walid tawfiq

Transcription

walid tawfiq

His Majesty King Abdullah II Bin Al-Hussein the Regent
Vision
To build the Tobacco and
Cigarette Company into
a premier institution and
leading
manufacturing
enterprise working across the
region through efforts of its
team of qualified managerial
and technical experts.
Mission
To use our advanced
technologies to develop
premium
products
at
reasonable prices while
maintaining our competitive
advantage through the
development of alliances
and long term partnerships
with
strategic
parties
working across regional
and International markets.
Working to foster the
total
commitment
of
our employees and our
management, we strive to
observe a continued growth
in sales and an ongoing
development in the scope of
our operations.
Mr. Tawfiq Fakhouri, Chairman of the Board of Directors
Table of Contents
1 to 26
Board of Directors Report
27 & 28
Auditors Report
29
Consolidated balance sheet as of December 31st, 2007 & 2006
(Exhibit A)
30
Consolidated statement of income & its appropriation for the
year ended December 31st, 2007 & 2006 (Exhibit B)
31
Consolidated statement of changes in shareholders equity for
the year ended December 31st, 2007 & 2006 (Exhibit C)
32
Consolidated statement of cash flow for the year ended
December 31,2007 (Exhibit D)
33 to 44
Notes to the consolidated financial statements
Board of Directors
Tawfiq Shaker Fakhouri
Board Chairman
Samer Tawfiq Fakhouri
Vice Chairman
Walid Tawfiq Fakhouri
Director
Ibrahim Rashid Al Juba
Director
Adel Ahmad Irshiad
Director
Rep-of the Bank of Jordan
Yahya Zakariya Qadamani
Director
Rep-of the Ekbal for General Trade
Abdul Rahman Talal Dakhmash Director
Rep. Pearl Comercial company for Construction & Investment
Hussein Mohammad Hanafiyeh
Director
Rep-of the Al Khaleej for Investment and Transportation
Adel Ramez Abu Durgham
Director
Rep-of the Zahra Al Urdun for Real-Estate Investment
Haitham Mahmoud Qtaishat
Director
Rep-of the Al Yamama Investment
Yousef Mohamad Omer
Representing Farah for Electrical & Sanitary Instruments Company
Director
The Board of Directors Report
Company’s Achievements during the Financial Year of 2007 and Plans for 2008
Dear Shareholders ,
On behalf of all the board members of the International Tobacco and Cigarette
Company (ITC), it gives me great pleasure to present to you ITC’s 16th comprehensive
annual report. It is in this report that we highlight our achievements during the
financial year of 2007, and present to you the operational strategy for ITC, a public
shareholding limited liabilities company, for the coming business year of 2008.
As a pioneering national company we have based our strategy for success on several
key factors including;
- Implementing cutting edge technological advancements in all our operations,
to manufacture high quality products that meet today’s economic and social
advancement.
- Building a team that recognizes and captures opportunities and rises to the
challenges to overcome all obstacles.
Providing reasonably priced products that meet the different needs of our
customers.
- Creating alliances with international suppliers to strengthen our competitive
advantage.
- Supporting the National Economy through the payment of fees and taxes. ITC has
paid in the year 2007 around $ 51,000,000, and the total amount of fees and taxes
paid since its inception has exceeded 604 million US dollars.
- Supporting the state treasury with foreign currencies from the export of the
companies products. ITC’s exports since the start of production have exceeded 179
million US dollars.
- Participating actively in the development of the local community through a wide
range of programs, the total amount spend on such program during the year 2007
was JD 50,238 and has amounted to JD 539,611 since the inception of ITC
Subsidiary Companies Owned by ITC
1: The Arab Cigarette Distribution Company
•
Limited Liabilities Company
•
Specialized in distribution of cigarette and tobacco products
•
Capital investment worth JD 30,000.00
•
100% ownership
•
Headquarters in Amman Na’ur, Hashemite Kingdom of Jordan
•
A team of 3 employees appointed by ITC
•
The company has no other branches
•
Registered by the Ministry of Industry and Trade, trade number (6321) on 4/9/2000
2: Al Fakher Tobacco for Trading and Agencies
•
Limited Liabilities Company
•
Specialized in the distribution of flavored tobacco within the Jordanian market
•
Capital investment worth JD 30,000.00
•
100% ownership
•
Headquarters in Amman Na’ur,Hashemite Kingdom of Jordan
•
A team consisting of 32 employees appointed by ITC
•
The company has no other branches
•
Owns Al Fakher Tobacco Trading in Ajman UAE . The Capital investment of
the company is JD 12 million.
•
Registered at the Ministry of Industry and Trade, trade number (12208) on
30/5/2006 and national ID issuing number (200010064)
National No.
9351011862
9721050578
9721000980
9561017570
9401006458
9481005364
Tawfeeq Shaker Fakhori
Samer Tawfeeq Shaker Fakhori
Waleed Tawfeeq Shaker Fakhori
Ibrahim Rasheed Abdul Mene’m al-Ja’ba
Hasan Mohammad Hasan Hanafiyeh
Haitham Mohammad Ali Al-Qteshat
Board of Directors Members and their Representatives
Name
03.04.1948
01.01.1940
20.05.1956
12.02.1972
01.05.1972
1935
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Date of Birth Nationality
1992
1993
Bachelor of Business
Administration
Secondary School (Tawjihi)
Tobacco Expert
1972
1968
1980
1987
2001
2006
1995
2001
2001
1992
1995
1999
2003
2005
2004
2001
2005
25.2.07
2003
2006
1980
1992
2001
25.3.07
7.11.07
1964
1973
1982
1985
2001
1972
1975
2002
2004
2004
2004
2005
Graduation Date From
Master of Business Administration 1999
Bachelor of Marketing
Administration
Businessman
Certicate
2.8.07
Until Present Date
Until Present Date
Until Present Date
Until Present Date
7.11.07
1995
1999
2003
2004
Until Present Date
Until Present Date
2005
25.3.07
Until Present Date
7.11.07
Until Present Date
1992
31.12.06
25.3.07
Until Present Date
Until Present Date
1972
1980
1985
Until Present Date
Until Present Date
1975
2002
2003
Until Present Date
Until Present Date
7.11.07
Until Present Date
To
Al-Eqbal press & enveloping Co.
High Art Trade Co.
High Fashion Clothes Co.
International Clothes Co.
Al-Ahliya Industrial Co.
International Tobacco & Cigarettes Co./Amman
The Hashemite Kingdom of Jordan Broadcast
Jordan Customhouse
Prime Ministry
Bank of Jordan
Al-Theqa International Transportation Co.
Zahrat Al-Urdun for Real Estate & Hotels Investments
Jordan Tobacco Co.
Arab Islamic Bank
Bank of Jordan
Bank of Jordan
Zahrat Al-Urdun for Real Estate & Hotels Investments
Corporation
Head of Board of Directors
General Manager
Board of Directors Deputy Head
Employee
Executive Manager
General Manager Assistant for Investment Treasury
General Manager Assistant for Investment & Branches
Board of Director Member
Board of Directors Member Representative- Al-Eqbal Jordanian Co. for General Trade
Board of Directors Member Representative - Bank of Jordan
Board of Directors Member
Factory Manager Assistant/ Production Manager
General Manager Assistant
Board of Directors Member Representative at Farah Co. for Electrical & Sanitary Installation
Board of Directors Member Representative- Lo’lo’a Trade Co. for Construction & Investment
Partner
Partner
Partner + Board of Directors Member
The Owner
Board of Directors Member Representative- Arab Gulf for Investment & General Transportation
Programs Announcer & Presenter
General Supervisor & Queen Alia’ Airport Customhouse Manager/ Amman Civil Airport
President Consultant/ Securities Commission General Coordinator
Information Consultant
Board of Directors Member Representative-Al-Yamama General Investment Co.
Board of Directors Member Representative- Lo’lo’a Trade Co. for Construction & Investment
Board of Directors Member Representative- Arab Gulf Investments & Public Transportation Co.
Position
Position at International Tobacco & Cigarettes Co., and Professional Experiences
Names of Board of Directors Members, and Higher Administration Members and Information about Each of Them.
National No.
04.12.1949 Jordanian
05.11.1962 Lebanese
9491000368
9501006210
Yousef Mohammad Omar Omar
Adel Ahmad Mahmoud Irshed
Abdul Rahman Talal Abdul Rahman Daghmash 9641028819
Adel Ramez Melhem Abu Dargham
1176667880
1979
Administration
Bachelor of Engineering
Bachelor of Laws - Cairo
1984
1986
1976
1985
1990
2001
Until Present Date
2005
Until Present Date
Until Present Date
2000
7.11.07
Until Present Date
Until Present Date
1995
Until Present Date
Until Present Date
1996
2003
2001
2001
1991
25.3.07
1995
1984
1985
1991
1.5.01
2002
2003
7.10.07
1988
2004
1997
2005
Until Present Date
Until Present Date
7.11.07
2005
Until Present Date
1984
1986
1987
1995
To
1979
1979
1982
1994
2005
1995
1999
2001
2005
1975
1984
1987
1987
Bachelor of Business/Accounting 1975
Administration
Date of Birth Nationality Certicate
Yehya Zakariya Mohammad Al-Qadamani 9571027681
Board of Directors Members and their Representatives
Name
Position
General Manager
Head of Directors Commission & General Agent
Board of Directors Member Representative- Arab Gulf Investments & Public Transportation Co.
Arab Islamic Bank Co.
International Tobacco & Cigarettes Co./Amman Board of Directors Member
International Tobacco & Cigarettes Co./Amman Board of Directors Member Representative- Al-Eqbal Jordanian Co. for General Trade
Al-Mahdi General Contracting Co./Abu Dhabi Accountant
Arab Co. for Electrical Industries
Jordan Bonds Co.
Arab Gulf Co.
Lo’lo’a Trade Co.
Al-Eqbal Jordanian Co.
Modern Fashion Co.
Financial Manager
Board of Directors Member Representative- Farah Sanitary & Electrical Installation Co.
Bank of Jordan
Head of Board of Directors Office - Financial Manager
International Tobacco & Cigarettes Co./Amman Board of Directors Member Representative- Farah Sanitary & Electrical Installation Co.
Government of Jordan
Previous Minister
International Tobacco & Cigarettes Co./Amman Board of Directors Member Representative- Bank of Jordan
Private Business
Lawyer
Daghmash Companies Group
Merchant & Businessman
General Manager of Daghmash Companies Group
Saudi Technical Co. for Plastic (Riyadh/KSA) Projects Architect
Al-Hoshan Press Association (Riyadh-Jeddah-Khubar/KSA) Maintenance Manager/Technical Sales Manager
Yousef Qara & Sons Press Co. (Lebanon/Germany/Syria/Jordan/U.A.E/Kuwait) Projects Architect
General Manager
Al-Theqa International Transportation Co. Board of Directors Member
Board of Directors Member/ General Manager
International Tobacco & Cigarettes Co./Amman Board of Directors Member Representative- Zahrat Al-Urdun for Real Estate & Hotels Investments
Tourism to Holy Lands Co./Jerusalem
Italian Airlines – General Agent/Jordan
Jet Tourist Co.
Bank of Jordan Co.
Corporation
9642002824
9692025386
9451006695
Martha Jameel Awwad Al-Horani
Najat Ali Ahmad Al-Bo
Mohammad Khaleel Hussein Al-Sheibat
9652014777
9391000976
Mahmoud Ali Mahmoud Al-Thabteh
Sirin Said Ghaleb Hasan
9401008738
Issa Mahmoud Mohammad Issa
9601025126
Taleb Maso’d Mohammad Al-Barqawi
Date of Birth Nationality
National No.
Samer Mohammad Mahmoud Al-Haj Maso’d 9661021658
Ibrahim Issa Rasheed Deeb
9501008308
Higher Administration
Name
1985
1981
1973
1989
1994
Jordan Certificate of Public
Auditor (JCPA)
Bachelor of Computer
1988
2007
Bachelor of Business Administration 1998
Bachelor of Accounting
1969
Executive Secretariat Diploma
Computer Programming Diploma 1990
Administration
Secondary School
Bachelor of Laws
Master of Engineering
1993
1972
1994
2001
1989
1994
6.2.99
1963
1999
2001
1961
11.93
1985
1991
2004
11.99
11.95
01.96
02.99
10.02
3.03
6.04
9.04
9.05
1971
1980
1999
2000
1.12.05
1988
6.06
Bachelor of Mechanic Engineering 1989
Secondary School
1967
Certicate
Until Present Date
1991
2000
Until Present Date
1994
1999
Until Present Date
1994
2001
Until Present Date
1993
Until Present Date
1991
2004
Until Present Date
11.95
1.96
1.99
10.02
3.03
6.04
9.04
7.09.05
Until Present Date
1980
1999
2000
2005
Until Present Date
2006
Until Present Date
To
Al-Batel Swatches & Jewels Co./Kuwait
Sanad Importation & Exportation Co./Poland
Trio Co. for Business Projects
ministry of Interior
Al-Eqbal Financial Investments Co.
Public Security Directorate- Jordan
Alia Hotel – Hosting Services
Deran Contracting Co.
Communications & Trade Co.
Tadamon Co.
Al-Asasiya for Administrative Systems
One World Co.
Cooperation for Solution Co.
Freelance
Intercom (Computer Consultations)
Umniah for Mobile
Public Association for Social Security/Libya
Lime & Bricks Co./Amman
Lo’lo’a Co. for Sanitary Sheet Industry/Amman
Royal Scientific Society
Corporation
Factory Manager
Sales & Marketing Manager
Sales & Marketing Manager
Sales & Marketing Manager by Agency
General Manager
General Manager
Exportation Manager
Traffic & Licensing Affairs Manager
Counselor
Head of Board of Directors Office Manager/Board of Directors Secretariat
Head of Administration Department – Traffic Department
Administrative Affairs Manager
Executive Secretary
General Manager Assistant
Trade Manager
Office Manager
Executive Secretary
Employees Officer-Employment
Human Resources Manager-Employment
Human Resources Manager
Human Resources Consultant
Employment Department Officer
Interior Auditor
Financial & Administrative Manager
Financial & Administrative Manager
General Manager Assistant for Financial & Administrative Affairs
Financial Manager
IT Center Deputy Manager
IT Manager
Position
Statement of Shareholders Who Own 5% or more of the
Capital as of 31/12/2007, compared to the previous year
Number of Shares as of 31 Dec.
2007
Number of Shareholder
Name of Shareholder
2006
Percentage
Percentage
3150
The United Arab Investors Co
3,416,048
17%
5,272,407
26%
10003
Tawfiq Shaker Khader Fakhouri
3,255,948
16%
605,413
3%
10002
Bank of Jordan
2,848,425
14%
2,848,425
14%
10003
Al-Iqbal for General Trading
1,932,915
9%
1,876,215
9%
The Company’s Market Position
ITC at present owns 50% of the local market share. It has been successfully able to
maintain this strong market presence due to the high sales volumes it records from
both its own brands and brands owned by Philip Morris. With aims to increase its
market share in both Jordan and the region, ITC’s management continuously research
both local market and export market trends.
Despite the strong competition and increase in smuggled tobacco products and
black market trade, ITC continues to produce products from the finest Tobacco that
adhere to international standards of excellence and quality.
ITC creates sales and marketing strategies that adhere to the laws and regulations
applicable to the field, producing tobacco products based on this commitment.
a) The company’s local market reach includes all Jordanian governorates and cities
b) The company’s regional market reach includes the markets of Iraq, Iran, Yemen and Libya
c) The company’s local market share is approximately 50%.
Government Protection
ITC enjoys no government protection other than what is provided by intellectual
property right and branding laws practiced in the Kingdom.
Laws Affecting Company Performance
a) Tax laws were amended to stipulate that a 100fls tax be collected for each cigarette
pack sold.
b) The company complies with production standards stipulated by law by including
all necessary health warnings on each cigarette pack it produces.
Statement of Names of the Exporters and Main Clients
for 2007
The Exporters
Number
Name of Client
Percentage of Transaction out of Total Purchases
1
PHILLIP MORRIS
56,76%
Number
Name of Client
Percentage of Transactions out of the Company’s Total Purchases/Revenues
1
Al-Masbah Company
39,10%
2
Mohammad Karim Abu Rashid
35,30%
3
Erad Trading Company
10,40%
Clients
The Development of Human Resources
The company continuous to implement its strategy of developing its human resources
, providing the most experienced management staff and enhancing the relations
between all its employees in order to build team spirit and enhance the standards of
living through a wide range of programs. These programs include but are not limited
to:
1) Social Programs: ITC creates many social programs , to foster a stronger sense of
loyalty amongst its employees.
2) Occupational Safety: The company creates many awareness and educational
programs that instill in its team members the importance of occupational safety
pratices while they are on the job.
3) Healthcare Services: The company has an in-house doctor who is specialized in
providing periodical check-ups and emergency treatment for its team members.
Employees are also provided with the necessary vaccinations they need to ensure
that they are healthy at all times while on the job.
4) Health Insurance: The company has a comprehensive health insurance program for
all its team members and their families.
5) Meal Plans: The company has formed an agreement with a company specialized in
providing meals for all employees at minimal cost.
6) Transportation: The company provides modern transportation services for all its
employees.
7) Education: The company covers the educational expenses of all distinguished
offsprings of its team members in universities and schools.
8) Social Committee: The social committee organizes events for the company’s
employees and provides support for members of low and medium income earning
households.
9) Model Team Members: The company elects the model employee of the month and
the year and also awards people who demonstrate good leadership skills.
10) Periodical Report: The PR department provides a newsletter reflecting the
companies latest news and developments
The Scientific
The International Tobacco Al-Fakher for Tobacco Trading
The Arab Company for
Qualification
and Cigarettes Co
and Agencies (Associate)
Distributing Cigarettes (Associate)
PhD
0
0
0
Master
7
0
0
High Diploma
0
0
0
BA
87
11
0
Junior Diploma
68
5
0
Higher School Diploma
61
9
0
Less than High School Diploma
283
7
0
Total
506
32
0
Training Courses Offered in 2007
and the Number of participating Employees
Certified operational risk executives accreditation training course
1
Effective strategic planning with balanced score card
1
Excel core and Excel expert
31
Integrated skills beginner
1
Modern concepts in risks and controls
18
Simatic’s 7 Tia
3
Custom Regulations
3
Electronic archiving system
1
H.R Investment
1
Electronic customs clearance
3
Integral Customs procedures
1
International diploma in H.R management
1
P.R logistics and protocol
1
ICDL
2
Preparation of administrative reports
1
Planning and implementing training needs
2
Engineer and practical training for water purification stations
3
Energy conservation
2
First aid
1
Radiation prevention workshop
12
Microsoft Excel 2003
2
Skills for Job Interviewing
2
English course
2
Total
95
10
Quality
Department
Shareholders
Department
Puplic
Relations
Department
Technical
Adminstrative
Administrative
Affairs
Department
Export
Department
Al Fakher Tobacco
Trading and Agencies
External
Auditor
Human
Resources
Department
Research &
Development
Department
General Manager
Board of Directors
GM Executive
Secretary
Factory
Department
Information
Technology
Department
Financial
Department
Internal Auditing
Department
The Arab Cigarettes
Distribution Company
Legal
Consultant
Commercial
Department
Auditing
Committee
Organization Chart for The Arab Cigarettes Distribution Company
General Manager
Secretary
Financial Department
Marketing & Sales Department
Accounts Division (1)
Local Marketing Division (1)
Sales Division (1)
Organization Chart for Al Fakher Tobacco Trading and Agencies
General Manager
Secretary
Financial Department
Marketing & Sales Department
Accounts Division (1)
Marketing & Sales Division
Alo Argeleh Division
Promoting Division
11
The risks incurred by the Company
1: The rise in tax rates results in an increase in the number of smuggled goods into
the country
2: The production of low quality imitated products by unknown parties who sell them
for lower prices
3: The change in governmental laws and the resulting effect on company strategies
The company’s achievements during the last financial year
1: The company was able to maintain its 50% market share and strengthen its market
presence
2: The building of a modern primary production plant in collaboration with Philip
Morris
3: The completion of the first phase of Al Fakher Production plant in the UAE to match
the increasing demand of Alfakher Molasses
4: The securing of a complete supply of ITC manufactured brands for the local market
5: Strengthening of ITC brands in the Iranian market
The financial effect of extraordinary operations of the last financial year which
are not part of the company’s main activities.
The past year did not witness such activaties
The Financial Analysis of the company’s operations and results for the last
financial year
Prior to embarking on this analysis we should shed light on several important points
that should be taken into consideration for any financial analyst when comparing
results.
The financial records and their amendments were recorded within a unified system
and form. They include the records and transactions made by the mother company
ITC and its subsidiaries.
Subsidiary Companies
1- The Arab Cigarette Distribution Company
• Limited Liabilities Company
• Specialized in the distribution of cigarette and tobacco products in Aqaba Special
Economic zone
• Capital investment worth JD 30,000.00
• 100% ownership
2- Al Fakher Tobacco for Trading and Agencies
• Limited Liabilities Company
• Specialized in the distribution of flavored tobacco within the Jordanian market and
12
it has investments in its own subsidiary company
• Capital investment worth JD 30,000.00
• 100% ownership
3- Al Fakher Tobacco Trading in Ajman UAE
With a capital of 40 million UAE Dirham which equals JD7, 720,000. AlFakher Tobacco
Trading specializes in the trade and production of flavored tobacco in the UAE, GCC
region and the globe.
The comparative figures for 2006
The figures include numbers for the Ekbal for Printing and Packaging Company
which was then a partner company of ITC with ownership of 52.4% before it was sold
to an international company.
13
The (unified) company sales during the financial year of 2007 amounted do 52.148.233
Dinars, against the sales of 2006 were 51.102.637 Dinars with an increase of 1.045.596
Dinars without excluding Al-Eqbal press & enveloping Co. for 2006 which amounted
5.518.799 Dinars.
Local Sales
Export Sales
14
2,170,476
7,971,939
1,204,512
210,912
0
181,661
12,030,963
1,468,516
0
0
Net accounts receivable
Net inventory
Spare parts warehouse
Margin & expenses on letters of credit
Goods in transit
Other receivable
Total current assets
Available for sale securities
Investments in land
Investments in associated companies
0
28,273,493
Stork key money after amortization
Total assets
3,721,410
2,082,930
511,117
700,000
9,228,710
0
2,800,000
0
12,028,710
Accounts& notes payable
Other payables
Loans-current portion
Bonds-current portion
Total current liabilities
Bonds-long terms portion
bonds long term
End of service indemnities
Total liabilities
12,000,000
0
664,715
982,351
2,400,000
0
197,717
16,244,783
0
16,244,783
28,273,493
Capital
Stocks owned by subsidiary’s company
Statutory Reserve
Voluntary Reserve
Proposed dividends
Unrealized gain from securities
Retained earnings
Total
Net equity
Net shareholders equity
Liabilities& shareholders’ equity
Shareholders’ equity
2,213,253
Bank overdrafts
Current liabilities
Liabilities& share holds equity
31,566
15
24,897,460
15,813,161
0
15,813,161
1,808,591
0
0
1,129,558
875,012
0
12,000,000
9,084,299
0
2,100,000
0
6,984,299
700,000
154,141
1,910,001
3,036,617
1,183,530
24,897,460
0
0
74,876
New products& trademark expenses-net
13,701,451
0
0
1,318,757
9,845,686
297,567
93,062
29,520
1,437,091
6,604,431
915,943
297,881
17,191
1999
Goodwill
Fixed assets-net of accumulated
deprecation
14,699,138
47,383
Non-current assets
244,080
Cheques under collection
1998
Cash on hands& at banks
This Item Consists of :
Description
42,810,155
20,012,818
0
20,012,818
2,844,073
0
1,800,000
2,039,008
1,329,737
0
12,000,000
22,797,337
0
1,400,000
3,500,000
17,897,337
700,000
790,578
6,519,664
6,542,039
3,345,056
42,810,155
0
39,648
0
17,859,400
0
0
7,696,878
17,214,229
429,315
748,433
252,329
1,782,748
12,175,006
1,629,778
158,480
38,140
50,921,171
35,554,260
0
35,554,260
4,190,488
6,701,203
2,860,935
5,388,696
2,108,263
0
14,304,675
15,366,911
0
0
0
15,366,911
1,400,000
354,500
7,371,423
5,347,420
893,568
50,921,171
2,917
80,640
0
19,929,179
0
861,171
12,051,998
17,995,266
404,483
0
490,148
2,197,174
10,066,979
2,998,454
290,355
1,547,673
2001
Balance Sheet
30/11/2000
58,718,028
37,281,282
0
37,281,282
6,001,633
2,749,420
4,125,000
6,342,831
3,062,398
0
15,000,000
21,436,746
0
0
0
21,436,746
700,000
0
4,776,557
11,155,800
4,804,389
58,718,028
2,217
67,383
0
24,811,625
3,948,697
861,171
5,799,360
23,227,575
406,714
1,192,006
178,750
3,132,602
12,485,288
3,297,526
2,232,397
302,292
2002
52,647,049
38,156,627
0
38,156,627
6,002,309
1,998,323
4,500,000
6,968,214
3,687,781
0
15,000,000
14,490,422
0
0
5,000,000
9,490,422
0
0
3,534,443
5,955,979
0
52,647,049
1,517
59,859
0
22,563,965
4,882,010
622,232
4,260,262
20,257,204
514,225
1,235,496
9,641
3,442,219
13,763,697
598,501
312,532
38,893
2003
60,129,101
343,188,8
0
39,318,848
5,764,471
2,858,000
4,500,000
7,446,377
3,750,000
0
15,000,000
20,810,253
0
0
5,000,000
15,810,253
0
0
2,911,737
4,880,997
8,017,519
60,129,101
817
20,798
0
20,209,100
4,841,090
622,232
6,987,875
27,447,189
516,198
0
743,223
3,362,649
19,031,658
3,245,672
324,625
223,164
2004
63,507,184
44,089,278
0
44,089,278
8,181,342
7,491,931
0
7,806,191
4,109,814
0
16,500,000
19,417,906
0
0
0
19,417,906
5,000,000
0
3,224,171
3,091,289
8,102,446
63,507,184
117
0
0
18,746,817
4,847,624
622,232
11,571,815
27,718,579
351,293
222,675
0
3,433,542
18,740,605
4,178,468
240,396
551,600
2005
74,037,911
38,770,227
2,950,538
35,819,689
4,251,992
3,208,160
0
4,306,191
4,150,838
97,492
20,000,000
35,267,684
0
1,433,333
0
33,834,351
0
8,400,000
6,321,317
6,445,340
12,667,694
74,037,911
0
0
6,602,986
24,186,446
916,145
622,232
9,389,433
32,320,669
1,662,543
308,772
26,922
3,937,399
17,017,608
6,791,051
932,014
1,644,360
2006
74,105,605
39,348,475
0
39,348,475
8,872,112
1,482,785
0
4,306,191
4,687,387
0
20,000,000
34,757,130
538,316
5,625,000
0
28,593,814
0
7,626,036
5,900,760
6,724,202
8,342,816
74,105,605
0
0
6,602,986
28,110,738
856,474
281,682
3,138,834
35,114,891
1,913,974
37,023
7,112
3,267,318
16,769,428
10,794,240
780,737
1,545,059
2007
19,311,885
(14,400,595)
4,911,290
(560,414)
(694,392)
(99,613)
0
(1,354,419)
0
0
0
0
0
(711,151)
(242,326)
2,603,394)
0
0
2,603,394
(26,034)
(26,034)
(45,000)
0
0
0
2,506,326
612,069
0
0
0
0
3,118,395
260,339
260,339
2,400,000
197,717
3,118,395
Cost of goods sold
Gross profit
General& administrative expenses
Selling& distribution expenses
Amortization
Slow moving inventory
Period expenses
Profit from investing in associated companies
Profit from investing in subsidiary companies
Profit (loss) of sale of securities
Adjustment of company share on associated companies
Increase of shareholders equity for associated companies
Bank interest
Other income expenses
Net income before minority rights
Minority Rights
Provision for subsidiary’s co.
Profit after net minority rights and before tax provision
Provision for Jordanian universities
Provision for scientific research& vocational training
Board of directors remuneration
Provisions for education& training fund
Other provision
Income tax provision
Net income after tax& provision
Retained earnings-beginning of year
Capitalization from retained earning
Paid out dividends
Adjustment of profit on associated companies
Prior years adjustments
Retained earnings (loss)- ending balance to be appropriated as follow
Transfer to statutory reserve
Transfer to voluntary reserve
Proposed dividends to shareholders
Retained earnings-end of period
Total
1998
Net sales
This Description Consists of:
Description
16
2,166,095
1,808,591
0
147,207
210,297
2,166,095
0
0
(51,281)
0
197,717
2,019,659
0
0
0
(41,250)
(21,030)
(21,030)
2,102,969
0
0
2,102,969
(160,644)
(631,493)
0
0
0
0
0
(1,328,442)
0
(159,493)
(530,337)
(638,612)
4,223,548
(16,816,509)
21,040,057
1999
6,008,248
2,844,073
1,800,000
909,450
454,725
6,008,248
0
0
0
0
1,808,591
4,199,657
(256,647)
0
0
0
(45,472)
(45,472)
4,547,248
0
0
4,547,248
16,758
(680,679)
0
0
0
0
0
(1,614,229)
0
(17,119)
(914,899)
(682,211)
6,825,398
(20,686,770)
27,512,168
30/11/00
9,138,532
4,190,488
2,860,935
1,391,406
695,703
9,137,408
0
0
(58,437)
0
2,844,073
6,351,772
(410,000)
0
0
(55,000)
(69,570)
(69,570)
6,955,912
0
0
6,955,912
85,424
(579,740)
0
(1,124)
0
(1,124)
0
(3,858,461)
(131,988)
(39,967)
(2,606,716)
(1,079,790)
11,310,937
(32,694,168)
44,005,105
2001
Income Statement
12,034,903
7,126,633
3,000,000
954,135
954,135
12,034,903
0
0
(9,159)
(695,325)
4,190,488
8,548,899
(507,257)
(185,000)
(76,622)
(48,616)
(95,413)
(95,413)
9,557,220
0
0
9,557,220
346,871
(461,933)
0
0
2,178,427
0
448,607
(4,629,269)
(161,090)
(54,497)
(3,153,536)
(1,260,146)
11,674,517
(37,583,991)
49,258,508
2002
11,753,075
6,002,309
4,500,000
625,383
625,383
11,753,075
(2,455)
0
0
0
6,001,633
5,753,897
(273,804)
0
(51,778)
(55,000)
(62,538)
(62,538)
6,259,555
0
0
6,259,555
151,904
(537,542)
335,767
0
2,678,961
0
266,661
(4,058,278)
(127,631)
(73,234)
(2,909,037)
(948,376)
7,422,082
(34,302,174)
41,724,256
2003
10,804,853
5,764,4710
4,500,000
478,163
62,219
10,804,853
(113,377)
0
0
0
6,002,309
4,915,921
(299,940)
0
(49,584)
(55,000)
(54,038)
(54,038)
5,428,521
0
0
5,428,521
7,892
(541,232)
0
0
2,261,185
0
213,761
(3,928,255)
(169,019)
(94,554)
(2,523,292)
(1,141,390)
7,415,170
(34,388,018)
41,803,188
2004
8,900,970
8,181,342
0
359,814
359,814
8,900,970
(65,199)
0
0
0
5,764,471
3,201,698
(239,791)
0
(28,047)
(55,000)
(35,981)
(35,981)
3,596,498
(15,886)
0
3,612,384
125,552
(579,689)
0
0
2,403,795
0
0
(4,185,915)
(199,380)
(53,266)
(2,500,514)
(1,432,755)
5,848,641
(30,587,571)
36,436,212
2005
4,293,016
4,251,992
0
0
41,024
4,293,016
(26,780)
(114,604)
(4,125,000)
0
8,181,342
378,058
0
0
(1,976)
(22,000)
(4,102)
(4,102)
410,238
(128,211)
(112,783)
651,232
(37,734)
(1,083,900)
0
214,703
0
0
0
(7,139,082)
(735,489)
0
(4,044,847)
(2,358,746)
8,697,245
(42,405,392)
51,102,637
2006
9,408,661
8,872,112
0
0
536,549
9,408,661
(28,592)
(59,670)
0
0
4,251,992
5,187,747
0
0
(41)
(55,000)
(53,655)
(53,655)
5,350,098
(338,905)
0
5,689,003
91,202
(1,398,899)
0
0
4,361,732
0
0
(5,571,932)
(231,161)
0
(3,358,312)
(1,982,459)
8,206,900
(43,941,233)
52,148,233
2007
Profits distributed by the Company
Distribution year
2002
2003
2004
Profits distributed as stocks
0
0
1.500.000 3.500.000 0
Percentage of distributed stocks
0
0
10%
Profits distributed as funds
4.125.000 4.500.000 4.50.000 4.125.000 0
Percentage of distributed funds
28%
Total profits
4.125.000 4.500.000 6.000.000 7.625.000 0
0%
28%
30%
40%
46%
Profits percentage/Capital
30%
30%
2005
21%
2006
Total
5.000.000
0
17.250.000
25%
22.250.000
The net profits of the Company before allocations of taxes and subsidiary amounted
5.689.003 Dinars against 651.232 Dinars for the previous year. The profits of stock and
investment land was 4.654.742 Dinars; and the net profit of Al-Fakher Company for
Tobacco Trade and Agencies with its subsidiary amounted 2.804.836 Dinars; therefore,
there is an operation loss for both the mother company and subsidiary (Arab Company
for Tobacco Distribution) amounting 1.770.575 Dinars including the bank interests
amounting 1.398.899 Dinars mainly used to finance Al-Fakher Company purchase,
operation and development in Ajman in addition to the cost increase of exportation
sales especially to Iran whereas the Company began on the end of 2007 to double
its prices and increase them on the beginning of 2008 till they reached the limit of
which the previous losses are compensated.
Net Income Trend
17
The shareholder’s net rights amounted 39.348.475 Dinars against 35.819.689 Dinars
with an increase of 3.528.786 Dinars with percentage of approximately 10% which
represents the net of profits realized after allocations and changing the just value.
Shareholders Equity
The operating capital increased to reach 6.521.077 Dinars during the current year
after being negative 1.269.676 Dinars in 2006. This is an indication that the company
is strong and able to meet its commitments, and it is noticeable that stock exchange
has increased to 123% from 96% in 2006.
The gross profit against net sales was about 16%, at the same time the administration
and general expenses and selling and distribution expenses were reduced against
bank interest expenses which increased because of bank facilitations for the
Company’s expansion projects.
Net Sales VS Operational Expenses
18
Share Net Book Value VS Market Price
Some financial percentages of the Company
are as follows:
2007
2006
No. Financial Percentage
1
Net profit after allocations/sales
9.95%
0.73%
2
Revenue/investment percentage
7.00%
0.51%
3
Revenue/property rights
13.20%
1.06%
4
Property rights/assets
140.00%
160.00%
5
Administrative expenses/sales
3.80%
4.40%
6
Sales & distribution expenses
6.44%
7.92%
7
Banking/sales expenses
2.68%
1.82%
8
Basic stock share of profits
0.258 dinar/stock
0.012 dinar/stock
19
Future Plans for the Company
Stemming from our belief in the local market as the leading supporter of our strategic
growth, both locally and regionally, we are planning to perform the following:
1: To conduct market studies geared towards developing new product offerings
designed to respond to local market needs
2: To empower our marketing team and provide them with the skills needed to find
non-traditional new markets.
3: To Complete the second phase of the UAE Fakher factory
4: To strengthen the positioning of the existing Alfakher Tobacco brands and to create
new markets.
5: To continue with our strategy of developing Human resources with regards to
skills, know-how and values.
6: To strengthen the companies legal position and compliance with laws and
regulations.
The amount of audit fees of the Company and subsidiaries, and the amount of fees
for other services received by and/or due to the auditor.
Fees of auditors of the Company and subsidiaries
Statement
Amount in dinar
Tobacco International Company
7.500
Arab Company for Tobacco Distribution
1.250
Al-Fakher Company for Tobacco Trade & Agencies
1.250
Total
10.000
20
National ID
9721000980
9732038721
12000346160 Jordanian
2000737776
2001097308
1105698671
Mr. Walid Tawfiq Fakhouri
Ms. Shatha Abd Al Hameed Al Dabas
Mariam Fakhouri
Rakan Walid Fakhouri
Aisha Walid Fakhouri
Bank of Jordan
9501006210
9721050578
Mr. Samer Tawfiq Fakhouri
H.E Adel Ahmed Ershed
9462000302
Ms. Nemat Theib Kamel Al-Ajam
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
9351011862
Jordanian
ITC
ITC
Investment
Jet
Readymade Concrete Imports
Jordan Bank International
Trust International for Transportation
Ekbal for Printing and Packaging
Consult Group for Investment
Bank of Jordan
Bank of Jordan
Bank of Jordan
Bank of Jordan
ITC
Bank of Jordan
Al-Zahra for Investment
Jet Transportation
ITC
ITC Bank of Jordan
Nationality Name of the Issued Company
Mr. Tawfiq Shaker Fakhouri
Board Members and their Representatives
Name
Board Representative of Bank of Jordan
Member of the Board
Share holder in ITC
Member of the Board
Represented by Mr.Shaker Fakhouri
Share holder of more than 50% of ITC Stocks
Share holder of more than 50% of the stocks
Share holder in ITC
Share holder in ITC
Share holder in ITC
Share holder in ITC
Member of the Board
Board
Rep. of ITC
Share holder in ITC
Vice Chairman
Board
Rep. of ITC
General Manager
Vice Chairman
Board Rep. of ITC
Member of the board
Board Chairman
Shareholder in ITC
Board Chairman
Share holder in ITC
25/3/2007
25/3/2007
1995
2001
2003
9/3/2005
Title of Persons in Issued/ Shareholdings Company Date of
Membership
Represented by H.E Adel Ahmed Ershed
Represented bu Walid Fakhouri
Represented by Mohammed Anwar Hamdan
The daughter of Walid Tawfiq Fakhouri
The son of Walid Tawfiq Fakhouri
The daughter of Walid Tawfiq Fakhouri
Ms. Walid Tawfiq Fakhouri
The Son of Tawfiq Fakhouri
The Son of Tawfiq Fakhouri
Mrs. Tawfiq Fakhouri
Type of relation or representation
Shares owned by board members and the firm’s management
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
-
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
-
1,000
1,000
1,000
1,000
1,000
1,000
1,000
-
2,083
2,848,425
1,640,202
87,509
1,565,000
310,000
292,187
-
2,083
7,704
16,706
20
5,000
5,000
5,000
-
6,666
5,000
18,750
605,413
22,777,372
356,250
3,125
-
2,422
2,848,425
1,080,000
87,809
1,565,000
310,000
292,187
8,084,898
2,422
8,958
20,60
203
5,000
5,813
5,000
-
6,666
5,000
18,750
3,255,948
25,136,852
356,260
3,125
Type of Value of Number of securities as of Number of securities as of
securities securities Dec 31st 2007
Dec 31st 2007
21
22
1600866537
9401006458
1612880043
9481005364
1901304522
Mr. Hassan Mohammed Hanafieh
Al Yamama for General Investments
Mr. Haitham Mohammed Ali Quteishat
Jordanian
Jordanian
Jordanian
Jordanian
Jordanian
Mr. Abd Al Rahman Talal Abd Al Rahman 9641028819
Daghmash
Arab Gulf Corporation
Jordanian
1109416944
Al Lulu’a Investment
ITC
Bank of Jordan
Iqbal for Printing and Packaging
ITC
Bank of Jordan
ITC
Bank of Jordan
ITC
ITC
Bank of Jordan
ITC
United Arab Investors
Taameer Jordan Holdings
Al Waha Insurance Company
Al Aman Corporation for Financial
Securities
ITC
Bank of Jordan
Nationality Name of the Issued Company
National ID
Name
Member of the Board
Board Representative at ITC
Shareholders in ITC
Shareholders in ITC
Board Representative of Al Yamama for
General Investments
Board Representative at ITC Board
Representative at ITC
Board Representative of the Gulf
Investments and Transportation
Member of the Board
Board Representative at ITC
Board Representative of Gulf Investments
and Transportation
Member of the Board
Board Representative of ITC
Al Lulua’ Representative
Member of the Board
Member of the Board
Member of the Board
Member of the Board
9/3/2005
9/3/2005
9/3/2005
9/3/2005
9/3/2005
13/3/2007
Member of the Board
9/3/2005
Member of the board
Represented by Mr. Shaker Fakhouri
Stocks
Stocks
Share holder of more than 50% of the stocks
Title of Persons in Issued/ Shareholdings Company Date of
Membership
Represented by Yehia Qadamani
Represented by Nabih Al Nabir
Represented by Haitham Mohammed Ali
Quteishat
Represented by Mr. Hassan Mohammed Hassan
Hanafieh
Represented by Yehya Al Qadamani
Represented by Adel Abu Dhargham
Represented by Haitham Mohammed Ali
Quteishat
Represented by Mr. Abd Al Rahman Daghmash
Represented by Mazen Al Bashir
Represented by Ibrahim Jua’ba
Represented by Awad Al Tal
Type of relation or representation
Shares owned by board members and the firm’s management
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
Stock
1,000
1,000
1,000
1,000
1,000
1,000
1,000
-
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,876,215
11,038,176
5,000
-
66,625
-
6,666
13,096
-
6,666
26,352
5,000
5,000
393,636
3,877,485
1,000,000
26,706
2,000,000
6,666
103,731
5,000
5,000
1,932,915
15,243,367
5,000
22
21,450
77,425
5,000
-
6,666
15,277
22,500
6,666
30,641
5,000
5,000
378,636
3,942,485
50,000
2,601
2,000,000
6,666
119,454
5,000
5,000
Type of Value of Number of securities as of Number of securities as of
securities securities Dec 31st 2007
Dec 31st 2007
9491000368 Jordanian ITC
Representative of Farah for Electronic Supplies
Trust International for Transportation Shareholder
9552000548 Jordanian Bank of Jordan
Bank of Jordan
1176667880 Lebanese
Mr. Yousif Mohammed Omar Omar
Ms. Samira Yousif Omar
Mr. Alaa Yousif Omar
Mr. Omar Yousif Omar
Mr. Ibrahim Rashid Abd Al Munim Al Jaba
Ms. Zinat Mohammed Jamil Amin
Mr. Adel Ramez Mulhim Abu Dhergham
United Arab Investors
Ms. Martha Jamil Awad Hourani
Ms. Najat Ali Ahmed Al Baw
Mr. Issa Mahmoud Mohammed Issa
Ms. Sirin Said Ghaleb Hasan
Mr. Taleb Massoud Mohammed Barqawi
Mr. Ibrahim Issa Rashid Theib
Mr. Mohammed Kalil Hussein Al Shueibat
Administrative Manager
23
IT Manager
Financial Manager
HR Manager
Commercial Manager
ITC Shareholder
Treasurer and Office Manager of the CEO
Exporting Manager
Sales and Marketing Manager
Factory Manager
Mr. Mahmoud Ali Mahmoud Al Thabteh
Al Zahra Representative
Member of the Board/ General Manager
Member of the Board
ITC Shareholder
Shareholder
ITC Shareholder
Member of the Board
Al Lulua’ Representative
ITC Shareholder
ITC Shareholder
ITC Shareholder
Member of the board
ITC Shareholder
ITC Shareholder
Mr. Samer Mohammed Mahmoud Al Haj Masoud 9661021658 Jordanian ITC
The Higher Management
Farah for Electronic Supplies
ITC
Ms. Amal Amin Al Turk
01/06/2006
01/12/2005
05/09/2005
09/05/2004
20/04/2001
06/02/1999
01/06/1994
11/12/1993
14/02/1993
07/10/2007
2001
03/03/2007
25/03/2007
07/11/2007
09/03/2005
09/03/2005
27/04/2003
Represented by Adel Ramez Mulhim Abu Dhergham
Ms. Adel Ramiz Mulhim Abu Dhergham
The Daughter of Mr. Yousif Mohammed Omar
The Son of Mr. Yousif Mohammed Omar
Ms. Yousif Mohammed Omar
Represented by Mr. Yousif Mohammed Omar Omar
Ms. Yehia Zakaria Mohammed Qudmani
Date of Membership Type of Representation
ITC Representative
09/03/2005
Gulf Investments and Transportation Representative
Title of Persons in Issued Company
Bank of Jordan
Mr. Yehia Zakaria Mohammed Qudmani
Nationality Name of Issue Company
National ID
Name
1- Privileges and Bonuses Paid to Members of the Board of Directors and Senior Management
Board Chairman and Board Members
Board of Directors
Position
Auditing
Transportation
Remuneration Allowances
Bonuses& Net Incentives Remarks
Benefits
Mr. Tawfiq Fakhouri
Board
Chairman
0
12,000
2,000
14,000
Mr. Samer Fakhouri
Vice Chairman
0
12,000
2,000
14,000
Mr. Walid Fakhouri
Member
333
12,000
2,000
14,333
Mr. Yehia Qamani
Member
0
12,000
2,000
14,000
Mr. Shaker Fakhouri
Member
0
1,464
2,000
3,464
Mr. Ibrahim Al Ju’ba
Member
0
12,000
2,000
14,000
Mr. Amer Al Bashir
Member
0
0
2,000
2,000
Resigned on 31/12/2006
Mr. Muhyi Al Din Al Husainy
Member
167
3,000
2,000
5,167
Mr. Yusif Mahammed Omar
Member
2,000
12,000
2,000
16,000
Hasan Mohammed Hanafieh
member
0
12,000
2,000
14,000
Mr. Haitham Qutaishat
Member
0
12,000
2,000
16,000
Mr. Talal Dagmash
Member
1,428
9,000
0
10,428
Hired on 13/3/2007
Mr, Bassam Adib
Member
0
7,000
0
7,000
Hired on 3/3/2007 and resigned on 7/10/2007
Mr. Adel Ershed
Member
0
9,000
0
9,000
Mr. Adel Abu Dhergam
Member
0
2,806
10,000
12,806
Hired on 7/10/2007
5,928
128,270
32,000
Total
Total
166,198
Note that Mr. Tawfiq Fakhouri, Mr. Samer Fakhouri and Mr. Ibrahim Al Ju’ba’ are provided with cars from the company.
2- Senior Management
Name
Position
Amount
Travel Expenses Net Incentives
Mr. Samer Fakhouri
General Manager
104,380
14,686
119,066
Mr. Samer Masoud
Factory Manager
41,795
5,751
47,546
Mr. Taleb Barqawi
Exporting Manager
34,502
14,419
48,921
Mr. Mohammed Shabiat
Financial Manager
48,758
0
48,758
Mr. Ibrahim Issa
Sales Manager
44,777
0
44,777
Ms. Sirin Hasan
IT Manager
32,592
0
32,592
Ms. Martha Al Hourani
Trade Manager
33,923
0
33,923
Ms. Najat Al Baw
HR Investor
32,003
0
32,003
Mr. Mahmoud Al Thabtah
Administrative Manager
29,225
0
29,225
Mr. Issa Mahmoud
Office Manager of the
Board of Directors
10,143
0
10,143
412,098
34,856
Total
Total
446,954
Note that Mr. Taleb Barqawi and Mr. Ibrahim Issa are provided with cars from the company.
Donations Made by ITC and Its Partner Companies During 2007
Entity
Amount of the Donation (JD)
Educational donations made for schools and university students
13,537
Donations made to the local community
7,372
Donations made for the benefit of charity organizations
19,592
Donations to treat patients
3,056
Al Fakher Tobacco for Trade and Agencies donations
6,880
Total
50,437
24
Contracts, Projects and Alliances Formed by the Firm:
ITC has no alliances or contracts made with any member of the Board of Directors,
his or her relatives or partner companies. Alliances are only formed with the Arab
Company for Distribution whereby this company sells the former party’s products
offered at the ASEZA in Aqaba. Alliances are also formed with Al Fakher, which
distributes tobacco and flavored tobacco products throughout the Kingdom.
The Company contribution to environment protection:
The Company established a waste water purification station with international
specifications to process the water and reuse it for trees irrigation.
The Company damages the unusable tobacco weekly in the places specified by the
Government.
The Company isolates the burned oils from drainages, and accumulates the same in
specific places; and then uses them in other fields.
Upon building the new factory, the Company installed filters for preventing tobacco
smell or dust from spreading.
The Company contribution to national society service:
The Company provides in kind and material support to various institutions,
commissions and departments of the national society in addition to municipalities,
charities, social associations, mosques, alms and poor families. It also made charitable
programs aiming at fulfilling the social responsibility through a set of good contacts
and relations established by the Company through the Public Relations Department
with its local community in order to provide the area population with social
welfare.
Through the Public Relations Department, the Company established a contact
system with its local community to strongly and clearly protrude its positive image,
and to show its effective participation in the national society development by social
responsibility programs executed by the Company.
The Company continuous implementing the International Tobacco Company Grants
Fund in order to develop national human resources in cooperation with Ministry of
Higher Education, whereas 12 students, one of each Governorate, joined their fellow
students at the cost of the Program; as a result, the beneficiaries from the Program are
now 24 students, two of each Governorate of the Kingdom, to provide the national
economy with qualified human resources. This Program is part of the Company’s
concern for Jordanian talented and educated youth; the total amount spent for
serving the national society during 2007 was 50.437 dinars, and since foundation
539.611 dinars.
Finally,
It is the pleasure of the Tobacco International Company represented by the Chairman
and Members of Board of Directors, the General Manager and all its workers to thank
King Abdullah the II Bin Al-Hussein for his wise administration, percipient vision and
appropriate directions which provide an economic and social environment that
enables Jordan to occupy an honorable position in the international economy. We
also thank the Government with all its relevant ministries and institutions, and thank
the International Tobacco Company’s shareholders and clients for their precious trust
and continual support of the Company’s progress.
25
At last, for and on behalf of my partners the Members of Board of Directors, we
thank the General Manager, Executive Management and the Tobacco International
Company personnel for their devotion for serving the Company purposes in addition
to their loyalty and professional teamwork performance which made the Company
reach this advanced position.
Declarations:
(1) The Company Board of Directors declares that there are no core effects on the
Company’s continuity during the next financial year.
(2) The Company Board of Directors declares its responsibility for preparing the financial
statements and providing the Company with an effective monitoring system.
(3) With an effective control system. We, hereunder signed, declare the authentication,
accuracy and completion of the information data stated in the annual statement.
26
Auditors Report
27
Auditors Report
28
Consolidated Financial Statements
Consolidated Balance Sheet as of December 31, 2007
Exhibit A
For the Year Ending on
December 31st
2007
(JD)
2006
(JD)
Cash on hand and in banks
1,545,059
1,644,360
78,737
932,014
Assets
Note
Accounts Receivable - Net
4
10,794,240
6,791,051
Inventory - Net
5,a3
16,769,428
17,017,608
Spare part inventory -net
6,a3
3,267,318
3,937,399
Goods in transit
37,023
308,772
Margins and expenses on letters of credit
7,112
26,922
1,913,974
1,662,543
35,114,891
32,320,669
Other receivables
7
Total current assets
Available for sale securities
8,b3
3,138,834
9,389,433
Investment in associate companies
9,c3
856,474
916,145
Investment in land
10,d3
281,682
622,232
fixed assets net of accumulated depreciation
11,e3
20,491,686
24,016,460
6,205,670
157,736
1,413,382
12,250
6,602,986
6,602,986
74,105,605
74,037,911
Equipment & machinery under installation
Constructions process
Goodwill
F3
Total assets
Liabilities and share holders equities
Current liabilities
Bank overdrafts
12
8,342,816
12,667,694
Short term loans
13
7,626,036
8,400,000
Accounts payable and notes payables
14
6,724,202
6,445,340
Other payables
15
5,900,760
6,077,311
28,593,814
33,590,345
Total Current Liabilities
Long term loans
13
5,625,000
1,433,333
End of service indemnities
E13
538,316
244,006
Capital
20,000,000
20,000,000
Shares owned by subsidiary companies
0
(97,492)
Statutory reserve
4,687,387
4,150,838
Voluntary reserves
4,306,191
4,306,191
Accumulated changes in fair value
1,482,785
3,208,160
Retained earnings at end of year
8,872,112
4,251,992
Total
39,348,475
35,819,689
Minority interest
0
2,950,538
Total shareholder equities
39,348,475
38,770,227
Total Liabilities and Shareholders’ Equity
74,105,605
74,037,911
Shareholder equities
The accompanying notes form an integral part of this statement.
29
Consolidated Statement of income For the Year Ended December 31st 2007 & December 31st 2006
Exhibit B
For the Year Ending on
December 31st
2007
(JD)
Note
2006
(JD)
Net sales
F3
52,148,233
51,102,637
Cost of sold goods
16
(43,941,333)
(42,405,392)
8,206,900
8,697,245
gross profit
Administrative and general expenses
17
(1,982,459)
(2,239,779)
Sales and distribution expenses
18
(3,358,312)
(4,044,847)
Interest on debentures
0
(154,384)
Bank interest
(1,398,899)
(929,516)
Storage expenses
0
(21,443)
Provision for Obsolete inventory
(227,431)
(735,489)
Provision for Doubtful debts
(3,730)
(91,294)
Damaged goods
0
(27,673)
Adjustment in investments profits for associated companies
0
214,703
Profits from securities sales
4,361,732
0
Profits from land sale
293,010
0
(201,808)
(16,291)
Net income before minority and provisions
5,689,003
651,232
Minority interest
0
(112,783)
Provision for subsidiary companies
(338,905)
(128,211)
Income after minority and before provisions
5,350,098
410,238
Jordanian Universities fees provision
(53,655)
(4,102)
Provision for scientific research and vocational training
(53,655)
(4,102)
Board of directors remuneration
(55,000)
(22,000)
Provision of training and educational fund
(41)
(1,976)
Net income after provisions
5,187,747
378,058
Retained profit at year beginning
4,251,992
8,181,342
Paid out dividents
0
(4,125,000)
Adjustments made to the profit earning records of associate companies
(59,670)
(114,604)
Expenditures / earnings from prior years
28,592
(26,780)
Total retained profit and appropriation
9,408,661
4,293,016
Transfer to statutory Reserve
536,549
41,024
Retained earnings at the end of the financial year (figure C)
8,872,112
4,251,992
Total
9,408,661
4,293,016
JD/Share
JD/Share
0,258
0,012
JD/Share
JD/Share
20,000,000
20,000,000
Other expenses
Earning per share
Number of shares weighted average
19
30
31
-
Transfer to Voluntary reserves
-
-
-
-
20,000,000
Minority interests
Stocks owned by subsidiary companies
Prior years expenses
Amendments on associate companies profits
Balance as of December 31/12/2007 (chart a)
4,687,387
-
-
536,549
-
-
-
-
4,306,191
-
-
-
-
-
-
-
1,482,785
-
-
-
-
-
(1,725,375)
-
0
-
-
-
(2,950,538)
-
-
0
-
-
-
97,492
-
-
(97,492)
8,872,112
(59,670)
28,592
(536,549)
-
-
-
5,187,747
4,251,992
-
-
2,950,538
-
-
3,208,160
-
Change in Fair Value
4,306,191
-
Income after provisions
4,150,838
(3,500,000)
20,000,000
-
3,500,000
Balance as 31/12/2006 (chart a)
-
Capitalization from retained earnings
-
(4,125,000)
-
(114,604)
-
-
(26,780)
-
(41,024)
-
378,058
8,181,342
JD
-
Exhibit C
39,348,475
(59,670)
28,592
-
97,492
(2,950,538)
(1,725,375)
5,187,747
38,770,227
-
(4,125,000)
(114,604)
(26,780)
(97,492)
2,950,538
-
-
(4,283,771)
378,058
44,089,278
JD
Retained earning
Total
at the end year
Amendments on associate companies profits
-
2,950,538
-
-
-
-
-
JD
-
-
-
-
(4,283,771)
-
JD
(97,492)
-
-
-
-
-
7,491,931
JD
Accumulated
Shares Owned
Changes in Fair Minority Interests
by Subsidiary
Value
prior years expenses
-
-
41,024
-
-
7,806,191
JD
Voluntary
Reserve
Stocks owned by subsidiary companies
-
-
Change in Fair Value
Minority Interest
-
Profit after provisions
4,109,814
JD
16,500,000
JD
Balances as 31/12/2005
Description
Statuary
Reserve
Capital
Consolidated Statement of Change in shareholders equity for the year ended December 31, 2007
Consolidated Statement of Cash Flows
Exhibit D
For the Year Ended in
December 31st 2007
2007
(JD)
2006
(JD)
Cash flows From Operating Activities
Net income after provisions and tax
5,187,747
378,058
Prior years expenses
28,592
(26,780)
Amendments on profit from investment in associated company
(59,670)
(114,604)
Slow moving inventory provision
227,431
735,489
Doubtful debts provision
3,730
91,294
Depreciation &Amortization
3,041,715
3,557,377
Operating profit before changes in working capital
8,429,545
4,620,834
Accounts receivable
(4,006,919)
(2,703,877)
151,277
(691,618)
Inventory
68,180
1,124,938
Spare parts inventory
622,650
(641,287)
Goods in transit
271,749
(86,097)
Margins& expenses on letters of credit
19,810
(26,922)
Other receivables
(251,431)
(1,311,250)
Accounts& notes payable
278,862
3,354,051
Other payables
117,759
3,097,146
Net cash provided from operating activities
5,701,482
6,735,918
Changes in fixed assets
483,059
(8,996,889)
Goodwill
-
(6,602,986)
Changes on land investments
340,550
-
Changes on constructions under process
(1,401,132)
-
Changes on machines under installation
(6,047,934)
-
Changes in investment in associated companies
59,671
3,931,479
Changes in investments available for sale
4,525,224
(2,101,389)
Shares owned by subsidiary co.
97,492
(97,492)
Minority interest
(2,950,538)
2,950,538
Net cash (used in) investing activities
(4,893,608)
(10,916,739)
Bank overdrafts
(4,324,878)
4,565,248
Loans
3,417,703
9,833,333
-
(4,125,000)
Debenture
-
(5,000,000)
Net cash provided from (used in) financing activities
(907,175)
5,273,581
Net increase (decrease) in cash
(99,301)
1,092,760
Cash on hand and at banks at the beginning of the year (exhibit a)
1,644,360
551,600
Cash on hand and at banks at the end of the year (exhibit a)
1,545,059
1,644,360
-
3,500,000
(Increase) decrease in current assets
Increase (decrease) in current liabilities
Cash flow from investing activities
Cash flow from financing activities
Non-Cash flow items
Transfer to capital from retained earnings and statutory reserve
32
1 Company’s Registration and Objectives
International Tobacco & Cigarettes Co. Ltd. (P.S.C) was established by virtue of the
temporary Companies Law No (1) of 1989 and was registered in the public shareholding
companies’ record at the Ministry of Industry and Trade in the Hashemite Kingdom
of Jordan under number (218) on 1/6/1992. The company’s operational purpose is to
manufacture tobacco and cigarettes of international and locally developed brands
and trademarks.
The company has established a full-owned company called (Arab Cigarettes
Distribution Co. Ltd.) with a capital of JD 30,000; the company has also established a
fully-owned company called Al Fakher Tobacco for Trading & Agencies Co. Ltd. with a
capital of 30,000.
2 Basis of Consolidation of the Financial Statements
The unified financial statements include assets, dues, sales and expenses of the
following subsidiaries.
Subsidiary Companies
Company Name
Company Status
Capital (JD)
Investment %
The Mother
Company’s share of
sub. profit
Invistment
Arab Cigarettes
Distribution Co. Ltd.
Limited liabilities
30,000
100%
1,811,207
4,568,391
Al Fakher Tobacco
for Trading &
Agencies Co. Ltd.
Limited liabilities
30,000
100%
2,804,833
4,993,470
There is no over draft value for it is a limited liabilities company with no closing price.
A summary of the transactions, profits, losses and existing assets for the subsidiary
companies.
Company name
Assets (JD)
............... (JD)
Revenues (JD)
Profits (JD)
Arab Cigarettes
Distribution Co. Ltd.
4,670,373
101,981
2,546,702
1,811,207
Al Fakher Tobacco for
Trading & Agencies Co.
Ltd.
1,983,433
14,840,863
14,064,145
2,804,833
3 Significant Accounting Policies
a. Inventory
1. Raw Materials and Spare Parts
Raw materials and spare parts inventory are stated at cost. Cost is determined by
using the moving average method.
2. Finished Goods
Finished goods inventory are stated at the lower cost or net realizable value. Cost is
determined by using the moving average method.
b. Available for sale securities
33
Available for sale securities are stated at fair market value. The change in the securities
fair market value from the book value is recorded as a component of shareholders’
equity.
c. Investments in Associate Companies
Investments over 20% in associated companies are stated as net equity.
d. Land Investments
Investments in land are stated at cost and they appeared at
attachments.
fair value on
e. Fixed Assets and Depreciation
Fixed assets are recorded at cost and depreciation is estimated by using the straightline method at annual depreciation rates between 2-50 percent.
f. Sales
Sales represent the value of invoices issued against goods delivered to the company’s
customers during the current year.
g. Foreign currency conversion
Foreign currency conversions are converted into Jordanian Dinars at exchange
rates prevailing at the date of transaction. Assets and liabilities expressed in foreign
currencies are converted into Jordanian Dinars at exchange rates prevailing at the
balance sheet date. Exchange differences arising from these translations are included
in the income statement of the year.
h. End of service remuneration
End of service remuneration is taken from the company’s financial internal system.
4 Accounts Receivable - Net
For the year ending
December 31, 2007
This
consists
of: of:
Thisitem
item
consists
2007
(JD)
2006
(JD)
Advance payments to farmers for previous years
101,230
101,230
Account receivables
4,109,457
3,558,698
Other receivables
6,763,692
3,308,620
Total
10,974,379
6,968,548
Less: provisions for doubtful debts
(180,139)
(177,497)
Net
10,794,204
6,791,051
34
5 Inventory- Net
This
consists
of:
Thisitem
Item
Consists
of:
Inventory& materials under process
Promotional materials
Manufactured tobacco
Raw materials
Finished goods at end of period – note 16
Consumables warehouse
Minor materials
Fuel tanks
Total
Less: Provision for slow moving items
Net
For the Year Ended
December 31st
2007
2006
(JD)
(JD)
973,099
899,634
538,281
429,110
834,698
1,203,594
12,470,141
12,655,123
2,317,152
1,656,742
8,325
9,528
0
477,140
27,362
24,750
17,169,058
17,355,621
(399,630)
(338,013)
16,769,428
17,017,608
6 Spare parts inventory net
For the year ending
December 31, 2007
2007
(JD)
2006
(JD)
Spare parts inventory
3,551,065
4,172,884
Spare parts- Vehicles
11,114
11,945
Total
3,562,179
4,184,829
Less: proving for slow moving items
(294,861)
(247,430)
Net
3,267,318
3,937,399
This
consists
of: of:
Thisitem
item
consists
35
7 Other Receivables
For the year ending
December 31, 2007
2007
(JD)
This item consists of:
2006
(JD)
Advanced payments on fixed assets purchases
0
396,140
Raw material warehouse deposits
324
324
Customs deposits
1,052
4,523
Warrantees deposits
0
174,018
Prepaid expenses
809,420
743,372
Refundable custom deposits
73,799
48,766
Others
80,771
113,671
Employees advances
143,771
122,762
Withholding sales tax
53,993
37,269
Prepaid installments
0
10,272
Prepaid on works under construction
750,844
11,426
Total
1,913,974
1,662,543
8 Avilable for Sale securities
2007
(JD)
No. of Shares
2006
(JD)
Available for Sale Securities
Bank of Jordan
-
0
1,255,619
Danish Food Industries Co.
20,734
20,734
20,734
Jordan Express Tourist Transportation
27,650
31,532
31,532
National Industries Co.
3,000
1,335
1,335
Al Shamal International Ind. Co./ Foreign
424,578
301,026
301,026
5,000
4,556
0
Arab Islamic Bank
1,946,515
1,296,866
4,560,602
Total cost
1,656,049
6,170,848
Amendments to the amounts of fair value
1,482,785
3,218,585
Fair Market Value Adjustment
3,138,834
9,389,433
36
9
Investment in Associated Companies
For the year ended in
December 31st 2007
Share of Owners
2007
(JD)
Trust for International Transportation Co.-P.S.C
total
40,647%
2006
(JD)
856,474
916,145
856,474
916,145
The financial statement as of 31 December 2006 was approved in evaluating the
investments in the associated companies above due to the availability of audited
financial statement for those companies at the date of preparation of financial
statements.
10
Lands Investments
For the Year Ending
December 31st 2007
2007
(JD)
2006
(JD)
Investments in Lands
281,682
622,232
Total
281,682
622,232
The fair value in Investments in lands at the date of preparing the financial
statements amounted to JD 900,000.
37
4,291,775
-
5,130,524
20,124,384
1,396,663
1,820,212
550,501
214,277
200,914
19,551
22,381
222,335
48,668
1,517
2,363
12,529
-
34,058,594
Apartments
Factory& management buildings
Machinery& equipment
Vehicles
Plants support equipment
Furniture& fixtures
Tools& equipments
Forklifts& equipments
Tobacco& cigarettes supplies
Containers
Cafeteria equipment
Water well
Drip Irrigation units
Other equipments
Aqaba branch assets
Fixed assets subsidiary co. - Al-Eqbal
Total
JD
Cost at
the year
beginning
Lands
Description
11 Fixed Assets, Net of Accumulated Depreciation
3,948,102
-
1,320
8,309
-
-
-
-
-
90,730
25,445
132,650
318,587
250,282
1,772,345
13,186
1,335,248
-
JD
Additions for
the year
631,000
-
-
-
-
-
-
-
-
-
-
142
2,061
62,383
566,414
-
-
-
JD
Disposals
During
the year
37,375,696
-
13,849
10,672
1,517
48,668
222,335
22,381
19,551
291,644
239,722
683,009
2,136,738
1,584,562
21,330,315
5,143,710
1,335,248
4,291,775
JD
Cost at the
year end
2007
-
20
20
20
15
20
20
50-33
15
20
10
20
25-20
10
4
-
-
JD
16,884,010
-
8,533
3,669
1,001
48,668
71,217
22,376
19,544
150,377
153,106
306,867
1,604,658
931,348
12,184,048
1,378,568
-
-
JD
Depreciation Accumulated
rate
Depreciation
20,491,686
-
5,316
6,973
516
0
151,118
5
7
141,267
86,616
376,142
532,080
653,214
9,146,267
3,765,142
1,335,248
4,291,775
JD
Net book
value
24,016,460
4,174,126
5,478
2,130
671
4,259
164,442
5
4
61,170
96,899
324,925
518,954
727,883
9,658,883
3,984,856
-
4,291,775
JD
Net book
value
2006
38
12 Banks Overdrafts
The company obtained overdraft credit facilities from several local banks with a total
value of JD 14,715,964 and a ceiling of bank guarantees valued at JD 5,543,422, which
are secured on the company’s guarantee.
13 Loans
For the Year Ended 31st December 2007
2007
a.
This
consists
of:
a. This
itemitem
consists
of:
Bank of Jordan loan (note13b)
Standard Charted Bank loan (note 13c)
City Bank loan/ US$ (note 13d)
City Bank loan/ JD (note 13e)
Bank of Jordan loan- subsidiary company Ekbal for printing and packaging
Societe General Bank loan- subsidiary company Ekbal for printing and packaging
Total
Short term (JD)
2006
Long term (JD)
Total (JD)
Total (JD)
1,875,000
5,625,000
7,500,000
5,000,000
2,000,000
0
2,000,000
0
709,000
0
709,000
0
3,042,036
0
3,042,036
3,000,000
0
0
0
900,000
0
0
0
933,333
7,626,036
5,625,000
13,251,036
9,833,333
b- The company obtained a loan from the Bank of Jordan that amounts to JD 7,500,000
with an interest rate of 7,875%, the loan is guaranteed by the company guarantee.
c- The company obtained a loan on 30/9/2007, from Standard Charted Bank that
amounted to JD 2,000,000 with interest price 7,5%, the loan will be paid in 6 months
installments. The loan was renewed and guaranteed by the company.
d- The company has a loan from City Bank that amounts to USD 1,000,000, the loan is
guaranteed by the company.
e- The company has a loan from City Bank that amounts to JD 4,000,000, the loan is
guaranteed by the company.
14 Accounts& Notes Payable
For the Year Ending
December 31st 2007
2007
(JD)
2006
(JD)
Accounts payable
6,600,390
5,276,901
Notes payable
123,812
1,168,439
Total
6,724,202
6,445,340
39
15
Other Payables
For the Year Ended
31st December 2007
2007
(JD)
This
consistsof:
of:
This item
item consists
2006
(JD)
Board of Directors remuneration
55,000
58,000
Provisions for income tax
451,739
330,601
Withholding sales tax
3,694,527
4,917,775
Jordan universities fees provisions
57,757
7,151
Provisions for scientific research& Prof. training
53,398
16,619
Accrued expenses
10,248
69,997
Due to income& social security
44,108
46,524
Other payables
34,609
23,886
Transactions received for product export account
1,283,743
-
Due to shareholders
56,637
202,399
Youth funds
108,645
154,481
Educational& Professional training funds
27,770
35,840
Remuneration reserve
21,756
63,240
Employees receivables
823
798
Due to shareholders
0
150,000
Total
5,900,760
6,077,311
16
Cost of Goods Sold
For the Year Ended
31st December 2007
This
consistsof:
of:
This item
item consists
Raw materials used in production
Manufacturing costs
Depreciation
Salaries& wages& related costs
Maintenance& Spare parts
Other manufacturing expenses
Electricity, water and fuel
Total manufacturing costs
Total production cost
Finished products at the beginning of the year
Promotional material
Finished goods at the end of the year – note5
Cost of goods sold
2007
(JD)
2006
(JD)
36,222,062
31,159,490
2,653,931
3,254,886
2,948,332
2,996,834
847,357
1,329,540
1,690,690
1,019,774
504,370
542,920
8,644,680
9,113,954
44,866,742
40,273,444
1,520,103
4,001,083
(128,360)
(212,393)
(2,317,152)
(1,656,742)
43,941,333
42,405,392
40
17
General and Administrative Expenses
For the Year Ended
31st December
2007
(JD)
2006
(JD)
Salaries& wages
741,227
854,132
Fees& subscriptions
86,366
148,332
Depreciation
185,739
212,408
Stationary& printing
27,228
53,455
Advertising expenses
41,027
45,894
Professional fees
60,381
90,105
Board of directors transportation
128,271
175,400
Company’s share in social security
43,501
58,959
Assets insurance
23,875
28,358
Fuel
14,251
16,511
Staff in-kind privilege
12,090
10,061
Postage, telephone& fax
55,392
44,894
Hospitality
25,059
21,127
Water, electricity& heating
12,025
19,701
Donations& supports
50,437
76,659
Miscellaneous expenses
31,832
36,834
Transportation
568
1,869
Medical expenses& health insurance
19,634
24,498
Studies expenses
1,986
4,579
Vehicles expenses
28,757
19,050
Building taxes
16,827
6,507
Maintenance& repair
35,041
49,417
Legal fees
5,817
6,458
Annual vacancies expenses
466
14,484
End of service remuneration
57,130
51,270
Computer expenses
29,375
18,531
Rents
41,661
10,622
Traveling expenses
136,477
95,778
Technical support expenses
61,491
32,335
Bank’s expenses& interest
8,528
8,046
Guarantees
0
1,897
Specialized fairs expenses
0
1,608
Total
1,982,459
2,239,779
41
18 Selling& Distribution Expenses
Selling& Distribution Expenses
For the Year Ended
31st December
2007 (JD)
Salaries, wages and related costs
673,525
628,2202007
Insurance
This
of:of:
Thisitem
itemconsists
consists
9,521
22,929
Depreciation
Salaries, expenses
wages and related costs
Advertising
202,045
1,328,661
Vehicles expenses
77,712
Transportation
35,818
Insurance
Depreciation
Staff
in-kind expenses
17,074
Export& freight expenses
370,139
Subscription& fees
2,594
Advertising expenses
Vehicles
expenses
Company
share
of social security
58,462
Stationary& printing
8,644
Hospitality
3,367
Transportation
Staff in-kind
expenses
Postage,
telephone&
fax
30,539
Studies& consultants expenses
1,693
Miscellaneous
41,249
Export& freight expenses
Subscription&
Maintenance&
repairfees
1,131
Health insurance
Company share of social security
31,671
Material& supplies
Stationary&
printing
Traveling
expenses
8,500
28,558
Yearly expenses vacancies
Hospitality
89
Fuel
Postage, telephone& fax
Rents
126,534
150,444
65,050
22,929
202,045
12,495
150,444
29,760
299,093
1,328,661
1,979,359
77,712
38,838
65,050
4,831
4,994
35,818
29,760
17,074
29,034
12,495
11,356
1,295
370,139
299,093
2,5941,614
4,831
38,794
32,795
58,462
38,838
8,64488,189
4,994
2,269
253
3,367
11,356
29,034
86,734
30,539
34,840
Studies& consultants expenses
36,587
20,537
Egypt expenses
Miscellaneous
Professional
expenses
34,654
10,563
Fire extinguishing expenses
Maintenance& repair
Healthdownload
insurance
Upload&
expenses
9,650
9,692
Trade mark registration
Material& supplies
32,929
Banks expenses
Traveling
expenses
Letters
of approval
expenses
54,444
-
Commissions& agencies
52,979
Total
3,358,312
Yearly expenses vacancies
Fuel
628,220
9,521
43,495
15,793
2006
(JD)
(JD)
673,525
1,979,359
Allowed discount
For the Year Ended
31st December
2006 (JD)
1,693
1,295
41,249
-
38,794
66,884
-
1,131
1,614
31,671
-
32,795
-
386,197
8,500
2,269
28,558
3,763
88,189
4,280
89
4,044,847
253
126,534
86,734
Rents
43,495
34,840
36,587
20,537
Egypt expenses
34,654
66,884
Professional expenses
10,563
-
Allowed discount
15,793
-
Fire extinguishing expenses
9,650
-
Upload& download expenses
9,692
-
Trade mark registration
32,929
386,197
Banks expenses
54,444
4,280
Letters of approval expenses
-
3,763
Commissions& agencies
52,979
-
Total
3,358,312
4,044,847
42
19 Other expenditures/ revenues
For the year ending
December 31, 2007
2007
(JD)
This
consists
of: of:
Thisitem
item
consists
2006
(JD)
Profits distribution of investment in companies
3.318
12.779
Bank interests
3.304
14.383
Currency fluctuations
(45.633)
(150820)
Property and equipment sale profits
(184.497)
24.154
Other revenues
21.700
65.174
Raw material sale revenue
0
18.039
Net
(201.808)
(16.291)
20 Income Tax
- Income tax for the mother company has been reviewed for the year 2005 and
received a final settlement on 16/5/2007.
- Income tax for the (Arab Co. for Cigarette Distribution) subsidiary company for 2006
has not yet been settled.
21 Contingent Liabilities
Loans incurred by the mother company were recorded at JD 5,453,422.
22 Financial Instruments
1- Price Risks
Price Risks Consist of the Following:
Risks of Currency Price Fluctuations
Most trading transactions made by the company were recorded in Jordanian Dinar
/U.S Dollar, the exchange of the Dinar has been fixed at U.S Dollar (1 U.S Dollar = 0,71
Jordan Dinar) as determined by the Central Bank of Jordan.
2- Risks of Interest
Most of the financial instruments listed in the balance sheet are not subject to interest
rate risks as all of the company’s cash is deposited in Banks with high solvency.
3-Credit, Liquidity and Cash Flow Risks
The company maintains cash balances at highly solvent financial institutions. Accounts
receivable were listed at fair value representing the cash flow to be received during
the year to face the obligations due for the same year.
23 Lawsuits
a- Lawsuits against the Company
The British and American Tobacco Company (BAT) and the Union Manufacturing
43
Company have filed a lawsuit against the International Tobacco and Cigarettes
Company (ITC) on December 30th 2001 for halting the production of the one of the
manufactured brands of cigarettes by ITC on grounds of the unlawful competition
law.
ITC has returned the appeal, which resulted in dismissing the procedure won by the
British and American Company and the Union Manufacturing Company by the Judge
of rushed matters. The verdict was in favor of ITC and the Supreme Court supported
the decision.
Accordingly, ITC has filed a counter lawsuit for compensation (Damage and
Disorder) against both the British American Tobacco Company (BAT) and the Union
Manufacturing Company. This lawsuit is still pending.
b- Lawsuits against Public Sales Taxation Department Filed by the Company
Sales Taxation Department has submitted a financial claim in addition to penalties on
the sales of cigarettes brand (L&M) alleging that sales tax was unpaid on a margin of
profit of the Distribution Company.
As a result of this unjustified claim the company has decided to file a lawsuit against
the Sales Taxation Department to drop the claim on the ground of Sales Laws and
the instructions issued by its General Manager since the Distribution Company of the
brand (L&M) is not affiliated with ITC, as it is an independent entity.
All procedures were taken in calculating the sales tax on the cigarette brand (L&M)
were supported by official letters from the company to the Sales Taxation Department
and the Company has also kept the written approvals issued by the Sales Taxation
Department concerning this issue. This lawsuit is still pending in the specialized
courts.
24 Comparative Figures
Certain comparative figures were reclassified to conform to the presentation of the
current year.
Numbers of the compared year include financial statements for subsidiary company
(Ekbal for Printing and Packaging) while the standard financial statements for the year
2007 does not include the financial statements of Ekbal for Printing and Packaging.
This is due to the fact that the company sold its shares except 5,000 shares that were
classified under the category of available for sales securities.
44

walid tawfiq

Transcription

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