FUNDAMENTALS OF FINANCIAL MANAGEMENT

FUNDAMENTALS OF FINANCIAL MANAGEMENT

FUNDAMENTALS OF FINANCIAL MANAGEMENT

Company Profile:

Thatta Cement Company Limited was incorporated in 1980 as a public limited company. It was a wholly owned subsidiary of the State Cement Corporation of Pakistan (Pvt.) Limited. The manufacturing facility was commissioned in 1982. The plant based on dry process technology, had a total installed capacity of 1,000 tons per day of clinker. The plant was supplied by M/s. Mitsubishi Corporation, Japan. In the year 2004 the consortium of Mr. Arif Habib and Al-Abbas Group acquired 100% shares of the Company from the Privatization Commission and took over its management control. The Company is now a part of the Arif Habib Group. The Group enjoys a diversified blend of expertise and interests in various industrial and financial concerns, including fertilizer, steel, cement, real estate, commercial banking, asset management, securities brokerage, and private equity.

Location:
The plant is located 115 km North East of Karachi at Ghulamullah Road, Makli, and District Thatta. The facility is spread over 236 acres of freehold land consisting of factory area, workers colony, officers colony, commercial buildings and water reservoirs. Finest quality raw material deposits are available close to the plant. These limestone and clay reserves are sufficient for about 100 years. In this respect, TCCL has the mining rights for extracting limestone from 2,364 acres, shale/clay from 1,121 acres and silica sand from 1,239 acres of land, respectively. The Company has further acquired mining rights of limestone for a further area of 1,240.02 acres in December 2010.

Initiatives:
Subsequent to the privatization, the management embarked on a number of initiatives to improve performance and efficiency of the unit. These include:

Induction of competent and experienced management personnel and skilled workforce Capacity expansion by 50% (i.e. from 1,000 tpd to 1,500 tpd) of clinker Refurbishment of 35 tons/hour cement grinding mill which was not operational for almost two decades Securing ISO 9001:2008 certification

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Installation of 24 tons/hr coal grinding mill Establishment and installation of a modern, computerized state of the art operations control system Conversion of the plant from furnace oil to multi fuel firing system (coal, gas and furnace oil

Board of Directors:
At present the Board of Directors consists of :

Mr. Muhammad Arif Habib Mr. Muhammad Fazlullah Shariff Mr. Muhammad Kashif Habib Mr. Muhammad Khubaib Mr. Nasim Beg Mr. Asadullah Khawaja Mr. Shahid Aziz Siddiqui

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Our Products:

Ordinary Portland cement:

Thatta OPC is unique in its Low Alkali content feature with a total content of alkalies below 0.4 percent. Thatta OPC has an advantage that it can be used in concrete made with aggregates that contain a form of silica which reacts with alkalies if present in high proportion to cause an expansion which disrupts concrete. Another special feature of the Thatta OPC is that it has low contents of Tricalcium Aluminate. This helps to control the effect of spontaneous over-heating in large masses of concrete and resistance to sulfate attack. Thatta OPC prevents chemical attack and corrosion on RCC. Its low heat of hydration makes it suitable for mass concreting. Its high early strength makes it ideal for use in load bearing structures. Thatta OPC has a higher Blaine value and fineness which facilitates denser concrete. Thatta OPC can be used in concrete mortars and grouts. Thatta OPC is a technically advanced and cost effective solution for construction above or below ground.

Sulphate Resistant Cement:

Thatta Sulphate Resistant Cement is suitable for application in areas affected by salinity, coastal belts, piling work, dams etc. It gives protection from chemical attack and corrosion. Its high early strength and low heat of hydration makes it ideal for use in load bearing structures. Low alkali content is an additional feature of Thatta SR Cement.

Portland Blast Furnace Slag Cement:

Thatta Slag Cement has excellent properties due to its higher fineness which facilitates denser concrete, prevents penetration of chloride and sulphate solution into the foundations. Thatta Slag Cement suits structures in hostile soil environments with high salinity, harmful chemical agents which pose a risk to foundation as well as the building. Thatta Slag Cement imparts better corrosion resistance properties in reinforcement steel structures. Thatta Slag Cement can be used in dams, bridges and earth retaining structures.

Ground Granulated Blast Furnace Slag:

FUNDAMENTALS OF FINANCIAL MANAGEMENT

GGBF Slag is ground to fineness of around 4,000 Blaine. It can be used for blending with cement and also as a filler in foundations.

Advantages:
The cement can be dispatched by road and rail as well in bulk tankers/containers. Tremendous strength, better setting time, sulphate resistant properties, low heat of hydration and low alkali content together with low expansion make Thatta Cement an ideal building material both for above or below ground constructions.

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Quality Policy:

Thatta Cement aims at being the leader and the most preferred brand of cement for its customers. Our objective is to:

Ensure satisfaction of our customers and all other stakeholders on the strength of our product quality Adopt environment friendly processes and safe working practices Develop quality management system, which facilitates continuous improvement in our system, process and procedures to ensure quality

Attract, motivate and retain our most valuable resources, i.e. human capital and formulate employee welfare oriented policies

Carryout social obligations towards the local inhabitants Carryout business conforming to all legal, regulatory and ethical dimensions

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Our Export:

Thatta Cement Company Limited is one of the prominent exporters of cement in Pakistan. We have always focused on delivering absolute customer satisfaction by providing our clients customized range of products. Our dedicated and industrious professionals constantly strive to understand the needs of our clients. The teams further, apply latest processes and technologies to provide the best possible solution to the clients.

Our main markets are:

Sri Lanka

Middle East

India

African Countries

FINANCIAL STATEMENTS FOR THATTA CEMENT CO LTD (THCCL) Although debt as a percent of total capital decreased at Thatta Cement Company Limited over the last fiscal year to 32.58%, it is still in-line with the Construction Materials industry's norm. However, there are not enough liquid assets to satisfy current obligations and operating profits are not yet strong enough to comfortably handle the burden. Accounts Receivable are among the industry's worst with 12.50 days worth of sales outstanding. This implies that revenues are not being collected in an efficient manner. Last, inventories seem to be well managed as the Inventory Processing Period is typical for the industry, at 125.53 days

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Careers:

The Company believes that it is the trustee of its Human Resources and encourages to develop them to introspect deeply and learn to act not on directives but on inspiration from within, thus aiming to provide a strong motivation to our employees to become psychological co-owners of the organization and to succeed with determination and commitment. As facilitators of the growth process of the employees, we are committed to providing a work environment where people are:

Offered full opportunities and challenges to develop individually, enabling career growth Offered suitable orientation and training Encouraged to acquire knowledge to meet the challenges of new technologies and business needs in the changing scenario

Educated and guided to inculcate and practice right values as are nurtured by the organization Provided strong motivation to take the organization ahead Assisted in creating and maintaining human resource system for optimizing human potential

Thatta Cement Company Limited offers employment opportunities in a wide range of functions. The process of recruitment in Thatta Cement Company Limited is fair and transparent, with adequate opportunities to look for suitable candidates both internally and from outside.

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Financial Reports:
Financial Year 2010-2006

FUNDAMENTALS OF FINANCIAL MANAGEMENT

FUNDAMENTALS OF FINANCIAL MANAGEMENT

FUNDAMENTALS OF FINANCIAL MANAGEMENT

Balance Sheet:
Balance sheet 2010 2009 2008 2007

rupees in Thousand Assets Noncurrent assets Property, plant & equipment Intangible assets long term Total noncurrent Assets Current Assets Stores,spaire parts & loose tools stock in trade trade debts Loans and advances Trade deposits and short term prepayments Accrued interest Other receivable Short term investment Tax refunds due from the government Taxation-net sales tax refundable Cash and bank balances Total current Assets

848781 3116 88 851985

822149 2616 88 824853

728992 15297 2708 746997

1410543 2213 2500 1415256

190029 238864 49649 12918

218895 225301 56135 16694

244063 128416 134212 48073

232599 121666 133000 58456

8127 54 6033

6910 1225 38597

6044 10533

6615 5922

32328 37371

18764

1155 12262 8230

72655 6236 6580 643729

10266 585639

11815 594336

6367 599355

FUNDAMENTALS OF FINANCIAL MANAGEMENT Total Assets 1437624

1419189

1346352

2058985

Equity And Liabilities SHARE CAPITAL AND RESERVES authorized Capital issued, subscribed and paid-up capital Accumulated loss Unrealized loss on available for sale investment total NON CURRENT LIABILITIES Long term financing long term deposit Deferred taxation total CURRENT LIABILITIES Trade and other payables Accrued markup Short term borrowing current maturity of long term financing total current TOTAL

900000

900000

900000

900000

797745 -22182

797745 -23124

797745 -226996

797745 -22113

775563

-3810 770811

570749

775632

41666 4249 44432 90347

83333 3962 53972 141267

166662 4474 17514 188650

654825 3356 2595 660776

227514 11124 291409

170582 10095 243102

332780 9532 147417

359850 10065 156000

41667 571714 1437624

83332 507111 1419189

97224 586953 1346352

96662 622577 2058985

FUNDAMENTALS OF FINANCIAL MANAGEMENT

FUNDAMENTALS OF FINANCIAL MANAGEMENT

Ratio Analysis:

FUNDAMENTALS OF FINANCIAL MANAGEMENT

Common Analysis
2010 2009 2008 2007

Assets
Non current assets Property, plant & equipment Intangible assets long term Total non current Assets

59.04054 0.216747 0.006121

57.9309 0.184331 0.006201

54.14572 1.136181 0.201136

68.50672 0.10748 0.121419

59.26341

58.12143

55.48304

68.73561

Current Assets Stores,spair e parts & loose tools stock in trade trade debts Loans and advances Trade deposits and short term prepayment s Accrued interest

13.21827 16.61519 3.453546 0.898566

15.42395 15.87533 3.955428 1.176306

18.12773 9.53807 9.968567 3.570612

11.29678 5.909028 6.459493 2.839069

0.565308 0.003756

0.486898 0

0.448917 0

0.321275 0

FUNDAMENTALS OF FINANCIAL MANAGEMENT Other receivable 0.419651 0.086317 Short term investment 0 2.719652 Tax refunds due from the government 2.24871 0 Taxation-net sales tax refundable Cash and bank balances Total current Assets Total Assets 2.599498 0 1.322164 0

0.782336 0

0.287617 0

0.085787 0.910757 0.611281

0 3.52868 0.302868

0.714095

0.832518

0.472908

0.319575

40.73659 100

41.87857 100

44.51696 100

31.26439 100

issued, subscribed and paid-up capital Accumulate d loss Unrealized loss on available for sale investment Total

55.49052 -1.54296

55.49052 -1.60849

55.49052 -15.7897

55.49052 -1.53816

0 53.94756

-0.26502 53.61701

0 39.70085

0 53.95235

NON CURRENT LIABILITIES

FUNDAMENTALS OF FINANCIAL MANAGEMENT Long term financing 2.898254 5.796578 long term deposit 0.295557 0.275594 Deferred taxation 3.090655 3.75425 total CURRENT LIABILITIES Trade and other payables Accrued markup Short term borrowing current maturity of long term financing total current 6.284467 9.826422

11.59288 0.311208 1.21826 13.12235

45.54911 0.233441 0.180506 45.96306

15.8257 0.773777 20.27018

11.86555 0.7022 16.90998

23.14792 0.663038 10.25421

25.03088 0.700114 10.85124

2.898324 39.76798

5.796509 35.27424

6.762825 40.82799

6.723733 43.30597

TOTAL

100

100

100

100

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Contact Us: Registered Office:

Pardesi House, Survey # 2/1, R.Y. 16, Old Queens Road, Karachi - 74000 Voice 92 21 32423295 , 32423478, 32419827

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Fax: 92 21 32400989 E-mail: info@thattacement.com

Mailing Address:
Arif Habib Centre, 23, M.T. Khan Road, Karachi.

Marketing Department:
E-mail: marketing@thattacement.com

Purchase Department:
E-mail: purchase@thattacement.com

Factory:
Ghulamullah Road, Makli, District Thatta, Sindh 73160 Voice: 92 298 770478 , 770731-32

Fax: 92 298 770735 E-mail: tccl_plant@yahoo.com

FUNDAMENTALS OF FINANCIAL MANAGEMENT