Dynea Pakistan : Transmission of Annual Report for the Year Ended June 30, 2022

DYNEA PAKISTAN LIMITED

40th Annual Report for the year ended

30th June, 2022

TABLE OF CONTENTS

Company Information	02
Vision and Mission Statements	03
FINANCIAL STATEMENTS
Chairman's Review	04
Directors' Report	06
Key Operating & Financial Data	13
Statement of Compliance with
Code of Corporate Governance	15
Auditors' Review Report	17
Auditors' Report	18
Statement of Financial Position	23
Statement of Profit or Loss	24
Statement of Comprehensive Income	25
Statement of Cash Flows	26
Statement of Changes in Equity	27
Notes to the Financial Statements	28
Pattern of Shareholdings	55
Notice of 40th Annual General Meeting	57
Notice of 40th Annual General Meeting (Urdu)	64
Directors' Report (Urdu)	72
Chairman's Review Report (Urdu)	74
Form of Proxy

DYNEA PAKISTAN LIMITED	ANNUAL REPORT 2022	01

	COMPANY INFORMATION
Board of Directors :
	Mr. Donald John Jenkin	Chairman
	Mr. Shabbir Abbas	Chief Executive Officer
	Mr. Lee Kin Seng
	Ms. Anam Fatima Khan
	Mr. Adnan Afridi
	Mr. Andalib Alavi
	Mr. Tariq Ahmed
Audit Committee :
	Mr. Adnan Afridi	Chairman
	Mr. Donald John Jenkin	Member
	Mr. Andalib Alavi	Member
Human Resource and Remuneration Committee :
	Mr. Andalib Alavi	Chairman
	Mr. Donald John Jenkin	Member
	Ms. Anam Fatima Khan	Member
	Mr. Shabbir Abbas	Member
Chief Financial Officer :
	Mr. Muhammad Shakeel Uddin
Company Secretary and Head of Internal Audit :
	Mr. Mujtaba Hassan Ghanchi
Bankers :
	M/s. Habib Bank Limited	M/s. National Bank of Pakistan
	M/s. Habib Metropolitan Bank Limited	M/s. Allied Bank Limited
	M/s. MCB Bank Limited	M/s. Bank Al-Falah Limited
	M/s. Standard Chartered Bank (Pakistan) Limited	M/s. Meezan Bank Limited
	M/s. United Bank Limited
	M/s. Dubai Islamic Bank Pakistan Limited
Auditors :
	M/s. EY Ford Rhodes
	Chartered Accountants
Legal Advisors :
	M/s. Zahid & Tariq Advocates
Share Registrar :
	FAMCO Associates (Pvt) Limited
	Management Consultants & Share Registrars
	8-F, Next to Hotel Faran Nursery, Block-6, P.E.C.H.S., Shahrah-e-Faisal, Karachi
	Ph: (92-21)34380101-5,34384621-3 (Ext. 103) Fax: [phone]
Registered Office :
	Office No.406 Parsa Tower, Plot No.31/1/A,
	Block-6. P.E.C.H.S., Shahrah-e-Faisal, Karachi.75400
	Ph: (92-21) 34520132 - 35 Fax: [phone]
Factories :
1.	Hub Unit	2.	Gadoon Unit
	A101 - A105, A132 - A136,		34-A,34-B, 35, 38-A and 88, Road-3,
	Hub Industrial Trading Estate,		Industrial Estate, Gadoon Amazai,
	Hub Chowki, Distt. Lasbella, Baluchistan.		District Swabi, Khyber Pakhtunkhwa.
	Ph: (92-853) 363706 - 09 Fax: [phone]		Ph: (92-938) 270150 - 52 Fax: [phone]
02	ANNUAL REPORT 2022		DYNEA PAKISTAN LIMITED

VISION AND MISSION STATEMENTS

Vision

Dynea Pakistan is Market Leader in its core and diversified business, delighting its customers by providing quality products at competitive price through development of market, product range, technology and human whilst ensuring sound return to stakeholders.

Mission

Maximize productivity and sales of Formaldehyde, Resins for wood- based panel industries and Moulding Compounds and provide satisfaction to customers.

DYNEA PAKISTAN LIMITED	ANNUAL REPORT 2022	03

CHAIRMAN'S REVIEW

Board Structure

The Board is made up of professionals with strong backgrounds in financial management, legal affairs, technical development and manufacturing operations. There are two committees, namely the Audit Committee which incorporates Risk Management and the Human Resources and Remuneration Committee, reporting to the Board.

It is my pleasure to welcome Mr Lee Kin Seng, President of AICA Asia Pacific Holding Private Limited, a major shareholder. In conjunction with this I would like to extend my thanks to outgoing director, Mr. Ameen Bandukda who leaves us after many years of service.

Memberships of the Board and its committees are detailed in the Directors' Report.

Dynamics and Functioning of the Board

Board meetings are held quarterly and otherwise as required. Attendance and participation are good and directors are available at other times to support management, in particular with compliance and legal matters. Their input is highly valued and much appreciated by both management and myself.

A consequence of Covid has been that the Board and its committees have not been able to meet in person. This has necessitated that meetings have been conducted via Zoom videoconferencing. I wish to thank the backroom people for setting up the meetings and ensuring their smooth operation.

Business Strategy Governance

In a mature market such as that in which the Company finds itself, it is not always easy to devise a strategy going forward. The strategy developed in 2010 to rebuild the Company was fully supported by the Board and the results speak for themselves.

The Company continues to strive for efficiency in its operations. The latest initiative is the installation of two solar electricity plant equivalent to 1.4 MW.

There are other projects under evaluation as the Company seeks to continue its growth strategy. However, given the current economic environment in which Pakistan finds itself, the Board and management consider it prudent to bide our time until the economy stabilises and projects can be properly evaluated.

Financial Reporting Process, Internal Audit and Internal Controls

The Board contains a strong representation of directors with backgrounds in finance, banking and business management. Systems are in place to ensure that financial management of all aspects of the Company's operations are managed with transparency, honesty and integrity. I feel that the outsourcing of the internal audit function to PwC adds further strength to the financial management of the business by giving an unbiased overview of the Company's operations.

A highlight of this financial year has been the successful upgrading of our ERP system to SAP. The system went live in July 2022 so the new financial year will be fully reported using SAP. It is a credit to management and the team from Siemens that the project was completed on time and within the allocated budget.

Risk Management

The Board is very conscious of the need to evaluate and manage risk to ensure business continuity. Covid is still with us and the unstable rupee and ongoing supply chain issues continue to impact the business. Management has had to balance the need to maintain sufficient inventories of key imported materials while at the same time trying to manage exchange rate risks.

04	ANNUAL REPORT 2022	DYNEA PAKISTAN LIMITED