MIRA
INFORM REPORT
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Report Date : |
12.11.2007 |
IDENTIFICATION
DETAILS
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Name : |
PAKISTAN CEMENT COMPANY LIMITED |
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Registered Office : |
Plot # 18-B, F-8 Markaz, Islamabad |
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Country : |
Pakistan |
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Financials (as on) : |
31.12.2006 |
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Date of Incorporation : |
1993 |
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Com. Reg. No.: |
0030391 |
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Legal Form : |
Public Limited Company |
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Line of Business : |
Manufacture and sale of ordinary grey Portland cement |
RATING &
COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
Business Name
PAKISTAN CEMENT COMPANY LIMITED
Full Address
Registered Address
Plot # 18-B, F-8 Markaz, Islamabad, Pakistan
Tel 92 (51) 111-111-722
Fax 92 (51) 2817300
Email www.pakistancement.com.pk
Short Description Of Business
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Nature of Business |
Manufacture and sale of ordinary grey Portland cement |
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Year Established |
1993 |
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Registration # |
0030391 |
Plant Location
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Address |
Chhoie
Mallot Road, Tehsil Kalar Kahar, District Chakwal, Pakistan |
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Tel # |
92 (51) 4020111 |
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Fax # |
92 (51) 4020230 |
Regional Offices
In Lahore, Multan & Chakwal
Auditors
M/s KPMG Taseer Hadi & Co.
(Chartered
Accountants)
Legal Status
Pakistan Cement Company Limited, formerly Chakwal Cement Company Limited was incorporated in Pakistan on 23 May 1993 as a Private Limited Company and was subsequently converted into a Public Limited Company on 18 October 1994
Details of Directors
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Names |
Designation |
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Mr. Nassef Onsi Naguib Sawiris Mr. Ahmad Said Heshmat Hassan Mr. Salman Khalid Butt Mr. Ahmed Shebi Tolba Daabes Mr. Sherif Youssef Mohamed Tantawy Mr. Hesham Moustafa Abdel Samie Mr. Amr Ali Reda Mr. Bilal Hamid Javaid Mr. Khawaja Mohammad Naveed Mr. Mohammad Aman Farooq Mr. Shahid Anwar |
Chairman / Chief Executive Managing Director Director Director Director Director Director Director Director Director Director |
Shareholders
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Categories of
Shareholders |
Percentage (%) |
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Directors, Chief Executive, their spouse and minor children Associated Companies Undertakings & Related Parties NIT / ICP Banks, Development Finance Institutions and Non Banking Financial Institutions Insurance Companies Modaraba and Mutual Funds General Public Others |
1.56 62.75 4.96 3.48 2.98 0.08 18.55 5.64 |
Associated Companies
Pakistan Cement Holding Limited, Pakistan.
Camden Holding PTE Limited, Singapore.
Orascom Construction Industries, Egypt.
Products
Manufacture and sale of ordinary grey Portland cement by its brand
name of “PAKCEM”
Number of Employees
575
Plant Capacity
2006
2005 (Metric Tons) (Metric Tons)
Installed Capacity 2,400,000 -
Actual production of cement 80,306 -
Annual Sales Volume
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Year |
In Pak Rupees |
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2006 |
88,585,535/- (Estimated) |
Distributors / Agents
Mainly in all important cities of Pakistan
Bankers
(1) MCB Bank Limited, Pakistan.
(2) Citibank N.A., Pakistan.
(3) Habib Bank Limited, Pakistan.
(4) Allied Bank Limited, Pakistan.
(5) United Bank Limited, Pakistan.
(6) PICIC Commercial Bank Limited, Pakistan.
(7) ABN AMRO Bank, Pakistan.
(8) Askari Commercial Bank Limited, Pakistan.
(9) Soneri Bank Limited, Pakistan.
(10) Standard Chartered Bank Limited, Pakistan.
(11) Habib Metropolitan Bank Limited, Pakistan.
Financial Results
Pakistan Cement Company (PCC) started its trial production on August, 28th 2006 with the launch of its OPC product 'PAKCEM' in the market. The brand was recognized for its premium quality, wide regional coverage and unique distribution methodology. PCC announced the start of its commercial operations on December 18th, 2006. PCC managed to position PAKCEM as Pakistan's premium brand and gain above 8.0% market share in the month of December alone building upon its established reputation and brand equity, ranking fourth in market share. Throughout the year, PCC achieved several technical milestones. The company's kiln started its operations in July, the first Cement Mill was operational in August and the second Cement Mill in November. In cooperation with FLSmidth, PCC upgraded its capacity to 2.4 Mtpa. Moreover, PCC has also finalized the contracts for its Coal Mill project that is expected to be operational before end of 2007 with an attractive payback period which will reflect in savings in operational costs and in increasing production efficiency. During 2006, the cement local consumption in Pakistan grew by 20.13% to reach 18.9 million tons and the Cement and clinker exports grew as well by 24% to reach 1.9 MT, corresponding to total dispatches of 20.83 MT with 20% YOY growth. There are currently 18 cement producers in Pakistan with 28 Plants. Total annual cement production capacity grew YOY by 65% to reach 34.8 MT by end of 2006 with an available capacity of 26.8 MT during the year. Hence, total effective capacity utilization dropped to 78% as compared to 82% in 2005, triggering a price war scenario that started in Aug 06. This has affected both local & export prices. Local prices declined by 40-45% from PkR260-280/bag in June 2006 to PkR180-200/bag by Dec '06.
Future Outlook
This trend is expected to continue till the Demand absorbs the supply excess capacity. However, given the country positive economic outlook stimulating growth in cement consumption, the Management believes that the medium term outlook for the industry & the company is very positive.
Foreign Exchange Rates
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Currency |
Unit |
Pakistani Rupee |
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US Dollar |
1 |
Rs. 60.92 |
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UK Pound |
1 |
Rs. 128.10 |
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Euro |
1 |
Rs. 89.20 |
Comments
Subject Company was established in 1993 and is engaged in manufacture and sale of ordinary grey Portland cement. Current management is reported as experienced, respectable and having satisfactory means of their own. Trade relations are reported as fair. Payments are usually correct and as per commitments. The Company can be considered for normal business dealings at usual trade terms and conditions.
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PAKISTAN CEMENT COMPANY
LIMITED |
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BALANCE SHEET AST AT
DECEMBER 31, 2006 |
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2006 |
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2005 |
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2006 |
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2005 |
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SHARE CAPITAL AND RESERVES |
Rupees |
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NON CURRENT ASSETS |
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Rupees |
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Share capital |
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6,768,378,870 |
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6,768,378,870 |
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Property, plant and equipment |
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16,995,907,107 |
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12,272,471,671 |
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Capital reserve |
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214,838,692 |
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214,838,692 |
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LONG TERM ADVANCE |
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92,965,500 |
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103,295,000 |
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Accumulated loss |
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(518,917,520) |
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(480,693,559) |
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6,464,300,042 |
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6,502,524,003 |
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LONG TERM DEPOSITS |
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41,705,960 |
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4,039,855 |
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NON - CURRENT LIABILITIES |
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DEFERRED TAX ASSET |
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265,470,973 |
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Long term financing - secured |
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7,015,937,230 |
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6,396,599,998 |
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CURRENT ASSETS |
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Deferred liabilities |
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1,773,000 |
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1,057,575 |
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Stores and spares |
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273,440,674 |
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Stock in trade |
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158,358,236 |
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Other long term liabilities |
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1,000,598,335 |
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842,209,417 |
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Advances - considered goods |
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153,919,105 |
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144,790,548 |
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Short term prepayments and balance with |
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CURRENT LIABILITIES |
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statutory authority |
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113,664,497 |
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100,359,504 |
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Interest accrued |
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1,177,988 |
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1,177,988 |
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Trade and other payables |
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1,546,738,615 |
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378,136,715 |
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Other receivables - considered goods |
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21,820,750 |
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Interest accrued |
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303,041,327 |
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217,531,929 |
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Advances income tax - net |
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9,987,197 |
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7,819,762 |
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Short term borrowings - secured |
1,837,939,235 |
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Cash and bank balances |
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41,909,797 |
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1,704,105,309 |
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3,687,719,177 |
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595,668,644 |
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774,278,244 |
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1,958,253,111 |
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18,170,327,784 |
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14,338,059,637 |
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18,170,327,784 |
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14,338,059,637 |
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CONTINGENCIES AND
COMMITMENTS |
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PAKISTAN CEMENT COMPANY
LIMITED |
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PROFIT & LOSS ACCOUNT |
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FOR THE YEAR ENDED
DECEMBER 31, 2006 |
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2006 |
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2005 |
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Rupees |
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Sales - net |
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88,585,535 |
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- |
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Cost of sales |
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(230,399,966) |
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Gross Loss |
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(141,814,431) |
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Selling, general and administrative
expenses |
(150,781,932) |
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(43,665,788) |
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Other expenses |
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(2,733,750) |
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(1,900,850) |
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Finance cost |
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(5,134,126) |
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(6,505,164) |
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Other operating income |
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1,634,361 |
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1,177,988 |
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Wavier of interest and panel charges on
long |
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term financing |
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767,297,896 |
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Fair value adjustment of deferred
liabilities for |
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custom duties and sales tax |
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(2,465,056) |
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(71,112,413) |
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(Loss) / Profit
before taxation |
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(301,294,934) |
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645,291,669 |
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Taxation |
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263,070,973 |
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(23,500,000) |
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(Loss) / Profit
after taxation |
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(38,223,961) |
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621,791,669 |
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(Loss) /
earnings per share - basic and diluted |
(0.06) |
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1.03 |
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RATING
EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)