engro foods presentation (financial accounting)

Overview of Engro Foods

“Engro Foods is among the biggest and fastest growing companies in Pakistan with a vision to cater to local needs with products conforming to global standards.”

Vision of the Company

“Engro foods will continue to make investment aimed at impacting lives and delighting consumers each day, every day, in a multitude of ways”

Mission of the Company

“Build branded food business to improve quality of life by offering tasty, affordable and high nutritional products to our consumers while maximizing stakeholder’s value”

Board of Directors of the Company

Names

• Abdul Samad Dawood (Chairman)

• Babur Sultan (CEO)

• Muhammad Amin• Sabrina Dawood• Rehan Hassan• Zafaryab Ali Khan• Isfandiyar Shaheen• Marco L. Spits• Syed Khalid Siraj Subhani• Wim Torfs

• Faiz Chapra (Company Secretary)

Responsibilities

• Chairman responsibility is to manage and to provide leadership to the Board of Directors of the Company

• The CEO acts as a direct connection between the Board and management of the Company and communicates to the Board on behalf of management

• Directors of the company are responsible for the management of their companies. They must act in a way most likely to promote the success of the business and benefit its shareholders. They also have responsibilities to the company’s employees, its trading partners and the state

• Company Secretary is the chief administrative officer of the company, responsible along with the directors for certain tasks under the Companies Act. They have power to enter into certain contracts on the company's behalf

Audit Committee MembersThe Board has formed an Audit Committee. It comprises of four members, of whom one is anindependent director and three are non-executive directors and the Chairman of the Committeeis a non-executive director. The committee comprises the following members:

• Muhammed Amin (Chairman)

• Abdul Samad Dawood (Member)

• Zafaryab Ali Khan (Member)

• Isfandiyar Shaheen (Member)

HR & Remuneration Committee Members

The Board has formed a Human Resource and Remuneration Committee i.e. the BoardCompensation Committee. It comprises of four members, all of whom are non-executivedirectors. The Chairman of the Committee is a non-executive director. The committee comprisesthe following members:

Rehan Hassan (Chairman)

Abdul Samad Dawood (Member)

Khalid Siraj Subhani (Member)

Isfandiyar Shaheen (Member)

Bankers of the Company

• Allied Bank Limited• Faysal Bank Limited• Bank Alfalah Limited• The Bank of Punjab• Habib Bank Limited• MCB Bank Limited• Meezan Bank Limited• National Bank of Pakistan• United Bank Limited• Habib Metropolitan Bank• Askari Bank Limited

• Al-Baraka Bank Pakistan Limited• Standard Chartered Bank Pakistan Limited• Soneri Bank Limited• NIB Bank Limited• Citi Bank .N.A.• Bank Al-Habib Limited• Deutsche Bank AG• Samba Bank Limited• Industrial & Commercial Bank of China• Summit Bank Limited

S.No. Shareholders Category No. of Shareholder No. of Shares Percentage

1. Directors, Chief Executive Officer, and their spouse and minor children. 10 509 0.0

2. Associated Companies, undertaking and related parties. 2 667,374,991 87.06

3. NIT & ICP

4. Banks Development Financial Institutions,Non Banking Financial Institutions.

14 25,939,659 3.38

5. Insurance Companies 6 4,857,700 0.63

6. Modarabas and Mutual Funds 37 12,176,412 1.59

7. Share holders holding 10% 2 667,374,991 87.06

8. General Public (Individual)

a. Local 7,418 21,782,131 2.84

b. Foreign

9. Others 135 34,464,673 4.50

Category of Share Holding as of 31st December 2015

Name of Subsidiary Company

Engro Foods Limited was formed as a wholly owned subsidiary of “ENGRO CORPORATION LTD”

In Engro Corporation Following Companies are own by ENGRO CORPORATION LTD

• Engro Fertilizer Ltd• Engro Foods Ltd• Engro Polymer and chemical Ltd• Engro Eximp (Pvt) Ltd• Engro Powergen Ltd

Year of Listing in Stock Exchange

Engro Foods Limited was incorporated in April 2005 and was listed on Stock Exchanges in 2011

Registrar of Company

M/S FAMCO ASSOCIATION PVT LTD.

FAMCO Associates (Pvt.) Limited [previously Ferguson Associates (Pvt.) Ltd.] has been in the business of Share Registration since 1988 and presently has over 40 blue chip companies as share registration clients, comprising of leading multinational and local companies.

Tax Consultant & Legal advisor of the company

Mr. Faiz Muhammad Ghanghario is tax Consultant & Legal advisor of

the company

2015 2014 2013 2012 2011

316200 / 76700 =4.13

88900 / 76700 = 1.16

21100 / 76700 = 0.28

25950 / 76200 =3.43

89100 / 75200 = 1.22

Earnings per share (EPS) is the portion of a company's profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company's profitability.

Earning Per Share

EPS = NET INCOMENO. of SHARES Note: Amount in thousand

MARKET VALUE OF SHARE

2015 2014 2013 2012 2011

146.50 108.54 104.44 98.14 22.60

0

50

100

150

2011 2012 2013 2014 2015

Authorized issued & Paid up Share Capital

Authorized Capital850,000,000 Ordinary shares of Rs. 10 each

Issued and Paid-up Capital766,596,075 Ordinary shares of Rs. 10 each fully paid in cash

(Amount in thousand)

8,500,000

7,665,961

Net Cash Flow from Operating Activities, Investing Activities & Financial Activities

2015 2014 2013 2012 2011

4,517 786 2,356 3,214 1,080

(790) (2,556) (5,221) (3,379) (2,341)

(1,722) (1,081) 547 1,819 2,474

(Amount in million)

Net cash flow from operating activities

Net cash flow from investing activities

Net cash flow from financing activities

Corporate Social Responsibility Activities of the Company in 2012 & 2013

Engro Foundation (the single CSR front for all Engro companies) contributed over Rs. 12.4 million in 2012 and Rs. 16.2 million under our social investments commitments in 2013.

Through flagship WELD (Women Empowerment Through Livestock Development) program theysought to increase the capacity of small-scale producers and strengthened the institutional framework for dairy production and milk collection network. Within the platform of the WELD project

Corporate Social Responsibility Activities of the Company in 2014

Engro Foundation (the single CSR front for all Engro companies) contributed over Rs. 17.4 million under their social investments commitments in 2014, as compared to Rs. 16.2 million in 2013, there are some following CSR activities

• Own a tree campaign• Treatments and animal handling trainings• School learning program and carrier development (e.g. Nara school, Sahiwal school etc.)• Health initiatives

Corporate Social Responsibility Activities of the Company in 2015

Engro Foundation (the single CSR front for all Engro companies) contributed over Rs. 24 million under their social investments commitments in 2015, as compared to Rs. 17.4 million in 2014.

Own A Tree Campaign: This education based campaign focused on raising awareness about the importance of plants to the environment and the invaluable contribution that individuals can make by caring for and raising a plant. 350 plants were distributed to students.

Credit rating of the Company

Credit Rating

Engro Foods has a medium to long term credit rating of “A+” (Single A Plus) by JCR-

VIS Credit Rating Co. Ltd. The rating reflects the Company’s financial and

management strength and denotes a low expectation of credit risk and the capacity for timely payment of financial commitment

Financial Ratios of year 2015

Current Ratio

The current ratio is a liquidity ratio that measures a company's ability to pay short-term and long-term obligations

Currents Assets . Current Liabilities

Amount in thousand

11,055,032 = 1.57,359,740


Quick Ratio

The quick ratio is a financial ratio used to gauge a company's liquidity.

Currents Assets – Inventory Current Liabilities

Amount in thousand

11,055,032 – 3,071,379 = 1.07,359,740


Assets Turnover Ratio

Asset turnover is a financial ratio that measures the efficiency of a company's use of its assets in generating sales revenue

Total Sales . Total Assets

Amount in thousand

49,834,089 = 1.826,285,386


Debt to Equity Ratio

Debt/Equity Ratio is a debt ratio used to measure a company's financial leverage, ratio indicates how much debt a company is using to finance its assets relative to the amount of value represented in shareholders' equity

Total Liability . Owner’s Equity

Amount in thousand

26,285,386 = 0.7614,912,801

Comprehensive Income

2015 2014 2013 2012 2011

3,139,780 8,69,800 1,72,733 2,624,999 872,464

Comprehensive income is the sum of net income and other items that must bypass the income statementbecause they have not been realized, including items like an unrealized holding gain or loss from availablefor sale securities and foreign currency translation gains or losses

Note: Amount in thousand

Audit Opinion for year 2015a) in our opinion, proper books of account have been kept by the Company as required by the Companies Ordinance, 1984;

b) in our opinion:(i) the balance sheet and profit and loss account together with the notes thereon have been drawn up in conformity with

the Companies Ordinance, 1984, and are in agreement with the books of account and are further in accordance with accounting policies consistently applied;

(ii) the expenditure incurred during the year was for the purpose of the Company's business; and(iii) the business conducted, investments made and the expenditure incurred during the year were in accordance with the

objects of the Company;

c) in our opinion and to the best of our information and according to the explanations given to us, the balance sheet, profit and loss account, statement of comprehensive income, statement of changes in equity and statement of cash flows together with the notes forming part thereof conform with the approved accounting standards as applicable in Pakistan, and, give the information required by the Companies Ordinance, 1984, in the manner so required and respectively give a true and fair view of the state of the Company's affairs as at December 31, 2015 and of the profit, total comprehensive income, changes in equity and its cash flows for the year then ended; and

d) in our opinion, no zakat was deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980).