporated on June 25, 2013 in Pakistan as a private limited company. The registered o�ce of the Subsidiary Company is situated at F-3, Hub Chuki Road, S.I.T.E., Karachi. The principal business of the Subsidiary Company is to carry-out CKD operations of Dongfeng vehicles. It has outsourced assembly of the vehicles to the Holding Company. 2. BASIS OF PREPARATION 2.1 The Companies Act, 2017 has been promulgated with e�ect from May 30, 2017. However, as per the requirements of Circular # 23 of 2017 dated October 4, 2017 issued by the Securities and Exchange Commission of Pakistan (SECP) and related clari�cation issued by the Institute of Chartered Accountants of Pakistan through its Circular # 17 of 2017 dated October 6, 2017, companies whose �nancial year, including quarterly and other interim period, closes on or before December 31, 2017, shall prepare their �nancial statements, including interim �nancial statements in accordance with the provisions of the repealed Companies Ordinance, 1984 (the Ordinance). 2.2 This consolidated condensed interim �nancial information is unaudited and has been prepared in accordance with the requirements of the International Accounting Standard 34 - 'Interim Financial Reporting' and provisions of and directives issued under the Ordinance. In the case where requirements di�er, the provisions of or directives issued under the Ordinance have been followed. This consolidated condensed interim �nancial information does not include all the information required for annual �nancial statements and therefore should be read in conjunction with the audited annual consolidated �nancial statements of the Group for the year ended June 30, 2017.

3. PRINCIPLES OF CONSOLIDATION These consolidated �nancial statements include the �nancial statements of Holding Company and its Subsidiary Company. The Holding Company's direct interest in the Subsidiary Company is 99.99% as at September 30, 2017 ( June 30, 2017: 99.99%).

Consolidated �nancial information combines like items of assets, liabilities, equity, income, expenses and cash �ows of the Holding Company with those of its Subsidiary, o�set (eliminate) the carrying amount of the Holding Company's investment in Subsidiary and the Holding Company's portion of equity of Subsidiary and eliminate in full intragroup assets and liabilities, equity, income, expenses and cash �ows relating to transactions between entities of the Group. Non-controlling interest is equity in the Subsidiary Company not attributable, directly or indirectly, to the Holding Company.


4. ACCOUNTING POLICIES

The signi�cant accounting policies and the methods of computation adopted in the preparation of this condensed interim �nancial information are consistent with those applied in the preparation of audited annual �nancial statements for the year ended June 30, 2017.

There are certain International Financial Reporting Standards, amendments to published standards and interpretations that are mandatory for the �nancial year beginning on July 1, 2017. These are considered not to be relevant or to have any signi�cant e�ect on Group's �nancial reporting and operations and are, therefore, not disclosed in the consolidated condensed interim �nancial information. 5. ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of this consolidated condensed interim �nancial information in conformity with the approved accounting standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including the expectation of future events that are believed to be reasonable under the circumstances. Actual results may di�er from these estimates.

During the preparation of this consolidated condensed interim �nancial information, the signi�cant judgements made by management in applying the Group's accounting policies and the key sources of estimation and uncertainty were the same as those that applied to the audited annual consolidated �nancial statements of the Group for the year ended June 30, 2017.

6. PROPERTY, PLANT AND EQUIPMENT

. Operating �xed assets Capital work-in-progress includes: Building Plant and machinery Vehicles

v


23

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

5.1

5.1.1

1,901,242

79,721

5,797

6,679

92,197

1,993,439

1,928,917

50,637

5,797

6,679

63,113

1,992,030

6.1 Operating �xed assets Book value at beginning of the period / year Additions during the period / year Disposals costing Rs.6,378 thousand (June 30, 2017: Rs.9,669 thousand) - at book value Assets classi�ed as held for sale costing Rs.Nil (June 30, 2017: Rs. 162,724 thousand) - at book value Depreciation charge for the period / year Book value at end of the period / year

1,928,917 933

(3,495)

- (25,113)

1,901,242

1,857,185 309,256

(2,294)

(137,909) (97,321)

1,928,917


24


6.2 Additions to operating �xed assets, including transfer from capital work-in-progress, during the period / year were as follows: Leasehold land Plant and machinery Furniture and �xtures Vehicles - owned - leased Other equipment O�ce equipment Computers

7. LONG TERM INVESTMENTS Associate - equity accounted investment Others - available for sale

7.1 Associated Company - equity accounted investment Ghandhara Industries Limited

Balance at beginning of the period / year Share of pro�t / OCI for the period / year Share of revaluation during the period / year Dividend received during the period / year Balance at end of the period / year

-

317

85

- -

305

-

226 933

897,497

- 897,497

857,012

40,485

-

-

897,497

207,980

39,442

14,710

4,300 32,523

6,188

3,042

1,071 309,256

857,012

- 857,012

647,079

210,784

50,811

(51,662)

857,012


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

7.1.1 Investment in Ghandhara Industries Limited (GIL) represents 5,166,168 (June 30, 2017: 5,166,168) fully paid ordinary shares of Rs.10 each representing 24.25% (June 30, 2017: 24.25%) of its issued, subscribed and paid-up capital as at June 30, 2017. GIL was incorporated on February 23, 1963 and its shares are quoted on Pakistan Stock Exchange Limited. The principal activity of GIL is the assembly, progressive manufacturing and sale of Isuzu trucks and buses. 7.1.2 The above �gures are based on audited �nancial statements of GIL as at June 30, 2017. The latest �nancial statements of GIL as at September 30, 2017 are not presently available.


7.1.3 The market value of investment as at September 30, 2017 was Rs.2,576.161 million (June 30, 2017: Rs.3,358.577 million).

7.2 Others - available for sale

v


25

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

1,875

(1,875)

-

1,875

(1,875)

-

Automotive Testing & Training Centre (Private) Limited 187,500 (June 30, 2017: 187,500) ordinary shares of Rs.10 each - cost Provision for impairment

8. CONTINGENCIES AND COMMITMENTS 8.1 Contingencies 8.1.1 There is no change in status of the contingencies as disclosed in note 26.1 of the audited annual �nancial statements of the Group for the year ended June 30, 2017.

8.1.2 Guarantees issued by banks on behalf of the Holding Company 8.2 Commitment Commitments in respect of capital expenditure, raw materials and components through con�rmed letters of credit

15,787

342,612

302,797

497,973

141,098

639,071 941,868

(195,049)

746,819

165,813

1,303,953

19,427

1,323,380 1,489,193

(146,926)

1,342,267

15,787

294,243

9. COST OF SALES

Opening stock of �nished goods

Cost of goods manufactured

Purchases

Closing stock of �nished goods

9.1


9.1 Cost of goods manufactured

Raw materials and components consumed

Factory overheads

365,152

132,821

497,973

1,169,888

134,065

1,303,953


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

10. This include gain on disposal of lease hold land during the period amounting Rs.36,509 thousand. 11. TRANSACTIONS WITH RELATED PARTIES

11.1 Signi�cant transactions with related parties are as follows:


26

Name

(i) Ultimate Holding Company Bibojee Services (Private) Limited (ii) Associated Companies The General Tyre and Rubber Company of Pakistan Limited Ghandhara Industries Limited Gammon Pakistan Limited (iii) Others UD Trucks Corporation, Japan Sta� provident fund Key management personnel

Rent of corporate o�ceRent of showroom

Purchase of tyres, tubes and �aps Contract assembly Body fabrication Sales of parts Purchase of parts O�ce rent Rent of Rawalpindi o�ce

Royalty Purchases of complete knock down kits Contribution made Remuneration and other short term bene�ts

3,000 -

8,871

219,375

5,831 2,879

660

750

-

-

1,969

18,210

1,380 3,000

13,582

53,633 676

3 - -

750

4,307

697,531

1,757

19,815

Nature of transaction

Quarter ended September 30,

2017 2016----------- Rupees ‘000 -----------


11.2 Period / year end balances are as follows:

Receivables from related parties Trade debts Loan and advances Deposits and prepayments

Payable to related parties Trade and other payables These are in the normal course of business and are settled in ordinary course of business.

12. CORRESPONDING FIGURES

In order to comply with the requirements of International Accounting Standard 34 - 'Interim Financial Reporting', corresponding �gures in the consolidated condensed interim balance sheet comprise of balances as per the audited annual �nancial statements of the Group for year ended June 30, 2017 and the corresponding �gures in the consolidated condensed interim pro�t and loss account, consolidated condensed interim cash �ow statement and consolidated condensed interim statement of changes in equity comprise of balances of comparable period as per the consolidated condensed interim �nancial information of the Group for the quarter year ended September, 30, 2016.

13. DATE OF AUTHORIZATION

This consolidated condensed interim �nancial information was authorized for issue on October 23, 2017 by the Board of Directors of the Holding Company.

v


27

Note


2017

(Audited)June 30,

2017

----------- Rupees ‘000 -----------

87,969 1,005

-

43,469

28,578 221 708

52,733




Ghandhara Nissan Limited

F-3, Hub Chowki Road, S.I.T.E., Karachi-75730Tel: 021-32556901 - 10 UAN: 111-190-190 Fax: 021-32556911 - 12

Email: [email protected] Web: www.ghandhara.com.pk

GHANDHARA NISSAN LIMITED · Mr. Mohammad Zia Mr. Muhammad ... of other vehicles under contract...

Documents

Transcript of GHANDHARA NISSAN LIMITED · Mr. Mohammad Zia Mr. Muhammad ... of other vehicles under contract...