GSK Annual Report 2014
GSK Annual Report 2014
GSK Annual Report 2014
CREATING
A COLOURFUL
TOMORROW
As a socially responsible global healthcare company, we at GSK aspire to provide quality products
that enable people to DO MORE, FEEL BETTER, LIVE LONGER.
Today, as societys expectations of healthcare companies are changing, demanding more for
patients, we as a Company want to lead this change and stay true to the values that are the
foundation of our business.
While we have made great strides to reshape the business by taking leadership positions in areas
such as innovation, transparency, access and collaboration, our passion to serve the needs of our
customers drives us to continually deliver products of value that touch millions of lives every day and
create a colourful tomorrow.
CONTENTS
02
04
06
07
08
10
12
14
16
18
20
21
22
23
24
27
28
29
32
35
36
Corporate
Information
Ethical
Leadership
Human
Resource Delivering
World Class
Performance
Vision,
Mission &
Values
Quality
Management
System
(QMS)
Medical
Affairs/
Dermatology
GSK
Expectations
Environment,
Health & Safety
(EHS)
Consumer
Health Care
Strategic
Priorities
Global
Manufacturing
& Supply
(GMS)
Vaccines
Company
Profile and
Group
Structure
Research &
Development
(R&D)
Corporate
Social
Responsibility
(CSR)
Organogram
Information
Technology
Achieving
Milestones
Geographical
Presence
Awards for
the Year 2014
GSK Pharma
Launches
2014
38
40
42
48
55
56
57
58
Directors
Profile
DuPont
Analysis
Board &
Management
Committees
Horizontal
Analysis
Directors
Report to the
Shareholders
Vertical
Analysis
Chief
Executives
Review
Direct Cash
Flow
50
Financial
Performance
at a Glance
51
Statement of
Value Added
52
Key
Operating
& Financial
Data
Board of Directors
Mr. Renaud Savary
Chairman
Audit Committee
Mr. Husain Lawai
Chairman
Management
Committee
Mr. M. Salman Burney
Mr. Yahya Zakaria
Director Finance
Mr Renaud Savary
Member
Company Secretary
Mr. Azeem A. Naqvi
Chairman
Chief Financial
Officer
Member
Bankers
Barclays Bank PLC Pakistan
Citibank NA
Deutsche Bank A.G.
Habib Bank Limited
Meezan Bank Limited
GSK
02
Chief Executive
Member
Human Resource
& Remuneration
Committee
Auditors
Legal Advisors
Mandviwalla & Zafar
Orr, Dignam & Co.
Rizvi, Isa, Afridi & Angell
Vellani & Vellani
Registered Office
35 - Dockyard Road, West Wharf,
Karachi - 74000.
Tel: 92-21-111-475-725
(111-GSK-PAK)
Fax: 92-21-32314898, 32311122
Website: www.gsk.com.pk
CORPORATE
INFORMATION
03
OUR VISION,
MISSION & VALUES
Our Vision
Our Values
Our Mission
GSKs quest is to improve the quality of human life
by enabling people to
GSK
04
Patient Focused
Our commitment to our purpose of improving the lives
of billions ensures that all our efforts, be it research,
manufacturing or distribution are geared towards
improving patient access to quality health solutions.
Transparency
As our business evolves to meet global challenges,
so do our existing systems for which transparency is
integral. By being transparent about what we do and
how, we earn and build trust.
Integrity
Our guiding principles go beyond complying with legal
and ethical regulations. Each member of the GSK family
takes pride in doing what is right for the patients and
consumers, placing them at the heart of every decision
we make. In doing so, we demonstrate integrity in action,
at every level, every day.
05
GSK
Individual Expectations
Leadership Expectations
GSK
EXPECTATIONS
06
Set direction
and inspire
Work across
boundaries
Release
energy
Develop
capability and
talent
Drive
performance
Live
our
values
Using sound
Cultivating a
Creating a
Investing in
Holding yourself,
Acting as a role
judgment to
network of
healthy, engaged
your people
your team
model, ensuring
collaborative
and inclusive
and others
everything you do
compelling vision
relationships,
working
organizational
accountable for
based on mutual
environment that
capabilities
delivering quality
values, serving
trust, to ensure
is sustainable
necessary to
results
patients and
work contributes
over time
implement our
to delivering our
for GSK as a
strategy and
whole
in the future
consumers
mission
Ensuring your
Building trusting
work supports
relationships
constructively
yourself with
and others
model, ensuring
your teams
within and
accountable for
everything you do
Engaging
Equipping
Holding yourself
Acting as a role
demonstrating a
knowledge to do
delivering quality
organizational
to achieve goals
positive mindset
results
values, serving
priorities and
and contribute to
patients and
applying sound
the success of
and supporting
consumers
judgment in all
GSK
others to do the
that you do
same
STRATEGIC
PRIORITIES
We are focused on the delivery of five strategic priorities to
achieve our mission of helping people Do more, feel better,
live longer.
Everyone at GSK has a role to play in delivering our
strategic priorities:
Building trust
We are committed to operating responsibly and ensuring that our behaviour and actions meet or exceed the expectations of society.
shareholder returns.
07
COMPANY
PROFILE & GROUP
STRUCTURE
GSK Pakistan Profile
GlaxoSmithKline Pakistan Limited was created January 1st, 2001 through the merger of SmithKline and French of
Pakistan Limited, Beecham Pakistan (Private) Limited and Glaxo Wellcome (Pakistan) Limited and stands today as the
largest pharmaceutical company in Pakistan.
GSK is a long established investor in Pakistan. Our legacy company Glaxo Laboratories Pakistan Ltd. was the first
pharmaceutical company to be listed on the Karachi Stock Exchange in 1951.
GSK Pakistan operates mainly in two industry segments: Pharmaceuticals (prescription drugs and vaccines) and
consumer healthcare (over-the-counter-medicines, oral care and nutritional care). In Pakistan, the Company deals in
Anti-infective, Respiratory, Vaccines, Dermatological, Analgesics, Oncology, Urology, Central Nervous System, Allergy,
Cardiovascular and Vitamins therapy areas.
We are committed to our mission of providing patients quality products to help improve the quality of their lives. Some
of our leading pharmaceutical brands include Augmentin, Seretide, Amoxil, Velosef, Zantac and Calpol and renowned
consumer healthcare brands, which include Panadol, Horlicks, Sensodyne and ENO. Prominent vaccines include
Synflorix, Infanrix Hexa, Rotarix, Havrix and Priorix Tetra.
Korangi
West Wharf
GSK
F-268 Site
08
GMS, Korangi,
Karachi
Located in the Korangi Industrial State, this
manufacturing site has a dedicated block for
Cephalosporin, both orals and injectables, as well as
a small unit for tablets. GMS Korangi manufactures
around 103 SKUs and produces an annual volume of
around 37 million packs. Major products manufactured
at this site are Velosef, Ceprorex and Theragran Ultra.
09
ORGANOGRAM
VICE PRESIDENT &
GENERAL MANAGER
(GLOBAL REPORTING)
HEAD OF LEGAL/
COMPANY SECRETARY
DIRECTOR
HUMAN RESOURCE
& INDUSTRIAL RELATION
DIRECTOR FINANCE
& ADMINISTRATION
HEAD OF INFORMATION
TECHNOLOGY
COUNTRY COMPLIANCE
OFFICER/CHIEF
INTERNAL AUDITOR
DIRECTOR
MEDICAL AFFAIRS
GLOBAL MANUFACTURING
AND SUPPLY
HEAD OF COMMERCIAL
EXCELLENCE & SPECIALITY
HEAD OF REGULATORY
AFFAIRS
GSK
SITE DIRECTOR
(WEST WHARF)
10
(GLOBAL REPORTING)
HEAD OF SALES
HEAD OF FINANCE
HEAD OF MARKETING
SENIOR DEMAND
FORECASTING MANAGER
EXTERNAL SUPPLY
MANAGER
GENERAL MANAGER
CONSUMER HEALTHCARE
11
GEOGRAPHICAL
PRESENCE
Biologicals
Corporate
Consumer Healthcare
GMS
GSK
Pharmaceuticals
12
13
ETHICAL
LEADERSHIP
At GSK, we are committed to develop and sustain a strong
ethical culture, where being patient focused is our core
responsibility. Our belief in complying with the Code of
Corporate Governance in letter and spirit facilitates the
promotion of good governance in our organization, while our
core values of Respect for people, Patient focused, Transparency
and Integrity underpin this belief.
retribution.
a professional manner.
standards of documentation.
GSK
Report.
14
15
QUALITY
MANAGEMENT
SYSTEM (QMS)
The Quality Management System (QMS) at GSK Pakistan delivers Quality for patient and customers, Compliance for the
regulators, and Improvement in performance for the business and shareholders. It continuously strives to improve current policies
and procedures with the aim of delivering quality products to patients. Quality Management is at the heart of every operation we
perform at GSK. To uphold expectations of our patients, we focused on the following areas in 2014:
QMS.
GSK
16
2014 was all about embedding QMS culture throughout various functions of GSK Pakistan. As a result our F-268 facility was
recognized one of the best sites in Asia. In 2015, the focus will be sustainability of QMS to deliver products of premier quality
to end users.
Quality is at heart of all activities that support the discovery, supply and
marketing of products to our patients and customers. Quality is critical to
building trust with society and, therefore, to our future business success.
GLOBAL QUALITY
GUIDELINE
(GQGs)
GLOBAL QUALITY
GUIDELINE
(GQGs)
To assure GSK Pakistan provides quality products and services, Global Quality Policies and Global Quality Management
into Local Standard Operating Procedures.
Following measures have been adopted to assure highest standard of quality provided to the end users:
Risk Management
Deviation Handling
CAPA Management
Policies have been embedded within our system. With the help of Gap analysis, all applicable policies have been converted
17
ENVIRONMENT,
HEALTH &
SAFETY(EHS)
GSK Pakistan is committed to a safe and accident free
environment. The theme EHS for all signifies that GSK Pakistan
takes responsibility for its staff, community and contractors.
2014 witnessed a number of initiatives and achievements that
demonstrated GSK Pakistans commitment to EHS.
Environment
Health
For its efforts in EHS, GSK Pakistan received the 11th Annual
Environmental Sustainability
Efficient use of natural resources, water and air
were the priorities of our environmental management
system during 2014. Multiple projects were also
initiated by our Korangi site to reduce our carbon
footprint. These initiatives resulted in a 27% reduction
in the consumption of water and 12% reduction in
C02 emission as compared to last year. The projects
included:
Safety
To ensure GSKs ambition of Work with Zero accidents,
defects and waste a ground-breaking training program
Leading EHS was designed and implemented across
all GMS sites. This program aims at identification of the
complacencies that every manager needs to address to fulfill
their EHS responsibilities
Furthermore, I AM EHS was introduced to increase
the capability of staff in identifying the potential hazards
and eliminating them before they cause harm. Extensive
exercises were also carried out to determine the site
GSK
18
I GEMBA
I ZAP
I COMPETE
I CARE
to avoid accidents
to improve safety culture
to be the world class
I love my family so work safely. Because
they are waiting for me
I AM
EHS
Unite
Involve
Join
Participate
Engage
19
GLOBAL
MANUFACTURING
& SUPPLY (GMS)
GMS Pakistan is part of GSKs Regional Pharma Supply. Our goal is to
invest in a winning team, deliver products of value at optimal cost, and
connect across GSK to drive performance with zero accidents, defects
and waste. These initiatives help align us with GMSs Supply Chain
Transformation and GSKs Production System, which in turn enables us
to become a world class leader in integrated supply chain.
Our supply chain is the lifeblood of GSK. The better it flows, the happier
our patients and consumers and the greater our competitive advantage.
Investment in new
State-of-the-art De
ionized Quality water
plant for Liquid Stream
Automation of Sterile
Powder Vials Packaging
Line: Productivity
Improvement
has been done for the Liquid Stream, which employs hi-polisher
addition will also help overcome any future capacity issues for
supply chain.
health standards.
Our focus is now to further enhance overall performance
by making our core processes more efficient by eliminating
20
RESEARCH &
DEVELOPMENT
(R&D)
Patient focused research and development is the heart of GSK business and
is a driving factor in pursuing our mission of helping people to Do more,
feel better, live longer. Our mission is two-fold, to develop more effective
ways of treating diseases for which medicines are already available or
providing breakthrough treatment for conditions for which there is no
treatment at all.
21
INFORMATION
TECHNOLOGY
GSK
22
Environment
Excellence Award
best practices.
23
HUMAN
RESOURCESDELIVERING
WORLD CLASS
PERFORMANCE
We strongly believe that to deliver world class performance, we must build
a sense of purpose and ownership amongst our employees driven by GSKs
mission to Do more, feel better, live longer. Thus, our focus is on acquiring
the best-in-class talent available, through effective employer branding, in
order to benefit from the diversity of experiences, ideas and ways of thinking.
Simultaneously, we are building an internal leadership pipeline through
differentiated performance of individuals who develop capability and talent
within the organization.
Employee Engagement
GSK
24
25
New Performance
Management System
Rollout
shop experience,
GSK
Throughout the year, our focus was to ensure that the four
26
Connect with HR Team - ASK HR-TELL HRGet answers to people management and HR
queries - Knowledge Management System
MEDICAL AFFAIRS
Medical departments play a vital role in generating quality
patient benefit.
partner for R&D and commercial, and fit for the future.
DERMATOLOGY
The Dermatology portfolio enjoys market leadership with
a variety of products. The business also contributes
significantly to the global dermatology segment and hence,
Milestones/
Achievements
Launch of Valtrex.
27
CONSUMER
HEALTHCARE
GSKs Consumer HealthCare business maintained its growth momentum
in 2014 reaching Rs. 4.9 billion which represents a 16% increase over
last year. All key brands such as Panadol, Horlicks and Sensodyne
reflected a strong performance throughout the year. With this
performance, the business continues to be aligned with GSKs corporate
vision of helping people Do more, feel better, live longer, and
improving access to our products
Nutrition Category.
2014.
GSK
28
Horlicks
following the
Digital Trend
VACCINES
Foreign Speaker
Programs On Vaccine
Preventable Diseases
Pakistan has a birth cohort of over 5 million, and is highly
susceptible to vaccine preventable diseases. One WHO
estimate reports that in Pakistan, more than 352,000 children
die before their fifth birthday, and almost one in five of these
deaths can be attributed to pneumonia. On the other hand,
an estimated 140,000 infants suffer from severe Rotavirus
Gastroenteritis every year in Pakistan with approximately 100
infected children dying every day due to the same.
In line with the growing need to prevent the increasing child
mortality rate, in 2011, GAVI, the Global Alliance for Vaccines
and Immunisation, extended its assistance for the inclusion
of Synflorix, GSKs flagship Pneumococcal vaccine, into the
Extended Program for Immunisation in Pakistan.
In order to further increase awareness regarding the
Pediatricians of Pakistan.
29
World Immunization
Week
Prevention is better than cure. It is also cheaper. Yet children
in Pakistan continue to die of preventable diseases for
which vaccinations are easily available. More than half of
the children in Pakistan are not vaccinated even though the
Rotavirus Disease
Awareness Campaign
2014
The Vaccines team launched a nationwide mass awareness
Print commercials.
resulting complications.
GSK
30
th
31
CORPORATE SOCIAL
RESPONSIBILITY
(CSR)
GSK is committed to excellence, and aims to conduct business practices
aligned with our values. We are dedicated to being a socially responsible
global healthcare company that places emphasis on the values of
transparency, respect for people, integrity and patient-focus. Our
operations are led by our values and principles where we put patients
first in our decision making to ascertain that we enable them to Do
more, feel better, live longer.
CARE Initiative
32
NH2
HO
O
H
N
N
3
OH
33
Orange United
Orange United is GSKs internal
employee
volunteer
campaign
GSK
world.
34
ACHIEVING
MILESTONES
Zantac belongs to the antiulcerant class and was introduced in Pakistan in 1983
for the treatment of Acid Related Disorders. In 2014, Zantac achieved the Rs.
900 million milestone. The brand continues to demonstrate GSKs commitment
to provide patient focused solutions by delivering high quality. The continued trust
of doctors on Zantac helped to maintain its position as the No.1 prescribed antiulcerant in Pakistan in 2014.
In 2014, GSK Pakistans flagship brand Velosef achieved Rs. 2 billion in sales. This
classic antibiotic aligns with GSKs commitment to provide patient focused solution
by delivering the reliability and quality that the Company is renowned for.
GSKs flagship brand, Augmentin is the highest selling brand in the Pakistan
Pharmaceutical Industry. Augmentin has been showing an upward growth for
the past several years. In order to uphold its brand equity and differentiate it from
TM
Betnovate is one of GSKs legacy dermatology products and has ensured relief
for patients suffering from Eczema since over two decades. A classic topical steroid,
Betnovate delivered on its identity of a reliable product built on GSKs strong
Betamethasone valerate
mirrors GSKs image in the local dermatology market as a name that can be trusted.
35
GSK PHARMA
LAUNCHES 2014
LIVING OUR VALUES: BEING PATIENT FOCUSED
Aligned with GSKs vision of enhancing patient care, compliance and better
treatment; the following SKUs (Stock Keeping Units) were upsized in 2014.
Gastrointestinal
Dependal M
Suspension
Living our values of constantly improving
the lives of patients by providing better
solutions to them, Dependal M
Suspension was upsized from 60 ml
to a 90ml bottle. This aims to improve
compliance of patients who suffer from
diarrhea.
Respiratory
Ventolin Syrup and
Expectorant
Ventolin Syrup and Ventolin Expectorant are time
tested brands for respiratory diseases. In order to enhance
access to patients and increase patient compliance, GSK
introduced two upsizes in the Ventolin range. Both
Ventolin Syrup and Expectorant were upsized from 60ml
GSK
to 120ml.
36
Analgesics
Calpol
The promise to make people do more, feel better and
live longer saw GSK introduce upsized SKUs in its
widely renowned Calpol range. In 2014, Calpol 6
Plus Suspension was upsized from 60ml to 90 ml, and
Calpol Paediatric Suspension was upsized from 90ml
to 100ml. Through these upsizes, we are aiming to
provide convenience and affordability to the mothers
using Calpol for their ailing children which will further
strengthen their trust on this legacy brand.
Dermatology
Cicatrin
For over four decades, Cicatrin powder has been providing
patients with relief from indications ranging from cuts,
abrasions and surgical incisions, to primary and secondary
skin infections.
37
GSK
38
DIRECTORS
PROFILE
Mr. Salman Burney is the VP/Area GM
for GSK Pakistan, Iran and Afghanistan.
Mr. Mehmood
Mandviwalla
39
BOARD AND
MANAGEMENT
COMMITTEES
The Board of Directors
Audit Committee
Terms of Reference
GSK
40
Human Resource
and Remuneration
Committee
This committee is responsible for dealing with employee
related matters including recruitment, training, remuneration,
performance evaluation, succession planning, and measures
of effectively utilizing the workforce of the Company. It is
also responsible for making HR policies, recommending and
approving salaries of the CEO, CFO, Company Secretary,
Head of Internal Audit and senior management who are
reporting directly to the CEO.
Management
Committees
Management Committee
Terms of Reference
The Management Committee ensures smooth operations
of the Company, engages in strategic business planning,
decision making and overall management of the Company.
It also ensures adequacy of operational, administrative and
financial controls.
Composition of the
Board
The Board consists of executive and non-executive
directors, including independent directors and those
representing minority interest, with the necessary skills,
knowledge, experience and competence, so that the Board
as a group includes competencies and diversity considered
relevant in the context of Public Sector Companys
operations.
The Board comprises of the Chairman and the Chief
Executive Officer, which are two separate positions.
Vision Team
The Vision team at GSK gives input for alignment of the
GSK strategy and futuristic objectives. It primarily reviews
line capacities at the various sites over the long term
perspective focusing on capacity constraints, potential
for export markets, product initiatives and new packaging
requirements
41
DIRECTORS
REPORT TO THE
SHAREHOLDERS
The Board of Directors of GlaxoSmithKline Pakistan Limited is pleased
to present you the Annual Report along with the Companys audited
financial statements for the year ended December 31, 2014.
The Directors Report has been prepared in accordance with section 236
of the Companies Ordinance, 1984 and clause 5.19 of Listing Regulations
of KSE and Regulation No. 35 of Listing Regulations of LSE. This report
is to be submitted to the members at the Sixty Eighth Annual General
Meeting of the Company to be held on April 23, 2015.
Operating results
Rs. in million
2,849
(1,162)
1,687
2,270
(78)
3,879
(1,013)
(290)
2,576
Pattern of Shareholding
The Board of Directors is pleased to announce a final cash
dividend of Rs. 5.00 per share amounting to Rs. 1.6 billion,
subject to the approval of the share holders in the Annual
General Meeting to be held on April 23, 2015.
The net sales of the Company grew by 10.5% during the
year to Rs. 27.9 billion. Net profitability of the Company was
Rs. 1.7 billion which was affected by factors as explained
more fully in the CEO Review on pages 48 to 49.
Holding Company
GSK
42
Human Resource
Development and
Succession Planning
2010
2012
2013
5.3
3.3
16.0
2011
4.6
15.5
17.4
2009
4.3
5.2
10
5.1
20
20.9
30
2014
PE Ratio
EPS
Corporate Social
Responsibility (CSR)
GSK is dedicated to being a socially responsible healthcare
company that aims to conduct business practices aligned
with our values. Corporate Social Responsibility is therefore
an integral part of how we work as an organization. At
GSK, we recognize the importance of corporate citizenship
and support multiple programmes at a grass root level,
focusing on health, education and general medical relief.
Our employees also participate in PULSE- a skillsbased volunteering initiative that enables them to make a
sustainable difference in communities and patients in need.
Our participation in various community support initiatives
originates from our mission to help make a significant
difference in the lives of many, and are mentioned in further
detail from page 32 to 34.
40.8
40
41.4
50
43
11,091
2010
9,933
2009
9,129
9,388
8000
9,585
10000
10,853
12000
6000
4000
2000
GSK
44
2011
2012
2013
2014
Business Ethics
and Anti-Corruption
Measures
GSK considers performance with integrity as the central
core of its operations. The Board of Directors of the
Company has set down the acceptable business practices
and behaviors in Code of Conduct/Statement of Ethics
and Business Practices to promote integrity and ethics.
The Code has been disseminated for signing by all the
employees, including the senior management and is also
available on the Companys website. Salient features of the
Code of Conduct are provided in brief on page 14.
Board of Directors
Meetings and
Attendance
Human Resource
and Remuneration
Committee
*Cease to be director of the Company with effect from May 07, 2014.
**Resigned with effect from August 22, 2014.
Management Committee
The Management Committee comprises of 10 senior
members who meet and discuss significant business plans,
issues and progress updates of their respective functions.
Significant matters to be put forth in the Board as per the
Code of Corporate Governance are also discussed for onward
approval.
Risk Management,
Governance and
Classification
Risk Management and Compliance Board (RMCB) is
responsible for identifying, assessing, treating, monitoring
and reporting on significant risks associated with the
business. RMCB also ensures that appropriate strategies
and policies are in place so that key risks which may
threaten the achievement of strategic objectives are
identified, recorded and minimized. RMCB held three (03)
meetings during the year.
Audit Committee
Name
Meetings
attended
Mr. M. Salman Burney
5
Mr. Husain Lawai
4
Mr. Mehmood Mandviwalla
5
Mr. Rafique Dawood*
3
Mr. Shahid Mustafa Qureshi*
3
Mr. Yahya Zakaria
5
Mr. Dave Cooper
4
Ms. Erum S. Rahim*
1
Mr. Renaud Savary
1
Ms. Fariha salahuddin**
Nil
Mr. Maqbool-ur-Rehman *
Nil
45
Likelihood
Impact
5
Almost certain
Catastrophic
4 Likely
Major
3 Moderate
Moderate
2 Modest
Unlikely
1 Minor
Rare
Auditors
The present auditors, Messrs A.F. Ferguson & Co. Chartered
Accountants, retire and being eligible, have offered themselves
for re-appointment. The Board of Directors endorses
recommendation of the Audit Committee for their reappointment as the Auditors of the Company for the financial
year ending December 31, 2015, at a mutually agreed fee.
Subsequent Events
Value of Investments of
Provident, Gratuity and
Pension Funds
The Company maintains retirement benefits plans for its
employees. Value of investments of provident and gratuity
funds based on un-audited accounts as of December 31,
2014 (audit in progress) was as follows:
2014
Rs. In millions
Provident fund
Gratuity fund
Pension fund
2,657
1,203
147
Value of Investment
30.0%
Provident Funds
Gratuity Funds
GSK
66.3%
46
Pension Funds
f.
been maintained.
c.
d.
M. Salman Burney
Chief Executive
Yahya Zakaria
Director
Karachi
February 25, 2015
e.
47
CHIEF
EXECUTIVES
REVIEW
I am pleased to present the Annual Report of your Company for
the financial year ended December 31, 2014.
Business Review
GSK
48
1,687
2000
1,062
2010
1,327
2009
1,141
1,058
1000
1,041
1500
500
0
2011
2012
2013
2014
1500
1,221
1200
300
725
Intellectual property
The use of scientific knowledge and creation of Intellectual
Property remains central to our values, however, the effective
legal protection of our intellectual property is equally important
for ensuring a reasonable return on investment in research and
commercialization of new treatments.
The IPR laws in Pakistan need to be amended to enforce
better controls over counterfeiting and discouraging violation of
intellectual property rights. Efforts and initiatives at Government
and organization levels have lead to increased deterrence but
there is still need for more effective implementation.
Acknowledgment
515
600
835
790
900
0
2010
2011
2012
2013
2014
Dividends
The Company maintained its history of providing reasonable
returns and payouts to its shareholders. The Board of Directors
of the Company, in their meeting held on February 25, 2015,
have proposed a cash dividend of Rs. 5.0 (2013: Rs. 3.5) per
share. Overall dividend payout for 2014 at Rs 1.6 billion will be
57.1% higher than 2013, reflecting the higher equity base.
M. Salman Burney
Chief Executive
Karachi
February 25, 2015
2009
49
FINANCIAL
PERFORMANCE
AT A GLANCE
Rupees in million
2014
2013
Net sales
27,883
25,231
Gross profit
7,346
6,229
Operating profit
2,869
1,969
2,849
1,810
Taxation
1,162
748
1,687
1,062
Dividend - cash*
1,592.3
3.5
289.5
3,184.7
2,895.2
1,013.3
5.0
* Represents final cash dividend @ Rs. 5.0 per share (2013: Rs. 3.5) proposed by the Board of Directors subsequent to the
year end.
Payout to Shareholders
Rs. in million
8000
2000
7,346
2009
GSK
Gross Profit
Operating Profit
50
2011
2013
2014
1,592
2009
Dividend
Bonus
1,013
1,053
2,869
2010
239
957
832
853
1,751
2,869
1,969
2,369
2012
2011
2012
290
6,229
5,818
1,952
2010
500
312
1,751
2000
1000
1500
1000
2,273
4,239
3000
4,853
5000
4000
6,045
6000
263
7000
2013
2014
STATEMENT OF
VALUE ADDED
2014
2013
Rs. 000
%
Rs. 000
Revenue Generated
Total revenue
28,665,947
100.0
25,946,631
100.0
19,083,436
66.6
17,670,879
68.1
2,630,772
9.2
2,616,579
10.1
433,783
1.5
528,362
2.0
Revenue distributed
Bought-in -materials and Services
Selling, Marketing and Distribution Expenses
Administrative Expenses and Financial Charges
Income tax
1,161,511
4.1
747,609
2.9
253,411
0.9
153,230
0.6
Sales tax
291,532
1.0
260,837
1.0
To Government 1,706,454
6.0
1,161,676
4.5
3,124,331
10.9
2,902,188
11.2
To Employees
3,124,331
10.9
2,902,188
11.2
100
0.0
4,684
0.0
To Society 100
0.0
4,684
0.0
Cash dividend*
1,592,338
5.5
1,013,305
3.9
To Shareholders
1,592,338
5.5
1,013,305
3.9
94,733
0.3
48,958
0.2
28,665,947
100.0
25,946,631
100.0
Donations
Retained in the Business
5.5% 0.3%
0.0%
10.9%
6.0%
1.5%
To Employees
To Society
9.2%
To Shareholders
66.6%
* Represents final cash dividend @ Rs. 5.0 per share proposed by the Board of Directors subsequent to the year end.
51
KEY OPERATING
AND FINANCIAL
DATA
Rupees in million
Balance Sheet
Assets employed
Fixed Assets - tangible
- property, plant and equipment
Assets - intangible
- Goodwill
Long Term Investments
Long-term loans and deposits
Net current assets
Non current assets held for sale
5,815
4,794
4,190
3,830
956
-
88
5,198
27
956
-
87
5,196
-
956
-
99
5,231
-
956
-
94
5,725
-
956
-
85
6,101
-
956
169
73
6,057
-
12,921
12,212
12,101
11,569
11,332
11,085
382
594
251
612
175
531
214
367
115
417
73
418
976
863
706
581
532
491
11,945
11,349
11,395
10,988
10,800
10,594
3,185
8,760
2,895
8,454
2,632
8,763
2,393
8,595
1,964
8,836
1,707
8,887
Shareholders Equity
Turnover and profit
11,945
11,349
11,395
10,988
10,800
10,594
Net sales
Gross profit
Operating profit
Profit before taxation
Taxation
Profit after taxation
EBTIDA
Cash Dividend including bonus shares
Sales per employee
27,883
7,346
2,869
2,849
(1,162)
1,687
3,293
1,592
11,091
25,231
6,229
1,969
1,810
(748)
1,062
2,323
1,303
9,933
23,150
6,045
2,369
2,322
(995)
1,327
2,716
1,316
9,129
21,750
5,818
2,273
2,237
1,096
1,141
2,599
1,196
10,853
18,916
4,853
1,952
1,932
874
1,058
2,324
1,144
9,388
16,754
4,239
1,751
1,706
665
1,041
2,061
853
9,585
4000
14.1
11.6
9.4
10.4
9.8
9.8
6,652
254.0
200
147.5
152.1
150
2010
2011
2012
2013
1,044
976
1,043
863
1,055
706
1,050
581
1,041
532
1,198
2009
2014
* Net Current Assets include Non Current Assets held for sale
50
3
0
109.3
100
2009
2010
2011
2012
2013
2014
90.0
88.2
71.8
65.0
2009
2010
High
Closing
179.8
136.2
111.0
491
1000
12
300
250
3000
2000
15
5,225
5,973
5,196
5,815
5,231
5,725
6,101
4,794
5000
3,830
6000
4,190
6,057
7000
Return on Equity
Percentage
8000
GSK
5,973
Less: Non-Current Liabilities
Staff retirement benefits - Staff gratuity
Deferred taxation
52
6,652
67.1
63.1
2011
132.3
81.8
73.3
61.0
2012
Low
68.0
2013
2014
Cashflows
Operating Activities
Investing Activities
Financing Activities
Changes in Cash equivalents
Cash & equivalents - Year end
Rs. in million
Rs. in million
Rs. in million
Rs. in million
Rs. in million
2,432
(920)
(957)
555
2,652
1,057
(285)
(990)
(218)
2,097
2,057
(1,167)
(900)
(10)
2,316
127
(558)
(782)
(1,213)
2,326
2,433
(739)
(849)
845
3,538
1,348
(262)
(1,189)
(103)
2,693
5.0
-
219.3
254.0
136.3
3.5
10.0
136.2
152.1
68.0
4.0
10.0
73.3
81.8
61.0
4.0
10.0
67.1
90.0
63.1
4.0
15.0
88.2
111.0
65.0
5.0
109.3
147.5
71.8
5.8
69,843
3.5
39,435
1.7
19,300
1.4
16,050
1.7
17,321
2.1
18,649
Financial Highlights
Profitability Ratios
Profit before tax ratio
Gross Yield on Earning Assets
Gross Spread ratio
Cost / Income ratio
Return on Equity
Return on Capital employed
Gross Profit ratio
Net Profit to Sales
EBITDA Margin to Sales
Operating leverage ratio
%
%
Times
Times
%
%
%
%
%
Times
10.2
7.1
0.2
0.6
14.1
9.1
26.3
6.1
11.8
5.5
7.2
7.6
0.2
0.7
9.4
6.2
24.7
4.2
9.2
(2.5)
10.0
6.9
0.2
0.6
11.6
8.4
26.1
5.7
11.7
0.6
10.3
14.8
0.2
0.6
10.4
7.5
26.8
5.2
11.9
1.1
10.2
8.7
0.2
0.6
9.8
7.2
25.7
5.6
12.2
1.0
10.2
12.8
0.2
0.6
9.8
8.3
25.3
6.2
12.0
(1.7)
Rupees
Times
Times
%
Times
Times
5.3
41.4
0.0
2.3
0.9
1.1
3.3
40.8
0.0
2.6
1.0
1.0
4.6
16.0
0.0
5.5
0.9
1.1
4.3
15.5
0.0
6.0
0.9
1.1
5.1
17.4
0.0
4.5
0.8
1.3
5.2
20.9
0.0
4.6
1.0
1.0
Rupees
37.5
39.2
43.3
45.9
55.0
62.1
Rupees
37.5
39.2
43.3
45.9
55.0
62.1
Investment/Market Ratios
53
KEY OPERATING
AND FINANCIAL
DATA
%
Times
Times
Times
Times
13.9
37.5
0.1
0.6
139.9
11.7
39.2
0.1
0.6
11.4
14.3
43.3
0.1
0.4
48.9
15.1
45.9
0.1
0.4
61.2
24.9
51.9
0.0
0.4
96.5
18.7
62.1
0.0
0.4
38.2
Times
Times
Times
Times
%
2.9
1.8
0.8
0.4
8.7
2.1
1.9
0.8
0.4
4.2
2.6
2.3
1.0
0.6
8.9
3.0
2.5
1.0
0.6
0.6
1.5
2.7
1.5
1.0
12.9
0.9
2.8
1.4
0.8
8.0
3.1
117
66.7
5
12.8
28
1.4
4.0
94
3.1
117
68.1
5
12.3
30
1.4
4.5
93
3.1
119
23.3
16
10.8
34
1.3
4.5
100
3.0
121
14.3
26
13.5
27
1.2
4.4
119
Liquidity Ratios
Advances to Deposits ratio
Current ratio
Quick / Acid test ratio
Cash to Current Liabilities
Cash flow from Operations to Sales
Times
Days
Times
Days
Times
Days
Times
Times
Days
3.2
115
63.0
6
10.6
34
1.5
4.2
86
1.5
1.8
GSK
Current Ratio
Quick Ratio
54
2010
2011
2012
2013
2014
2009
Debtors Turnover
Inventory Turnover
2010
2011
2012
2013
5
2009
115
117
119
16
30
26
0.8
0.8
1.0
0.5
0.0
112
1.9
90
60
1.0
1.0
1.4
1.5
121
2.3
2.5
2.7
2.8
120
2.0
117
150
3.0
2.5
3.3
112
72.1
5
10.5
35
1.4
4.2
82
2014
DUPONT
ANALYSIS
Sales
Rs. 27,883
Net Profit
Rs. 1,687
Return on Assets
8.83%
Total Cost*
Rs. 27,883
1.46 Times
Total Assets
Rs. 19,101
14.12%
Rs. 26,196
Sales
Assets Turnover
Return on Equity
Current Assets**
Rs. 11,405
Owners Equity
Rs. 11,945
Ownership Ratio
62.54%
Total Liabilities
Rs. 7,156
Total Assets
Rs. 19,101
+
Current Liabilities
Rs. 6,180
Owners Equity
*
**
Rs. 11,945
55
HORIZONTAL
ANALYSIS
%
5.2
13.0
7.9
(0.4)
22.2
38.0
3.7
21.5
7.0
1.7
9.3
9.0
1.9
8.4
6.4
26.8
47.4
72.7
6.5
10.4
5.2
3.7
3.2
35.8
9.7
4.2
2.1
16.4
17.6
(2.3)
11.7
(0.6)
4.0
2.7
89.3
18.0
Total Assets
6.5
10.4
5.2
3.7
3.2
35.8
12.9
12.4
14.5
18.1
(2.9)
12.5
(14.2)
11.5
(55.6)
13.2
31.4
1.6
25.0
31.1
10.0
46.7
63.7
(26.9)
(63.8)
(43.1)
(41.6)
(43.2)
(36.4)
(46.8)
GSK
Net sales
Cost of sales
Gross profit
Selling, marketing and distribution expenses
Administrative expenses
Other operating expenses
Other income
Operating profit
Financial charges
Profit before taxation
Taxation
Profit after taxation
56
9.0
11.1
3.0
19.7
19.3
(20.4)
37.8
(16.9)
235.1
(22.0)
(24.9)
(19.9)
6.4
7.4
3.9
8.5
(23.2)
(0.7)
(28.5)
4.2
30.1
3.8
(9.2)
16.3
15.0
13.3
19.9
21.8
22.8
13.4
16.2
16.5
82.4
15.8
25.3
7.9
VERTICAL
ANALYSIS
%
62.5
5.1
32.4
63.3
4.8
31.9
70.1
4.3
25.6
71.1
3.8
25.1
72.5
3.6
23.9
73.4
3.4
23.2
100.0
100.0
100.0
100.0
100.0
100.0
40.4
59.6
39.1
60.9
42.3
57.7
37.8
62.2
35.1
64.9
34.8
65.2
Total Assets
100.0
100.0
100.0
100.0
100.0
100.0
100.0
73.2
26.8
12.8
4.7
0.9
2.1
10.5
0.2
10.3
5.0
5.2
100.0
74.3
25.7
12.2
4.4
0.9
2.1
10.3
0.1
10.2
4.6
5.6
100.0
74.7
25.3
11.6
5.1
0.9
2.8
10.5
0.3
10.2
4.0
6.2
Net sales
Cost of sales
Gross profit
Selling, marketing and distribution expenses
Administrative expenses
Other operating expenses
Other income
Operating profit
Financial charges
Profit before taxation
Taxation
Profit after taxation
100.0
73.7
26.3
13.3
3.7
0.9
1.8
10.3
0.1
10.2
4.2
6.1
100.0
75.3
24.7
14.4
3.7
0.6
1.8
7.8
0.6
7.2
3.0
4.2
100.0
73.9
26.1
13.1
3.4
0.8
1.4
10.2
0.2
10.0
4.3
5.7
57
2014 2013
27,676,396
25,296,211
(20,860,599)
(19,893,193)
(2,915,649)
(2,711,605)
(218,263)
(206,333)
(342,393)
(20,241)
(171,871)
(181,702)
(20,363)
(16,147)
(710,378)
(1,210,352)
(5,090)
(104)
2,431,790
1,056,534
(1,221,013)
(725,019)
Cash Flows From Investing Activities
Investments encashed
Return on investments
109,575
-
91,982
186,500
191,881
161,339
(919,557)
(285,198)
(957,390)
(989,812)
(957,390)
(989,812)
554,843
(218,476)
Dividends paid
Net cash used in financing activities
2,097,268
2,315,744
2,652,111
2,097,268
GSK
58
FINANCIAL
HIGHLIGHTS
Sales Revenue
Market Capitalization
+58.7%
Rs. 5.3
Rs. 3.3
+42.9%
Rs. 5.0
Rs. 3.5
Return on Equity
+50.0%
14.1%
9.4%
+46.8%
9.1%
6.2%
CONTENTS
02
04
05
06
07
08
09
10
45
46
47
48
50
51
Statement of
compliance
with the code
of corporate
governance
Notes to
and forming
part of the
financial
statements
Review
report to the
members on
statement of
compliance
with the code
of corporate
governance
Pattern of
shareholding
Auditors
report to the
members
Categories of
shareholders
Balance sheet
Shareholding
information
Notice
of annual
general
meeting
Cash flow
statement
Factories and
distribution /
sales offices
Statement of
changes in
equity
Form of proxy
Glossary
01
STATEMENT OF COMPLIANCE
WITH THE CODE OF
CORPORATE GOVERNANCE
FOR THE YEAR ENDED 31 DECEMBER 2014
This statement is being presented to comply with the Code of Corporate Governance (the Code) contained in Clause 5.19 of Listing
Regulations of Karachi Stock Exchange and Regulation No. 35 of Listing Regulations of Lahore Stock Exchange for the purpose
of establishing a framework of good governance, whereby a listed company is managed in compliance with the best practices of
corporate governance.
GSK
The Company has applied the principles contained in the Code in the following manner:
02
1.
The Company encourages representation of independent, non-executive directors and directors representing minority interests
on its Board of Directors. At present the Board includes:
Independent Directors
Husain Lawai
Non-Executive Directors
Dave Cooper
Renaud Savary
Mehmood Mandviwalla
Executive Directors
M. Salman Burney
Yahya Zakaria
The independent director meets the criteria of independence under Clause 5.19.1 (b) of the Karachi Stock Exchange Limited
regulations and under Clause I (b) of Regulation No.35 of Chapter XI of the Listing Regulations of the Lahore Stock Exchange.
2.
The Directors have confirmed that none of them is serving as a director on more than seven listed companies, including this
Company.
3.
All the resident directors of the Company are registered as taxpayers and none of them has defaulted in payment of any loan
to a banking company, a Development Financial Institution or a Non-Banking Financial Institution or, being a Broker of a stock
exchange, has been declared as a defaulter by that stock exchange.
4.
The Company is finalizing the due diligence of selected candidates to fill in the casual vacancy on the Board. The Company has
applied to the SECP for extension of time in this respect.
5.
The Company has prepared a Code of Conduct and has ensured that appropriate steps have been taken to disseminate it
throughout the company along with its supporting policies and procedures.
6.
The Board has developed a vision/mission statement, overall corporate strategy and significant policies of the Company. The
Board has delegated the authority for approval of significant policies to the Chief Executive Officer. A record of particulars of such
significant policies along with the dates on which they were approved or amended has been maintained.
7.
All the powers of the Board have been duly exercised and decisions on material transactions, including appointment and
determination of remuneration and terms and conditions of employment of the Chief Executive Officer, other executive and nonexecutive directors, have been taken by the Board.
8.
The meetings of the Board were presided over by the Chairman and in his absence, by a director elected by the Board for the
purpose and the Board met at least once in every quarter. Written notices of the Board meetings, along with agenda and working
papers, were circulated at least seven days before the meeting. The minutes of the meetings were appropriately recorded and
circulated.
9.
During the year one director obtained certification under the directors training program.
10. New appointment of the Company Secretary was made during the year. The remuneration of Chief Executive Officer, Chief
Financial Officer, Company Secretary and Chief Internal Auditor was approved by the board.
11. The Directors Report for this year has been prepared in compliance with the requirements of the Code and fully describes the
salient matters required to be disclosed.
12. The financial statements of the Company were duly endorsed by Chief Executive Officer and Chief Financial Officer before
approval of the Board.
13. The Directors, Chief Executive Officer and executives do not hold any interest in the shares of the Company other than that
disclosed in the pattern of shareholding.
14. The Company has complied with all the material corporate and financial reporting requirements of the Code.
15. The Board has formed an Audit Committee. It comprises three members, all of whom are non-executive directors and the
chairman of the committee is an independent director.
16. The meetings of the Audit Committee were held at least once every quarter prior to approval of interim and final results of the
Company and as required by the Code. The terms of reference of the committee have been formed and advised to the committee
for compliance.
17. The Board has formed an HR and Remuneration Committee. It comprises four members, of whom three are non-executive
directors including the chairman of the committee.
18. The Board has outsourced the internal audit function to Ernst & Young Ford Rhodes Sidat Hyder & Co., Chartered Accountants,
who are considered suitably qualified and experienced for the purpose and are conversant with the policies and procedures of the
company.
19. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the quality control
review program of the ICAP, that they or any of the partners of the firm, their spouses and minor children do not hold shares of the
Company and that the firm and all its partners are in compliance with International Federation of Accountants (IFAC) guidelines
on code of ethics as adopted by the ICAP.
20. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance
with the listing regulations and the auditors have confirmed that they have observed IFAC guidelines in this regard.
21. The closed period, prior to the announcement of interim/final results, and business decisions, which may materially affect the
market price of companys securities, was determined and intimated to Directors, employees and stock exchanges.
23. The related party transactions have been placed before the Audit Committee and approved by the Board of Directors along with
pricing methods.
24. We confirm that all other material principles enshrined in the Code have been complied with.
Karachi
February 25, 2015
M. Salman Burney
Chief Executive
22. Material/price sensitive information has been disseminated among all market participants at once through the stock exchanges.
03
GSK
04
(d) in our opinion, Zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was deducted
by the company and deposited in the Central Zakat Fund established under section 7 of that Ordinance.
05
BALANCE SHEET
AS AT DECEMBER 31, 2014
Rupees 000
Note
2014 2013
NON-CURRENT ASSETS
Fixed assets
3
Intangible - goodwill
4
Long-term loans to employees
5
Long-term deposits
6,652,251
955,742
65,722
21,955
5,973,404
955,742
70,079
16,865
CURRENT ASSETS
7,695,670
7,016,090
158,775
6,308,061
535,116
414,641
144,669
5,793
56,925
301,986
799,984
591,667
2,060,444
156,548
6,271,405
349,950
248,463
118,592
9,753
46,951
392,202
1,231,588
224,269
1,872,999
Non-current assets classified as held for sale
15
11,378,061
27,147
10,922,720
SHARE CAPITAL AND RESERVES
19,100,878
17,938,810
3,184,672
8,760,431
2,895,156
8,454,157
11,945,103
11,349,313
382,253
593,354
250,977
612,012
975,607
862,989
6,002,632
177,536
5,561,429
165,079
6,180,168
5,726,508
Share capital
Reserves
16
17
NON-CURRENT LIABILITIES
Staff retirement benefits
Deferred taxation
18
19
CURRENT LIABILITIES
Trade and other payables
Provisions
20
21
7,155,775
6,589,497
CONTINGENCIES AND COMMITMENTS 22
GSK
The annexed notes 1 to 46 form an integral part of these financial statements.
06
M. Salman Burney
Chief Executive
19,100,878
17,938,810
Yahya Zakaria
Chief Financial Officer
Rupees 000
Note
2014 2013
Net sales
23
27,882,887
25,230,878
Cost of sales
24
(20,537,116)
(19,002,112)
7,345,771
6,228,766
Gross profit
Selling, marketing and distribution expenses
25
(3,694,682)
(3,625,389)
Administrative expenses
26
(1,020,261)
(935,974)
27
(253,411)
(153,230)
Other income
28
491,528
454,916
2,868,945
1,969,089
(20,363)
(159,217)
2,848,582
1,809,872
Taxation
(1,161,511)
(747,609)
1,687,071
1,062,263
(116,163)
(81,095)
Impact of taxation
38,187
27,491
(77,976)
(53,604)
1,609,095
1,008,659
Operating profit
Financial charges
29
30
Total comprehensive income
Earnings per share
31
Rs. 5.30
Rs. 3.34
M. Salman Burney
Chief Executive
Yahya Zakaria
Chief Financial Officer
07
Rupees 000
Note
2014 2013
3,221,259
2,355,352
32
(78,358)
(100,242)
(710,378)
(1,210,352)
(733)
11,776
2,431,790
1,056,534
(1,221,013)
(725,019)
109,575
91,982
CASH FLOWS FROM INVESTING ACTIVITIES
186,500
Return received
191,881
161,339
(919,557)
(285,198)
Dividend paid
(957,390)
(989,812)
554,843
(218,476)
2,097,268
2,315,744
2,652,111
2,097,268
CASH FLOWS FROM FINANCING ACTIVITIES
33
The annexed notes 1 to 46 form an integral part of these financial statements.
GSK
08
M. Salman Burney
Chief Executive
Yahya Zakaria
Chief Financial Officer
STATEMENT OF
CHANGES IN EQUITY
Capital reserves
General Unappropriated
Reserve
Issue of
reserve
profit
arising on
bonus
amalgamation
shares
Total
Balance as at January 1, 2013
2,631,960
2,184,238
3,999,970
2,577,270
11,393,438
(1,052,784)
263,196
(263,196)
263,196
(263,196)
1,062,263
1,062,263
(53,604)
1,008,659
1,008,659
2,895,156
2,184,238
3,999,970
2,269,949
11,349,313
(1,013,305)
(1,013,305)
289,516
(289,516)
(289,516)
(1,052,784)
10 shares held
- net of tax
(53,604)
Balance as at December 31, 2013
Final dividend for the year ended
10 shares held
289,516
1,687,071
1,687,071
(77,976)
1,609,095
1,609,095
3,184,672
2,184,238
3,999,970
2,576,223
11,945,103
- net of tax
(77,976)
Balance as at December 31, 2014
M. Salman Burney
Chief Executive
Yahya Zakaria
Chief Financial Officer
09
The Company is incorporated in Pakistan as a limited liability company and is listed on the Karachi and Lahore Stock
Exchanges. It is engaged in manufacturing and marketing of research based ethical specialties, other pharmaceutical
and consumer products.
2.
The Company is a subsidiary of S.R. One International B.V., Netherlands, whereas its ultimate parent company is
GlaxoSmithKline plc, UK.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
2.1
The principal accounting policies applied in the preparation of these financial statements are set out below.
Statement of compliance
These financial statements have been prepared in accordance with approved accounting standards as applicable in
Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued
by the International Accounting Standards Board as are notified under the Companies Ordinance, 1984, provisions of
and directives issued under the Companies Ordinance, 1984. In case requirements differ, the provisions or directives of
the Companies Ordinance, 1984 shall prevail.
Basis of preparation
i)
Provision for retirement benefits
ii)
Impairment of non-current assets
iii)
Provision for obsolete and slow moving stock
iv)
Provision for doubtful receivables
v) Taxation
GSK
2.2
10
Estimates and judgments are continually evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances.
There have been no critical judgments made by the Companys management in applying the accounting policies that
would have effect on the amounts recognised in the financial statements.
Changes in accounting standards, interpretations and pronouncements
(a)
Standards, interpretations and amendments to published approved accounting standards that are
effective in the current year and are relevant
IFRIC 21, Levies a new interpretation is applicable for the Company for the first time for the financial year
beginning on January 1, 2014, sets out the accounting for an obligation to pay a levy that is not income tax. The
interpretation addresses what the obligating event is that gives rise to pay a levy and when should a liability be
recognised. The Companys current accounting treatment / policy is already in line with this interpretation.
(b)
Standards, interpretations and amendments to published approved accounting standards that are
effective in the current year and are not relevant
Other new standards, amendments and interpretations that are mandatory for accounting periods beginning on
January 1, 2014 are considered not to be relevant for the Companys financial statements and hence have not
been detailed in these financial statements.
(c)
2.3
2.4
Standards, interpretations and amendments to published approved accounting standards that are not
yet effective
IFRS 13, "Fair value measurement", aims to improve consistency and reduce complexity by providing a precise
definition of fair value and a single source of fair value measurement and disclosure requirement for use across
IFRSs. The requirement do not extend the use of fair value accounting but provide guidance on how it should be
applied where its use is already required or permitted by other standards within IFRSs. The standard will affect
the determination of fair value and its related disclosures in the financial statements of the Company.
There are other standards and amendments to the published standards that are not yet effective and are also
not relevant to the Company and therefore, have not been presented here.
Approved funded gratuity plans / funds for its permanent employees; and
Approved funded pension plan / fund for management employees of former GlaxoSmithKline Pharmaceuticals
(Private) Limited.
Contributions to the gratuity and pension plans / funds are based on actuarial recommendations. The latest actuarial
valuations of the schemes were carried out as at December 31, 2014 using the Projected Unit Credit Method.
Retirement benefits are payable to employees on completion of prescribed qualifying period of service under the plans
/ funds.
2.4.2 The Company also operates approved contributory provident funds for all its permanent employees.
2.5 Compensated absences
The Company provides for compensated absences of its non-management employees on unavailed balance of leave in
the period in which the leave is earned.
2.6 Taxation
2.6.1 Current
The charge for current taxation is based on taxable income at the current rates of taxation after taking into account tax
credits and rebates available, if any, and taxes paid under the final tax regime.
11
Deferred tax is accounted for using the balance sheet liability method on all temporary differences arising between tax
bases of assets and liabilities and their carrying amounts. Deferred tax liability is recognised for all taxable temporary
differences and deferred tax asset is recognised to the extent that it is probable that taxable profits will be available
against which the deductible temporary differences, unused tax losses and tax credits can be utilised. Deferred tax is
charged or credited in the profit and loss account except for deferred tax arising on revaluation of available for sale
investments and remeasurements of retirement benefits obligations which are recognised in other comprehensive
income.
2.7 Provisions
2.8
Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events,
it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount
can be made.
Property, plant and equipment
(i)
Property, plant and equipment are stated at cost less accumulated depreciation / amortisation and accumulated
impairment.
(ii)
Depreciation is charged using the straight line method whereby the carrying value of an asset less estimated
residual value, if not insignificant, is written off over its estimated remaining useful life. Depreciation / amortisation
on assets is charged from the month of addition to the month of disposal. Cost of leasehold land is amortised
over the period of the lease.
Major spare parts and stand-by equipment qualify for recognition as property, plant and equipment when the
entity expects to use these for more than one year. Transfers are made to relevant operating assets category as
and when such items are available for use.
Maintenance and normal repairs are charged to income as and when incurred. Major renewals and improvements
are capitalised and the assets so replaced, if any, are retired.
Gains and losses on disposal of fixed assets are included in income currently.
Capital work-in-progress
Capital work-in-progress is stated at cost less impairment in value, if any. It consists of expenditure incurred and
advances made in respect of tangible fixed assets in the course of their construction and installation.
2.9 Impairment
GSK
12
Carrying values of assets are reviewed for impairment when events or changes in circumstances indicate that the
carrying value may not be recoverable. If any such indication exists, assets or cash-generating units are tested for
impairment. Cash generating units to which goodwill is allocated are tested for impairment annually. Where the carrying
values of assets or cash generating units exceed the estimated recoverable amount, these are written down to their
recoverable amount and the resulting impairment is charged to profit and loss account.
Impairment is reversed only if there has been a change in estimates used to determine recoverable amounts and only to
the extent that the revised carrying value does not exceed the carrying value that would have existed, had no impairment
been recognised, except impairment of goodwill which is not reversed.
2.10 Goodwill
Goodwill represents excess of consideration transferred over the fair value of the interest acquired in the net assets of
an entity. After initial recognition, it is carried at cost less accumulated impairment, if any.
2.11 Stores and spares
These are valued at lower of cost, determined using moving average method, and estimated recoverable amount. Items
in transit are valued at cost comprising invoice value plus other charges incurred thereon. Provision is made for items
which are obsolete and slow moving.
2.12 Stock-in-trade
These are valued at the lower of cost and net realisable value. Cost is determined using first-in first-out method.
Cost of raw and packing materials comprise of purchase price including directly related expenses less trade discounts.
Cost of work-in-process and finished goods include cost of raw and packing materials, direct labour and related
production overheads.
Net realisable value signifies the estimated selling price in the ordinary course of business less costs necessarily to be
incurred to make the sale.
2.13 Trade debts
Trade debts are initially recognised at the invoice value which signifies their fair value, and then carried at amortised
cost. Provision is made against debts considered doubtful of recovery. Bad debts are written off when considered
irrecoverable.
2.14 Investments
Available-for-sale
Securities intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or
changes in the interest rates, are classified as available-for-sale.
Available-for-sale investments are initially recognised at fair value plus transaction cost and subsequently recognised at
fair value.
Gains and losses arising from changes in fair value are recognised in other comprehensive income.
Held-to-maturity
These are investments with fixed or determinable payments and fixed maturity with the Company having positive intent
and ability to hold to maturity. These are stated at amortised cost.
2.15 Non-current assets held for sale
Non-current assets are classified as held for sale if their carrying amount is to be recovered principally through a sale
transaction rather than through continuing use. These assets are available for sale in their present condition subject
only to terms that are usual and customary for sales of such assets and their sale is highly probable.
The Company measures its non-current assets classified as held for sale at the lower of carrying amount and fair value
less costs to sell. Costs to sell signify the incremental costs directly attributable to the disposal of an asset, excluding
finance costs and income tax expense.
13
Cash and cash equivalents are carried in the balance sheet at cost / amortised cost. For the purpose of the cash flow
statement, cash and cash equivalents comprise of cash and cheques in hand, balances with banks on current, savings
and deposit accounts, short-term investments and short-term borrowings under running finance, having maturity of upto
three months.
2.17 Foreign currency translation
Foreign currency transactions are recorded into Pak Rupee using the exchange rates prevailing at the dates of the
transactions. Monetary assets and liabilities in foreign currency are translated into Pak Rupee at the rates of exchange
prevailing at the balance sheet date. Exchange gains and losses are included in income currently.
The financial statements are presented in Pak Rupees, which is the Companys functional and presentation currency.
2.18 Revenue recognition
Revenue is recognised to the extent it is probable that the economic benefits will flow to the Company and the revenue
can be measured reliably. Revenue is measured at the fair value of the consideration received or receivable, and is
recognised on the following basis:
Sales of goods are recorded when the risks and rewards of the goods are transferred to the customers.
-
Returns on deposits, investments, scrap sales and insurance commission are recognised on accrual basis.
2.19 Financial assets and liabilities
All financial assets and liabilities are initially measured at cost which is the fair value of the consideration given or
received respectively. These are subsequently measured at fair value, amortised cost or cost as the case may be.
2.20 Dividend
Dividend is recognised as a liability in the period in which it is approved.
2.21 Share based payments
Cash settled share based payments provided to employees are recorded as liability in the financial statements at fair
value over the period the services are received.
2.22 Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker who is responsible for allocating resources and assessing performance of the operating segments.
Rupees 000
Note
3.
3.1
3.5
3.6
FIXED ASSETS
Operating assets
Major spare parts and standby equipments
Capital work-in-progress
GSK
14
2014 2013
5,318,400
74,542
1,259,309
5,075,833
42,722
854,849
6,652,251
5,973,404
Land
Building
Freehold Leasehold On freehold On leasehold
Rupees 000
land
land
3.1
Operating assets
Plant &
machinery
Furniture
Vehicles
Office
& fixtures equipments
Total
174
351,719
32,547
146,388 340,542
446,959
26,068 178,901
252,397 5,075,833
100,258
784,733
Disposals
- Cost
(84,018)
(1,558) (136,279)
(3,887) (225,742)
- Accumulated depreciation
71,319
1,548
3,042
- Accumulated impairment
4,239
(8,460)
Depreciation charge
Impairment reversal
Transferred to disposal
- Cost
- Accumulated depreciation
(174)
(174)
(10)
(61,705)
(18,930) (103,823)
150,483
4,239
(845)
(71,020)
(5,251)
(8,915)
31,916
2,698
39
(64,417)
(7,752)
(1,611)
(73,954)
40,081
5,140
1,586
(24,336)
(2,612)
(25)
(27,147)
346,468
(40,302) (228,493)
74,574
(72,938) (478,652)
34,653
46,807
1,310,662 2,874,953
153,530 353,915
278,872 5,318,400
271,344 590,847
627,759 8,327,894
Cost
382,676
1,666,626 4,788,642
Accumulated depreciation
(36,208)
Accumulated impairment
346,468
(20,147)
1,310,662 2,874,953
(183)
153,530 353,915
(20,330)
278,872 5,318,400
Depreciation rate
% per annum
- 2.5 to 10
2.5
2.5 5 to 6.67
10
25 10 to 33.33
174
356,970
70,060
682,410
(27,040) (102,429)
142,064 314,215
242,609 4,624,418
20,545 161,044
67,110 1,001,169
Disposals
- Cost
- Accumulated depreciation
9,539
77,504
5,702
68,780
274,046
435,571
- Accumulated impairment
16,571
24,443
10
41,033
(930)
(482)
(168)
(48,740)
(2,177)
(52,497)
(36,532) (292,956)
(16,053)
(85,977)
Depreciation charge
Impairment charge
(5,251)
174
351,719
(5,343)
(55,145) (491,914)
(5,343)
146,388 340,542
252,397 5,075,833
248,445 548,225
531,388 7,842,857
Cost
174
382,676
Accumulated depreciation
(30,957)
Accumulated impairment
174
(31,916)
351,719
(27,084)
(222)
146,388 340,542
252,397 5,075,833
Depreciation rate
% per annum
- 2.5 to 10
2.5
2.5
5 to 10
10
(59,222)
25 10 to 33.33
15
Details of assets sold, having net book value in excess of Rs. 50,000 are as follows:
Description
Cost Accumulated
depreciation
and
impairment
Rupees 000
loss
Plant & machinery - various
items
11,677
7,485
Book
value
Office equipment
22,578
22,359
}
}
}
447
447
34,702
30,291
4,411
3,581
1,604
1,977
1,195
697
498
4,076
3,889
- Office equipment
115
115
8,967
6,305
2,662
1,758
679
751
371
Plant & machinery - various
items
2,143
GSK
Tender
Tender
Tender
2,143
1,007
308
9,877
9,751
126
288
274
14
12,602
11,147
1,455
735
437
475
475
298
Items sold with tenders having
individual book values
less than Rs. 50,000
16
1,555
Items sold with tenders having
individual book values
less than Rs. 50,000
Plant & machinery various items
Office equipment various items
Tender
1,555
187
Plant & machinery - various
items
.
Office equipment
Particulars of purchaser
219
Items sold with tenders having
individual book values
less than Rs. 50,000
- Plant & machinery various items
Mode of
disposal
4,192
Items sold with tenders having
individual book values
less than Rs. 50,000
- Plant & machinery various items
Sale
proceeds
- Office equipment -
various items
1,095
1,069
26
21,802
1,558
21,607
1,548
195
2,150
10
25,190
24,661
529
2,150
Plant & machinery - various
items
6,458
2,818
3,640
2,117 Tender
"
383
208
175
560
"
"
1,093
410
683
1,345
"
Balance carried forward
89,395
75,840
13,555
10,345
Motor vehicles
Book
value
Sale
proceeds
89,395
75,840
13,555
10,345
674
494
180
702
Mode of
disposal
Tender
1,123
579
544
1,026
2,359
1,029
1,330
2,230
Particulars of purchaser
2,420
1,815
605
1,300
5,500
7,280
2,432
2,048
342
5,232
2,090
2,319
1,711
942
769
1,682
3,769
2,704
1,065
3,375
2,119
1,589
530
1,588
Gulshan-e-Iqbal, Karachi
7,280
2,730
4,550
5,500
Gulistan-e-Johar, Karachi
2,065
1,549
516
1,819
Kemari, Karachi
2,855
2,006
849
2,604
766
574
192
815
1,337
1,003
334
957
1,285
858
427
1,324
490
368
122
500
Gulistan-e-Johar, Karachi
Mr. S. Muhammad Shakil, B-213,
Journalist Society ,Block 4/A,
Gulshan-e-Iqbal, Karachi
1,231
404
827
1,031
Karachi
985
595
390
901
1,049
787
262
870
815
611
204
754
1,211
322
889
1,128
134,651
99,189
35,462
48,270
Description
Cost Accumulated
depreciation
and
impairment
Rupees 000
loss
17
Motor vehicles
Book
value
Sale
proceeds
134,651
99,189
35,462
48,270
1,914
1,033
881
1,914
Mode of
disposal
Tender
Particulars of purchaser
Gulshan-e-Iqbal, Karachi
1,302
244
1,058
1,170
Gulshan-e-Iqbal, Karachi
2,777
363
2,414
2,668
7,104
3,353
3,751
4,461
Company
GSK
policy
18
1,354
1,016
338
338
855
641
214
214
652
489
163
163
1,800
1,350
450
450
1,067
717
350
656
1,524
691
833
762
655
491
164
650
815
611
204
326
1,203
489
714
624
1,049
705
344
629
1,800
1,350
450
450
674
607
67
260
1,654
362
1,292
1,305
1,874
903
971
1,496
855
641
214
214
1,089
645
444
923
1,414
1,061
353
566
1,527
760
767
1,193
1,203
526
677
968
1,760
523
1,237
1,061
3,250
2,438
812
1,300
1,068
617
451
546
1,073
503
570
887
1,849
1,387
462
740
1,450
997
453
870
1,564
1,173
391
850
1,043
750
293
635
2,118
925
1,193
1,067
810
607
203
203
1,354
1,016
338
338
1,123
456
667
1,100
985
657
328
356
1,414
1,068
346
566
191,673
131,354
60,319
81,189
Description
Cost Accumulated
depreciation
and
impairment
Rupees 000
loss
Motor vehicles
Book
value
Sale
proceeds
191,673
131,354
60,319
81,189
5,872
3,882
1,990
2,051
Mode of
disposal
Particulars of purchaser
Company
policy
855
641
214
214
1,401
941
460
841
815
611
204
204
7,400
4,509
2,891
4,440
1,462
800
662
1,305
1,068
684
384
850
1,608
678
930
1,260
662
497
165
220
1,068
651
417
824
1,203
451
752
1,093
1,148
413
735
1,100
1,098
618
480
923
1,760
357
1,403
1,467
1,673
444
1,229
1,500
4,201
2,178
2,023
4,214
Total
224,967
149,709
75,258
3.3
Leasehold land includes land at Sundar Industrial Estate, Lahore, with a net book value of Rs. 17.53 million (2013: Rs.
17.99 million) for which lease from Punjab Industrial Estates Development and Management Company is not finalised.
Considering the realignment in process at certain manufacturing facilities of the Company, during the year the Company
has changed the useful life of certain plant and machinery from 10 years to 15 years, which resulted in revision
of depreciation rates. The Company believes that the said change in estimate reflects more accurately the useful
life and pattern of consumption of economic benefits of the respective assets. This change has been accounted for
prospectively in accordance with the requirements of International Accounting Standards (IAS)-8 "Accounting Policies,
Changes in Accounting Estimates and Errors".
The effect of the change on depreciation expense, recognised in cost of sales, in the year is decrease in and in future
years increase in charge of Rs. 114.54 million respectively.
Rupees 000
2014 2013
3.5
42,722
41,382
(9,562)
29,810
21,486
(8,574)
74,542
42,722
3.4
103,695
19
2014 2013
3.6
Capital work-in-progress
Civil work
Plant and machinery
Furniture and fixtures
Office equipments
Advances to suppliers
274,797
856,608
13,130
89,837
65,124
Provision for impairment
1,299,496
(40,187)
903,793
(48,944)
4.
INTANGIBLE - Goodwill
1,259,309
854,849
955,742
955,742
Goodwill
170,970
556,822
18,167
44,694
113,140
The recoverable amount of cash generating unit is the higher of value in use or fair value less cost to sell. Value in use is
calculated as the net present value of the projected cash flows of the cash generating unit to which the asset belongs,
discounted at risk-adjusted discount rate.
Details relating to the discounted cash flow model used in the impairment test are as follows:
Valuation basis
Value in use
Key assumptions
Sales growth rates
Discount rate
Determination of assumptions
Growth rates are internal forecasts based on both internal and external
market information and past performance.
Cost reflects past experience, adjusted for inflation and expected changes.
Discount rate is primarily based on weighted average cost of capital.
Terminal growth rate
4%
Period of specific projected cash flows 5 years
Discount rate
16.5%
The valuation indicates sufficient headroom such that a reasonably possible change to key assumptions is unlikely to
result in an impairment of the related goodwill.
GSK
Rupees 000
20
2014 2013
5.
To executives
To other employees
9,884
104,431
4,685
116,038
Recoverable within one year - note 9
Executives
Other employees
114,315
120,723
(5,009)
(43,584)
(4,082)
(46,562)
(48,593)
(50,644)
Reconciliation of carrying amount of
loans to executives:
Opening balance
Disbursements including promotions
Recoveries and amortisation
65,722
70,079
4,685
9,469
(4,270)
7,402
5,955
(8,672)
9,884
4,685
5.1
These loans have been given in accordance with the terms of employment for purchase of house, motor car, motor cycle,
computer and for the purpose of staff welfare and are repayable in 12 to 60 equal monthly installments depending
upon the type of the loan. These loans are interest free except certain loans which carry interest ranging from 5% to
8% per annum (2013: 5% to 8% per annum). All loans are secured against the retirement fund balances.
The maximum aggregate amount of loans due from executives at the end of any month during the year was Rs. 13.78
million (2013: Rs. 9.99 million).
2014 2013
6.
172,092
(13,317)
167,775
(11,227)
7. STOCK-IN-TRADE
158,775
156,548
Raw and packing materials including
in transit Rs. 668.63 million (2013: Rs. 938.19 million)
2,431,776
Work-in-process
426,951
Finished goods including
in transit Rs. 466.87 million (2013: Rs. 481.39 million)
3,849,157
2,455,476
586,481
3,594,402
Less: Provision for slow moving, obsolete and
damaged items - note 7.3
6,707,884
6,308,061
6,271,405
103,429
64,154
80,897
128,383
48,395
43,494
7.1
(399,823)
6,636,359
(364,954)
Rupees 000
21
8.
2014 2013
TRADE DEBTS
Considered good
GlaxoSmithKline Trading Services Limited
- Associated company
- Others
Considered doubtful
12,426
522,690
54,032
349,950
57,261
Provision for doubtful debts
589,148
(54,032)
407,211
(57,261)
535,116
349,950
8.1 The maximum aggregate amount due from the related party at the end of any month during the year was Rs. 43.22
million (2013: Rs. 58.71 million).
Rupees 000
48,593
44,241
50,644
39,684
321,807
27,689
158,135
Provision for doubtful advances
349,496
(27,689)
158,135
321,807
158,135
414,641
248,463
10.
Trade deposits
- considered good
- considered doubtful
120,716
28,832
86,352
12,214
Provision for doubtful deposits
149,548
(28,832)
98,566
(12,214)
Prepayments
120,716
23,953
86,352
32,240
11. REFUNDS DUE FROM GOVERNMENT
144,669
118,592
56,925
18,464
46,951
18,464
Provision for doubtful receivables
75,389
(18,464)
65,415
(18,464)
56,925
46,951
GSK
22
2014 2013
9.
Rupees 000
12.
2014 2013
OTHER RECEIVABLES
Due from related parties
- Associated companies - note 12.1
- BMS Pakistan (Private) Limited
Management Staff Pension Fund - note 18.1
254,711
342,984
6,042
30,798
Claims recoverable from suppliers
Receivable against sale of assets
Workers Profits Participation Fund - note 12.3
Others
260,753
99
1,659
15,744
23,731
373,782
1,742
3,318
13,360
12.1 Due from associated companies
301,986
392,202
7,418
42,390
8,377
189
11,686
463
129,267
1,026
6,331
4,215
15,229
1,682
1,452
15,015
9,971
15,157
140,647
8,377
8,234
17
488
142,192
1,064
6,668
4,440
13,190
2,297
213
254,711
342,984
12.1.1 The Company also has Rs. 129.27 million (2013: Rs. 142.19 million) payable to the same entity that has been classified
in trade and other payables.
12.2 The maximum aggregate amount due from related parties at the end of any month during the year was Rs. 337.23
million (2013: Rs. 365.48 million).
2014 2013
Opening balance
Allocation for the year note 27
(2,129)
(155,100)
(11,205)
(98,160)
Interest on funds utilised in Companys business note 29
(157,229)
(109,365)
(103)
Amount paid to the Fund
(157,229)
172,973
(109,468)
107,339
15,744
(2,129)
Closing balance
Rupees 000
23
INVESTMENTS - Held-to-maturity
Investments represent three treasury bills (2013: two treasury bills) which are held with Company's banker for safe
custody yielding 9.46% to 9.88% per annum (2013: 9.41% to 9.79% per annum) with maturity by March 2015 (2013:
by January 2014).
Rupees 000
14.
2014 2013
With banks
on deposit accounts - note 14.1
on PLS savings accounts - note 14.1 & 14.2
on current accounts
[including foreign currency account
Rs. 246.57 million (2013: Rs. 166.09 million)]
Cash and cheques in hand
[including foreign currency in hand of
Rs. 4,890 (2013: Rs. 3.31 million)]
1,600,000
89,928
1,375,000
228,310
366,700
252,999
3,816
16,690
2,060,444
1,872,999
14.1 At December 31, 2014 the rates of mark-up on PLS savings accounts and on term deposit accounts were 6.5% to
7.4% (2013: 6.5% to 6.8%) per annum and 8.8% to 9.0% (2013: 8.5% to 9.2%) per annum respectively.
14.2 This includes Rs. 1.80 million under lien with bank against bank guarantee issued on behalf of the Company.
Rupees 000
15.
Freehold land
Building on freehold land
Plant and machinery
Furniture and fixtures
2014 2013
174
24,336
2,612
25
GSK
27,147
15.1 During the year, the Company initiated assessment of disposal of its land located at 18.5 Km, Ferozepur Road, Lahore
measuring approximately 27 acres alongwith the related operating assets. In this respect an agreement to sell with
a value of Rs. 950 million has been executed subsequent to the year end; accordingly provision for impairment
accumulating to Rs. 24.58 million in respect of these assets has been reversed.
24
Rupees 000
16.
SHARE CAPITAL
2014 2013
500,000,000
500,000,000
Ordinary shares of Rs. 10 each
Issued, subscribed and paid-up capital
5,000,000
5,000,000
53,868
53,868
643,398
2,487,406
643,398
2,197,890
3,184,672
2,895,156
5,386,825
5,386,825
64,339,835
64,339,835
248,740,618
219,789,047
2014 2013
318,467,278
289,515,707
16.1 As at December 31, 2014 S.R. One International B.V., Netherlands and its nominees held 245,180,610 shares (2013:
222,891,465 shares).
Rupees 000
2014 2013
17. RESERVES
18. STAFF RETIREMENT BENEFITS
2,184,238
3,999,970
2,576,223
2,184,238
3,999,970
2,269,949
8,760,431
8,454,157
18.1.1 The Company operates approved funded gratuity schemes for its permanent employees and approved funded pension
scheme only for management employees of former GlaxoSmithKline Pharmaceuticals (Private) Limited (the Plans).
Actuarial valuation of these plans is carried out every year and the latest actuarial valuation was carried out as of
December 31, 2014.
18.1.2 Plan assets held in trust are governed by local regulations which mainly include Trust Act, 1882; the Companies
Ordinance, 1984; Income Tax Rules, 2002 and the Rules under the trust deeds. Responsibility for governance of the
Plans, including investment decisions and contribution schedules, lies with the Boards of Trustees of relevant plans /
funds. The Company appoints the trustees and all trustees are employees of the Company.
18.1.3 The latest actuarial valuation of the Plan as at December 31, 2014 was carried out using the Projected Unit Credit
Method. Details of the Plans as per the actuarial valuation are as follows:
25
Balance at January 1
Benefits paid by the plan
Current service cost
Interest cost
Remeasurement on obligation
Balance at December 31
18.1.6 Movement in the fair value of plan assets
Balance at January 1
Contributions paid into the plan
Benefits paid by the plan
Interest income
Remeasurement on plan assets
Balance at December 31
18.1.7 Expense recognised in profit and loss account
Current service cost
Net interest cost / (income)
Expense / (income) recognised in profit
and loss account
18.1.8 Remeasurements recognised in Other
Comprehensive Income
(Gain) / loss from changes in
demographic assumptions
Experience losses / (gains)
Remeasurement of fair value
of plan assets
GSK
18.1.9 Net recognised liability / (asset)
26
Net liability / (asset) at the beginning of the year
Expense / (income) recognised in profit and
loss account
Contribution made to the fund during the year
Remeasurements recognised in other
comprehensive income
Recognised liability / (asset)
as at December 31
1,585,653
1,292,228
141,270
105,433
(1,203,400)
(1,041,251)
(147,312)
(136,231)
382,253
250,977
(6,042)
(30,798)
1,292,228
(116,922)
83,494
167,277
159,576
1,108,768
(117,928)
79,131
131,293
90,964
105,433
(5,805)
3,774
13,315
24,553
98,249
(5,729)
3,823
11,461
(2,371)
1,585,653
1,292,228
141,270
105,433
1,041,251
78,358
(116,922)
132,625
68,088
933,488
100,242
(117,928)
114,384
11,065
136,231
(5,805)
17,008
(122)
130,229
(5,729)
15,298
(3,567)
1,203,400
1,041,251
147,312
136,231
83,494
34,652
79,131
16,909
3,774
(3,693)
3,823
(3,837)
118,146
96,040
81
(14)
159,576
(20)
90,984
2,392
22,161
79
(2,450)
(68,088)
(11,065)
122
3,567
91,488
79,899
24,675
1,196
250,977
175,280
(30,798)
(31,980)
118,146
(78,358)
96,040
(100,242)
81
(14)
91,488
79,899
24,675
1,196
382,253
250,977
(6,042)
(30,798)
18.1.11 Actuarial Assumptions
17.14
80.57
2.29
13.61
84.57
1.82
96.74
3.26
98.66
1.34
100.00
100.00
100.00
100.00
The sensitivity of the defined benefit obligation to changes in the weighted principal assumptions is:
1%
1%
(126,040)
68,735
144,267
(62,724)
Impact on defined benefit obligation
Change in
Increase in
Decrease in
Rupees 000
assumption
assumption
assumption
27
Present value of defined
benefit obligation
Fair value of plan assets
(1,292,228)
1,041,251
(1,108,768)
933,488
(1,057,028)
843,122
(940,478)
635,425
(382,253)
(250,977)
(175,280)
(213,906)
(305,053)
Experience Adjustments
Gain / (loss) on obligation
(as percentage of plan
obligation)
Gain / (loss) on plan assets
(as percentage of
plan assets)
Pension plan / fund
Present value of defined
benefit obligation
Fair value of plan assets
(1,585,653)
1,203,400
(141,270)
147,312
(105,433)
136,231
(98,249)
130,229
(83,544)
118,656
(67,850)
111,558
6,042
30,798
31,980
35,112
43,708
Experience Adjustments
Gain / (loss) on obligation
(as percentage of plan
obligation)
(17.38)% 2.25% (6.45)% (9.60)% (1.84)%
Gain / (loss) on plan assets
(as percentage of
plan assets)
(0.08)% (2.62)% 1.00% (3.50)% (0.54)%
18.4 Company's contributions towards the provident fund for the year ended December 31, 2014 amounted to Rs. 93.51
million (2013: Rs. 81.46 million).
18.5 The weighted average duration of approved funded gratuity schemes for its permanent employees is 8 years and of
approved funded pension scheme is 12 years.
18.6 Expected maturity analysis of undiscounted retirement benefit plans.
GSK
28
Rupees 000.
Less than
a year
Between
1-2 years
177,955
140,635
Between
2-5 years
Between
5-10 years
Over
10 years
Total
18.7 Figures in this note are based on the latest actuarial valuation carried out as at December 31, 2014.
Rupees 000
DEFERRED TAXATION
Credit balance arising in respect of accelerated
tax depreciation allowances
Debit balances arising in respect of:
- Provision for retirement benefits
- Provision for doubtful debts and refunds
due from government
- Provision for trade deposits and
doubtful advances
- Provision for slow moving & obsolete stocks
and stores & spares
823,192
767,831
123,702
71,342
23,837
24,536
18,584
63,715
59,941
229,838
155,819
593,354
612,012
1,029,693
459,043
131,241
1,611,548
549,177
76,391
604,108
40,649
3,117,822
139,367
6,678
682,582
57,961
2,041,344
160,692
29,664
64,523
67,291
31,020
53,080
215,846
42,271
45,479
2,129
35,980
18,377
53,895
159,116
37,094
20.
Creditors
- Associated companies
- Others
Bills payable
Royalty and technical assistance fee payable
- Associated company
- Others
Accrued liabilities - note 20.1
Advances from customers
Contractors retention money
Taxes deducted at source and payable to
statutory authorities
Workers Profits Participation Fund - note 12.3
Workers Welfare Fund
Central Research Fund
Unclaimed dividend
Dividend payable - note 20.2
Others
6,002,632
5,561,429
20.1 This includes liability for share based compensation amounting to Rs. 92.02 million (2013: Rs. 153.08 million).
20.2 This amount pertains to dividend payable to Stiefel Laboratories (Ireland) Limited the application for remittance of which
is pending with the State Bank of Pakistan.
Rupees 000
19.
2014 2013
2014 2013
21. PROVISIONS
Balance as at January 1
Charge for the year
Payments during the year
165,079
30,730
(18,273)
200,716
15,244
(50,881)
Balance as at December 31
177,536
165,079
29
21.1 Provisions include restructuring costs and government levies of Rs. 64.85 million and Rs. 112.69 million (2013: Rs.
55.12 million and Rs. 109.96 million) respectively.
22. CONTINGENCIES AND COMMITMENTS
22.1 Contingencies
(a)
(b)
Claims against the Company not acknowledged as debt amount to Rs. 137.86 million (2013: Rs. 129.11 million) as at
December 31, 2014 for reinstatement of employees and other cases.
Income Tax
(i)
(ii)
(iii)
GSK
(iv)
30
While finalising the Companys assessments for the years 1999-2000 through 2002-2003 (accounting years
ended December 31, 1998 through 2001) the Assessing Officer (AO) had made additions to income raising
tax demands of Rs. 73.6 million. Such additions were made on the contention that the Company had allegedly
paid excessive amount for importing certain raw materials. Upon Companys appeal, the Commissioner of Inland
Revenue (Appeals) (CIRA) had maintained the addition to income for assessment years 1999-2000 and 20002001 (accounting years ended December 31, 1998 and 1999) while the additions made in assessment years
2001-2002 and 2002-2003 (accounting years ended December 31, 2000 and 2001) were deleted. In respect
of assessment years 1999-2000 and 2000-2001 the Company, and in respect of assessment years 20012002 and 2002-2003, the department, filed respective appeals with the Income Tax Appellate Tribunal (ITAT). In
2008, all the above assessments were set aside by ITAT for fresh consideration by the AO. In 2011, AO passed
assessment orders for the above years in which additions of same amount as described above were made. The
Company has filed appeals against the orders of AO with CIRA. In 2014, Companys appeals to Commissioner
Inland Revenue (Appeals) (CIRA) in respect of its income tax assessments for tax years 2000-01 to 2002-03
have been decided whereby additions to income in respect of certain raw materials have been deleted, resulting
in deletion of tax demand to the extent of Rs. 26.8 million. The Company has filed appeal before the Appellate
Tribunal Inland Revenue (ATIR) against the additions to income confirmed by the CIRA whereas the department
has filed appeal before the Appellate Tribunal Inland Revenue against the additions to income deleted by CIRA.
While finalising the assessment of former Smith Kline & French of Pakistan Limited for the assessment year
2002-2003 (accounting year ended December 31, 2001), the Assessing Officer (AO) had made addition to
income raising tax demands of Rs. 4.03 million. Such addition was made on the contention that the Company
had allegedly paid excessive amount for importing certain raw materials. Upon Companys appeal, the CIRA had
maintained the addition to income against which the Company filed an appeal with the ITAT.
In 2008, the above assessment was set aside by ITAT for fresh consideration by the AO. In 2011, AO passed
assessment order for the above year in which addition of same amount as described above was made. The
Company has filed appeal against the order of AO with CIRA who has maintained the aforesaid addition. The
Company has filed appeal against the decision of the CIRA before the Appellate Tribunal Inland Revenue.
While amending the assessments of the Company for the tax years 2005, 2006, 2007 and 2008 (accounting
years ended December 31, 2004, 2005, 2006 and 2007) the Assessing Officer (AO) had made additions to
income raising tax demands totalling Rs. 151.15 million. Such additions were made on the contention that the
Company had allegedly paid excessive amounts for importing certain raw materials and in respect of royalty.
The Company has filed appeals with CIRA in respect of above tax years. In tax years 2005 and 2008, CIRA has
granted relief on certain additions made by AO. The company has filed appeal before Appellate Tribunal Inland
Revenue against remaining additions on which relief has not been granted by CIRA.
While finalising the assessment of former GlaxoSmithKline Pharmaceuticals (Private) Limited (GSKPPL)
formerly Bristol-Myers Squibb Pakistan (Private) Limited for tax year 2006 (accounting year ended December
31, 2005) the Assessing Officer (AO) made additions to income raising tax demands of Rs. 10.04 million on
the contention that the Company had allegedly paid excessive amounts for importing certain raw materials. The
Company has filed an appeal with CIRA in respect of the said matter.
(v)
(c)
In October 2007, the High Court awarded its verdict for the assessment years 1989-1990 and 1990-1991 in
favour of the tax department confirming tax demands of Rs. 11.99 million. However, the decisions in respect
of the departments appeals for the assessment years 1991-1992 through 2002-2003 are still pending in the
High Court for which the net aggregate tax liability, if such cases are decided against the Company, will be Rs.
302.11 million.
The Company had filed an appeal in the Supreme Court of Pakistan against the above decision of the High
Court in respect of assessment years 1989-1990 and 1990-1991 and a leave to appeal had been granted to
the Company. The Company through its legal counsel had also filed review petition before the High Court in this
regard.
(vi)
While finalising the assessments of the Company for tax year 2012 (accounting year ended December 31,
2011) the Additional Commissioner (AC) made additions to income raising tax demands of Rs. 87.15 million on
the contention that the Company had allegedly paid excessive amounts on account of royalty and technical fees
and certain imported raw materials. The Company has filed an appeal with the Commissioner of Inland Revenue
(Appeals) (CIRA) in respect of the said matter. The CIRA has deleted the order passed under section 122(5A)
of the Ordinance.
(vii) During the year, while finalising the assessments of the Company for tax year 2011 (accounting year ended
December 31, 2010) the Deputy Commissioner Inland Revenue (DCIR) made additions to income raising tax
demands of Rs. 98.64 million on the contention that the Company had allegedly paid excessive amounts on
account of royalty, certain imported raw materials and stock written off. The Company filed appeal with the CIRA
against the DCIRs order. The CIRA has maintained the additions made by DCIR, against which the company
has filed appeal before ATIR.
(viii) During the year, as a result of monitoring of withholding tax for the tax year 2012 (accounting year ended
December 31, 2011) Deputy Commissioner Inland Revenue (DCIR) issued an order raising tax demand
amounting to Rs. 80 million. Such demand has been made on the contention that the Company has not deducted
tax @ 20% at the time of making payment on account of meeting and symposia and gifts and giveaways under
section 156 of Income Tax Ordinance 2001. The Company has filed an appeal before CIRA against the order
of DCIR. In addition to this, on the Companys appeal the High Court has granted stay against the recovery until
the case is heard by Sindh High Court.
The management is confident that the ultimate decisions in the above cases will be in favour of the Company, hence no
provision has been made in respect of the aforementioned additional tax demands.
Sales Tax
(i)
Effective July 1 , 2013, Sindh Revenue Board has levied Sindh Sales Tax at the rate of 16 per cent on toll
manufacturing activities under Sindh Sales Tax on Services Act, 2011 treating such activity as a service.
Historically, such activity had been treated as a manufacturing of goods and were taxable within the domain of
Federal Sales Tax Act, 1990. No sales tax was payable under the Federal law on toll manufacturing charges paid
by the Company owing to the fact that the Company is engaged in manufacturing of pharmaceutical products
which are exempt from federal sales tax.
While finalising the assessments of former GlaxoSmithKline Pharmaceuticals (Private) Limited (GSKPPL)
formerly Bristol-Myers Squibb Pakistan (Private) Limited for assessment years 1989-1990 through 20022003 (accounting years ended December 31, 1989 through 2001) the Assessing Officer (AO) made additions
to income raising tax demands of Rs. 314.10 million on the contention that the Company had allegedly paid
excessive amounts for importing certain raw materials. CIRA also maintained the additions. On GSKPPLs
appeals, the additions made by the AO were deleted by ITAT. Later, the department filed appeals against the
decision of ITAT in the High Court of Sindh (the High Court).
31
(ii)
In view of this, the Company has jointly filed a constitutional petition with M/s. Pharmatec Pakistan (Private)
Limited (toll manufacturer of the Company) before the Honorable Sindh High Court contending that toll
manufacturing is a process and not a service; therefore comes under the legislative authority of the Federal
Government; hence, Sindh Sales Tax is not chargeable on toll manufacturing charges billed to the Company.
The High Court has issued a stay order and restrained Sindh Revenue Board from collection of sales tax on toll
manufacturing charges till the time aforesaid petition is decided by the Court. The management of the Company
on the advice of its legal counsel is confident that the eventual outcome of the petition would be in favour, hence,
no provision is made in the financial statements for sales tax on toll manufacturing charges which estimates to
an amount of Rs. 110.04 million (2013: Rs. 29.96 million).
During the year, Commissioner has raised a demand of Rs. 36.4 million in respect of few products of Company
on the ground that the products are neither medicines nor drugs which are exempt from levy of sales tax (as per
SRO 551(I)/2008) etc. Companys appeal is pending with Income Tax Appellate Tribunal.
The management is confident that the ultimate decisions in the above cases will be in favour of the Company, hence no
provision has been made in respect of the aforementioned tax demands.
22.2 Commitments
Commitments for capital expenditure outstanding as at December 31, 2014 amounted to Rs. 1,077.17 million (2013:
Rs. 232.34 million).
Rupees 000
23.
NET SALES
Gross sales
Local
Export
Less: Commissions, returns and discounts
Sales tax
2014 2013
27,762,280
997,647
25,110,902
923,658
28,759,927
585,508
291,532
26,034,560
542,845
260,837
27,882,887
25,230,878
23.1 Sales of major product categories i.e. antibiotics, dermatologicals and consumer during the year amounted to Rs. 10.38
billion, Rs. 3.18 billion and Rs. 4.85 billion (2013: Rs. 9.86 billion, Rs. 2.68 billion and Rs. 4.17 billion) respectively.
23.2 Company sells its products through a network of distribution channels involving various distributors / sub-distributors
and also directly to government and other institutions. Sales to two distributors (2013: two distributors) exceed 10
percent of the net sales during the year, amounting to Rs. 3.69 billion and Rs. 3.15 billion (2013: Rs. 3.34 billion and
Rs. 2.96 billion).
GSK
32
Rupees 000
COST OF SALES
Raw and packing materials consumed
Manufacturing charges to third parties
Stores and spares consumed
Salaries, wages and other benefits - note 24.1
Fuel and power
Rent, rates and taxes
Royalty and technical assistance fee
Insurance
Publication and subscriptions
Repairs and maintenance
Training expenses
Travelling and entertainment
Vehicle running
Depreciation
(Reversal of) / Charge for Impairment
Provision for slow moving and obsolete stock
and damaged items
Provision for slow moving and obsolete
stores and spares
Provision for doubtful advances
Canteen expenses
Laboratory expenses
Communication and stationery
Security expenses
Stock written off
Other expenses
13,295,361
645,677
53,070
1,453,680
656,388
3,649
246,607
119,425
3,273
203,419
3,185
13,706
25,152
315,288
(34,653)
13,067,837
471,245
44,940
1,331,233
569,759
3,375
212,208
112,957
1,567
203,217
2,821
10,738
23,966
378,114
5,343
61,018
85,158
5,388
27,689
94,131
40,774
9,143
11,915
17,282
48,512
641
91,907
41,938
10,966
11,339
17,771
50,959
Opening stock of work-in-process
Closing stock of work-in-process
17,319,079
583,291
(423,385)
16,749,999
508,555
(583,291)
Opening stock of finished goods
Purchase of finished goods
17,478,985
3,385,581
3,400,399
16,675,263
2,384,664
3,498,279
Closing stock of finished goods
Cost of samples shown under selling, marketing
and distribution expenses - sales promotion
24,264,965
(3,545,291)
22,558,206
(3,385,581)
(182,558)
(170,513)
20,537,116
19,002,112
24.1 Salaries, wages and other benefits include Rs. 52.68 million and Rs. 39.75 million (2013: Rs. 39.31 million and Rs.
34.51 million) in respect of defined benefit plans and contributory provident fund respectively.
24.
2014 2013
33
25.
2014 2013
1,063,910
1,039,494
434,178
450,089
304,168
83,003
82,764
37,858
36,428
24,157
(3,229)
34,736
31,895
14,240
16,586
1,415
1,840
5,806
35,344
1,008,810
964,176
570,438
455,308
270,321
69,732
72,523
33,706
19,982
23,888
20,714
25,366
30,833
13,447
12,633
1,089
1,755
1,320
29,348
3,694,682
3,625,389
25.1 Salaries, wages and other benefits include Rs. 40.68 million and Rs. 34.88 million (2013: Rs. 37.96 million and Rs. 31.57
million) in respect of defined benefit plans and contributory provident fund respectively.
Rupees 000
26.
ADMINISTRATIVE EXPENSES
GSK
34
2014 2013
606,741
80,361
17,353
6,404
47,150
26,870
48,408
100
13,140
9,141
29,004
29,053
14,832
7,676
18,346
8,512
28,000
29,170
562,145
60,433
21,039
9,860
43,424
28,638
45,412
4,684
13,965
8,942
28,858
21,097
6,962
7,667
18,400
9,696
13,528
31,224
1,020,261
935,974
26.1 Salaries, wages and other benefits include Rs. 24.87 million and Rs. 17.22 million (2013: Rs. 18.76 million and Rs. 15.38
million) in respect of defined benefit plans and contributory provident fund respectively.
Rupees 000
2014 2013
4,675
4,500
3,295
200
971
3,200
500
742
9,141
8,942
26.3 This represents expenses of Rs. 53.66 million (2013: Rs. 55.87 million) net of recovery of Rs. 24.49 million (2013: Rs.
24.65 million) from related parties.
Rupees 000
27.
2014 2013
155,100
67,291
31,020
98,160
36,692
18,378
253,411
153,230
20,569
167,352
17,260
141,627
Income from non-financial assets
187,921
158,887
36,896
39,485
44,466
32,951
2,011
48,441
40,387
21,417
1,855
6,385
126,897
11,945
186,500
491,528
454,916
20,363
143,070
16,044
103
20,363
159,217
28. OTHER INCOME
Income from financial assets
Scrap sales
Insurance commission
Service fee on clinical trial studies
Liabilities no longer required written back
Gain on transfer of marketing authorisation rights
and related trademarks of certain products
Exchange gain - net
Insurance claim recovery
29.
FINANCIAL CHARGES
35
2014 2013
30. TAXATION
Current
- for the year
- prior years
Deferred
1,141,982
19,529
720,999
(82,143)
108,753
30.1 Relationship between tax expense and accounting profit
1,161,511
747,609
Profit before taxation
Applicable tax rate
Tax calculated at applicable tax rate
Impact of taxability at different rate
and Final Tax Regime
Prior years adjustment
Effect of tax credits
Effect of change in tax rate
Tax effect of other than temporary differences
2,848,582
1,809,872
33%
34%
940,032
615,356
264,975
(49,814)
(1,066)
7,384
228,958
(82,143)
(15,164)
602
31. EARNINGS PER SHARE
1,161,511
747,609
31.1
1,687,071
1,062,263
318,467
318,467
Rs. 5.30
Rs. 3.34
The weighted average shares at December 31, 2013 have been increased to reflect the bonus shares issued during
the year.
GSK
31.2 A diluted earnings per share has not been presented as the Company did not have any convertible instruments in issue
which would have any effect on the earnings per share if the option to convert is exercised.
36
Rupees 000
32.
2014 2013
2,848,582
1,809,872
443,999
(36,896)
513,622
(39,485)
(187,921)
118,227
(186,500)
(158,887)
96,026
337,409
224,776
3,185,991
2,034,648
(2,227)
(36,656)
(185,166)
(166,178)
(26,077)
(9,974)
63,801
(15,857)
(1,191,185)
412
(5,393)
(26,050)
(6,192)
52,488
(362,477)
(1,191,777)
385,288
12,457
1,548,118
(35,637)
(Increase) / decrease in current assets
Stores and spares
Stock-in-trade
Trade debts
Loans and advances
Trade deposits and prepayments
Refunds due from government
Other receivables
Increase / (decrease) in current liabilities
Trade and other payables
Provisions
35,268
320,704
3,221,259
2,355,352
2,060,444
591,667
1,872,999
224,269
2,652,111
2,097,268
33.
37
SEGMENT INFORMATION
Management has determined the operating segments based on the information that is presented to the chief operation
decision maker of the Company for allocation of resources and assessment of performance. Based on internal
management reporting structure the Company is organised into the following two operating segments:
- Pharmaceuticals
- Consumer healthcare
Management monitors the operating results of above mentioned segments separately for the purpose of making
decisions about resources to be allocated and for assessing performance.
Segment results and assets include items directly attributable to a segment as well as those that can be allocated on a
reasonable basis.
34.1 The financial information regarding operating segments is as follows:
Segment wise operating results
Pharma- Consumer
Rupees 000
Gross profit
Selling, marketing and
distribution expenses
Administrative expenses
Segment results
Total
Pharma-
Consumer
Total
23,034,203
4,848,684 27,882,887 21,062,973
4,167,905 25,230,878
(17,167,734) (3,369,382) (20,537,116) (15,974,046) (3,028,066) (19,002,112)
5,866,469
1,479,302
7,345,771
330,583
2,630,828
5,088,927
1,139,839
(2,748,133)
(866,093)
1,474,701
6,228,766
(877,256) (3,625,389)
(69,881)
(935,974)
192,702
1,667,403
Other operating expenses
(253,411)
(153,230)
Other income
491,528
454,916
Financial Charges
(20,363)
(159,217)
2,848,582
1,809,872
Pharma- Consumer
Rupees 000
Segment assets
Total
Pharma-
Consumer
Total
897,421 14,583,336
Unallocated assets
3,506,990
3,355,474
Total Assets
19,100,878
17,938,810
Segment liabilities
5,102,376
801,945
5,904,321
5,122,799
382,144
5,504,943
GSK
Unallocated liabilities
1,251,454
1,084,554
38
Total liabilities
7,155,775
6,589,497
Pharma- Consumer
Rupees 000
433,527
2,960,961
639,715
405,439
10,472
163,370
833,957
44,650
Total
443,999
3,124,331
1,473,672
450,089
Pharma-
504,515
2,796,269
806,140
427,335
Consumer
9,107
105,919
728,474
27,973
Total
513,622
2,902,188
1,534,614
455,308
34.5 The Company has realigned certain brands from Pharmaceuticals segment to Consumer healthcare segment, in line
with group strategy envisaged at helping these products achieve better market penetration. Due to this realignment,
effects on segment analysis relating to prior year have been summarised below:
Rupees 000
Segment revenues
Segment results
Segment assets
Other segment information
Decrease in
Pharam-
ceuticals
Increase in
Consumer
healthcare
512,615
50,408
84,160
60,540
512,615
50,408
84,160
60,540
34.6 Non-current assets classified as held for sale are included in segment assets of Pharmaceuticals segment.
35.
The amounts charged in these financial statements for remuneration of the Chief Executive, Directors and Executives
are as follows:
Chief Executive
Rupees 000
Managerial remuneration
Bonus - note 35.1
Retirement benefits *
House rent
Utilities
Medical expenses
Others
Number of person(s)
Executives
19,809
18,491
11,474
25,628
424,965
357,301
24,685
42,524
6,205
12,473
228,126
193,230
6,395
3,548
2,052
7,840
143,280
99,600
8,720
7,564
2,798
11,533
175,320
148,179
1,938 1,681 622 2,563 38,960 32,929
146
111
66
364
15,806
13,572
441
419 1,015 4,194 127,369 94,686
62,134
1
74,338
1
24,232
2
64,595 1,153,826
5
317
939,497
296
* Retirement benefits represent amount contributed towards various retirement benefit plans.
35.1 Bonus includes share based payments as Share Appreciation Rights (SARs) given to the Chief Executive, Executive
Directors and certain executives amounting to Rs. 21.57 million (2013: Rs. 72.25 million). These are granted every year
and are payable upon completion of three years of qualifying period of service. These are linked with the share value of
ultimate parent company, GlaxoSmithKline plc, UK. Accruals made for bonus during the year are actualised subsequent
to the year end when performance evaluations are finalised; and comparative figures are adjusted accordingly.
Directors
39
36.
In addition to the above, fee to three (2013: three) non-executive Directors during the year amounted to Rs. 675
thousand (2013: Rs. 900 thousand).
Chief Executive, Executive Directors and certain executives are also provided with free use of Company maintained cars
in accordance with the Company policy.
TRANSACTIONS WITH RELATED PARTIES
Rupees 000
2014 2013
Relationship
Nature of transactions
Holding Company:
Dividend paid
780,183
810,580
Associated companies /
undertakings:
a. Purchase of goods
b. Purchase of property, plant and equipment
c. Sale of property, plant and equipment
d. Sale of goods
e. Royalty expense charged
f. Recovery of expenses
g. Service fee on clinical trial studies
h. Services received
i. Legal/professional fee
j. Donations
k. Payment on behalf of associated company
Staff retirement funds:
Key management personnel: a. Salaries and other employee benefits
b. Post employment benefits
c. Sale of assets - sales proceeds
Fee for attending meetings
to non-executive directors
4,944,001
5,446
116,345
232,976
24,494
2,011
2,031
2,725
5,338,218
156
120,059
198,010
24,077
1,855
1,859
888
575
175,218
20,776
11,805
192,482
18,210
5,484
675
900
36.1 Balances of related parties as at December 31, 2014 are included in the respective notes to the financial statements.
These are settled in the ordinary course of business. The receivables and payables are mainly unsecured in nature and
bear no interest.
37.
The facility for running finance available from a bank amounted to Rs. 100 million (2013: Rs. 100 million). Rate of
mark-up is three month KIBOR plus 1.25% (2013: three month KIBOR plus 1.25%) per annum. The arrangements are
secured by Intra Group Guarantee.
GSK
40
The facilities for opening letters of credit and guarantees as at December 31, 2014 amounted to Rs. 2.17 billion (2013:
Rs. 2.82 billion) of which unutilised balances at the year end amounted to Rs. 1.13 billion (2013: Rs. 2.27 billion).
38.
All the financial assets of the Company, except treasury bills classified as held to maturity, are categorised as loans and
receivables and all the financial liabilities are categorised as financial liabilities measured at amortised cost. The carrying
values of all financial assets and liabilities approximate their fair values.
Interest bearing
Rupees 000
Non-interest bearing
Total
Maturity
Maturity Total
Maturity
Maturity Total
up to one
after one
up to one
after one
year
year
year
year
Financial assets
Loans to employees
Trade deposits
Trade debts
Interest accrued
Other receivables
Short term investments
Cash and bank balances
1,873
1,797
3,670
46,720
63,925
110,645
114,315
120,716
120,716 120,716
535,116
535,116 535,116
5,793
5,793 5,793
280,200
280,200 280,200
591,667
591,667
591,667
1,689,928
1,689,928
370,516
370,516 2,060,444
2,283,468
1,797
2,285,265
1,359,061
63,925
1,422,986
3,708,251
1,827,596
4,581
1,832,177
1,127,775
65,498
1,193,273
3,025,450
5,700,431
5,700,431
5,700,431
5,700,431
5,700,431 5,700,431
5,298,772
5,298,772 5,298,772
2,283,468
1,797
2,285,265 (4,341,370)
63,925
1,827,596
4,581
1,832,177 (4,170,997)
Financial liabilities
The effective mark-up rates for the financial assets and liabilities are mentioned in respective notes to the financial
statements.
38.2 Financial Risk Management
Market risk
(i)
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in the market
interest rates. As at December 31, 2014 the Company does not have any borrowings. Further, the entire interest
bearing financial assets of Rs. 2.28 billion (2013: Rs. 1.83 billion) are on fixed interest rates, hence management
believes that the Company is not exposed to interest rate changes.
(ii)
Currency risk
Foreign currency risk arises mainly where receivables and payables exist in foreign currency due to transactions
with foreign undertakings. Net payables exposed to foreign currency risk as at December 31, 2014 amount to
Rs. 906.22 million (2013: Rs. 1,178.86 million). The liability is mainly denominated in US Dollars. At December
31, 2014, if the Pakistan Rupee had weakened / strengthened by 5% against the US Dollar with all other
variables held constant, post-tax profit for the year would have been lower / higher by Rs. 45.31 million (2013:
Rs. 58.94 million).
(a)
41
Credit risk
Credit risk represents the accounting loss that would be recognised at the reporting date if counterparts failed to
perform as contracted. The analysis of maximum exposure to credit risk resulting from each class of financial assets is
as follows:
Rupees 000
Trade debts
Loans to employees, trade deposits, interest accrued and other receivables
Bank balances
(c)
349,950
578,232
1,856,309
3,112,768
2,784,491
Bank balances represent low credit risk as these are placed with banks having good credit rating assigned by credit
rating agencies.
Liquidity risk
Liquidity risk reflects the Company's inability in raising funds to meet commitments. The Company manages liquidity risk
by maintaining sufficient cash and balances with banks in deposit accounts and arranging financing through banking
facilities and managing timing of payments to associated undertakings.
39.
39.1
GSK
535,116
521,024
2,056,628
Trade debts of the Company are not exposed to significant credit risk as the Company trades with credit worthy
third parties. Trade debts of Rs. 268.47 million (2013: Rs. 106.71 million) are past due of which Rs. 54.03 million
(2013: Rs. 57.26 million) have been impaired. Past due but not impaired balances include Rs. 35.95 million (2013: Rs.
10.35 million) outstanding for more than three months.
Loans to employees are secured against their retirement benefits.
Rupees 000
42
2014 2013
2014 2013
2,778,607
2,656,590
95.61%
2,371,642
2,256,860
95.16%
The cost of the above investments amounted to Rs. 2,434.3 million (2013: Rs. 2,097.7 million)
Percentage (%)
Government securities
Debt securities
Equity securities
Mutual funds
Bank deposits
76.40
15.83
2.65
5.12
Rupees 000
75.67
1.89
16.02
6.20
0.22
2,029,677
420,536
70,431
135,946
1,707,606
42,717
361,648
139,889
5,000
39.3 The investments out of provident funds have been made in accordance with the provisions of Section 227 of the
Companies Ordinance, 1984 and the rules formulated for this purpose.
40.
NUMBER OF EMPLOYEES
Number of employees including contractual
employees at the end of year
2014 2013
2,514
2,540
2,548
2,570
41.
The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going
concern so that it can continue to provide adequate returns for shareholders and benefits for other stakeholders and
to maintain an optimal return on capital employed. The current capital structure of the Company is equity based with no
financing through borrowings.
42.
The capacity and production of the Companys plants are indeterminable as these are multi-product and involve varying
processes of manufacture.
MAJOR GLOBAL THREE-PART INTER-CONDITIONAL TRANSACTION BETWEEN GLAXOSMITHKLINE PLC,
UK AND NOVARTIS AG, SWITZERLAND
GlaxoSmithKline plc, UK (GSK plc) announced a major global three-part inter-conditional transaction with Novartis
AG, Switzerland (Novartis) on April 22, 2014, whereas GSK plc and Novartis will work to create a new world-leading
Consumer healthcare business with GSK plc holding a controlling equity interest of 63.5%. Further, GSK plc will also
acquire Novartiss global vaccines business (excluding influenza vaccines) whereas GSK plc will divest its marketed
Oncology portfolio and Research and Development activities related to it, as well as rights to GSK plcs AKT inhibitor to
Novartis.
Pursuant to the global transaction the Company will have its distribution rights terminated for the Oncology portfolio,
which portfolio contributed to less than 1% in the revenue and gross profit of the Company.
43.
43
In respect of Consumer healthcare business, the Board of Directors of the Company in their meeting held on February
25, 2015 considered various options and in principle decided for its demerger. The Board has also approved the
appointment of financial and legal consultants for advising in respect of structuring of the transaction and scheme of
arrangements.
The above transactions are subject to the receipt of all applicable legal and regulatory approvals, consents, permissions
and sanctions as may be necessary.
44.
45.
46.
SUBSEQUENT EVENTS
The Board of Directors in their meeting held on February 25, 2015 proposed a cash dividend of Rs. 5 per share (2013:
Rs. 3.50 per share) amounting to Rs. 1.59 billion (2013: Rs. 1.01 billion) subject to the approval of the members in the
forthcoming annual general meeting of the Company.
CORRESPONDING FIGURES
Corresponding figures have been re-arranged and reclassified, wherever necessary for purpose of comparison. There
were no significant reclassifications in these financial statements.
DATE OF AUTHORISATION FOR ISSUE
These financial statements were approved and authorised for issue by the Board of Directors of the Company on
February 25, 2015.
GSK
44
M. Salman Burney
Chief Executive
Yahya Zakaria
Chief Financial Officer
PATTERN OF SHAREHOLDING
FORM 34
2,039
1,528
1,221
1,397
336
140
77
49
34
17
16
9
7
11
4
8
4
6
1
1
5
4
3
2
4
2
2
1
3
1
2
1
2
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
From
1
101
501
1001
5001
10001
15001
20001
25001
30001
35001
40001
45001
50001
55001
60001
65001
70001
75001
80001
85001
90001
95001
100001
105001
120001
125001
140001
145001
165001
175001
180001
190001
195001
235001
240001
285001
300001
305001
325001
365001
680001
845001
1020001
1125001
1850001
2165001
2190001
4085001
9175001
9800001
17825001
39375001
205800001
SHARES HOLDING
To
100
500
1000
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
55000
60000
65000
70000
75000
80000
85000
90000
95000
100000
105000
110000
125000
130000
145000
150000
170000
180000
185000
195000
200000
240000
245000
290000
305000
310000
330000
370000
685000
850000
1025000
1130000
1855000
2170000
2195000
4090000
9180000
9805000
17830000
39380000
205805000
6,958
NUMBER OF
HAREHOLDERS
S
45
CATEGORIES OF
SHAREHOLDERS
a)
Sr. No. Categories of Shareholders
1
2
3
4
5
6
7
8
Number of Shareholders
Individuals
Investment Companies
Insurance Companies
Joint Stock Companies
Financial Institutions
Associated Companies
Central Depository Company (b)
Others (see below)
Others:
i
Mohsin Trust
ii
The Al-Malik Charitable Trust
iii
Punjabi Saudagar Multipurpose Co-operative Society
iv
The Anjuman Wazifa Sadat-o-Momineen Pakistan
(b)
Individuals
Investment Companies
Insurance Companies
Joint Stock Companies
Financial Institutions
Modarabas
Foreign Shareholders
Others (see below)
GSK
2,149
5
1
10
2
4
4,783
4
4,853,474
2,757
1
21,980
6,038
263,029,794
50,509,990
43,244
1.53
0.00
0.00
0.01
0.00
82.59
15.86
0.01
6,958
318,467,278
100.00
1
1
1
1
26,452
936
332
15,524
0.01
0.00
0.00
0.00
43,244
0.01
Number of Shareholders
Others:
i
The Aga Khan University Foundation
ii
The Pakistan Memon Educational & Welfare Society
iii
Trustees Kandawala Trust
iv
Trustees Saeeda Amin WAKF
v
Trustees Mohammad Amin WAKF ESTATE
vi
Managing Committee Karachi Zarthosti Banu Mandal
vii
Trustees of Aminia Muslim Girls School
viii
Trustees of Zafa Phar Lab. Staff P. Fund
ix
Trustees Mrs. Khorshed H. Dinshaw & Mr. Hoshang N.E. Dinshaw C.T
x
Trustees D.N.E. Dinshaw Charity Trust
xi
Trustee A. Saadat & Co. Employees Gratuity Fund
xii
Trustee National Bank of Pakistan Employees Pension Fund
xiii
Trustees of EA Consulting (Pvt.) Ltd Employee P.F.
xiv
Trustee National Bank of Pakistan Employee Benevolent Fund Trust
xv
The Al-Malik Charitable Trust
xvi
Trustees Saeeda Amin WAKF
xvii
Trustee Abdul Shakoor Haji Hussain
xviii
Trustee Avanceon Ltd. Employees Provident Fund
46
Percentage (%)
1
2
3
4
5
6
7
8
Shares held
Shares held
Percentage (%)
4,660
16
9
59
10
3
8
18
13,655,874
13,865,669
10,535,121
545,334
6,789,833
40,530
3,561,099
1,516,530
4.29
4.35
3.31
0.17
2.13
0.01
1.12
0.48
4,783
50,509,990
15.86
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
35,510
30,125
68,352
87,500
180,000
29,012
33,000
16,738
54,239
73,610
6,122
846,818
11,000
29,713
3,221
5,000
1,070
5,500
0.01
0.01
0.02
0.03
0.06
0.01
0.01
0.01
0.02
0.02
0.00
0.27
0.00
0.01
0.00
0.00
0.00
0.00
18
1,516,530
0.48
SHAREHOLDING
INFORMATION
Categories of Shareholders
Number of
Shareholders
Number of
Shares Held
Percentage
(%)
2
1
3,873
8,281
0.00
0.00
2
1
1
245,180,610
19,698
17,829,486
76.99
0.01
5.60
11,321
0.00
13,562,659
4.26
26
4,706,468
1.48
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1,125,200
2,170,000
369,050
11,483
3,520
52,000
150,000
95,632
7,000
10,000
7,000
9,801,754
57,400
2
0.35
0.68
0.12
0.00
0.00
0.02
0.05
0.03
0.00
0.00
0.00
3.08
0.02
0.00
6799
18,440,289
5.79
b. Foreign
374,657
0.12
Foreign Companies
3,186,442
1.00
Others
91
1,283,453
0.40
Totals
6,958
318,467,278
100.00
245,180,610
17,829,486
76.99
5.60
Share holders holding 5% or more
82.6%
5.8%
Associated Companies
4.4%
3.3%
0.2%
2.1%
0.5%
1.1%
Individuals
Investment Companies
Insurance Companies
Joint Stock Companies
Financial Institutions
Foreign Shareholders
Others
Distribution of Shares
47
NOTICE OF ANNUAL
GENERAL MEETING
Notice is hereby given that the SIXTY-EIGHTH Annual General Meeting of the Shareholders of the Company will be held at
Beach Luxury Hotel, Karachi at 11:00 a.m. on Thursday, April 23, 2015 to transact the following business:
1.
To receive, consider and adopt the audited Accounts together with the Director's and Auditors Report thereon for the
year ended December 31, 2014
2.
3.
To appoint Auditors of the Company upto the next Annual General Meeting and to authorize the Directors to fix their
remuneration.
Karachi
April 02, 2015
GSK
Notes:
48
1.
The individual Members who have not yet submitted photostat copy of their valid Computerized National Identity Card
(CNIC) to the Company are once again requested to send their CNIC (copy) at the earliest directly to the Companys
Share Registrar at Central Depository Company of Pakistan Limited, CDC House, 99-B, Block B, S.M.C.H.S., Main
Shahra-e-Faisal, Karachi. The Corporate Entities are requested to provide their National Tax Number (NTN) and Folio
Number along with copy of the CNIC. Reference in this connection be made to the Securities and Exchange Commission
of Pakistan (SECP) Notification dated August 18, 2011, SRO 779(I) 2011, which mandates that the dividend warrants
should bear CNIC number of the registered member or the authorized person, except in case of minor(s) and corporate
members.
2.
The Share Transfer Books of the Company will be closed for the purpose of determining the entitlement for the
payment of Final Dividend from April 16, 2015 to April 23, 2015 (both days inclusive). Transfers received at the Office
of the Share Registrar of the Company at Central Depository Company of Pakistan Limited, CDC House, 99-B, Block
B, S.M.C.H. Society, Main Shahrah-e-Faisal, Karachi at the close of business on April 15, 2015 (Wednesday) will be
treated in time for the purposes of entitlement to the transferees.
3.
A member entitled to attend and vote at the Meeting may appoint another member as his/her Proxy to attend, speak
and vote at the Meeting on his/her behalf. Instrument appointing Proxy must be deposited at the Office of the Share
Registrar of the Company at Central Depository Company of Pakistan Limited, CDC House, 99-B, Block B, S.M.C.H.S.,
Main Shahra-e-Faisal, Karachi not less than 48 hours before the time of the Meeting.
4.
The shareholders are requested to notify the Company if there is any change in their address.
5.
CDC Account Holders will further have to follow the under mentioned guidelines as laid down in Circular No. 1 of 2000
dated January 26, 2000 issued by the Securities and Exchange Commission of Pakistan.
A.
i)
In case of individuals, the account holder or sub-account holder and/or the person whose securities are in group
account and their registration details are uploaded as per the Regulations, shall authenticate his/her identity
by showing his/her original Computerized National Identity Card (CNIC) or original passport at the time of
attending the meeting.
ii)
In case of corporate entity, the Board of Directors resolution/power of attorney with specimen signature of the
nominee shall be produced (unless it has been provided earlier) at the time of the meeting.
B.
i)
In case of individuals, the account holder or sub-account holder and/or the person whose securities are in group
account and their registration details are uploaded as per the Regulations, shall submit the proxy form as per the
above requirement.
ii)
The proxy form shall be witnessed by two persons whose names, addresses and CNIC numbers shall be
mentioned on the form.
iii)
Attested copies of CNIC or the passport of the beneficial owners and the proxy shall be furnished with the proxy
form.
iv)
The proxy shall produce his/her original CNIC or original passport at the time of the meeting.
v)
In case of corporate entity, the Board of Directors resolution/power of attorney with specimen signature shall
be submitted (unless it has been provided earlier) along with proxy form to the Company.
6.
The shareholders holding physical shares are also required to bring their original CNIC and/or copy of CNIC of
shareholder(s) of whom he/she/they hold Proxy(ies) without CNIC such shareholder(s) shall not be allowed to attend
and/or sign the Register of Shareholders/Members at the AGM.
7.
In pursuance of the directions given by SECP vide SRO 787 (1)/2014 dated September 8, 2014, those shareholders
who desire to receive Annual Financial Statements in future through email instead of receiving the same by Post are
advised to give their formal consent along with their valid email address on a standard request form which is available
at the Company's website i.e. www.gsk.com.pk and send the said form duly filled in and signed along with copy of his /
her / its CNIC / Passport to the Company's Share Registrar.
Please note that giving email address for receiving of Annual Financial Statements instead of receiving the same by
post is optional, in case you do not wish to avail this facility please ignore this notice. Annual Financial Statements will
be sent at your registered address, as per normal practice.
8.
Revision of Withholding Tax on Dividend Income under Section 150 of Finance Act 2014:
Please further note that under Section 150 of the Income Tax Ordinance, 2001 and pursuant to Finance Act 2014
withholding tax on dividend income will be deducted for Filer and Non-Filer shareholders @ 10% and 15% respectively.
According to clarification received from Federal Board of Revenue (FBR) withholding tax will be determined separately
on Filer/Non-Filer status of Principal shareholder as well as Joint Holder(s) based on their shareholding proportions,
in case of joint accounts.
In this regard, all shareholders who hold shares with joint shareholders, are requested to provide shareholding
proportions of Principal shareholder and Joint Holder(s) in respect of shares held by them to our Share Registrar, in
writing as follows:
Total Shares
Shareholding
Proportion
(No. of Shares)
Joint Shareholder
Name and CNIC #
Shareholding
Proportion
(No. of Shares)
Notes: The required information must be reached to our Share Registrar by April 15, 2015, otherwise it will be assumed that
the shares are equally held by Principal shareholder and Joint Holder(s).
Shareholders are therefore requested to please check and ensure Filer status from Active Taxpayers List (ATL) available
at FBR website http://www.fbr.gov.pk/ as well as ensure that their CNIC / Passport number has been recorded by the
Participant / Investor Account Services or by Share Registrar (in case of physical shareholding). Corporate bodies (nonIndividual shareholders) should ensure that their names and National Tax Numbers (NTN) are available in ATL at FBR website
and recorded by respective Participant / Investor Account Services or in case of physical shareholding by Company's Share
Registrar.
Principal Shareholder
Folio /
CDS Account #
49
FACTORIES AND
DISTRIBUTION / SALES
OFFICES
FACTORIES
Karachi
F 268, S.I.T.E.,
Near Labour Square,
Karachi 75700
Tel: (92 -21) 32570665 69
Fax: (92-21) 32572613
Plot # 5, Sector 21,
Korangi Industrial Area,
Karachi 74900
Fax: (92 21) 35015800
UAN: 111 000 267
B 63, 65,
Estate Avenue,
S.I.T.E.,
Karachi
Tel: (92 -21) 32561200 07
Fax: (92-21) 32564908
Sukkur
Plot No. 77/80, Block B,
Friends Cooperative Housing Society,
Akhuwut Nagar, Airport Road
Tel: (92 -71) 5630668, 5630144
Fax: (92-71) 5631665
Multan
Islam-ud-din House, Mehmood Kot,
Bosan Road,
Tel: (92 -61) 6222061 63
Fax: (92-61) 6222064
Lahore
Cordeiro House,
Plot No. 27, Kot Lakhpat Industrial Estate,
Kot Lakhpat
Tel: (92 42) 35111061 64
Fax: (92 42) 35111065
Islamabad
Aleem House, Plot No. 409,
Sector I 9, Industrial Area
Tel: (92 51) 4433589, 4433598
Fax: (92 51) 4433706
Peshawar
GSK
50
FORM OF PROXY
______________________________________________, another
(Signature of Witness 1)
(Signature of Witness 2)
Name of Witness:
Name of Witness:
CNIC No.:
CNIC No.:
Address:
Address:
2.
For the appointment of the above proxy to be valid, this instrument of proxy must be received at the Office of the Share Registrar of the Company at Share
Registrar Department, Central Depository Company of Pakistan Limited, 99-B, Block B, S.M.C.H.S., Main Shahra-e-Faisal, Karachi, at least 48 hours
before the time fixed for the Meeting.
3.
Any alteration made in this instrument of proxy should be initialed by the person who signs it.
4.
In the case of joint holders, the vote of the senior who tenders a vote whether in person or by proxy will be accepted to the exclusion of the votes of the
other joint holders, and for this purpose seniority will be determined by the order in which the names stand in the Register of Members.
5.
The proxy form must be witnessed by two persons whose names, addresses and CNIC numbers shall be mentioned on the form.
(ii)
Attested copies of CNIC or the passport of the beneficial owners and of the Proxy must be furnished with the proxy form.
(iii)
The Proxy must produce his original CNIC or original passport at the time of the Meeting.
(iv)
In case of corporate entities, the Board of Directors resolution/power of attorney and specimen signature must be submitted (unless it has been provided
earlier) alongwith proxy forms to the Share Registrars.
Notes:
1.
The Member is requested:
(a) to affix Revenue Stamp of Rs. 10/- at the place indicated above;
(b) to sign in the same style of signature as is registered with the Company;
(c) to write down his/her Folio Number.
51
Affix
Correct
Postage
GLOSSARY
TERM DEFINITION
AC
Additional Commissioner
AMP
African Malaria Partnership
AO
Assessing Officer
ATIR
Apellate Tribunal Inland Revenue
BMS
Britol Myers Squibb
CFC
Concern for Children
CHC
Consumer Health Care
CIRA
Commissioner of Inland Revenue (Appeals)
COPD
Chronic Obstructive Pulmonary Disease
CRM
Customer Relationship Management
CSR
Corporate Social Responsibility
Cx Consumer
DCIR
Deputy Commissioner Inland Revenue
EBIT
Earnings Before Interest and Taxation
EBITDA
Earnings Before Interest, Taxation, Depreciation and Amortization
EHS
Environment, Health and Safety
EMAP
Emerging Markets & Asia Pacific
EPS
Earnings Per Share
ERP
Enterprise Resource Planning
FLP
Future Leaders Programme
GMS
Global Manufacturing and Supply
GSK GlaxoSmithKline
GSKP
GlaxoSmithKline Pakistan
HCP
Healthcare Professional
HR
Human Resources
IAS
International Accounting Standards
ICAP
Institute of Chartered Accountants Pakistan
ICMAP
Institute of Cost and Management Accountants Pakistan
IFAC
International Federation of Accountants
IFRIC
Internal Financial Reporting Interpretation Committee
IFRS
International Financial Reporting Standards
IPR
Intellectual Property Rights
IR
Industrial Relations
IT
Information Technology
ITAT
Income Tax Appellate Tribunal
KIBOR
Karachi Interbank Offer Rate
KSE
Karachi Stock Exchange
LDC
Lesser Developed Countries
LSE
Lahore Stock Exchange
NBFC
Non-Bank Financial Companies
NBV
Net Book Value
NFEH
National Forum for Environmental Health
NGO
Non Government Organization
NTD
Neglected Tropical Diseases
OCI
Other Comprehensive Income
PMA
Pakistan Medical Association
QMS
Quality Management System
R&D
Research and Development
Rx Pharma
SKU
Stock Keeping Unit
SLIC
State life Insurance Corporation
UACC
United Against Cervical Cancer
WHO
World Health Organization
ZAP
Zero-Accident Promotion