Karachi Electric Supply Company Limited’s fourth right issue of the company

Karachi: This is an Announcement made to the Karachi Stock Exchange, as provided by Pakistan Press International Information Services.

In compliance with the listing rules of the esteemed Exchange, We write to inform you that the Board of Directors of the Company in its meeting held on 29 July 2011 at 4:00 p.m. in KESC Board Room, 3rd KESC House, 39-B, Sunset Boulevard, Phase-II, Defence Housing Authority, Karachi, inter alia, considered the fourth Right Issue of the Company and approved as follows:

Right Shares

Issue of 7.25% Right Shares, subject to approval of SECP, i.e. twenty-nine (29) ordinary right shares for every four hundred (400) ordinary shares held by the shareholders at par he ,i.e. Rs. 3.50 per share. The Right issue shall rank pail passu with the existing ordinary shares of the Company in all respects.

Detailed announcement on Right issue envisaging purpose of the Right Issue, benefits to the Company, use of funds and financial projections is attached herewith

Book Closure of Right Issue

The approval of the Board to the said Right Issue is subject to approval of the SECP and book closure with be notified on receipt of SECP approval.

We trust this will meet the requirements of the Listing rules in full.

 

1.The Secretary, Lahore Stock Exchange (G) Limited, LahoreFax: 042-111 441 441
2.The Secretary, Islamabad Stock Exchange (G) Limited, IslamabadFax: 051- 111 473 329
3.The Securities and Exchange Commision of Pakistan, IslamabadFax: 051 9218592/9204915
4.The Register, Joint Stock Compaines, SECP, KarachiFax: 021-99213278
5.Central Depository Company of Pakistan LimitedFax: 021-34326034
6.CDC Share Register Services .Fax: 021-34326053

 

Announcement – Right Issue

KESC Board of Directors in its meeting held on 29 July, 2011 at 4:00 p.m. in KESC Board Room, 3rd Floor KESC House, 39-B, Sunset Boulevard, Phase-II, Defence Housing Authority, Karachi, has approved the following:-

Right Shares

Issue of 7.25 percent Right Shares, subject to approved of SECP, i.e. twenty – nine (29) ordinary right shares for every four hundred (400) ordinary shares held by the shareholders at par i.e. Rs. 3.50 per share. The Right Issue shall rank pari passu with the existing ordinary shares of the company in all respects.

Purpose of the Right Issue

The Right Shares are being issued to provide fresh equity which will support the capital expenditure requirements, improve debt equity and liquidity ratios, reduce finance cost and will improve profitability of the company to benefit all the stakeholders.

Benefits to the Company

Injection of economic and efficient generation in KESC system and implementation of system improvement and loss reduction projects will improve operational and financial viability and profitability of the company. Partial funding the said projects through additional equity will reduce financing cost and positively contribute to future financial results of the company.

Use of Funding

Funds generated through Right Shares will be utilized to party financing equity components of new generation projects and capex requirements to augment and dilapidated transmission network and system improvement and loss reduction projects and to meet working capital deficit to reduce bank borrowings and resultant financing cost.

 

Financing Plan

Rupees in Million

Paid Up CapitalReserveAccumulatedNet Equity
Ordinary RPS TotalLosses
As on 31 March 201174,3525,98380,3355,372(83,748)1,211
Proposed (7.25%) Right Issue5,402-5,4025,402
Status after Fourth Right Issue79,7545,98385,7375,372(83,748)6,613

 

Financial Projects(Rupees in Millions)
2011-122012-132013-14
Net Revenue (Including tariff differential)157,501169,304178,661
Expenditure excluding interest expenses(148,371)(148,759)(155,195)
Operating Profit / (Loss)9,03020,54523,456
Interest expenses(6,879)(6,460)(4,993)
Net Profit / (Loss)2,15114,08518,474

 

It is printed to underscore that the above projections are based on certain assumptions and that a few key assumptions such as fuel supply and price applicable tariff etc. are governed by external factors and are by and large beyond the management control. Any fluction in the said key factors assumptions will obviously impact the above financial projections.

The above projections reflect the bons fide current and future business perception and judgment of the Directors as to costs and future performance of the Company ‘s and MEPRA approved tariff of the Company. Neither the Company nor the Directors accept any responsibility for conclusions drawn or investment decisions made by any member or any other person based upon the aforementioned information.

Attended the Board Meeting

Through tele-Con and consented to sign

Waqar Hassan Siddique

Chairman

Attended the Board Meeting

Through tele-Con and consented to sign

Tabish Gauhar

Chief Executive Officer

Attended the Board Meeting

Through tele-Con and consented to sign

Syed Arshad Masood Zahidi

Director

Attended the Board Meeting

Through tele-Con and consented to sign

Mubaser H-Sheikh

Director

Attended the Board Meeting

Through tele-Con and consented to sign

Muhammad Tayyab Tareen

Directors

Attended the Board Meeting

Through tele-Con and consented to sign

Naveed Ismail

Director

Attended the Board Meeting

Through tele-Con and consented to sign

Syed Nayyar Hussain

Director

Attended the Board Meeting

Through tele-Con and consented to sign

Shan A.Ashary

Director

Attended the Board Meeting

Through tele-Con and consented to sign

Zulfiqar Haidar Ali

Director

For more information, Contact:
Syed Moonis Abdullah Alvi
Company Secretary and Dy. CFO
Karachi Electric Supply Company Limited
KESC House, 39- B-, Sunset Boulovard,
Phase – II, Deffence Housing Authority,
Karachi.
Tel: 32647017
Fax: 32647155