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Dear shareholders
Assalamu Alaikum
Last year, I presented the
Directors’ Report to you that report I attempted to give you a
brief history about your Company as to how it started from a
humble beginning and came to its current state. The operation
and financial health of the Company would have been better if
there would have not been management and financial
dislocations due to political reasons. You will kindly observe
from the Directors’ Report that the Company is gradually
coming out of disorders as reflected through the operational
and financial performance of the Company during the financial
year ending 31 December 2009. The production has increased
from 2.254 million pounds in 2008 to 2.916 million pounds in
2009 and the turnover has in creased from Tk. 163 million
Tk.207 million. the Company suffered a loss of Tk. 13.9
million in the year 2008 and by the grace of Almighty ALLAH
this situation has been reversed in 2009 in which year your
Company made a profit of Tk. 17.3 million.
Your Company has been bestowed
with two financial gifts. SABINCO transferred an amount of Tk.
45 million to a block account which represented accumulated
interest and agreed to write-off such blocked loan on the
condition that your Company would have paid the outstanding
principal amount of loan of Tk. 150 million within a
stipulated time frame. I am very happy to inform you that the
loan account of SABINCO has been fully settled and the Company
Received a benefit of Tk. 45 million which has completely
wiped out the previous accumulated losses. This coupled with
profitable operation during 2009 has enabled your Company to
declare a stock divided in the ration of 1B:10. In order to
further strengthen the financial health of your Company and to
reduce dependence on bank loan for working capital purposes,
the Company received an interest free loan of Tk. 52 million
from sister concerns which enabled it, amounting to Tk. 1.5
million and long term loans repaid of SABINCO and Sonali Bank
Ltd. amounting to Tk. 22.87 million. Your Company now has cash
resources exceeding Tk.. 28 million.
I am confident that the BMRE
which the Company is going to undertake during the year 2010
and should be operational by the beginning of 2012, will
significantly change the operational and financial condition
of your Company and will make your Company own a 100% export
oriented state of the art spinning unit having 30,000 plus
Spindles. The Company is Going to adopt such financing program
to implement this scheme which will basically be equity based
and therefore further reduce the interest burden.
We have all observed a robust
growth of our financial sector through issue of bonus shares
and right shares during the year 2009 and first half of 2010.
Almost all banks in the country are prepared to undertake
investment programs at bigger scale. I hope this year the
textile sector of the country will be benefited through
strengthening the capital base by issue of bonus and right
shares. In turn, the textile sector of the country will be
better placed than ever before to receive long term and medium
term assistance so that this sector can become more
competitive in the international market. I hope the pressure
pf deposit will force the commercial banks to reduce there
lending rates which will benefit all sectors particularly the
textile sector.
The textile sector has grown in
spite of all apprehensions emanating from world recession. Our
exports from textiles have already started showing improving
trends. We are hoping that the challenges of the world economy
will be effectively met by the year 2010 and our textile
sector will embrace a new era of all-round expansion and
growth during the year 2011. As explained in details in the
Director’s Report, your Company wants to be part of it and I
seek your kind support.
I want to put few further world
about world economic prospect by the end of 2010 and beginning
of 2011. Recently the International Monitory Fund has revised
world GDP growth from earlier estimate of 4.2% to 4.6%. The
industrial sector of United States recorded continued
increased output for the last successive 6 months. The
unemployment rate has not further deteriorated and consumer
expenditures shown signs of growth. The US now needs to expand
its exports. The economy of EU countries has been in stalemate
but of late started showing improvement. The Asian giants
China and Japan are both helping USA and Europe through
finance and trade. The unemployment problem is still haunting
almost all developed countries of the world but this is
heartening that the matter is not worsening. There are
cautious economic forecasts coming from UN that the recession
may be thawing by the end of 2010. If this happens and the
world economy returns to normal growth regime in 2011, we can
expect our textile exports will grow at an optimum rate
hopefully not below 10%.
I hope that managing Director
and her team will build up strong organization to support the
production and marketing efforts which a dynamic organization
needs and I wish her all success with her expansion program
and pray to Almighty ALLAH that she should be able to meet
your expectations.
I am expressing my gratitude to
you for deciding to attend the 15th AGM of CMC-Kamal
Textile Mills Ltd.
Sd/-
AHM Mustafa Kamal, FCA, MP
Chairman
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