During the year under review, the company posted highest-ever profit and recorded high productivity. This enabled the company to bring the turnaround in operating results and thus stakeholders also benefited by its 15 percent cash dividend. The company emphasises that at present there is no foreign currency loan outstanding on the company's books. The management has several development projects in the pipeline. Process conversion of white cement project is progressing on schedule and is expected to be completed by June 2005.
The new line will increase Maple Leaf's white cement capacity from 100 tonnes per day to 600 tpd. The capacity of the dry process plant will be enhanced from 3,300 tpd to 4000 tpd by optimisation of the plant. It has planned an expansion project of grey cement of 6,700 tpd.
Maple Leaf Cement Factory Ltd was incorporated in the province of Punjab as a public company, limited by share. It was listed on stock exchanges on August 17, 1994.
At present, the share in the company is trading at Rs 32.40 per share carrying substantial premium over the par value of Rs 10. During the last one year the share price followed the rising trend from Rs 29.36 to Rs 46.80 per share.
The company is a subsidiary of Kohinoor Textile Mills Ltd which has 50.13 percent stake in the equity of the company.
Maple Leaf Ltd Cement Factory Limited has a diversified product range and is the only cement company in Pakistan capable of producing grey, white, sulphate-resisting and low-alkali cements. It is the second largest cement producer in the country having a local market share of 9 percent.
The company has both dry process and wet process kilns. The dry process kiln was efficiently operated at 103 percent of capacity whereas the wet process plants were operated only to meet peak demand of cement in the country.
During the period under review the company posted considerably improved results. Sales in terms of value was record highest at Rs 4.967 billion (FY 2002-03: Rs 4.025 billion).
Net sales amounted to Rs 3.376 billion after payment of Rs 1.529 billion towards central excise duty and general sales tax and Rs 63.04 million as commission to distributors.
The company booked pretax profit amounting to Rs 751.51 million after accounting for all charges including depreciation of Rs 334.383 million and financial charges of Rs 381.84 million against preceding year's pre-tax loss of Rs 92.916 million.
There was substantial reduction in the financial charges by 10.76 percent from Rs 427.86 million in the preceding year.
Reprofiling of the expensive foreign currency loans by replacement with lower interest bearing local currency loans has been completed. It is emphasised that at present there is no foreign currency loan outstanding on company books. This has not only reduced financial costs but also eliminated the exchange risk associated with foreign currency loans.
Apart from reduced financial costs there were three more contributory factors in the record highest profitability. There was higher utilisation of production capacity, better selling price, and conversion to coal firing.
The earnings per share (EPS) were Rs 2.70 for the year ended June 30, 2004, as compared to Rs 0.83 in the previous year. The EPS would have been Rs 4.07 (2003 Rs -0.59 (minus fifty-nine) had it not been mandatory to make provision for the deferred tax liability.
Like other many cement companies, Maple Leaf Cement Factory Ltd had faced severe crisis for the last several years due to sluggish demand, lower retention price and high production cost because of the impact of interest bearing loans.
The company has made remarkable turnaround in its operation which has enabled it to pass the benefit to shareholders by declaring cash dividend at Rs 1.50 per share.
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Performance Statistics (Million Rupees)
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Balance sheet -As At-
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June 30
2004 2003
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Share Capital-Paid-Up: 1,804.91 1,804.91
Reserves & Surplus: 1,621.90 1,405.16
Shareholders Equity: 3,426.81 3,210.07
L T Debts: 2,186.69 2,940.94
Deferred & Other Liabilities: 7.76 6.69
L T Deposits: 7.18 7.11
Current Liabilities: 1,459.17 1,156.62
Tangible Fixed Assets: 5,562.68 5,497.28
L T Investments: 5.00 5.00
Deferred Tax Assets: 10.24 256.95
L T Loans: 6.35 6.29
L T Deposits & Prepayment: 4.07 4.58
Current Assets: 1,499.27 1,551.33
Total Assets: 7,087.61 7,321.43
Sales, Profit & Pay-out
Sales: 3,375.80 2,404.81
Gross Profit: 1,148.23 361.55
Operating Profit: 1,090.77 312.90
Other Income: 11.13 22.05
Financial (Charges): (310.84) (427.86)
(Depreciation): (334.38) (338.42)
Profit/(Loss) Before Taxation: 751.51 (92.92)
Profit After Taxation: 487.47 150.10
Earnings Per Share (Rs): 2.70 0.83
Dividend Cash @(2003:Nil)
Rs 1.50/Share (270.00) -
Share Price (Rs) On 24/02/05: 32.40 -
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Financial Ratios
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Price/Earning Ratio: 12.00 -
Book Value Per Share: 18.99 17.78
Price/Book Value Ratio: 1.71 -
Debt/Equity Ratio: 39:61 48:52
Current Ratio: 1.03 1.34
Assets Turn Over Ratio: 0.47 0.32
Days Receivables: 9 14
Days Inventory: 16 18
Gross Profit Margin (%): 34.01 15.01
Net Profit Margin (%): 14.44 6.23
R O A (%): 6.87 2.05
R O C E (%): 8.67 24.50
Plant Capacity & Production (Clinker 000 Metric Tons)
A)Clinker-Grey:
Installed Capacity: 1,470.00 1,470.00
Production: 1,051.92 964.15
Capacity Utilisation (%): 71.56 65.58
B) Clinker-White:
Installed Capacity: 30.00 30.00
Production: 35.49 36.73
Capacity Utilisation (%): 118.30 122.43
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COMPANY INFORMATION: Chairman & Chief Executive: Tariq Saeed Saigol; Director: Zamiruddin Azar; Company Secretary: Wasif Mehmood; Chief Financial Officer: Arshad Mahmood Qureshi; Registered Office: 42-Lawrance Road Lahore; Web Address: www.kmig.com; Mills: Iskanderabad District Mianwali.
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