DEAR SHAREHOLDERS,
As- salamo Alaikum.

It is indeed my proud privilege to greet you on behalf of the Board of Directors of the Company to the Twenty fifth Annual General Meeting of the esteemed shareholders and lay before you the Annual Report together with the Audited Accounts Containing Consolidated Statement of Statement of Financial Position, Consolidated Statement of Comprehensive Income, Consolidated Statement of Cash Flows and Statement of Changes in Equity and Notes to them as well as well as the Auditors Report thereon for the year ended 30th June, 2016. I hope your constructive suggestions, advice and active participation will turn this meeting a success.

Environment Encircling The Business

The business environment and its outlook especially in the garment sector, has not improved much during the year and in line with what we forecasted earlier. It had to face a turbulent economic scenario that mostly emanated from the global recession, primarily arising out of Europe. With the continuation of the global recession the business outlook appears to be still volatile. There appears to be little scope to keep business above the breakeven of minimum acceptable risk and the risk still persists at a high level. Having so much competition in the market and facing increasing pressure of the buyers to reduce prices, Bangladesh is still availing the advantage of low production costs compared to China, its main competitor in the global market. However, costs of doing business is also increasing in Bangladesh as reflected by the increase in service charges by the financial institutions, low gas supply, increased transportation costs and increased cost of electricity and gas. With the increase in production costs in China, the Chinese RMG sector is more interested in producing value added products thus creating an opportunity of supplying low-end RGM products to the Chinese market by foreign suppliers. This may again create an opportunity for Bangladesh to explore the Chinese market. It is expected that the RMG sector will grow in the same pace next year. However, it needs the attention of regulators to keep the utility and financial costs within tolerable limit.

With the pace of change, the buyer countries are also erecting more and more non-tariff barriers like work place, code of conduct, eco-labeling, human rights, social accountability, safety requirements and creation of trade unionism in the EPZ area. In the domestic concern, political impasse, back dated customs, port system, high rate of bank & insurance charges, irregular supply and higher charges of utilities in EPZ zone and stiff competition from outside EPZ companies also put hindrance to our business.

Operations Review And Present Status of The Company

Strong backward & forward linkage support and good customer relationship of your company has made it able to retain its customer base.

The Company was able to achieve a revenue of Tk. 86.18 core and a net profit of Tk. 6.99 core. This was made possible by improvement in productivity, efficiency and producing more value added products.

There has been no change in the nature of the Company's business during the year under review and the company remains operated on its principal areas of business i.e. the manufacturing of export oriented knit fabrics and knit garments towards more value addition from the company's own produced fabrics.

Apart from the above turnover and profitability issues, in other areas, overall momentum could be maintained in every level of management.

Revaluation Of Fixed Assets of The Company

The Company has got revalued its fixed assets as of 30 June 2016 by Ahmed Zaker & Co, Chartered Accounts and Valued, resulting in a revaluation surplus at Tk. 207,277,407.

Board of Audit Committee

The Company has an audit committee, which met four times during the year 2015-2016, to consider first quarter, half-yearly, third quarter and annual accounts ended June 30, 2016 along with auditor's report on the annual financial statements.

Financial Report

The operation financial results of the company for the year ended June 30 2016 are given below:

Particulars 2015-2016
Taka
2014-2015
Taka
Sales (Tk.) 861,758,235 824,947,670
Gross Profit (Tk.) 145,002,717 120,277,022
Operating Profit (Tk.) 86,030,553 53,458,760
Net Profit Before Tax for the Year (Tk.) 86,090,553 54,700,895
Gross Profit Margin (%) 16.83 14.58
Earning Per Share (Tk.) (After Tax) 2.58 1.94

Appropriation Of Profit

In accordance with BAS-I "Presentation of Financial Statements", balance of accumulated surplus carried forward in the Balance Sheet will be applied for payment of this year's dividend proposed by Board of Directors and the proposed dividend will be recognized in the accounts as and when approved by the shareholders in the annual General Meeting Following the principle, dividend approved in the last Annual General Meeting will be provided for in the accounts of current year. In view of the above, the Board of Directors has proposed for appropriation as follows:

Particulars 2015-2016
Taka
2014-2015
Taka
Accumulated Surplus-Opening Balance 156,129,956 149,717,920
Deduct: Dividend Apportioned for Previous Year (39,341,150) (38,569,750)
Accumulated Surplus-Net of Previous year's Dividend 116,788,806 111,148,170
Less: Prior Year's Adjustments (2,168,991) -
Add : Net Profit During the year 69,920,258 44,981,786
Balance Available for Appropriation 184,540,073 156,129,956
Declaration Of Dividend

On the basis of the proposed appropriation of profit, the Board of Directors is pleased to recommend for declaration of stock dividend to all shareholders at the rate of 20% for the year under report for your approval. This will involve an amount of Tk. 54,151,938.

Out of the fund available for appropriation, stock dividend and un-appropriated surplus to be carried forward for the year will be made as follows:

Particulars 2015-2016
Taka
2014-2015
Taka
Fund Available for Distribution 184,540,073 156,129,956
Deduct: Proposed issue of Bonus share @20% (2015: 17%) (54,151,938) (39,341,150)
Un-appropriated Surplus 130,388,135 116,788,806
Future Plan

Mithun Knitting & Dyeing (CEPZ) Limited is being managed by group of professionals with good business acumen and experience. The management always endeavors to keep the business on track of best performance. We believe that the company is in right track of business and operation. The Company will however look for BMRE to cater to the customers needs and current trends.

Industrial Relations

The management-employee relations in our Company remained supportive of production and conducive to the growth of the Company during the year.

The Board of Directors And Election

The following persons were the members of the Board of Directors of the company during the year under review. The number and amount of shares held by each Director at the beginning and end of the reporting financial year are also furnished in the following statement as per Stock Exchange Listing Regulation:-

NAME & DESIGNATION SHARES HELD
01-07-2015
AMOUNT
Taka
SHARES HELD
30-06-2016
AMOUNT
Taka
Mrs. Rabeya Khatun
Chairman
463846 4,638,460 542699 5,426,990
Mr. Md. Mahbub-Ul Haque
Managing Director
1473542 14,735,420 1724043 17,240,430
Mr. Md. Mozammel Haque
Director
472198 4,721,980 552471 5,524,710
Mr. Md. Rafiqul Haque
Director
1474176 14741760 1724785 17,247,850
Mr. Md. Atiqul Haque
Director
1473542 14735,420 1724043 17,240,430

The aforesaid directors however resigned on 25 September 2016. The present directors and their share holding on 25 September 2016 are as follows:

NAME & DESIGNATION SHARE AS ON 25TH SEPTEMBER 2016
Dr AKM Sahabub Alam
Chairman
1,000,000 10,000,000
Mr. Showkat Mehmood
Managing Director
700,000 7,000,000
Mr. Nayan Mehmood
Director
700,000 7,000,000
Ms. Rozy Akther Khan
(Nominated by Mehmood Equities Ltd.)
1,083,100 10,831,000
Mr. AKM Faroque
(Nominated by Mehmood Equities Ltd.)

In accordance with Article 74 of the Articles of Association, all the new directors retire from the Board at this AGM and being eligible offer themselves for re-election as per Article 75 of the Articles of Association of the Company.

Environment Role

The Company is committed to maintain high standard of pollution free environment at mill area. Accordingly, tree plantation activities are implemented every year at mill premises.

Auditors

The present auditors, Zoha Zaman Kabir Rashid & Co, Chartered accountants will retire at 25th Annual General Meeting and being eligible, offer themselves for re-appointment.

Corporate Governance

Corporate Governance is the practice through which the company is governed by the board, keeping in view its accountability to the shareholders, stakeholders and to the society. The status report is required to be presented by the Company pursuant to notification No. SEC/CMRRCD/2016-158/134/Admin/44 of August 07, 2012 issued by the Bangladesh Securities and Exchange Commission is furnished in the Annexure-l.

Dear Shareholders

Before concluding, on behalf of the board, I would like to record the appreciation of the Board of Directors for The Skill, dedication and commitment of all employees who have continued to render excellent service to the Company even under difficult circumstances. I would also like to express my sincere appreciation and gratitude to our dear Shareholders, Customers, Banks & Financial Patrons, Agents, Suppliers and Well-wishers for their continued confidence reposed on us and also for their untiring efforts and support to the Company.


On behalf of the Board

Showkat Mehmood
Managing Director
24 November, 2016