The company has relatively small capital base but maintains robust financial backbone as can be seen from the financial ratios in the performance statistics. Its turnover and profitability were record highest in its career. Hence the company maintained its profit distribution profile of being regular and attractive in payouts.
For the year under review, the directors recommended cash dividend at Rs 6.0 per share (FY 2003-04: Rs 6.50 per share) and proposed reserve for bonus share in the ratio of 1:4 (2003-04: 1:2). The company is making thrust in the decorative business and has embarked an expansion project in Lahore. Chairman of the company and his directors hope, so plan to make the Lahore project when completed, the state of the art facility in paint industry. The production from Alkyd manufacturing has been enhanced to 180 tons/month.
Berger Paints Pakistan Ltd is engaged in the manufacturing of paints varnishes and other related items. These include decorative paints, automotive paints, industrial/power coatings, wood and vehicle refinishes, protective coatings, road marking paints.
Berger-DPO a subsidiary of the company also markets a range of other road safety products such as traffic signs, cat studs, delineators, barriers, guard rails, etc. The company was incorporated in the province of Sindh on March 25, 1950 as a limited company and started its commercial operation, initially with the paints imported from the United Kingdom.
In 1955 it established manufacturing facilities in Karachi. Ever since, the company has met the growing demand through regular extensions in its product range and has maintained a high reputation for consistent quality.
In 1974 the company was converted into a public limited company, when 49.38% of the shares were acquired by Pakistani Investors with remaining 50.2% held by the UK, parent company, Jenson & Nicholson Ltd.
Soon afterwards, Jenson and Nicholson was taken over by Hoechst, one of the world's major manufacturers of chemicals and allied products. Slotrapid Limited, a UK based company with diversified business interests, acquired the control of Berger Paints Pakistan Ltd in 1991.
With its Head Office at Karachi, Berger Paints Pakistan has also regional offices at Lahore and Islamabad as well as it has wide network of distributors/dealers and sales personnel at all major urban centres of the country.
It is ISO 9001:2000 certified company. Stringent quality controls regimes testing procedure for finished products as well as computerised colour matching technology. Its shares are quoted on the Karachi and Islamabad Stock Exchanges and the market price of the share on 29-09-2005 for the closing quotation was recorded at Rs 124.25 per 10-rupee share. During the last one year the price of the share had peaked at Rs 179.75 per share.
During the year under review the company posted highest ever sales (net) revenue at Rs 2.122 million (FY 2003-04: Rs 1,243.49 million). Administrative and selling expenses and finance cost have sharply escalated. But other operating income and gross margin substantially improved as can been seen from the Performance Statistics appended below.
Pretax profit shot up at Rs 95.40 million (2003-04: Rs 61.55 million) registering 55% increase over the preceding year. The future outlook is mostly based on the growing economic indicators but susceptible to interruption due to energy crisis continued war in Iraq and clouds of crisis looming large in Iran which is another important oil producer. Towards the close of the 1st quarter of forthcoming financial year 2005-06, today the economy seems to have been insulated from major oil crisis. In this scenario the company is moving forward to avail of the opportunities to expand sales seems to have emphasis on the automotive/decorative paints and industrial/powder coatings businesses.
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Performance Statistics (Million Rupees)
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30th June 2005 2004
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Share Capital-paid-up: 46.25 30.83
Revenue Reserve: 257.32 244.21
Shareholders Equity: 303.57 275.04
Surplus on Revaluation of
Fixed Assets-Net: 186.64 191.25
Deferred Liability: 15.72 10.38
Current Liabilities: 875.10 435.40
Fixed Assets: 426.85 301.04
L.T. Investments: 17.95 15.47
L.T. Loans: 9.99 6.72
L.T. Deposits: 6.30 6.46
Current Assets: 919.94 582.38
Total Assets: 1,381.03 912.07
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Sales, Profit & Pay Out:
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Net Sales: 2,122.50 1,243.49
Gross Profit: 516.30 320.03
Other Operating Income: 36.95 15.01
Operating Profit: 123.41 77.09
Finance (Cost): (20.79) (10.42)
(Depreciation): (20.73) (18.89)
Profit Before Taxation: 95.40 61.55
Profit After Taxation: 57.01 33.71
Earnings Per Share (Rs): 12.33 7.29
Dividend (Cash) Per Share: 6.00 6.50
Share Price (Rs) on 29/09/05: 124.25 -
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Finance Ratios:
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Price/Earning Ratio: 10.07 -
Book Value Per Share: 65.64 89.21
Price/Book Value Ratio: 1.89 -
Debt/Equity Ratio: 0:100 0:100
Current Ratio: 1.05 1.38
Asset Turn Over Ratio: 1.54 1.36
Days Receivables: 61 56.88
Days Inventory: 98 104
Gross Profit Margin (%): 24.32 25.74
Net Profit Margin (%): 2.68 2.71
R.O.A (%): 4.13 3.79
R.O.C.E (%): 12.36 7.07
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Production Capacity:
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A) Actual Production
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(Figures in Million Litres): 23.50 11.25
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B) The capacity of the plant is indeterminable because it is a multi-product plant involving varying processes of manufacturing.