DIRECTOR S REPORT TO THE MEMBERS The Directors of your company are pleased to present the un-audited quarterly financial statements for the period ended March 31, 2016. During the quarter under review the company incurred loss before tax of Rs.26.598 million as against loss before tax of Rs.60.764 million of the corresponding period. Your company incurred loss due to power crises, unstable prices of yarn and cotton and lack of overseas demand of Pakistani yarn during the period under review. The production capacity was curtailed due to power shortage which caused our operational cost per unit to increase considerably causing loss in the quarter under review. We would like to thanks all our workers, staff and officers, customers, agents, suppliers and shareholders for their dedicated efforts. We also thanks to our financial institutions for their financial support to run our operations. For and on behalf of the Board of Directors Lahore: NOOR ELAHI April 29, 2016 Chief Executive COMPANY S PROFILE BOARD OF DIRECTORS Chairman and Chief Executive: MR. NOOR ELAHI Directors: MRS. PARVEEN ELAHI MRS. NAHEED JAVED MR. NABEEL JAVED MR. JAVED USMAN MR. FAIZAN JAVAID MR. MATIUDDIN SIDDIQUI (NIT NOMINEE) COMPANY SECRETARY MR. ASIF PERVAIZ KHAWAJA AUDIT COMMITTEE MR. JAVED USMAN -CHAIRMAN MR. NABEEL JAVED -MEMBER MR. FAIZAN JAVED -MEMBER BANKERS AUDITORS LEGAL ADVISOR HEAD OFFICE REGISTERED OFFICE MILLS SHARE REGISTRAR M/S. BANK ALFALAH LIMITED M/S. MEEZAN BANK LIMITED M/S. BANK AL-HABIB LIMITED M/S. HABIB METROPOLITAN BANK LTD. M/S. MUSLIM BANK LIMITED M/S. NATIONAL BANK OF PAKISTAN M/S. MUSHTAQ & CO. Chartered Accountants Room # 407-Commerce Centre, 4th Floor, Hasrat Mohani Road, Karachi-74200 M/S. MOHSIN & WAHEED LAW ASSOCIATES Office # S-3, 2nd Floor, West End Plaza, 72-The Mall Road, Lahore. 35-Industrial Area, Gulberg-III, Lahore-54000 Phone: (92-42) 3571-4601, 3576-1243-4 Fax: (+92-42) 3571-1400, 3576-1222 Email: info@rubytextile.com.pk Room # 203-Faiyaz Centre, 2nd Floor, 3-A, S.M.C.H.S., Shahrah-e-Faisal, Karachi-74400. Phone: (92-21) 3439-6600, 3438-7700 Fax: (+92-21) 3439-8800 Raiwind-Manga Road, Raiwind, District Kasur-55050, Pakistan. Phone: (+92-42) 3539-1031, 3539-2651-2 Fax: (+92-42) 3539-1032 Email: wasim@rubytextile.com.pk M/S. CORPLINK (PRIVATE) LIMITED 1-K, (Commercial) Wings Arcade, Model Town, Lahore-54700 Phone: (+92-42) 3583-9182, 3588-7262 Fax: (+92-42) 3586-9037
CONDENSED INTERIM BALANCE SHEET (UN-AUDITED) AS AT March 31, 2016 Un-audited Audited ASSETS Note 31-March-16 30-Jun-15 NON CURRENT ASSETS Property, plant and equipment 5 1,003,483,170 1,037,950,919 Long term deposits 6,990,105 5,709,645 CURRENT ASSETS Stores, spare parts and loose tools 119,517,441 112,599,173 Stock in trade 392,461,235 406,109,152 Trade debts 33,438,161 26,480,634 Loans and advances 25,458,933 29,844,310 Other receivables 1,377,257 6,347,336 Tax refunds due from Government 26,207,362 26,164,033 Cash and bank balances 14,273,001 2,375,756 612,733,390 609,920,394 TOTAL ASSETS 1,623,206,665 1,653,580,958 EQUITY AND LIABILITIES SHARE CAPITAL AND RESERVES Authorized Capital 70,000,000 (June 30, 2015 : 70,000,000) Ordinary shares of Rs. 10 each 700,000,000 700,000,000 Issued, subscribed and paid up capital 52,214,400 (June 30, 2015 : 52,214,400) Ordinary shares of Rs. 10 each 522,144,000 522,144,000 Capital reserves 3,240,000 3,240,000 Accumulated loss (379,690,801) (287,716,230) 145,693,199 237,667,770 Surplus on revaluation of property, plant and equipment - net of tax 450,368,934 463,317,944 NON CURRENT LIABILITIES Long term financing from banking companies 46,301,542 39,714,349 Long term financing from others 153,239,763 108,374,063 Long term financing from directors and associates 455,471,499 418,911,843 Deferred liabilities 13,584,901 14,085,200 CURRENT LIABILITIES Trade and other payables 264,234,749 273,599,168 Accrued mark up / interest 21,206,661 21,235,661 Short term borrowings 44,439,716 62,553,646 Current portion of Long term financing from banking companies 3,492,282 317,900 Long term financing from others 14,410,000 3,495,938 Provision for taxation 10,763,419 10,307,479 358,546,828 371,509,790 CONTINGENCIES AND COMMITMENTS 6 TOTAL EQUITY AND LIABILITIES 1,623,206,665 1,653,580,958 CHIEF EXECUTIVE DIRECTOR
CONDENSED INTERIM PROFIT AND LOSS ACCOUNT (UN-AUDITED) FOR THE QUARTER ENDED MARCH 31, 2016 Nine Months Ended Quarater Ended 31-March-16 31-March-15 31-March-16 31-March-15 Sales 194,861,314 384,591,744 34,185,492 125,200,470 Cost of sales (273,405,474) (483,953,107) (55,558,502) (170,507,608) Gross loss (78,544,160) (99,361,363) (21,373,010) (45,307,137) Other operating income 641,030 677,231 210,000 195,000 Distribution cost (2,797,353) (4,295,473) (12,496) (976,189) Administrative expenses (14,169,458) (17,101,034) (3,313,042) (5,577,531) Other operating expenses - - - - Finance cost (9,597,700) (26,912,911) (2,110,155) (9,099,121) Loss before taxation (104,467,640) (146,993,550) (26,598,703) (60,764,978) Taxation - Current (455,940) (653,807) (0) - - Deferred - 37,521,225-16,648,113 (455,940) 36,867,418 (0) 16,648,113 Loss for the period (104,923,581) (110,126,132) (26,598,703) (44,116,865) Loss per share - basic and diluted (2.01) (2.11) (0.51) (0.84) Chief Executive Director
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME (UN-AUDITED) FOR THE QUARTER ENDED MARCH 31, 2016 Nine Months Ended Quarater Ended 31-March-16 31-March-15 31-March-16 31-March-15 Loss for the period (104,923,581) (110,126,132) (26,598,703) (44,116,865) Other comprehensive income for the period - - - - Total comprehensive loss for the period (104,923,581) (110,126,132) (26,598,703) (44,116,865) CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY (UN-AUDITED) FOR THE QUARTER ENDED MARCH 31, 2016 Share capital Capital reserves Accumulated Loss Total Balance as at July 01, 2014 - restated - (Audited) 522,144,000 3,240,000 (115,021,963) 410,362,037 Total comprehensive loss for the period - - (110,126,132) (110,126,132) Transferred from surplus on revaluation of property, plant and equipment on account of incremental depreciation - net of tax - - 13,046,370 13,046,370 Balance as at March 31, 2015 - (Unaudited) 522,144,000 3,240,000 (212,101,726) 313,282,274 Balance as at July 01, 2015 - (Audited) 522,144,000 3,240,000 (287,716,230) 237,667,770 Total comprehensive loss for the period - - (104,923,581) (104,923,581) Transferred from surplus on revaluation of property, plant and equipment on account of incremental depreciation - net of tax - - 12,949,010 12,949,010 Balance as at March 31, 2016 - (Unaudited) 522,144,000 3,240,000 (379,690,801) 145,693,199 Chief Executive Director
CONDENSED INTERIM CASH FLOW STATEMENT (UN-AUDITED) FOR THE QUARTER ENDED MARCH 31, 2016 31-March-16 31-March-15 CASH FLOWS FROM OPERATING ACTIVITIES Loss before taxation (104,467,640) (146,993,550) Adjustments for : Depreciation 34,467,749 36,275,428 Provision for staff retirement benefits - gratuity 1,210,224 5,418,141 Finance cost 9,597,700 26,912,911 Gain on disposal of property, plant and equipment - - 45,275,672 68,606,480 (Loss) / profit before working capital changes (59,191,968) (78,387,070) Working capital changes: (Increase) / decrease in current assets Stores, spares and loose tools (6,918,270) 5,524,492 Stock in trade 13,647,917 (28,569,153) Trade debts (6,957,527) (4,917,450) Loans and advances 4,385,377 3,367,400 Trade deposits and short term prepayments - - Other receivables 6,559,551 4,545,711 10,717,048 (20,049,000) Increase in current liabilities Trade and other payables (9,364,419) (24,153,043) Cash used in operations (57,839,338) (122,589,113) Finance cost paid (9,626,699) (12,925,921) Income tax paid (1,632,798) (2,364,017) Staff retirement benefits - gratuity paid (1,710,522) (3,570,867) Net cash used in operating activities A (70,809,357) (141,449,918) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment - - Proceeds from sale of property, plant and equipment - - Long term deposits (1,280,461) - Net cash used in investing activities B (1,280,461) - CASH FLOWS FROM FINANCING ACTIVITIES Long term financing from banking companies 65,541,337 (3,891,997) Long term financing from directors and associates 36,559,656 129,043,000 Long term financing from others - - Share Deposit Money - - Expenses for Further Issuance Capital - - Net cash generated from financing activities C 102,100,993 125,151,003 Net increase in cash and cash equivalents A+B+C 30,011,175 (16,298,915) Cash and cash equivalents at the beginning of the year (60,177,890) (160,633,090) Cash and cash equivalents at the end of the year (30,166,715) (176,932,005) Cash and cash equivalents Cash and bank balances 14,273,001 3,365,411 Short term borrowings (44,439,716) (180,297,416) (30,166,715) (176,932,005) Chief Executive Director
SELECTED NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS (UN-AUDITED) FOR THE QUARTER AND HALF YEAR ENDED MARCH 31, 2016 STATUS AND ACTIVITIES The company was incorporated in Pakistan on October 18, 1980 as a private limited company and was subsequently converted into public limited company. The registered office of the company is located at 3-A, SMC Housing Society, Shara-e-Faisal, Karachi. The shares of the company are quoted on the Pakistan Stock Exchange. The principal business of the company is manufacturing and sale of yarn. The manufacturing units are located at Manga Road, Raiwind in the province of Punjab. 2 BASIS OF PREPARATION 2.1 Statement of Compliance This condensed interim financial information is un-audited and has been prepared in accordance with the requirements of the International Financial Reporting Standard (IFRS) IAS 34, "Interim Financial Reporting" as applicable in Pakistan. This condensed interim financial information does not include all of the information and disclosures required for annual financial statements, and should be read in conjunction with the financial statements of the company as at and for the year ended June 30, 2015. This condensed interim financial information is being submitted to the shareholders as required by the Listing regulations of Pakistan Stock Exchange and section 245 of the Companies Ordinance, 1984. These condensed interim financial statements comprise of condensed interim balance sheet, condensed interim profit and loss account, condensed interim statement of comprehensive income, condensed interim cash flow statement and condensed interim statement of changes in equity together with the notes for the period ended March 31, 2016 which have been subjected to a review but not audited. These condensed interim financial statements also include the condensed interim income statement for the quarter ended Mar 31, 2015. 3 SIGNIFICANT ACCOUNTING POLICIES The accounting policies and methods of computation which have been used in the preparation of this condensed interim financial information are the same as those applied in preparation of the financial statements for the preceding year ended June 30, 2015. Amendments to certain existing standards and new interpretations on approved accounting standards effective during the period either were not relevant to the company's operations or did not have any impact on the accounting policies of the company. 4 ACCOUNTING ESTIMATES, JUDGEMENTS AND FINANCIAL RISK MANAGEMENT The preparation of this condensed interim financial information in conformity with approved accounting standards requires management to make estimates, assumptions and use judgements that affect the application of policies and reported amounts of assets and liabilities and income and expenses. Estimates, assumptions and judgements are continually evaluated and are based on historical experience and other factors, including reasonable expectations of future events. Revisions to accounting estimates are recognized prospectively commencing from the period of revision. Judgements and estimates made by management in the preparation of this condensed interim financial information are the same as those that were applied to the financial statements as at and for the year ended June 30, 2015. The company's financial risk management objectives and policies are consistent with those disclosed in the financial statements as at and for the year ended June 30, 2015. 5 PROPERTY, PLANT AND EQUIPMENT Un audited Audited Operating fixed assets 1,003,483,170 1,037,950,919 1,003,483,170 1,037,950,919 Opening written down value 1,037,950,919 1,085,108,323 Add: Addition during the period / year - 1,220,000 Add: Surplus on revaluation of property, 31-Mar-16 30-Jun-15 ------------------ plant and equipment - arised - - 1,037,950,919 1,086,328,323 Less: Disposal during the period - - Depreciation charged during the period / year (34,467,749) (48,377,404) Closing written down value 1,003,483,170 1,037,950,919
5.1 Following is the detail of additions and disposals during the period : Owned: (Unaudited) (Audited) 31-Mar-16 30-Jun-15 Additions Disposals Additions Disposals ------------------------------------------------------------- Free hold land - - - - Plant and machinery - - - - Furniture and Fixture - - 1,220,000 - Vehicles - - - - 6 CONTINGENCIES AND COMMITMENTS - - 1,220,000-6.1 Bills discounted with recourse amounted to Rs. 0 million (June 30, 2015: Rs. 21.43 million). 6.2 There is change in status of contingencies as disclosed in the audited annual financial statements of the Company for the year ended June 30, 2015. CONTINGENCIES. The change in contingencies is as follows: 6.2.1 Company has filed suit no.78/2015 in Honorable Lahore High Court against Habib Metropolitan Bank Limited under section 9 of the Financial Institutions (recover of finances) ordinance 2001, for redemption, cancellation of documents, declaration, rendition of accounts, permanent and perpetual injuction and recovery with profit till realization of amount and costs amounting to Rs.1532.841 millions. The company is strongly contesting its case before Honorable Court and as per legal opinion, all the above matters are being contested by the Company on merits. 7 TRANSACTION WITH RELATED PARTIES The related parties and associated undertakings of the company comprise of associated companies, directors and key management personnel. The company's aggregate transactions with the associated companies are as follows:- (Un audited) 31-March-16 30-Jun-15 ------------------ Transactions with the related parties Relationship Mr. Noor Elahi Director / Chief Executive Reciepts 6,420,000 54,690,000 Mrs. Perveen Elahi Director Payments 5,960,000 - Receipts 25,010,000 24,045,000 Mrs. Naheed Javed Director Receipts 10,250,000 49,748,000 Aroma Drinks Pvt Ltd. Associated company Receipts 395,000 560,000 Pure Drinks FSD Associated company Receipts 1,000,000 - Yasir foods industries limited Associated company Payments - - Sunrise bottling private limited Associated company Receipts 4,414,735 1,279,469 Payments - 22,000 8 CORRESPONDING FIGURES Comparative information has been rearranged and reclassified, wherever necessary, for the purpose of better presentation and comparison. However, no significant reclassifications are made in these condensed interim financial statements. 9 DATE OF AUTHORIZATION FOR ISSUE The condensed interim financial statements has been authorized for issue on April 29, 2016 by the board of directors of the company. 10 GENERAL Figures have been rounded off to the nearest rupee. Chief Executive Director