MS AR 2018 (1)

Review Of Business Performance
Once again, I begin this letter with a sense of pride about
Mughal Steel. As I look back on last year, in fact, the
last decade, it is remarkable how well the Company has
performed despite of various challenges. In FY 2018 as well,
despite of prevailing unstable economic and political climate,
the Company managed to clock its highest ever topline and
bottom line figures, improve its profitability and maintain
its growth momentum. The Company posted overall sales
revenue of Rs. 22,225.842 million in FY 2018 as compared
to Rs. 18,802.811 million in the last year resulting in increase
in earnings per share from Rs. 4.21 in FY 2017 to Rs. 5.13 in
FY 2018.
During the year, the Company managed to overcome
its energy constraints by obtaining enhancement in its
gas and electricity sanctioned loads and installation and
commissioning of six (6) new engines for the power plant.
The Board also approved Phase II of its earlier expansion
plan, which will fill further strengthen the strategic positioning
of the Company. Looking ahead, I have great confidence
in the future of the Company. Our balance sheet remains
strong, and we expect to gain the benefit from actions taken
in 2018. Within the businesses, we expect Mughal Supreme
to continue to perform well, and for announced expansions
to come online and further contribute towards improvements
in financial and operational performance.
At the heart of our growth strategy, is the desire of both the
Board to maximize shareholder value and return, that is why
we have consistently been paying out cash dividends as well
as issuing bonus shares in past. Keeping in view the same,
on behalf of the Board of Directors, I’m pleased to announce
final cash dividend @ Rs. 2.20/- per share i.e. 22% for the
year ended June 30, 2018 to you, our owners.
Review Of Board Performance
As the Chairman of the Board, I hereby present the review
on the overall performance of the Board and Board’s role in
achieving the Company’s objectives as required u/s 192 of
Companies Act, 2017.
The objective of the Board is to ensure that the organization
is being managed effectively, in a way that helps it to
achieve its objectives whilst also safeguarding the integrity
of the organization and the interests of its stakeholders.
Overall, the Board is working well given its organizational
model and board structure, with Board members having
the appropriate range of skills, knowledge and experience,
as well as the degree of diversity, necessary to enable it
to effectively govern the business. The Board committees
as well continued to work efficiently as designated by the
Board. Individual Board members appear to be hard-working
and demonstrate a strong commitment towards overall
performance of the Company. Behaviour in the boardroom is
mostly seen to be constructive. Board appears very focused
on and committed to Company’s values and mission.
Appropriate proportion of time is given to both strategic and
operational level discussions and issues. Majority of the
Directors have certifications under the Directors’ Training
Program conducted by ICAP.
Attendance of Board members at Board meetings and
committee meetings was 100%, with zero absences against
a target of 95%. There was no code of conduct violation.
Performance objectives were reviewed against actual results
and were found satisfactory. During the year, there was one
change on the Board. Muhammad Waleed Bin Tariq Mughal
resigned from his position as Board member due to personal
reasons. In his place Mr. Abdul Rehman Qureshi was
appointed as Director for the remaining term.
The role of the Board has been pivotal in achieving the
Company’s objectives. The Board has developed short,
medium and long-term plans to achieve its strategic
objectives. The Board regularly reviews the principle risks
and mitigating factors against them. The Board’s role
in dealing with energy crisis and maintaining sustained
production levels has been very effective. The relationship
between the Board and its committees is very constructive
and productive. The contribution and efforts of all Board
members has been very vital. Independent and Non-
Executive Directors provide depth of expertise and support
for effective decision making.
On an overall basis, I believe that the strategic direction of
the organization for the long-term is clear and appropriate.
Further, the processes adopted in developing and
reviewing the overall corporate strategy and achievement of
organization’s objectives are commendable which are truly
reflected by the current financial results and performance of
the organization.
I’ll continue to be responsible for leading the Board, fostering
a culture of openness and constructive debate during which
all views are heard and ensuring that the Board hears from
an appropriate range of senior management. I’ll remain
firmly committed to ensuring that your Company complies
with all the relevant codes and regulations and ensuring that
our management team continues to make decisions that will
create value for you in the short, medium and long term.
Lastly, I would like to recognize the efforts of our executive
management team for their prudent and insightful leadership
during the past year together with their ability to be flexible
and react quickly when it became necessary to protect the
business against various adversities. I would also like to
expresses my gratitude for the efforts of all our workers for
their dedication and stakeholders for their trust in us.
MIRZA JAVED IQBAL
Chairman
Lahore: September 19, 2018
Annual Report 2018
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