Rafhan AR 2008

10 Years at a Glance
2008 2007 2006 2005 2004 2003 2002* 2001 2000 1999
Net Sales
Rs. Million 10,747 7,578 6,127 5,194 4,534 4,031 4,390 3,126 2,806 2,692
Cost of Sales
Rs. Million 8,006 5,480 4,556 3,997 3,259 3,001 3,329 2,345 2,134 2,111
Gross Profit
Rs. Million 2,741 2,098 1,571 1,198 1,275 1,030 1,061 781 672 581
%age of Sales 26 28 26 23 28 26 24 25 24 22
Profit After Tax

Rs. Million 1,492 1,089 809 615 670 521 527 347 307 271
Capital Expenditure
Rs. Million 606 114 122 302 448 415 239 121 90 247
Dividend Amount
Rs. Million 924 831 647 323 286 259 259 134 125 111
Percentage 1,000 900 700 350 310 280 280 145 135 120
Earnings per Share

Rupees 161.57 117.92 87.62 66.57 72.51 56.43 57.06 37.62 33.26 29.34
* Data for 15 months

Contents
IN THE NAME OF ALLAH THE MERCIFUL, THE COMPASSIONATE
02 Company Information
03 Notice of Meeting
06 Chief Executive's Review
16 Horizontal Analysis – P&L and B/S
17 Vertical Analysis – P&L and B/S
18 Directors' Report
25 Forward Looking Statement
26 Stakeholders’ Information
27 Summary of Cashflow Statements
28 Statement of Value Added & its Distribution
29 Review Report
30 Statement of Compliance
31 Auditors' Report
32 Balance Sheet
34 Profit and Loss Account
35 Cash Flow Statement
36 Statement of Changes in Equity
37 Notes to the Accounts
58 Pattern of Shareholding
Proxy Form
Rafhan Maize Products Co. Ltd. 01

Company Information
Chairman Shares Transfer Committee Registered Office

John F. Saucier Rashid Ali 1st Floor, Finlay House,
Ansar Yahya I.I. Chundrigar Road,
Vice Chairman/Chief Executive & M. D. Anis A. Khan Karachi-74000, Pakistan
Ph: (92-21)2442516 – 2410848
Rashid Ali
Bankers Fax: (92-21) 2428651
Directors Citibank, N.A.
Head Office & Shares Department
Habib Bank Ltd.
Cheryl K. Beebe
Meezan Bank Ltd. Rakh Canal East Road,
Mary A. Hynes
MCB Bank Ltd. Faisalabad, Pakistan
Ehsan A. Nomani
National Bank of Pakistan Ph: (92-41) 8540121-22-23
Zulfikar Mannoo
Standard Chartered Bank (Pakistan) Ltd. Fax: (92-41) 8711016
Mian M. Adil Mannoo
Website: www.rafhanmaize.com
Wisal A. Mannoo
Auditors E-mail: corporate@rafhanmaize.com
Ansar Yahya
Anis A. Khan KPMG Taseer Hadi & Co.
Chartered Accountants
Chief Financial Officer Lahore – Karachi
Anis A. Khan
Legal Advisor
Secretary M. Ali Seena
C/o Surridge & Beecheno, Karachi
M. Yasin Anwar
Shares Registrar
Audit Committee
FAMCO Associates (Pvt.) Ltd.
Cheryl K. Beebe
(Formerly Ferguson Associates (Pvt) Ltd.)
Zulfikar Mannoo
4th Floor, State Life Building 2-A,
Ansar Yahya
Wallace Road, Karachi-74000:
Tel:2427012 - 2425467
Fax: 2426752 - 2428310
02 Annual Report 2008

Notice of Meeting
Notice is her eby given that the 1 15th Chartered Accountants, retire and 2. A member entitled to attend, speak
General Meeting (Annual Or dinary) of being eligible, offer themselves for and vote at the meeting shall be
the shar eholders of Rafhan Maize re-appointment. The Boar d of entitled to appoint another person as
Products Co. Ltd. will be held on Directors, on r ecommendations of his/her proxy to attend, speak and
Saturday, March 28, 2009 at 10:00 a.m. at the Audit Committee, has proposed vote instead of him/her, and a proxy
the Overseas Investors Chamber of appointment of Messrs KPMG Taseer so appointed shall have such rights
Commerce and Industry's Hall, T alpur Hadi & Co., Chartered Accountants with respect to attending, speaking
Road, Karachi to transact the following for the year 2009. and voting at the meeting as ar e
business: available to a member . Pr oxies in
order to be effective must be received
1. To confirm minutes of the last By order of the Board by the Company not less than 48
General Meeting (Annual Ordinary) hours before the meeting. A proxy
of the shareholders of the Company need not be a member of the
held on Saturday, March 29, 2008 at Company. Form of proxy is enclosed.
Karachi.
Karachi M. Yasin Anwar 3. Shareholders are requested to notify
2. To receive, consider and adopt the March 6, 2009 Company Secretary change of addr ess, if any , to
Audited Accounts of the Company Company’s Shar es Registrar
for the year ended December 31, 2008 immediately.
together with the Dir ectors and
Auditors Reports thereon. 4. CDC shareholders desiring to attend
the meeting are requested to bring
3. To appr ove final cash dividend Notes: their original Computerised National
@400% for the year ended December 1. The Shar e T ransfer Book of the Identity Car ds, Account and
31, 2008 as r ecommended by the Company will r emain closed fr om Participant’s ID numbers, for
Board of Directors. 20th to 28th March, 2009 (both days identification purpose, and in case
inclusive) and no transfer will be of proxy, to enclose an attested copy
4. To appoint auditors and fix their accepted for registration during this of his/her CNIC.
remuneration. The present auditors period.
Messrs KPMG Taseer Hadi & Co.,

Vision
To be the Premier Provider of Refined

Agriculturally Based Products and
Ingredients in the Region.
Mission Statement
To grow business consistently through positive
relationship with customers to attain full customer
satisfaction and to bring continual improvement
by adopting only those business practices which add
value to our customers, employees and shareholders.

Our Core Values
Define and direct every decision we make and

every action we take at Rafhan Maize.
Integrity
Excellence Respect
Financial Success
Integrity Respect
We adhere to a code of conduct, We deal with and treat others
which produces consistently the way we want to be dealt
ethical behaviour. with and treated.
Excellence Financial Success

We do the right things in a We consistently focus on our business
superior manner while striving for to create economic value today and
continuous improvement. into the future.

Chief Executive’s Review
remained below target due to low output satisfaction of customers' specific needs. The
of key crops and the ever growing cost of Company embarked on a cost saving
agricultural inputs. Maize, which is your exercise to mitigate the pr essure on costs,
Company's single main raw material, and continued its ef forts to optimize
showed an increase in price by almost 46% production, improve plant yields, r ealize
over the last year. All these events adversely energy savings and focus on customer
affected the key macr oeconomic relationships as a source of new business
fundamentals of our country . The GDP opportunities.
growth rate came down to 5.8% against a
target of 7.2% for the year 2007-08. The Your Company's keen understanding of
It is my pleasure to present the Company's newly elected government inherited an customers' needs and pr eferences is
Annual Report for the financial year ended economy which, after maintaining a high evidenced from the excellent r esults of
December 31, 2008. Your Company growth rate of around 7% during the last 2008. Your Company retained its strong
successfully delivered another profitable 3-4 years, is being threatened by domestic reputation as the supplier of choice
year in line with its strategy to gr ow its and global economic recession. through a progressive marketing mix. The
business and achieved the historic turnover sales volume increased by 8% over last
figure of over Rs.10 billion. Though By the grace of Almighty Allah, your year. Export sales of Rs.434 million ar e
economic and political conditions were not Company continued to demonstrate an down by Rs.70 million over the last year
conducive to business gr owth, your excellent track record of performance despite figure of Rs.504 million due to decline in
Company performed well to continue as a the national and international challenges international demand. The aggregate net
premier supplier of agriculturally based affecting our economy. Your Company, being sales of Rs.10,747 million are up by 42%
ingredients through strategic marketing an ingredient supplier, put major emphasis over the last year sales of Rs.7,578 million
initiatives. on value added pr oducts and pr oduct which indicated the collective contribution
application technical support for the by all strategic business units.
ECONOMIC ENVIRONMENT
OPERATING RESULTS
The year 2008 can be termed as a dif ficult Year ended December 31
year in our country, with many challenges
2008 2007
across all fronts. The economic front faced
the challenges of decelerated gr owth, an Net Sales Rs. (Million) 10,747 7,578
increase in the fiscal deficit, rising inflation Net Income After Tax Rs. (Million) 1,492 1,089
(especially food inflation) and a widening Earnings per Share Rupees 161.57 117.92
of the trade gap. A high demand for foreign
exchange r equired to pur chase oil and
declining exports depleted foreign exchange
reserves. The value of Rupee depr eciated
by 28%. The average inflation rate was
around 20% for the year 2008 with food
inflation even crossing the rate of 30%.
Whereas the first thr ee quarters of 2008

showed growth in business, the last quarter
was marked with worst energy crisis and
the consequential slow down of industrial
and business activities. An unprecedented
rise in oil prices in the international market
started to show a decline but the overall
impact on Pakistan's economy could not be
realized. The manufacturing sector recorded
the weakest growth of a decade due to the
high cost of doing business, the energy crisis,
high financing costs and other adverse
factors impacting the profitability as well as
ability to continue smooth operations.
Performance of the agricultural sector also

Finance cost at Rs.36 million is up by Rs.24 INDUSTRIAL BUSINESS growing demand. The paper industry also
million primarily due to the ongoing faced adverse effects of the economy despite
The year 2008 proved to be one of the most
capacity expansion project to meet our future better working of large scale units. Cheaper
difficult and challenging years for the
growth plans. Operating profit and profit imports of writing & printing paper , the
industrial sector. We saw marked industrial
after tax were Rs.2,415 million and Rs.1,492 energy crisis and expensive raw materials
slow down which impacted growth as well
million; up by 38% and 37% r espectively affected smooth operation of the paper
as profitability of the industrial businesses.
over the previous year depicting a robust industry, which negatively impacted the
growth and strong confidence of our valued demand of Amisol ® star ches. The
Textile continues to be the largest sector of
customers. Our business success is corrugation and paper converting industries
the national economy and has been
dependent on tr usting relationships and operated at a better pace to cover industrial,
designated as a dominant driving force for
our core values of Integrity , Excellence, electronics, cement and food packaging
economic growth. Our diversified range of
Respect and Financial Success. demand, thereby, supporting the sale of
starches including Rafhan ®, Penetrose®,
Amisol®, Tex-o-Film® and Coratex™-P are
BUSINESS REVIEW consumed in textile weaving and processing
We have come a long way in pr oducing as ingredients of first choice. The operation
agriculturally based pr oducts and of the textile industry remained depressed
ingredients and have established ourselves and consequently demand for modified
as a progressive trendsetter and a reliable starches from this segment remained low.
solution pr ovider to various types of The textile sector continued to face the
industries. A major key to our success has challenges of high manufacturing costs,
been constant innovation in the pr oduct strong global competition, massive electricity
line, catering services to dif ferent and gas load shedding, escalation in tariffs
functionalities in the market. on utilities and high borrowing rates.
We strive to meet and exceed customer Paper and paperboard demand in Pakistan
expectations by delivering the best products continued to grow in line with the overall
and services to our valued customers improvement in the educational and
through value, dependability , technical industrial demand. Large investments are
service, consistent quality and long term being made in this sector to enhance the
relationships. domestic capacities for manufactur e of
quality paper and paperboard to meet the

your Company's T ex-o-Film ® and expansion, diversification, R&D and focus to convert challenges into opportunities. We
Coragum® starches. on functionalities has enabled us to remain are str engthening our pr esence in the
at the for efront of the food ingr edient regional markets of the Middle East,
FOOD BUSINESS business. Afghanistan and Bangladesh. W e have
Your Company is a leading manufacturer undertaken several initiatives to generate
ANIMAL NUTRITION & HEALTH volumes and support business needs in
of food ingredients adding functionality to
different food segments. The product range BUSINESS order to cope with the growing competition
of our food ingredients business includes The animal nutrition ingredients business in the international markets.
Globe™ and Snowflake® starches, Rafhan® continued to perform well, led by the
Liquid Glucose, Cer elose ® Dextr ose poultry, livestock and aquaculture sectors. We are confident that our state of the art
Monohydrate, Rafhan® Liquid Caramel and A shortage of grains and other substitute facilities together with geographical presence
Golden Syrup to meet desired functionalities feed ingredients in the country provided a will cr eate sustained gr owth for the
of a wide range of food products. strong demand for our animal nutrition Company and continue to invest our
ingredients. The poultry business has shown resources in high growth areas.
The food business displayed favorable resilience despite high inflation. Similarly
growth due to sustained performance of the growing ar eas of fish farming and the RAW MATERIAL
confectionery industry, which consumed popularity of cattle feed rationing kept
Promotion of maize in Pakistan is part of
good volumes of liquid glucose. The export demand of our Prairie Gold® and Rafhan®
our business strategy. Your Company firmly
led confectionery sector performed better, Maize Gluten Meals, Buffalo™ Maize Bran,
believes that bilateral r elations with the
whereas unorganized units faced the issue Enzose® Hydrol and Rafhan ® Maize Oil
of the energy crisis. The vibrant demand for farming community spanned over 35 years
Cake strong.
food grade star ches fr om dif ferent had been bedrock of our financial success.
applications in food pr ocessing also Your Company is a pioneer in
EXPORTS
contributed to volume growth. However, conceptualizing and executing the unique
Your Company is gradually expanding and idea of spring maize cultivation in Pakistan.
inflationary pressures on the prices of utilities
diversifying its customer base in the export
and essential food items ar e unsettling
markets by exploring new opportunities. We are strategizing for maize productivity
consumers' buying patterns and squeezing
There is a good business potential for export enhancement both vertically and
their purchasing power.
but high sea freights and tough competition horizontally through innovative research
from China, India and Far-Eastern countries and development activities. The year 2008
Our str ong commitment to invest in
restricted our growth in the export business.
manufacturing technology , business was marked with a record increase in maize
In spite of the difficulties, we are determined

area and production. Benefiting from the customers' needs, we are regularly investing force behind our spirit to meet challenges
situation, we were able to procure maize to in state of the art technology , plant and and achieve business excellence. Our efforts
meet our maize grind requirements. Our equipment, training of human r esources, to promote business excellence are not just
field team of agricultural experts remained and diversification to new pr oducts as a limited to our pr oducts and services, but
on their toes 24 hours a day to provide for part of our strategy to bring organic growth are also included in the way we do business.
necessary logistic facilities to farmers for the in the base business and gr ow in high Your Company is committed to pr oduce
safe handling of their pr oduce and growth markets and segments. The quality pr oducts to fulfill customers'
management of an efficient supply chain. investment portfolio of the Company has requirements and strengthen our position
been realigned as per changing market as a quality-managed Company through a
Your Company is committed to follow viable needs. Over the years, the plant capacity customer driven, service-oriented and
opportunities and technologies for the was gradually incr eased and now the dynamic quality and environmental friendly
promotion of maize in Pakistan. Company operates from two locations with management system.
Development work in Southern Punjab and sufficient manufacturing capacity to meet
Sindh is already in progress. We foresee a market demand. Construction work of our Our Quality Management System's
tremendous potential of yield enhancement third plant in the south region is in progress. involvement starts at the strategic planning
in NWFP as well in ar eas where maize is In order to meet the futur e needs of our stage and goes all the way until the product
grown on huge acreages but with low yields. customers in the domestic and export
New and better methods of maize markets, your Company has embarked on
cultivation will be demonstrated to farmers production capacity expansion and
in NWFP to make the maize cr op an diversification to value added products. The
economically desirable proposition for them. Company has invested Rs.606.3 million in
Our agricultural research and development property, plant and equipment during the
activities are well aligned with Company's year 2008. On business development front,
specific requirements while supporting your Company continues to invest on new
increase in farm income level. It will be our ingredients to capitalize new opportunities
earnest endeavor to serve the farming in the marketplace.
community with all our str ength and
sincerity. INTEGRATED QUALITY AND
ENVIRONMENTAL
INVESTMENT MANAGEMENT SYSTEM
Keeping pace with the ever gr owing Our customers' satisfaction is the driving

and services are delivered. It continues its employees; protect our community and
journey towards continual improvement environment, and achieve applicable legal
through customer and employee feedback and other requirements. Being conscious to
and by critical performance evaluation of changing needs of our customers, we ar e
our pr ocesses. The pr oducts ar e constantly striving to fulfill their emerging
manufactured in such a manner that they requirements and are pleased to inform that
are safe and comply with all applicable we have achieved HALAL certification of
safety norms and provisions. Product safety our all products from competent Shariah
is an essential quality featur e and we Authorities.
continue to monitor it closely thr ough
quality audits. Process Standar dization alongwith
Implementation of all these international
The str ong commitment to OSHE standards will further enhance your
management is reflected by the continual Company's image in the national and global
improvement in the activities and markets as a quality supplier of ingredients
procedures. This year the Envir onmental which consistently add value to our
Management System was successfully customers' finished products.
accredited against the new EMS 14001
Standard. Work on OHSAS 18001:2007 is in RESEARCH AND DEVELOPMENT
progress and will be accr edited in 2009.
Our flexible and dynamic corporate strategy
Quality Management Surveillance Audit of
strives to enhance customer satisfaction
ISO 9001QMS Certification was conducted
through continuous improvement and value
this year without any nonconformity and
added benefits. Our range of pr oducts is
we endeavor to maintain this r ecord in
constantly expanding, supported by
future.
extensive development work. We consider
diversification of our product line to be a
Our quality methods are being evaluated
major tool for success in the ever changing
against international standar ds multiple
market scenario. Over the years, we have
times a year and pr ocess parameters ar e
come up with significant innovations in our
validated on quarterly basis to allow the
product line, which have added value to
provision of high quality pr oducts to our
our pr oducts for dif ferent consuming
valued customers ar ound the year .
segments.
Furthermore, we have adopted Gael Quality,
UK Software to integrate our ISO 9001:2000
Your Company is not only equipped with
Quality Management System, ISO
R&D facilities at both plants but also has a
14001:2004 Envir onment Management
continuous interaction with the customers
System and OHSAS 18001:2007
for their feedback. We strongly believe in
Occupational Health and Safety Assessment
regular and continuous vigilance on product
Series System in our daily r outine
improvement and have always been
production. These enhancements to the
committed to innovation. Your Company
quality of our overall performance also
leads the industry when it comes to
safeguard the health and safety of our
introduction of new products in the market,

differentiated services for modern customer strengths by leveraging knowledge and OCCUPATIONAL SAFETY AND
needs and the intr oduction of global experience available in other af filiate HEALTH
technical and safety standards enabling us countries. During the year 2008, your
Company kept on expanding and Safety is our core priority. Safety values are
to r emain at the for efront of our cor e
upgrading its IT infrastr ucture and demonstrated in our day-to-day activities
businesses.
capabilities to meet ever changing business through lead-by-example approach. Health,
needs. safety and envir onmental concerns ar e
INFORMATION TECHNOLOGY always among our key focal points. We are
Information technology is considered the committed to provide clean, healthy and
OPERATIONS
backbone of our Company. Dealings with safe conditions for our employees,
such a large number of suppliers, dealers, The management team continued to work contractors, visitors and the community in
customers and other contractors can only proactively with firm commitment to which we operate.
be conducted in a fair manner with the help achieve excellence in all ar eas of
of strong IT system. Your Company has a performance. Our own landmarks achieved The Safety, Training and Envir onment
custom designed IT system which integrates in the past were exceeded. The management Management Program developed over a
all sorts of operations to ensur e smooth, team focused on economizing and period of time in line with our pr ocesses
timely and fair flow of information. The reengineering the manufacturing processes
production facilities and our of fices in to save energy, protect the environment and
different locations are connected through continue our focus on workplace safety .
dedicated communication channels. This also allowed your Company to
coordinate and integrate the activities of
Your Company is highly vigilant in employees, material suppliers and vendors
deploying the technical developments which to fulfill the requirements of customers. The
take place around the globe and which are ultimate aim was to exceed the expectations
in line with the strategic pathways and long of our internal and consequently external
term vision of the business. Our IT customers and generate good return for the
Department believes in providing quality assets of shareholders.
and timely support to all of the operating
business areas of the Company to enhance The annual production and yield tar gets
their productivity, effectiveness and decision were exceeded. This allowed us to meet
making capabilities to support consistent enhanced market demand in spite of
growth of the Company. excessive nationwide load shedding of
electricity and gas. Our management team
Your Company, being an international emphasized the need to be strategically
Company, has access to its worldwide IT prepared for emergency and crisis situations,
resources. We make full use of global IT such as the ener gy crisis, which became
worse in last quarter of 2008.

and activities and with employee

participation was further impr oved by
introducing new practices. Safety Month
was observed at both plants in November.
The safety slogan for the year was “Safety
- Our First Ingr edient”. Practical
demonstrations and drills on fire fighting,
rescue, first aid and confined space entry
etc. wer e arranged for the Company
employees in coordination with the Civil
Defence Department. 100 safety talks were
delivered to 1,349 employees during Safety
Month at both plants.
In total, safety training was pr ovided to

6,006 employees (many employees attended
multiple trainings) at both plants through
(including exposure hours of 2007 and 2008) Your Company has also been actively
450 training courses and safety talks on fire
respectively. Over 2.9 million and 8.0 million enhancing the land and communities
fighting, envir onmental impr ovement,
exposure hours without a lost workday around our facilities. In total, 8,705 and
emergency action plan, fire alarm and smoke
accident were achieved at the Cornwala 1,200 green plants were planted at the Rakh
detection system, fire hydrant system, work
Plant during the year 2008 and up to 31st Canal and Cornwala Plants r espectively.
permits, water conservation and electrical
December, 2008 (including exposure hours Green patches of 184,591 and 3,000 square
safety. Activities were monitored, controlled
of years 2005, 2006, 2007 and 2008) feet were developed at the Cornwala and
and dir ected thr ough periodic safety
respectively. The Board of Directors of Corn Rakh Canal Plants respectively. Green belts
inspections, safety r ounds, practical
Products International acknowledged this of 49,182 and 4,000 square feet developed
demonstrations and audits. An inter
significant achievement by adopting a
departmental safety performance outside the Rakh Canal and Cornwala Plants
resolution to commend the dedication of
competition was arranged and the “Chief respectively, are maintained for public use.
employees for the continued promotion of
Executive’s Safety Shield” was awarded to 400 trees were planted in the green fields of
the best performers - W arehouse and health and safety.
farmers surrounding Cornwala Plant.
Distribution Department at the Rakh Canal
Plant and Dry Starch and Glucose Refinery ENVIRONMENTAL 30 students of dif ferent pr ofessional
Departments at the Cornwala Plant. STEWARDSHIP PROGRAM institutions wer e pr ovided internship
Our environmental commitment extends training. Your Company also contributed
Over 5.7 million and 7.8 million exposur e for constructing a by-pass road of Jaranwala
to every part of our operations. Our plants
hours without a lost workday accident were city by the local government to facilitate
have Environment Committees to manage
achieved at the Rakh Canal Plant during
routine environment issues and r eview traffic flow.
the year 2008 and upto 31st December, 2008
performance. An environmental impact
assessment is done in advance for every HR MANAGEMENT AND
new project and measures are adopted to EMPLOYEES RELATIONS
minimize adverse impacts on the
Your Company takes pride in its people and
environment. Our employees r egularly
recognizes its employees as the most
undergo training to impr ove awareness
valuable asset and the competitive edge for
about environment-friendly practices.
its business. There is a proactive approach
to developing leadership talent.
Your Company's Environment Stewardship
Management is dedicated to building an
Program continues with a goal of building
environment in which employees can work
a Better Business and a Better World using
with full peace of mind. Focusing on team
Earth's harvest wisely and r esponsibly.
work in all areas of our business is the key
Several training programs were initiated to
driving force in achieving leadership and
enhancing employees' awareness. Different
higher efficiencies.
ideas are being implemented to create better
plants, better offices and better communities.
We expect to see exceptional performances
Energy conservation, waste r eduction,
by motivating, developing and rewarding
environmental monitoring, and noise control
our employees to cr eate a cultur e of
are ongoing programs.

continuous impr ovement by pr oviding career growth. This is achieved thr ough VALUES AND BUSINESS
challenging growth oriented and varied delegation of r esponsibility and r egular CONDUCT POLICIES
career experiences. training opportunities, both within the
The Company's Core Values and Business
country and in appropriate cases, abroad.
Conduct Policies are considered to be the
A major priority for the business is to capture
critical components for our continued
value through development of exceptional Extensive in-house training and
success. In order to educate and reinforce
people and r etain highly skilled and development programs are one of the tools
our Company V alues and Policies on
committed people. Our Companywide used for development of our winning team.
Business Conduct, a training program under
talent management system identifies, In total, 19 in-house training sessions were
the name of “PILLARS - V ALUES AND
develops and sustains the flow of talent to conducted for 253 managers/officers and
BUSINESS CONDUCT WORKSHOP” has
ensure that we have the right people in the 134 for 1,978 workers at the Rakh Canal and
been developed for the employees by Corn
right job at the right time. The Company Cornwala Plants. Training was provided to
Products International. This pr ogram is
strives to provide its employees competitive management and non-management
conducted by senior leaders trained as
remuneration packages and an enabling employees on the following topics:
trainers for the workshop by international
corporate environment with ample learning
consultants. The management has
opportunities to develop technically , • Management Skills Development.
conducted 19 such workshops and 663
professionally and personally. Negotiations • Technical Skills Development.
• HACCP, GMP and Food Safety. managers, officers, staff and workers have
on a new settlement with the CBA were
• Conservation of Energy, Water, Steam been trained in 2008. The pr ogram will
concluded in 2008.
and Other Utilities. continue in 2009 to promote the values and
• Zero Defect Production Program. business ethics as a competitive advantage.
TRAINING AND MANAGEMENT
• Product Yield Control.
DEVELOPMENT
• Process SOPs. SOCIAL RESPONSIBILITY AND
The training program of the Company is • Product Safety and Packaging. COMMUNITY WORK
designed on an annual basis focusing on • Vibration Monitoring and Control of
We aim to play a positive r ole in the
the customer and business needs and Rotary Equipment.
communities in which we operate. We are
challenges. Developing our people is a top • Lubrication Program.
• Balancing of Rotary Equipment. committed to follow the highest social
priority. Over the years, we have maintained
• Electrical Safety and Arc Flash. standards as a good corporate citizen in our
a distinctive corporate culture driven and
• Company Policies on Safety , society for long term success.
influenced by our dedicated and energetic
workforce. Our employees ar e given Environment and Quality.
opportunities for self-development and • Integrated Management System.

culture and based on its str ong operating

results, secur ed 13th time the “T op 25
Companies of Pakistan Award” announced
by the Karachi Stock Exchange. Following
the same footsteps, your Company was also
awarded for the consecutive 7th time Best
Corporate Report Award for best presented
accounts declar ed by The Institute of
Chartered Accountants of Pakistan and The
Institute of Cost & Management
Accountants of Pakistan. Special Merit
Export Trophy fr om the Federation of
Pakistan Chambers of Commer ce &
Industry on export of Corn (Maize) derived
products worth Rs.434 million for the year
2007-08 was another corporate distinction.
ACKNOWLEDGEMENT
I take this opportunity to thank our valued
Donations, scholarships and r egular utilities and necessities of life. The
customers who have shown gr eat
sponsorships support the welfar e of our government has increased the minimum
confidence in our pr oducts and ar e
local communities and are encouraged at support price of wheat from Rs.625 to Rs.950
providing sustained support in ensuring
all levels within the organization. A public to induce the farmers to grow more wheat.
the continued success of the Company.
primary school, post of fice and bank ar e With the increase in the price of wheat, the
being maintained by your Company for the same price trend is foreseen for maize having
the same cultivation season. The high price The Company is pr oud of its employees
benefit of our neighbors. A fully equipped and extends appreciation and gratitude to
dispensary is also maintained to face any of wheat may also shift demand of livestock
sector to maize, creating a tough competition them for their loyalty, commitment, hard
emergency and general health car e. Your work and consistently delivering
and increase in prices. Continuous energy
Company believes in working as part of a outstanding performance. W e also
crisis and high labor costs, coupled with
community and will keep on looking for acknowledge the support and cooperation
above factors, are likely to continue to affect
ways to contribute to the general well-being received fr om our esteemed suppliers,
the manufacturing sector r esulting in an
of the society. Being a responsible member bankers and other stakeholders.
increase in cost of other raw materials,
of the corporate community, your Company
manufacturing supplies and engineering.
contributes substantially towar ds the I am also thankful for the excellent support
Consequently, it will be difficult to pass on
national exchequer on account of taxes and the total impact on your Company's cost of and guidance pr ovided by our par ent
other government levies. production to the customers. Company and the Boar d of Dir ectors
towards achieving excellent results and for
BUSINESS RISKS, CHALLENGES Despite a difficult and challenging business the trust reposed by the shareholders on the
AND FUTURE PROSPECTS environment, your Company is fully aware management of the Company.
and cognizant of market dynamics and is
The business environment of the country is
committed to maintain its focus on further Please join me in praying Almighty Allah
expected to remain extremely challenging
improving operational ef ficiencies, cost to give us the courage and wisdom to face
in the year 2009. Any improvement in the
rationalization, customer services and the challenges ahead and to work even
business environment will largely depend
exploring new opportunities. Our belief is harder for the prosperity of the Company
on the economic policies of the government
based on the inher ent str ength of your and its stakeholders. A'meen
and improvement in the global economy.
Company and we ar e confident that we
Pakistan's economy has undergone a testing
will, Insha Allah, be able to withstand the
time - going forward business conditions
emerging and diverse challenges to achieve
may be tougher. The high inflation rate,
your Company's objectives and deliver
rising ener gy deficit, volatile political
exceptional value to our customers and
situation, unfavorable trade balance and
shareholders. Rashid Ali
escalation in input costs may lead to a slow
down in the economic gr owth and Vice Chairman
CORPORATE DISTINCTIONS Chief Executive & M.D.
performance of the industrial sector . The
Faisalabad
purchasing power of the consuming Your Company also continued to February 12, 2009
segments is already eroded by the continued demonstrate a high quality of corporate
increase in prices of essential commodities,

Horizontal Analysis of Profit and Loss Account
2008 2007 2006
Sales 142% 124% 118%

Cost of sales 146% 120% 114%
Gross profit 131% 134% 131%
Distribution cost 84% 179% 128%
Administrative expenses 108% 107% 105%
Operating profit 138% 133% 135%
Other operating income 145% 141% 95%
Finance cost 306% 58% 247%
Other operating expenses 137% 135% 145%
Profit before taxation 137% 134% 131%
Taxation 136% 134% 131%
Profit after taxation 137% 135% 132%
Horizontal Analysis of Balance Sheet

2008 2007 2006
NON CURRENT ASSETS

Property, plant and equipment 103% 112% 113%
Capital work-in-progress 566% 33% 55%
EMPLOYEES RETIREMENT BENEFITS 75% 290% 94%

LONG TERM LOANS 54% 58% 103%
CURRENT ASSETS
Stores and spares 128% 125% 109%
Stock in trade 177% 117% 84%
Trade debts 105% 123% 123%
Loans, advances, deposits, prepayments
and other receivables 132% 112% 97%
Cash and bank balances 4% 129% 1631%
TOTAL ASSETS 133% 112% 100%
CURRENT LIABILITIES
Trade and other payables 130% 107% 99%
Mark up accrued on short term running finances 13970% 3% 61%
Short term running finances - secured – – –
(Refer note below)
Provision for taxation 188% 143% 84%
NON CURRENT LIABILITIES

Deferred taxation 93% 133% 132%
SHARE CAPITAL AND RESERVES

Share capital 100% 100% 100%
Reserves 119% 111% 107%
TOTAL LIABILITIES 133% 112% 100%
1. There were no short term running finances in 2007 hence no percentage has been worked out.
2. 2005 has been taken as base year and percentage variations have been worked out year on year basis.

Vertical Analysis of Profit and Loss Account
2008 2007 2006
Sales 100.0% 100.0% 100.0%

Cost of sales 74.5% 72.3% 74.4%
Gross profit 25.5% 27.7% 25.6%
Distribution cost 1.5% 2.5% 1.7%
Administrative expenses 1.5% 2.0% 2.3%
Operating profit 22.5% 23.2% 21.6%
Other operating income 0.8% 0.8% 0.7%
Finance cost 0.3% 0.2% 0.3%
Other operating expenses 1.6% 1.6% 1.5%
Profit before taxation 21.4% 22.2% 20.4%
Taxation 7.5% 7.8% 7.2%
Profit after taxation 13.9% 14.4% 13.2%
Vertical Analysis of Balance Sheet

2008 2007 2006
NON CURRENT ASSETS

Property, plant and equipment 29.6% 38.2% 38.1%
Capital work-in-progress 9.6% 2.3% 7.7%
EMPLOYEES RETIREMENT BENEFITS 1.4% 2.4% 0.9%

LONG TERM LOANS 0.0% 0.0% 0.1%
CURRENT ASSETS
Stores and spares 5.4% 5.5% 5.0%
Stock in trade 46.0% 34.5% 32.8%
Trade debts 6.6% 8.3% 7.6%
Loans, advances, deposits, prepayments 0.0% 0.0% 0.0%
and other receivables 1.1% 1.1% 1.1%
Cash and bank balances 0.3% 7.7% 6.7%
TOTAL ASSETS 100.0% 100.0% 100.0%
CURRENT LIABILITIES
Trade and other payables 14.6% 14.9% 15.7%
Mark up accrued on short term running finances 0.2% 0.0% 0.1%
Short term running finances - secured 9.4% 0.0% 0.0%
Provision for taxation 2.8% 2.0% 1.5%

Deferred taxation 4.5% 6.4% 5.4%

Share capital 1.8% 2.3% 2.6%
Reserves 66.7% 74.4% 74.7%
TOTAL LIABILITIES 100.0% 100.0% 100.0%

Directors’ Report
The Directors of your company feel pleasure in presenting the annual audited accounts
along with auditors’ report thereon for the year ended December 31, 2008.
Financial Results
Profit and Appropriations Year ended December 31

2008 2007
(Rupees in Thousands)
Profit after taxation 1,492,365 1,089,184

Actuarial gains/(losses) of employees
retirement benefits (15,977) 41,146
Unappropriated profit brought forward 2,895,238 2,596,187
4,371,626 3,726,517
Appropriations
Final Dividend 2007 @400% (2006: @350%) 369,457 323,275
st
1 Interim Dividend 2008 @350% (2007: @300%) 323,275 277,093
2nd Interim Dividend 2008 @250% (2007: @250%) 230,911 230,911
923,643 831,279
Unappropriated Profit 3,447,983 2,895,238
Earnings per Share (Rupees) 161.57 117.92

The Directors of the company endorse the contents of the Chief Executive’s Review
which covers review of company’s business and operations, outlook and investment
plans for strategic growth.
Distribution of Sales
(Percentage)
9.1%
13.9% 71.5%
5.2%
0.3%
Material & Services Dividend & Retention
Taxation Employee Cost
Finance Cost

Corporate Governance (d) International Accounting
Your company is committed to maintain Standards, as applicable in Profit after Tax
Pakistan, have been followed
(Rupees in Million)
high standar ds of good corporate
in pr eparation of financial
1,492
governance without any exception. The
Directors are pleased to state that your statements and any departure
company is compliant with the provisions therefrom has been
of the Code of Corporate Governance as adequately disclosed. 1,089
required by SECP and formed as part of

stock exchanges listing r egulations. (e) The system of internal control 809
Statement of compliance with Code of is sound in design and has
Corporate Governance is annexed. been effectively implemented 615
670
and monitored. 521
Disclosures under Code of Corporate

Governance (f) There ar e no significant
doubts upon the company’s
Corporate and Financial Reporting ability to continue as a going
Framework concern. 2008 2007 2006 2005 2004 2003
(a) The financial statements (g) There has been no material

prepared by the management of departure fr om the best
the Company, fairly present state practices of corporate
of its af fairs, the r esult of its governance as detailed in the Sales
operations, cash flows and listing regulations. (Rupees in Million)
10,747
changes in equity.
(b) Proper books of accounts of the 7,578

Company have been
maintained.
6,127
(c) Appropriate accounting policies
have been consistently applied
5,194
4,534
in pr eparation of financial 4,031
statements and accounting

estimates ar e based on
re a s o n a b l e a n d p r u d e n t
judgment.
2008 2007 2006 2005 2004 2003

Directors’ Report
Key operating and financial data of last six years are as follows:
2008 2007 2006 2005 2004 2003
Net Sales (Rs’Mio) 10,747 7,578 6,127 5,194 4,534 4,031

Cost of Sales (Rs’Mio) 8,006 5,480 4,556 3,997 3,259 3,001
Gross Profit (Rs’Mio) 2,741 2,098 1,571 1,198 1,275 1,030
%age of Sales 26 28 26 23 28 26
Operating Profit (Rs’Mio) 2,415 1,755 1,321 978 1,101 893
%age of Sales 22 23 22 19 24 22
Profit Before Tax (Rs’Mio) 2,299 1,681 1,252 953 1,050 848
Profit After Tax (Rs’Mio) 1,492 1,089 809 615 670 521
Earnings per Share (Rupees) 161.57 117.92 87.62 66.57 72.51 56.43
Dividend Amount (Rs’Mio) 924 831 647 323 286 259
Percentage 1,000 900 700 350 310 280
Capital Expenditure (Rs’Mio) 606 114 122 302 448 415
Ten Years Performance showing key indicators has been given on the inside cover sheet of this report.
Earnings per Share Capital Expenditure

(Rupees) (Rupees in Million)
161.57
606
117.92
448
415
87.62 302
72.51
66.57
56.43
114 122
2008 2007 2006 2005 2004 2003 2008 2007 2006 2005 2004 2003

Value of investments of employees retirement funds:
Rs. in million
2008 2007
Provident Fund as at June 30 600.706 465.009
Gratuity Fund as at December 31 582.149 507.134
Superannuation Fund as at December 31 242.847 212.101
Board of Directors
The Board of Directors comprises of three executive and seven non-executive directors.
The current members of the Boar d of Dir ectors have been listed in the Company
Information. During the year under r eview, three casual vacancies occurred in the
Board which were filled up within 30 days thereof.
Attendance at Board Meeting

During the year ended December 31, 2008, five meetings of Board of Directors were
held and attended as follows:
Name of No. of meetings

Name of Director Alternate Director attended
John F. Saucier M. Maqbool Ahmad 2

Rashid Ali 5
Cheryl K. Beebe Sh. Gulzar Hussain 3
Robin A. Kornmeyer Sh. Gulzar Hussain 2
Mary A. Hynes S. Yousuf Hashmi 2
Ehsan A. Nomani –
Zulfikar Mannoo 5
Mian M. Adil Mannoo 3
Wisal A. Mannoo 4
Ansar Yahya 5
Anis A. Khan 5
Mr. J. F. Saucier and Ms. C.K. Beebe replaced Mr. J.B. Hebble and Mr. D. A. Larson in
Jan’08. Ms. M.A. Hynes replaced Mr. R.A. Kornmeyer in Jul’08.
Transactions in Company’s Shares

CEO, Directors, CFO, Company Secretary and their spouses and minor children have
made no transactions in the Company’s shares during the year except as stated below:
No. of Shares
Purchased/Acquired Transferred
Jeffrey B. Hebble Director 1

Robin A. Kornmeyer Director 1
Dale A. Larson Director 1
John F. Saucier Director 1
Cheryl K. Beebe Director 1
Mary A. Hynes Director 1
Mian M. Adil Mannoo Director 200
Wisal A. Mannoo Director 100
Sarwat Zulfikar
W/o Zulfikar Mannoo Spouse 100
Parent Company
Corn Products International, Inc., USA is holding majority shar es of the company.
Auditors
The retiring auditors, Messrs KPMG Taseer Hadi & Co., Chartered Accountants, being
eligible, of fer themselves for r e-appointment. The Boar d of Dir ectors, on

Directors’ Report
recommendations of Audit Committee, has proposed appointment of Messrs KPMG

Taseer Hadi & Co., Chartered Accountants for the year 2009, by the shareholders of
the Company in the next general meeting. However , as r equired by the Code of
Corporate Governance, the partner incharge of audit will be changed by KPMG since
the existing partner incharge has completed its tenure of five years.
Audit Committee
The Board of Directors has established an Audit Committee in compliance with the
Code of Corporate Governance with the following members –
Cheryl K. Beebe Chairperson Non Executive Director

Zulfikar Mannoo Member Non Executive Director
Ansar Yahya Member Executive Director
After resignation of Mr. R.A. Kornmeyer, Ms. C.K. Beebe was appointed Chairperson
of the Audit Committee in July, 2008.
The Audit Committee r eviewed the quarterly, half yearly and annual financial
statements before submission to the Board and their publication. CFO, Head of Internal
Audit and a representative of external auditors attended all the meetings where issues
relating to accounts and audit were discussed. The Audit Committee also reviewed
internal audit findings and held separate meetings with internal and external auditors
as required under the Code of Corporate Governance. The Audit Committee also
discussed with the external auditors their letter to the management. Related Parties
Transactions were also placed before the Audit Committee.
Executive Management Committees

In order to strengthen team spirit and participation in management decisions, following
Corporate Executive Management Committees have been formed –
Executive Management Team
Rashid Ali – Vice Chairman/Chief Executive and M.D.

Ansar Yahya – Chief Operating Officer
Anis A. Khan – Chief Financial Officer & Director
All business decisions ar e finalized by the above team. This team is on top of all
Executive Management Committees.
Executive Committee

M. Saleem Rana – Director Operations, Safety & Environment
Ali Masud Zaidi – Deputy Director Projects
This committee collaborates to achieve and impr ove overall performance of the
company, develop and implement approved business plan objectives and strategies,
identify potential problems, monitor investment projects, review expenditures, identify
opportunities/projects and implement good governance throughout the company.
System Technology Committee

M. Tayyab Raza – Chief Information Manager IT
Rapid changes and improvements are taking place in the IT world. The r ole of this
committee is to adopt latest technologies and modern systems for overall improvement
in the IT area.

Remuneration & Compensation Committee

M. Fayyaz Anwar – Human Resource Manager
The Company believes in happy and satisfied workforce. In order to ensure recruitment
of dedicated and devoted employees and also retain existing ones, the responsibility
of this committee is to formulate and implement packages for new employees, consider
promotions of existing workfor ce through prescribed appraisal forms and r eview
their remunerations.
Business Strategy Committee

Muhammad Sarwar – Senior Manager Sales & Marketing
Terms of Reference:
• To consider all matters pertaining to Company’s operations, day–to–day
affairs requiring collective wisdom of the senior management.
• Preparation of annual business plan, Budget, operational model and
Structure.
• Evaluate market, financial and operational risks, threats and opportunities
and devise ways to mitigate the effects of risks on Company’s business.
• Monitor performance against achievement of goals.
• Monitor performance of the designated management committees.
• Give inputs on new initiatives, products and projects.
Crisis Management Committee

Ali Masud Zaidi – Deputy Director Projects
M. Fayyaz Anwar – Human Resource Manager
M. Yasin Anwar – Company Secretary
Terms of Reference:
• To assure that Rafhan Maize can effectively manage any unexpected crisis.
• To prepare Company as thoroughly as possible in advance for any crisis;
whether involving personnel, plant, pr oduct, natural disaster or any
unexpected event of similar nature.
• Compliance of Crisis Management Procedures as per Company’s Crisis
Management Manual and Emergency Action Plans.
In addition to above Corporate Executive Management Committees, Divisional

Committees have also been formed which meet once in a month to r eview the
performance of the r espective divisions and build up strategies to bring further
improvement and to deliver even better results. The Team Leaders are responsible
to hold the meetings of the Committees.

Directors’ Report
Divisional Committees include –

1. Finance & IT Committee
2. Human Resources Committee
3. Manufacturing Optimization and Safety Committee
4. Market & Customer Relations Committee
5. Maize Purchase & Production Committee
6. Projects Committee
7. Procurement Committee
8. Quality Management Systems Committee
One sub–committee under Finance & IT and one under Manufacturing Optimization
and Safety have been formed. Moreover, following three additional sub–committees
have also been formed to include the bottom line management in the decisions making:
1. Logistics & Inventory Control

2. Quality
3. Products Development
Pattern of Shareholding
Pattern of Shareholding as on December 31, 2008 according to requirements of Code
of Corporate Governance and a statement r eflecting distribution of shar eholding
appears at pages 58 and 59 to this report.
Contribution to National Exchequer

Your Company has contributed Rs.1,262 million (2007:Rs.841 million) during the year
2008 to the national exchequer on payments towar ds sales tax, income tax, import
duties and statutory levies. An amount of Rs.116 million (2007:Rs.108 million) was
also paid as withholding income tax deducted by the company fr om shareholders,
employees, suppliers and contractors.
Dividend
The Company has already paid two interim dividends of 350% and 250% each. The
Directors now propose a final dividend of 400% making the total 1000% for the year.
On behalf of the Board
Rashid Ali
Faisalabad Vice Chairman
February 12, 2009 Chief Executive & M.D.

Forward Looking Statements
"intend," "continue," "pr o forma," freight and shipping costs, and changes
"forecast" or other similar expressions or in regulatory controls regarding quotas,
the negative thereof. All statements other tariffs, duties, taxes and income tax rates;
than statements of historical facts in this operating difficulties; boiler r eliability;
report or referred to or incorporated by our ability to effectively integrate acquired
reference into this r eport are "forward- businesses; labor disputes; genetic and
looking statements." These statements are biotechnology issues; changing
subject to certain inher ent risks and consumption pr eferences and tr ends;
Rafhan Maize Pr oducts Co. Ltd. is an uncertainties. Although we believe our increased competitive and/or customer
affiliate of Corn Products International, expectations reflected in these forward- pressure in the corn-refining industry; the
Inc. This Annual Report contains or may looking statements ar e based on outbreak or continuation of serious
contain forward-looking statements. The reasonable assumptions, stockholders are communicable disease or hostilities
Company intends these forward looking cautioned that no assurance can be given including acts of terrorism; stock market
statements to be cover ed by the safe that our expectations will prove correct. fluctuation and volatility. Our forward-
harbor provisions for such statements. Actual results and developments may looking statements speak only as of the
These statements include, among other differ materially fr om the expectations date on which they are made and we do
things, any pr edictions r egarding the conveyed in these statements, based on not undertake any obligation to update
Company`s prospects or future financial various factors, including fluctuations in any forward-looking statement to reflect
condition, earnings, revenues, expenses worldwide markets for corn and other events or circumstances after the date of
or other financial items, any statements commodities, and the associated risks of the statement. If we do update or correct
concerning the Company`s prospects or hedging against such fluctuations; one or more of these statements, investors
future operation, including management`s fluctuations in aggregate industry supply and others should not conclude that we
plans or strategies and objectives therefor and market demand; general political, will make additional updates or
and any assumptions underlying the economic, business, market and weather corrections.
foregoing. These statements can conditions in the various geographic
sometimes be identified by the use of regions and countries in which we
forward looking wor ds such as "may ," manufacture and/or sell our pr oducts;
"will," "should," "anticipate," "believe," fluctuations in the value of local
"plan," "pr oject," "estimate," "expect," currencies, energy costs and availability,

Stakeholders’ Information
Six Years Summary
Rupees in Million
2008 2007 2006 2005 2004 2003
Profit and Loss Account
Net turnover 10,746.83 7,578.34 6,127.13 5,194.39 4,534.03 4,031.20
Gross profit 2,741.25 2,098.17 1,571.06 1,197.69 1,274.75 1,029.95
Operating profit 2,415.17 1,754.64 1,320.87 978.35 1,101.14 893.03
Profit before tax 2,299.07 1,681.10 1,252.39 953.06 1,049.84 848.00
Profit after tax 1,492.37 1,089.18 809.28 614.86 669.73 521.19
Earnings before interest, taxes, depreciation
and amortization (EBITDA) 2,475.27 1,829.73 1,460.72 1,130.22 1,171.95 957.68
Balance Sheet
Share capital 92.36 92.36 92.36 92.36 92.36 92.36
Reserves 3,486.08 2,933.33 2,634.29 2,472.81 2,161.25 1,639.31
Property, plant and equipment 1,553.16 1,501.74 1,342.43 1,184.95 1,307.85 588.70
Net current assets / (liabilities) 1,684.25 1,589.41 1,267.58 992.19 857.75 543.40
Long term / deferred liabilities 235.27 252.34 190.20 144.36 153.91 30.80
Investors' Information
Profitability Ratios:
Gross profit ratio Percentage 25.51 27.69 25.64 23.06 28.12 25.55
Net Profit to Sales Percentage 13.89 14.37 13.21 11.84 14.77 12.93
Return on equity Percentage 45.20 37.87 30.59 25.52 33.61 32.57
Return on capital employed Percentage 39.13 33.23 27.75 22.69 27.82 29.57
Weighted Average cost of debt Percentage 12.66 8.91 9.28 6.17 2.16 7.63
Inventory turnover ratio Times 2.98 3.47 3.41 2.60 2.46 2.73
No. of days in inventory Days 122.48 105.19 107.04 140.38 148.37 133.70
Debtors turnover ratio Times 31.28 23.08 22.97 24.01 27.26 29.59
No. of days in receivables Days 11.67 15.81 15.89 15.20 13.39 12.34
Total assets turnover ratio Times 2.06 1.92 1.74 1.47 1.45 1.61
Fixed assets turnover ratio Times 6.92 5.05 4.56 4.38 3.47 6.85
Operating Cycle Days 77.78 73.43 85.11 96.38 97.25 104.62
Quick/ Acid test ratio Times 0.29 1.01 0.89 0.33 0.34 0.25
EBITDA Margin Percentage 23.03 24.14 23.84 21.76 25.85 23.76
Price earning ratio Times 14.74 19.12 10.27 10.52 8.55 8.86
Cash dividend per share Rupees 100.00 90.00 70.00 35.00 31.00 28.00
Dividend yield ratio Percentage 4.00 4.00 8.00 5.00 5.00 5.60
Dividend payout ratio Percentage 61.89 76.32 79.89 52.58 42.75 49.75
Bonus shares issued Percentage – – – – – –
Debt equity ratio – – – – – –
Current ratio Times 2.19 3.38 3.08 2.21 2.20 1.73
Interest cover Times 64.65 143.38 62.38 116.33 206.25 130.95
Break–up value per share – Refer note below
– Without surplus on revaluation of fixed assets Rupees 387.43 327.58 295.21 277.72 243.99 187.48
– Including the effect of surplus
on revaluation of fixed assets Rupees 387.43 327.58 295.21 277.72 243.99 187.48
Market value per share Rupees 2,381.42 2,255.00 900.00 700.00 620.00 500.00
Market value per share during the year (High) Rupees 2,940.00 2,415.00 918.00 700.00 650.00 510.00
Market value per share during the year (Low) Rupees 2,300.00 945.00 700.00 594.00 510.00 306.00
Dividend cover Ratio Times 1.62 1.31 1.25 1.90 2.34 2.02
Note: The Company has not carried out any revaluation, hence there is no surplus on revaluation of fixed assets.

Summary of Cash Flow Statement
2008 2007 2006 2005 2004 2003

(Rupees in Thousand)
Cash flow from operating activities 741,969 1,011,787 1,179,186 599,909 553,353 791,103
Cash flow from investing activities (604,368) (111,239) (119,926) (299,500) (446,663) (414,201)
Cash flow from financing activities (429,291) (831,423) (837,449) (318,987) (98,248) (374,007)
(291,690) 69,125 221,811 (18,578) 8,442 2,895
Opening Cash and cash equivalents 305,420 236,295 14,484 33,062 24,620 21,725
Closing Cash and cash equivalents 13,730 305,420 236,295 14,484 33,062 24,620

Statement of Value Added and its Distribution
2008 2007
(Rupees in thousands)
VALUE ADDED
Net sales 10,746,826 7,578,339
Material and services (7,632,370) (5,209,380)
Other income 90,911 62,862
3,205,367 2,431,821
DISTRIBUTION % %
EMPLOYEES AS REMUNERATION
Salaries, wages and amenities 559,202 17 477,496 20
FINANCIAL CHARGES TO PROVIDERS

OF FINANCE
Finance Cost 36,123 1 11,807 –
GOVERNMENT AS TAXES
Tax 806,700 26 591,917 24
Workers participation fund 123,498 4 90,285 4
Workers welfare fund 47,398 1 34,308 1
977,596 31 716,510 29
SHAREHOLDERS AS DIVIDEND
Cash dividend 923,643 29 831,279 34
RETAINED WITHIN THE BUSINESS

Depreciation 140,081 4 136,824 6
Retained profit 568,722 18 257,905 11
708,803 22 394,729 17
3,205,367 100 2,431,821 100

Review Report to the Members
on Statement of Compliance with Best Practices of Code of Corporate Governance
We have reviewed the Statement of Compliance with the best practices contained in the Code of Corporate Governance
prepared by the Board of Directors of Rafhan Maize Pr oducts Co. Ltd. (“the Company”) to comply with the Listing
Regulations of the respective Stock Exchanges, where the Company is listed.
The responsibility for compliance with the Code of Corporate Governance is that of the Boar d of Dir ectors of the
Company. Our responsibility is to review, to the extent where such compliance can be objectively verified, whether the
Statement of Compliance reflects the status of the Company's compliance with the provisions of the Code of Corporate
Governance and report if it does not. A review is limited primarily to inquiries of the Company personnel and review
of various documents prepared by the Company to comply with the Code.
As part of our audit of financial statements we are required to obtain an understanding of the accounting and internal
control systems sufficient to plan the audit and develop an effective audit approach. We have not carried out any special
review of the internal control system to enable us to express an opinion as to whether the Board's statement on internal
control covers all controls and the effectiveness of such internal controls.
Based on our review nothing has come to our attention, which causes us to believe that the Statement of Compliance
does not appropriately reflect the Company's compliance, in all material respects, with the best practices contained in
the Code of Corporate Governance.
KPMG Taseer Hadi & Co.

Chartered Accountants
Lahore
February 12, 2009

Statement of Compliance
with the Code of Corporate Governance - year ended December 31, 2008
This statement is being pr esented to appointment and determination of 16. The meetings of the audit committee
comply with the Code of Corporate remuneration and terms and were held at least once every quarter
Governance contained in Listing conditions of employment of the prior to approval of interim and final
Regulation No.37 of Karachi Stock CEO and other executive directors, results of the Company and as
Exchange (Guarantee) Limited and have been taken by the Board. required by the Code. The terms of
Chapter XIII of Lahor e Stock Exchange reference of the committee have been
8. The meetings of the Boar d wer e
(Guarantee) Limited for the purpose of formed and advised to the committee
presided over by the Chairman, and
establishing a framework of good for compliance.
in his absence, by a director elected
governance, wher eby the company is
by the Boar d for this purpose and 17. The Board has set-up an ef fective
managed in compliance with the best
the Board met at least once in every internal audit function. The Internal
practices of corporate governance.
quarter. Written notices of the Board Auditor is suitably qualified and
meetings, along with agenda and experienced for the purpose and is
The Company has applied the principles
working papers, were circulated at conversant with the policies and
contained in the Code in the following
least seven days before the meetings. procedures of the Company . The
manner:
The minutes of the meetings wer e Internal Auditor is involved in
a p p ro p r i a t e l y r e c o rd e d a n d internal audit function on a full time
1. The Company encourages
circulated. basis.
representation of independent non-
executive directors and the Boar d 9. The Dir ectors of the Boar d wer e 18. The statutory auditors of the
has 7 independent non-executive apprised of their duties and Company have confirmed that they
directors including 3 dir ectors responsibilities from time to time have been given a satisfactory rating
representing minority shareholders. during Board meetings. under the Quality Contr ol Review
program of the Institute of Chartered
2. The directors of the Company have 10. The Board approves appointment of
Accountants of Pakistan, that they
confirmed that none of them is CFO, Company Secretary and Head
or any of the partners of the firm,
serving as a dir ector in mor e than of Internal Audit, including their
their spouses and minor children do
ten listed companies, including this remuneration and terms and
not hold shares of the Company and
Company. conditions of employment, as
that the firm and all its partners are
determined by the CEO. However,
3. All the r esident dir ectors of the in compliance with International
there was no new appointment
Company are registered as taxpayers Federation of Accountants (IFAC)
against these posts during the year.
and none of them has defaulted in guidelines on code of ethics as
payment of any loan to a banking 11. The directors' report for the year has adopted by Institute of Charter ed
company. None of our directors is a been prepared in compliance with Accountants of Pakistan.
member of Stock Exchange. the requirements of the Code and
19. The statutory auditors or the persons
fully describes the salient matters
4. Three casual vacancies occurr ed in associated with them have not been
required to be disclosed.
the Boar d during the year under appointed to provide other services
review were filled up by the Directors 12. The financial statements of the except in accordance with the listing
within thirty days thereof. Company were duly endorsed by regulations and the auditors have
CEO and CFO before approval of the confirmed that they have observed
5. The Company has pr epared a
Board. IFAC guidelines in this regard.
'Statement of Ethics and Business
Practices', which has been signed by 13. The directors, CEO and executives 20. We confirm that all other material
all the dir ectors and employees of do not hold any interest in the shares principles contained in the Code have
the Company. of the Company other than that been complied with.
disclosed in the pattern of
6. The Boar d has developed a On behalf of the Board.
shareholding.
vision/mission statement, overall
corporate strategy and significant 14. The Company has complied with all
policies of the Company. A complete the corporate and financial reporting
record of particulars of significant requirements of the Code.
policies along with the dates on 15. The Boar d has formed an audit
which they wer e appr oved or committee. It is comprised of thr ee Rashid Ali
amended has been maintained. members, of whom two ar e non- Vice Chairman
7. All the powers of the Boar d have executive dir ectors including the Chief Executive & M.D.
been duly exer cised and decisions chairperson of the committee. Faisalabad
on material transactions, including February 12, 2009

Auditors’ Report to the Members
also includes assessing the accounting the year then ended; and
policies and significant estimates made
by management, as well as, evaluating d) in our opinion Zakat deductible at
the overall presentation of the above said source under the Zakat and Ushr
statements. We believe that our audit Ordinance, 1980(XVIII of 1980), was
provides a r easonable basis for our deducted by the Company and
opinion and, after due verification, we deposited in the Central Zakat Fund
report that: established under section 7 of that
Ordinance.
a) in our opinion, pr oper books of
account have been kept by the
Company as r equired by the
Companies Ordinance, 1984;
KPMG Taseer Hadi & Co.

b) in our opinion: Chartered Accountants
i) the balance sheet and profit and Lahore
loss account together with the February 12, 2009
notes thereon have been drawn
We have audited the annexed balance up in conformity with the
sheet of Rafhan Maize Products Co. Ltd. Companies Or dinance, 1984,
(“the company”) as at 31 December 2008 and are in agreement with the
and the related profit and loss account, books of account and are further
cash flow statement and statement of in accordance with accounting
changes in equity, together with the notes policies consistently applied;
forming part ther eof, for the year then
ended and we state that we have obtained ii) the expenditure incurred during
all the information and explanations the year was for the purpose of
which, to the best of our knowledge and the Company's business; and
belief, were necessary for the purposes of
our audit. iii) t h e b u s i n e s s c o n d u c t e d ,
investments made and the
It is the responsibility of the Company's expenditure incurred during the
management to establish and maintain a year were in accor dance with
system of internal contr ol, and prepare the objects of the Company;
and present the above said statements in
conformity with the approved accounting c) in our opinion and to the best of our
standards and the r equirements of the information and accor ding to the
Companies Or dinance, 1984. Our explanations given to us, the balance
responsibility is to express an opinion on sheet, profit and loss account, cash
these statements based on our audit. flow statement and statement of
changes in equity together with the
We conducted our audit in accor dance note forming part ther eof conform
with auditing standards as applicable in with approved accounting standards
Pakistan. These standards require that we as applicable in Pakistan, and, give
plan and perform the audit to obtain the information r equired by the
reasonable assurance about whether the Companies Ordinance, 1984, in the
above said statements ar e fr ee of any manner so required and respectively
material misstatement. An audit includes give a true and fair view of the state
examining, on a test basis, evidence of the Company's af fairs as at 31
supporting the amounts and disclosures December 2008 and of the profit, its
in the above said statements. An audit cash flows and changes in equity for

Balance Sheet
As at 31 December 2008
Note 2008 2007

NON CURRENT ASSETS
Property, plant and equipment 5 1,553,156 1,501,737
Capital work in progress 6 503,559 88,892
2,056,715 1,590,629
LONG TERM LOANS 7 791 1,460
Employees retirement benefits 8 71,957 96,537
CURRENT ASSETS
Stores and spares 9 279,768 218,821
Stock in trade 10 2,406,062 1,361,821
Trade debts 11 343,604 328,389
Loans, advances, deposits, prepayments
and other receivables 12 56,131 42,534
Cash and bank balances 13 13,730 305,420
3,099,295 2,256,985
CURRENT LIABILITIES
Trade and other payables 14 765,924 589,359
Mark up accrued on short term running finances 8,522 61
Short term running finances - secured 15 493,709 –
Provision for taxation 146,889 78,158
1,415,044 667,578
WORKING CAPITAL 1,684,251 1,589,407
TOTAL CAPITAL EMPLOYED 3,813,714 3,278,033

Deferred taxation 16 235,273 252,337
NET CAPITAL EMPLOYED 3,578,441 3,025,696
Rashid Ali
Vice Chairman
Anis Ahmad Khan Chief Executive & M. D. Zulfikar Mannoo
Director Director

Note 2008 2007
REPRESENTED BY :

Share capital 17 92,364 92,364
Reserves 18 3,486,077 2,933,332
CONTINGENCIES AND COMMITMENTS 19
3,578,441 3,025,696
The annexed notes 1 to 36 form an integral part of these financial statements.
Rashid Ali
Vice Chairman
Director Director

Profit and Loss Account
For the year ended 31 December 2008
Note 2008 2007

Sales - Net 20 10,746,826 7,578,339

Cost of sales 21 (8,005,580) (5,480,167)
Gross profit 2,741,246 2,098,172
Distribution cost 22 (160,563) (190,583)

Administrative expenses 23 (165,510) (152,950)
(326,073) (343,533)
Operating profit 2,415,173 1,754,639

Other operating income 24 90,911 62,862
2,506,084 1,817,501
Finance cost 25 (36,123) (11,807)

Other operating expenses 26 (170,896) (124,593)
(207,019) (136,400)
Profit before taxation 2,299,065 1,681,101

Taxation 27 (806,700) (591,917)
Profit after taxation 1,492,365 1,089,184
Earnings per share - Basic and diluted (Rupees) 28 161.57 117.92
Rashid Ali
Vice Chairman
Director Director

Cash Flow Statement
Note 2008 2007

CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 2,299,065 1,681,101
Adjustment for non-cash charges and other items:
Depreciation 140,081 136,824
Provision for employees retirement benefits 17,145 19,694
Provision for doubtful debts 3,209 1,372
Profit on sale of property, plant and equipment (549) (1,089)
Interest income (25,420) (22,005)
Finance cost 36,123 11,807
Markup capitalized 9,963 1,099
Operating profit before working capital changes 2,479,617 1,828,803
Increase in current assets:
Stores and spares (60,947) (43,168)
Stock in trade (1,044,241) (201,208)
Trade debts (18,424) (62,974)
Loans, advances, deposits, prepayments and other receivables (14,178) (5,054)
(1,137,790) (312,404)
Increase in current liabilities:
Trade and other payables 175,922 36,521
Net decrease in working capital (961,868) (275,883)
Cash generated from operations 1,517,749 1,552,920
Taxes paid (746,430) (528,402)
Employees retirement benefits paid (17,145) (19,694)
Interest received 25,420 22,005
Finance cost (37,625) (15,042)
(775,780) (541,133)
Net cash generated from operating activities 741,969 1,011,787
Cash flows from investment activities
Property, plant and equipment (606,325) (114,255)
Sale proceeds of property, plant and equipment 707 1,402
Long term loans disbursed (230) (948)
Repayment from long term loans 1,480 2,562
Net cash used in investing activities (604,368) (111,239)
Cash flows from financing activities

Dividend paid (923,000) (831,423)
Short term running finances - secured 493,709 –
Net cash used in financing activities (429,291) (831,423)
Net (decrease)/increase in cash and cash equivalents (291,690) 69,125
Cash and cash equivalents at the beginning of the year 305,420 236,295
Cash and cash equivalents at the end of the year 13 13,730 305,420
Rashid Ali
Vice Chairman
Director Director

Statement of Changes in Equity
Capital Reserves Revenue Reserves

Share Share Unappro- Total
capital premium Other General priated profit
Balance as at 31 December 2006 92,364 36,946 941 207 2,596,187 2,726,645
Total recognized income for the year – – – – 1,130,330 1,130,330

Final dividend 2006 Rs. 35 per share – – – – (323,275) (323,275)
Ist interim dividend Rs. 30 per share – – – – (277,093) (277,093)
2nd interim dividend Rs. 25 per share – – – – (230,911) (230,911)
– – – – 299,051 299,051
Total recognized income for the year – – – – 1,476,388 1,476,388

Final dividend 2007 Rs. 40 per share – – – – (369,457) (369,457)
Ist interim dividend Rs. 35 per share – – – – (323,275) (323,275)
2nd interim dividend Rs. 25 per share – – – – (230,911) (230,911)
– – – – 552,745 552,745
Statement of Recognized Income and Expenses

2008 2007
Actuarial gain/(loss) of retirement benefits recognized directly in equity (24,580) 63,302

Deferred tax on actuarial gain/(loss) recognized directly in equity 8,603 (22,156)
Net profit for the year 1,492,365 1,089,184
Total recognized income for the year 1,476,388 1,130,330
Rashid Ali
Vice Chairman
Director Director

Notes to the Financial Statements
1 THE COMPANY AND ITS OPERATIONS

Rafhan Maize Products Company Limited ("the Company") is incorporated in Pakistan and is listed on
the Karachi and Lahore Stock Exchanges. Corn Products International Inc. Chicago, U.S.A, holds majority
shares of the Company. The registered office of the Company is Finlay House, I.I. Chundigar h Road,
Karachi.
The Company uses maize as the basic raw material to manufacture and sell a number of industrial products,
principal ones being industrial starches, liquid glucose, dextrose, dextrin and gluten meals.
2 Basis of preparation
2.1 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 r equirements differ, the pr ovisions or dir ectives of the Companies
Ordinance, 1984 shall prevail.
2.2 Standards, interpretation and amendments to published approved accounting standards

The following standards, amendments and interpretations of approved accounting standards
will be effective for accounting periods beginning on or after 1 January 2009:
Revised IAS 1 - Presentation of financial statements (effective for annual periods beginning on
or after 1 January 2009) introduces the term total comprehensive income, which represents changes
in equity during a period other than those changes r esulting from transactions with owners in
their capacity as owners. Total comprehensive income may be presented in either a single statement
of comprehensive income (effectively combining both the income statement and all non-owner
changes in equity in a single statement), or in an income statement and a separate statement of
comprehensive income.
IFRS 7 – Financial Instruments: Disclosures (effective for annual periods beginning on or after
28 April 2008) supersedes IAS 30 – Disclosures in the Financial Statements of Banks and Similar
Financial Institutions and the disclosure requirements of IAS 32 – Financial Instruments: Disclosure
and Presentation. The application of the standard is not expected to have significant impact on
the Company's financial statements other than increase in disclosures.
The following standards, amendments and interpretations of approved accounting standards

will be effective for accounting periods beginning on or after 1 January 2009. These are not likely
to have an effect on the Company's financial statements.
Revised IAS 23 - Borrowing costs (effective for annual periods beginning on or after 1 January 2009).
IAS 29 – Financial Reporting in Hyperinflationary Economies (ef fective for annual periods
beginning on or after 28 April 2008).
Amendments to IAS 32 Financial instruments: Presentation and IAS 1 Presentation of Financial

Statements (effective for annual periods beginning on or after 1 January 2009).
Amendment to IFRS 2 Share-based Payment – Vesting Conditions and Cancellations (effective

for annual periods beginning on or after 1 January 2009).
Revised IFRS 3 Business Combinations (applicable for annual periods beginning on or after 1
July 2009).
Amended IAS 27 Consolidated and Separate Financial Statements (effective for annual periods
beginning on or after 1 July 2009).

IFRS 8 – Operating Segments (effective for annual periods beginning on or after 1 January 2009).
IFRIC 13 Customer Loyalty Programmes (effective for annual periods beginning on or after 01
July 2008).
IFRIC 15- Agreement for the Construction of Real Estate (effective for annual periods beginning
on or after 1 October 2009).
IFRIC 16- Hedge of Net Investment in a Foreign Operation. (effective for annual periods beginning
on or after 1 October 2008).
The International Accounting Standards Board made certain amendments to existing standards
as part of its first annual improvements project. The effective dates for these amendments vary
by standard and most will be applicable to the Company’s 2009 financial statements. These
amendments are unlikely to have an impact on the company’s accounts except for the following:
Amendments to IAS 39 Financial Instruments: Recognition and Measurement – Eligible hedged

Items (effective for annual periods beginning on or after 1 July 2009).
IAS 27 ‘Consolidated and separate financial statements’(effective for annual periods beginning
on or after 1 January 2009).
IFRIC – 17 Distributions of Non-cash Assets to Owners (effective for annual periods beginning
on or after 1 July 2009).
IFRS 5 Amendment - Improvements to IFRSs - IFRS 5 Non-curr ent Assets Held for Sale and
Discontinued Operations (effective for annual periods beginning on or after 1 July 2009).
3 Basis of measurement
These financial statements have been prepared under the historical cost convention, except for recognition
of certain employees retirement benefits at present value.
4 Summary of significant accounting policies

4.1 Revenue recognition
Sale of goods
Revenue from sales is recognized upon transfer of significant risks and r ewards of ownership
of the goods to buyers i.e. dispatch of goods to customers.
Interest
Income from bank deposits and loans is recognized on accrual basis.
4.2 Taxation
Current
Tax provision is based on profits as adjusted for tax purposes after taking into account all available
allowances and credits.
Deferred
The Company accounts for deferr ed taxation, using the balance sheet liability method, on all
temporary differences. Deferred tax liabilities are generally recognized for all taxable temporary
differences and deferred tax assets are recognized to the extent that it is pr obable that taxable
profits will be available against which the deductible temporary dif ferences, unused tax losses
and tax credits can be utilized. Deferred tax is calculated at the rates that are expected to apply
to the period when the differences reverse based on tax rates that have been enacted or substantively
enacted by the balance sheet date.

4.3 Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depr eciation except land and capital
work in progress, which are stated at cost.
Depreciation on property, plant and equipment is pr ovided on a straight-line-basis. Rates of

depreciation, which are disclosed in note 5, are designed to write off the cost over the estimated
useful lives of the assets.
Full month's depreciation is charged in the month of addition and no depreciation is charged in
the month of deletion.
Maintenance and normal repairs are charged to income as and when incurred. Major renewals
and improvements are capitalized. Gains and losses on disposals are included in the profit and
loss currently.
Residual value and useful life of assets are reviewed at each financial year end.
4.4 Retirement and termination benefits

Defined contributions scheme
The Company operates a defined contribution appr oved provident fund for all its eligible
employees, in which the Company and the employees make equal monthly contributions at the
rate of 14% of basic salary including dearness allowance of employees.
Defined benefits schemes

The Company also maintains an approved gratuity fund for all its employees and an approved
pension fund for officers and above-grade employees, having a service period of minimum 10
years.
The contributions ar e made to pension and gratuity funds in accor dance with the actuary’s
re c o m m e n d a t i o n s b a s e d o n t h e a c t u a r i a l v a l u a t i o n o f t h e s e f u n d s a s a t
31 December 2008.
The future contribution rates of these funds include allowances for deficit and surplus. Projected
unit credit method is used for valuation of these funds based on the following significant
assumptions:
Gratuity Fund Pension Fund

2008 2007 2008 2007
Discount rate 15% 10% 15% 10%

Expected return on plan assets 15% 10% 15% 10%
Contribution rates (% of basic salaries) 7% 10% 9% 10%
Annual increase in pension rate – – 5% –
Expected rate of growth per annum in
future salaries 15% 12% 15% 12%
The actuarial gains and losses ar e recognized in the period in which they occur dir ectly in
shareholders' equity and presented in the statement of recognized income and expenses.

4.5 Compensated absences
The Company accounts for compensated absences on the basis of unavailed earned leave balance
of each employee at the end of the year.
4.6 Stores and spares

These are valued at lower of cost, which is calculated according to moving average method, and
net realizable value. Stores in transit are valued at invoice value including other charges, if any,
incurred thereon.
4.7 Stocks in trade

Stocks in trade have been valued at the lower of cost and net r ealizable value. Net r ealizable
value signifies the estimated selling price in the or dinary course of the business less estimated
costs to complete and to make the sale.
Cost has been determined as follows:

Raw materials Moving average cost
Work in process Standard cost, which approximates actual
cost
Finished goods Standard cost, which approximates actual
cost
The variance between standard and actual cost on work in process and finished goods is charged
to cost of sales.
4.8 Research and development cost

Research and development costs are charged to profit and loss account in the year in which these
are incurred.
4.9 Foreign currencies

Transactions in foreign currencies are translated into reporting currency at the rates of exchange
prevailing on the dates of transactions. Monetary assets and liabilities denominated in for eign
currencies are translated at the rates prevailing on the balance sheet date. Non-monetary assets
and liabilities are translated using exchange rates that existed when the values were determined.
Exchange differences on the foreign currency translations are included in income along with any
related hedge effects.
4.10 Cash and cash equivalents

For the purpose of cash flow statement, cash and cash equivalents comprise of cheques in hand,
cash and bank balances.
4.11 Borrowing costs

Borrowing costs incurred on related property, plant and equipment are capitalized till the date
of commissioning. All other borrowing costs are included in the profit and loss of the period on
an accrual basis.
4.12 Provisions
A provision is recognized when the Company has a present legal or constructive obligation as
a result of past event and it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation of which reliable estimate can be made.
4.13 Financial instruments

Financial assets are loans to employees and advances, trade debtors, advances, others receivables
and cash and bank balances. These are stated at their nominal value as reduced by the appropriate
allowances for estimated irrecoverable amount.

Financial liabilities are classified according to the substance of the contractual arrangements
entered into. Significant financial liabilities ar e short-term finances utilized under mark-up
arrangements, deposits, creditors, accrued and other liabilities and other provisions. Mark-up
bearing finances are recorded at the gross proceeds recovered. Other liabilities are stated at their
nominal value.
4.14 Off-setting of financial assets and financial liabilities

A financial asset and financial liability is of fset and the net amount is r eported in the balance
sheet if the Company has a legal enforceable right to set-off the recognized amounts and intends
either to settle on net basis or to realize the assets and settle the liabilities simultaneously.
4.15 Related party transactions

Transactions with related parties are priced at comparable uncontrolled market price except for
the assets sold to employees under the employees' car scheme as approved by the boar d of
directors.
Parties are said to be related if they are able to influence the operating and financial decisions
of the Company and vice versa.
4.16 Impairment
The carrying amounts of the Company’s assets ar e reviewed at each balance sheet date to
determine whether there is any indication of impairment. If any such indication exists, the asset’s
recoverable amount is estimated and impairment losses are recognized.
4.17 Dividends
Dividend distribution to the shareholders is recognized as a liability in the period in which it is
approved by the shareholders.
4.18 Derivative financial instruments

These are initially recorded at fair value on the date a derivative contract is entered into and are
re-measured to fair value at subsequent reporting dates. The method of recognizing the resulting
gain or loss depends on whether the derivative is designated as a hedging instrument, and if
so, the nature of the item being hedged. The Company designates certain derivatives as cash
flow hedges.
The Company documents at the inception of the transaction the relationship between the hedging
instruments and hedged items, as well as its risk management objective and strategy for
undertaking various hedge transactions. The Company also documents its assessment, both at
hedge inception and on an ongoing basis, of whether the derivati ves that are used in hedging
transactions are highly effective in offsetting changes in cash flow of hedged items.
The effective portion of changes in the fair value of derivatives that are designated and qualify
as cash flow hedges are recognized in equity. The gain or loss relating to the ineffective portion
is recognized immediately in the profit and loss account.
Amounts accumulated in equity are recognized in profit and loss account in the periods when
the hedging items will effect profit or loss. However, when the forecast hedged transaction results
in the recognition of a non-financial asset or a liability, the gains and losses previously deferred
in equity are transferred from equity and included in the initial measurement of the cost of the
asset or liability.

5 Property, Plant and Equipment
COST DEPRECIATION Book value

As at As at As at Charge As at As at
01 January 31 December 01 January On for 31 December 31 December
2008 Additions Disposals 2008 2008 disposals the year 2008 2008 Rate
(Rupees in thousands) %
Free–hold land 138,078 127,244 – 265,322 – – – – 265,322

Factory building on free–hold land 593,932 9,614 – 603,546 295,010 – 47,941 342,951 260,595 10
Plant, machinery and equipment 2,068,341 32,153 (170) 2,100,324 1,061,819 (170) 77,833 1,139,482 960,842 10
Other machinery and equipment 46,412 4,949 (8) 51,353 26,249 (8) 1,513 27,754 23,599 10–12
Furniture, fixture and office –
equipment 43,603 2,481 (64) 46,020 32,053 (64) 3,861 35,850 10,170 20–25
Automobiles 63,247 15,217 (1,188) 77,276 36,745 (1,030) 8,933 44,648 32,628 20
2008 2,953,613 191,658 (1,430) 3,143,841 1,451,876 (1,272) 140,081 1,590,685 1,553,156
COST DEPRECIATION Book value

As at As at As at Charge As at As at
01 January 31 December 01 January On for 31 December 31 December
2007 Additions Disposals 2007 2007 disposals the year 2007 2007 Rate
(Rupees in thousands) %
Free–hold land 138,078 – – 138,078 – – – – 138,078

Factory building on free–hold land 538,004 55,928 – 593,932 247,400 – 47,610 295,010 298,922 10
Plant, machinery and equipment 1,850,747 218,120 (526) 2,068,341 986,092 (526) 76,253 1,061,819 1,006,522 10
Other machinery and equipment 44,416 2,240 (244) 46,412 25,050 (244) 1,443 26,249 20,163 10–12
Furniture, fixture and office equipment 43,481 4,544 (4,422) 43,603 32,808 (4,422) 3,667 32,053 11,550 20–25
Automobiles 50,643 15,617 (3,013) 63,247 31,594 (2,700) 7,851 36,745 26,502 20
2007 2,665,369 296,449 (8,205) 2,953,613 1,322,944 (7,892) 136,824 1,451,876 1,501,737
5.1 The cost of fully depreciated assets which are still in use is Rs. (thousands) 721,550 (2007: Rs. (thousands)
652,631).
Note 2008 2007

5.2 Depreciation charge for the year has been allocated as follows:
Cost of sales 21 132,325 130,234
Distribution cost 22 3,016 2,189
Administrative expenses 23 4,740 4,401
140,081 136,824
5.3 Disposal of property, plant and equipment

Book Sale
Description Sold to Cost value Proceeds Profit Mode of sale
Automobile Mr. Sher Wali Khan
Gul Marjan, Bannu 618 139 371 232 Tender
Above represents sale of assets with book value of more than Rs. (thousand) 50.

6 CAPITAL WORK IN PROGRESS
Cornwala/ Plant
Mehran expansion
projects projects Others 2008 2007
(Rupees in thousands )
Civil works and buildings 144,298 1,084 – 145,382 9,665

Plant and machinery 253,314 – – 253,314 48,527
Project stores 98,049 – – 98,049 23,886
Advance for land–Note 6.2 – – 6,814 6,814 6,814
2008 495,661 1,084 6,814 503,559 88,892
2007 79,088 2,990 6,814
6.1 Cornwala / Mehran pr ojects include markup amounting to Rs. (thousands) 9,963 (2007: Rs.
(thousands) 1,099) capitalized during the year at the rate rangi ng from 10.40% to 16.70% per
annum (2007: 9.73% to 11.88%).
6.2 This represents full payment of Rs. (thousands) 1,814 (2007 : Rs. (thousands) 1,814) and legal
cost incurred Rs. (thousands) 5,000 (2007:Rs. (thousands) 5,000) for the Company's factory land
in Faisalabad which was acquired from the government in 1953 but r egistration of title is still
pending in the name of Company.
Note 2008 2007

7 LONG TERM LOANS - SECURED
CONSIDERED GOOD
Staff loans outstanding for periods less than three years to:
Executives 7.4 885 1,820
Other employees 689 1,003
1,574 2,823
Less: Current maturity 12 783 1,363
791 1,460
7.1 Loans to other employees represent house building loans provided to employees in accordance
with Company's policy and are repayable over a period of five years. These loans ar e secured
against the employees provident fund. Loans to employees carry interest at the rate of approximately
8% per annum (2007: 8 % per annum).
7.2 Maximum aggregate balance during the year, at the end of any month, of loans to executives
was Rs. (thousands) 1,730 (2007: Rs. (thousands) 2,197).
7.3 No loans were granted to the directors and chief executive of the Company.
2008 2007
7.4 Loans to executives
Opening balance 1,820 1,529
Disbursement during the year – 850
Recoveries during the year (935) (559)
Closing balance 885 1,820

2008 2007
8 EMPLOYEES RETIREMENT BENEFITS
Gratuity 89,746 90,263

Pension (17,789) 6,274
71,957 96,537
8.1 Movements in the net assets/(liabilities)

recognized in the balance sheet Gratuity Pension
are as follows: (Rupees in thousands)
2008 2007 2008 2007
Net assets/(liabilities) at the
beginning of the year 90,263 51,903 6,274 (18,668)
Expenses recognized (9,259) (12,007) (7,886) (7,687)
Contribution paid 9,259 12,007 7,886 7,687
Actuarial (loss)/gain recognized (517) 38,360 (24,063) 24,942
Net assets/(liabilities)
at the end of the year 89,746 90,263 (17,789) 6,274
8.2 The amounts recognized in the profit and

loss account are as follows:
Current service cost 17,856 16,332 8,483 6,079
Interest cost 35,160 29,574 20,645 17,948
Expected return on plan assets (43,757) (33,899) (21,242) (16,340)
9,259 12,007 7,886 7,687
8.3 The amounts recognized in the balance

sheet are as follows:
Present value of the obligation (492,403) (416,871) (260,636) (205,827)
Fair value of plan assets 582,149 507,134 242,847 212,101
Net asset/(liability) 89,746 90,263 (17,789) 6,274
8.4 Movement in present value of defined

benefit obligation
Present value of defined benefit obligation
as at the beginning of the year 416,871 393,382 205,827 201,449
Current service cost 17,856 16,332 8,483 6,079
Interest cost 35,160 29,574 20,645 17,948
Actual benefits paid during the period (14,639) (22,009) (7,392) (6,466)
Actuarial (gain)/loss on obligation. 37,155 (408) 33,073 (13,183)
Present value of defined benefit
obligation as at the end of the year 492,403 416,871 260,636 205,827

Gratuity Pension
8.5 Movements in fair value of plans assets 2008 2007 2008 2007
Fair value of plan asset as at the
beginning of the year 507,134 445,285 212,101 182,781
Expected return on assets 43,757 33,899 21,242 16,340
Actual contribution by the employer 9,259 12,007 7,886 7,687
Actual paid during the year (14,639) (22,009) (7,392) (6,466)
Actuarial gain on plan asset 36,638 37,952 9,010 11,759
Fair value of plan asset as at the
end of the year 582,149 507,134 242,847 212,101
8.6 Actual return on plan assets
Expected return on plan assets 43,757 33,899 21,242 16,340

Actuarial gain on plan assets 36,638 37,952 9,010 11,759
80,395 71,851 30,252 28,099
(Percentage) (Percentage)
8.7 Plan assets consist of the following
Debt instruments 45% 59% 70% 72%
Cash and other deposits 55% 41% 30% 28%
2008 2007 2006 2005 2004

8.8 Historical information - gratuity
Present value of defined

benefit obligation (492,403) (416,871) (393,382) (320,395) (297,774)
Fair value of plan assets 582,149 507,134 445,285 391,652 330,638
Surplus in the plan 89,746 90,263 51,903 71,257 32,864
Experience adjustment arising

on plan liabilities 37,155 (408) 60,504 (1,896) (1,544)
on plan assets 36,638 37,952 41,150 36,497 28,677
8.9 Historical information - pension
Present value of defined

benefit obligation (260,636) (205,827) (201,449) (189,549) (170,077)
Fair value of plan assets 242,847 212,101 182,781 153,466 125,052
Surplus/(deficit) in the plan (17,789) 6,274 (18,668) (36,083) (45,025)
on plan liabilities 33,073 (13,183) (5,572) 2,345 44,775
on plan assets 9,010 11,759 11,183 8,403 3,090

Note 2008 2007
9 STORES AND SPARES
Stores 158,514 108,762
Spares 97,889 87,976
256,403 196,738
Less: Provision for slow moving and obsolete items 9.1 (31,019) (25,297)
225,384 171,441
Stores in transit 54,384 47,380
279,768 218,821
9.1 Provision for slow moving and obsolete items

Provision for the year 5,722 2,344
Closing balance 31,019 25,297
10 STOCK IN TRADE
Raw materials
Corn and cobs 1,887,117 997,243
Corn seeds 5,096 6,793
1,892,213 1,004,036
Work in process 28,785 26,699
Finished goods 485,064 331,086
2,406,062 1,361,821
11 TRADE DEBTS
Secured – against security deposits and bank guarantees 233,869 236,532
Unsecured – considered good
Related parties 38,528 52,474
Others 71,207 39,383
109,735 91,857
Considered doubtful 10,651 7,442
120,386 99,299
Less: Provision for doubtful balances 11.1 (10,651) (7,442)
109,735 91,857
343,604 328,389
11.1 Provision for doubtful balances

Provision for the year 3,209 1,372
Closing balance 10,651 7,442

Note 2008 2007
12 LOANS, ADVANCES, DEPOSITS, PREPAYMENTS
AND OTHER RECEIVABLES
Loans and advances – considered good
Suppliers of goods and services 21,165 14,046
Employees 12.1 2,545 1,721
Current maturity of long term loans 7 783 1,363
24,493 17,130
Deposits and prepayments
Security deposits 8,794 8,744
L/C margin 5,154 959
Prepayments 12,308 11,724
26,256 21,427
Other receivables – Farmers balances
Considered good 1,569 49
Considered doubtful 1,675 1,675
3,244 1,724
Less: Provision for doubtful balances (1,675) (1,675)
1,569 49
Due from related parties 1,455 1,036
Workers' profit participation fund 12.2 1,177 627
Others 1,181 2,265
56,131 42,534
12.1 No advances were given to executives, directors and chief executive of the Company during the year.
Note 2008 2007

12.2 Workers' profit participation fund
Opening balance 627 (6)
Provision for the year 26 (123,498) (90,285)
Payment to the fund 124,048 90,918
Closing balance 1,177 627
13 CASH AND BANK BALANCES

Cash at banks
on current accounts 351 6,866
on PLS accounts 13.1 28 282,472
379 289,338
Cash in hand 1,958 1,502
Cheques in hand 11,393 14,580
13,351 16,082
13,730 305,420
13.1 These carry profit at a rate ranging from 1% to 10.50% per annum (2007: 1% to 9.75% per annum)

Note 2008 2007
14 TRADE AND OTHER PAYABLES
Creditors 203,504 94,361
Advances from customers 80,938 90,355
Security deposits from dealers and contractors 14.1 167,170 148,424
Other deposits 14.2 1,677 883
Accrued liabilities 240,646 207,753
Workers' welfare fund 47,398 34,308
Employees provident fund 3,026 –
Sales tax payable 16,485 9,429
Special excise duty 1,958 1,367
Unclaimed dividend 3,122 2,479
765,924 589,359
14.1 The agreement between dealers and contractors gives Company the right to utilize these deposits
in normal course of business.
14.2 These represent deposits held against tenders for the sale of scrap.
15 SHORT TERM RUNNING FINANCES - SECURED
The aggregate financing facility available from commercial banks is Rs. (thousands) 2,300,000 (2007: Rs.
(thousands) 1,283,000).
The rate of markup ranges fr om 10.40 % to 16.70 % per annum (2007 : 9.73 % to 1 1.88 % per annum).
These facilities are secured by joint pari passu hypothecation char ge on current assets of the Company
and are subject to repricing on monthly/quarterly basis.
The unutilized facility for letters of cr edit as on 31 December 2008 amounts to Rs. (thousands) 284,087
(2007: Rs. (thousands) 271,190 ).
2008 2007
16 DEFERRED TAXATION
This comprises of:
Credit/(debit) balances arising in respect of :
Accelerated tax depreciation 225,971 231,610
Others (15,883) (13,061)
Employees retirement benefits 25,185 33,788
235,273 252,337

2008 2007 2008 2007
(Number of shares) (Rupees in thousands)
17 AUTHORIZED, ISSUED, SUBSCRIBED
AND PAID UP CAPITAL
Authorized share capital
Ordinary shares of Rs.10 each 20,000,000 20,000,000 200,000 200,000
17.1 Issued, subscribed and

paid up capital
Ordinary shares of Rs. 10 each
fully paid up for cash 1,858,991 1,858,991 18,590 18,590
Issued other than cash
- plant and machinery 36,294 36,294 363 363
Issued as fully paid bonus shares 7,341,143 7,341,143 73,411 73,411
9,236,428 9,236,428 92,364 92,364
17.2 Corn Products International Inc., USA held 6,494,243 (2007: 6,494,243) ordinary shares of Rs. 10
each as at 31 December 2008.
Note 2008 2007

18 RESERVES
CAPITAL
Share premium 18.1 36,946 36,946
Other 18.2 941 941
37,887 37,887
REVENUE
General reserve 207 207
Unappropriated Profit 3,447,983 2,895,238
3,448,190 2,895,445
3,486,077 2,933,332
18.1 This reserve can be utilized in accordance with the provision of section 83(2) of the Companies
Ordinance, 1984.
18.2 This reserve was created under section 15BB of the Income Tax Act, 1922 to avail the tax exemption
in prior years.
19 CONTINGENCIES AND COMMITMENTS

a) Certain labour cases are pending before the labour courts and their financial ef fect cannot be
reasonably determined due to their nature and uncertainty surrounding them. The possibility
of any outflow for settlement of these claims is considered remote.
b) Land registration fee as per Note 6.2.
c) Commitments in respect of capital expenditure contracted but not provided amount to

Rs. (thousands) 650,715 (2007: Rs. (thousands) 144,699).
d) Commitments in respect of purchase of corn amount to Rs. (thousands) 2,720,089 (2007: Rs.
(thousands) 1,325,709).
e) Commitments in respect of counter guarantees given to banks in consideration of their guarantees

in the normal course of business amount to Rs. (thousands) 80,922 (2007: Rs. (thousands) 80,132).

Note 2008 2007

20 SALES - NET
Domestic 10,816,972 7,389,117
Export 433,825 504,285
11,250,797 7,893,402
Less: Sales tax 461,401 292,565
Special excise duty 27,941 10,009
Trade discount and Commission 14,629 12,489
503,971 315,063
10,746,826 7,578,339
21 COST OF SALES
Raw material consumed:
Corn 5,793,989 3,722,097
Others 113,675 1,723
Stores 224,513 181,948
Packing material 247,571 181,041
6,379,748 4,086,809
Factory expenses:
Salaries, wages and amenities 21.1 383,099 317,564
Spares consumed 105,418 94,795
Fuel and power 1,006,596 736,363
Rent, rates and taxes 3,564 3,425
Repairs and maintenance 14,468 10,170
Depreciation 5.2 132,325 130,234
Insurance 8,493 9,253
Factory general expenses 127,933 98,865
1,781,896 1,400,669
8,161,644 5,487,478
Add: Opening work in process stock 26,699 13,892
8,188,343 5,501,370
Less: Closing work in process stock (28,785) (26,699)
Cost of production 8,159,558 5,474,671
Add: Opening finished goods stock 331,086 336,582
8,490,644 5,811,253
Less: Closing finished goods stock (485,064) (331,086)
8,005,580 5,480,167
21.1 Salaries, wages and amenities include Rs. (thousands) 8,055 (2007: Rs. (thousands) 9,352) in
respect of contribution to pension and gratuity fund and Rs. (thousands) 8,977 (2007:
Rs. (thousands) 7,895) in respect of contributions to provident fund.

Note 2008 2007
22 DISTRIBUTION COST
Salaries and amenities 22.1 44,782 38,155
Traveling and automobile expenses 7,341 7,247
Freight and distribution 96,131 135,949
Insurance 2,226 439
Rent, rates and taxes 758 937
Repair and maintenance 134 822
Electricity charges 66 67
Printing and stationery 423 653
Telephone and postage 1,481 1,632
Advertising and sales promotion 630 732
Depreciation 5.2 3,016 2,189
Market research and development 44 52
Provision for doubtful debts 3,208 1,372
Miscellaneous expenses 323 337
160,563 190,583
22.1 Salaries and amenities include Rs. (thousands) 2,169 (2007: Rs. (thousands) 2,097) in respect of
contribution to pension and gratuity fund and Rs. (thousands) 1,909 (2007: Rs. (thousands) 1,604)
in respect of contributions to provident fund.
Note 2008 2007
23 ADMINISTRATIVE EXPENSES
Salaries and amenities 23.1 131,321 121,777
Traveling and automobile expenses 10,248 12,122
Insurance 929 904
Rent, rates and taxes 1,019 1,143
Repair and maintenance 6,050 1,604
Electricity charges 1,190 1,125
Printing and stationery 967 1,151
Telephone and postage 3,329 3,465
Legal and professional charges 2,657 1,993
Depreciation 5.2 4,740 4,401
Auditors' remuneration 23.2 1,511 1,415
Miscellaneous expenses 1,549 1,850
165,510 152,950
23.1 Salaries and amenities include Rs. (thousands) 6,921 (2007: Rs. (thousands) 8,245) in respect of
contribution to pension and gratuity fund and Rs. (thousands) 6,309 (2007: Rs. (thousands) 5,713)
in respect of contributions to provident fund.

Note 2008 2007

23.2 Auditors' remuneration
Statutory audit fee 600 550
Review of half yearly accounts 200 200
Services in connection with review and reporting of
accounts to CPI Inc. 560 525
Audit of gratuity and pension funds 76 70
Out of pocket expenses reimbursed 75 70
1,511 1,415
24 OTHER OPERATING INCOME
Mark up on staff loans and profit on bank deposits 25,420 22,005
Sale of scrap 31,544 29,085
Profit on sale of property, plant and equipment 549 1,089
Profit on sale of pesticides and seeds 5,737 3,957
Commission received 1,249 –
Foreign exchange gain 23,584 464
Miscellaneous income 2,828 6,262
90,911 62,862
25 FINANCE COST
Mark up on short term running finances 29,192 4,480
Bank charges and commission 6,931 7,327
36,123 11,807
26 OTHER OPERATING EXPENSES
Workers Profit Participation Fund 12.2 123,498 90,285
Workers' Welfare Fund 47,398 34,308
170,896 124,593
27 TAXATION
Current 815,161 551,931
Deferred (8,461) 39,986
806,700 591,917
27.1 The Income Tax Department has charged tax of Rs. (thousands) 81,078 for the assessment year
2001-2002 (financial year ended 30 September 2000) under section 12(9A) of the Income T ax
Ordinance, 1979 (Repealed) on the allegation that the dividend distribution by the Company
was less than 40% of its after tax pr ofits. Against this levy, the Company filed an appeal with
the Commissioner of Income Tax (Appeals), which was r ejected. The Company pr eferred an
appeal with the Income Tax Appellate Tribunal (ITAT) against the order of CIT (Appeals). The
ITAT vide order dated 21 April 2006 decided the case in favour of the Company and confirmed
that levy of tax under section 12(9A) was against the pr ovisions of the law and dir ected the
assessing officer for decision in accordance with the provisions of amended clause 59 of Part IV,
Second Schedule to the repealed Income Tax Ordinance, 1979. The Income Tax Department has
moved to Lahore High Court on 17 October 2006, against the or ders of ITAT. The case has not
been fixed for hearing so far.
No Provision has been created in these financial statements as according to the management of
the Company, it is probable that this case will be decided in favour of the Company. The legal
advisors of the Company have concurred with the management's view.

2008 2007
% %
27.2 Numerical reconciliation between average effective
tax rate and applicable tax rate:
Applicable tax rate 35.00 35.00
Tax effect of inadmissible expenses 0.40 0.11
Tax effect of admissible expenses (0.08) (0.22)
Effect of presumptive tax regime and others (0.23) 0.32
Average effective tax rate (tax expense
divided by profit before tax) 35.09 35.21
28 EARNINGS PER SHARE - BASIC AND DILUTED
28.1 Earning per share - Basic
Profit attributable to ordinary

shareholders (Rupees in thousands) 1,492,365 1,089,184
Number of ordinary shares (Numbers) 9,236,428 9,236,428
Earnings per share - basic (Rupees) 161.57 117.92
28.2 Earning per share - Diluted
There is no dilution effect on basic earnings per share as the Company has no such commitments.

29 FINANCIAL INSTRUMENTS
2008
Interest bearing Non Interest bearing
Maturity Maturity
Maturity within one Maturity Maturity within one Maturity
upto year to after upto year to after Sub
one year five years five years Sub total one year five years five years total Total
FINANCIAL ASSETS
Loans to employees 225 295 – 520 558 496 – 1,054 1,574
Trade debts – – – – 343,604 – – 343,604 343,604
Loans, advances, deposits,
prepayments and other
receivables – – – – 13,975 – – 13,975 13,975
Cash and bank balances 28 – – 28 13,702 – – 13,702 13,730
253 295 – 548 371,839 496 – 372,335 372,883
FINANCIAL LIABILITIES
Trade and other payables – – – – 546,909 – – 546,909 546,909
Markup accrued on
short term finances 8,522 – – 8,522 – – – – 8,522
8,522 – – 8,522 546,909 – – 546,909 555,431
On balance sheet gap (8,269) 295 – (7,974) (175,070) 496 – (174,574) (182,548)
OFF BALANCE SHEET ITEMS

Commitments – counter guarantees – – – – 80,922 – – 80,922 80,922
Capital – – – – 650,715 – – 650,715 650,715
Others – – – – 2,720,089 – – 2,720,089 2,720,089
– – – – 3,451,726 – – 3,451,726 3,451,726
2007
Interest bearing Non Interest bearing
Maturity Maturity
Maturity within one Maturity Maturity within one Maturity
upto year to after upto year to after Sub
one year five years five years Sub total one year five years five years total Total
FINANCIAL ASSETS
Loans to employees 404 502 – 906 959 958 – 1,917 2,823
Trade debts – – – – 328,389 – – 328,389 328,389
Loans, advances, deposits,
prepayments and other
receivables – – – – 13,766 – – 13,766 13,766
Cash and bank balances 282,472 – – 282,472 22,948 – – 22,948 305,420
282,876 502 – 283,378 366,062 958 – 367,020 650,398
FINANCIAL LIABILITIES
Trade and other payables – – – – 279,572 – – 279,572 279,572
Markup accrued on
short term finances 61 – – 61 – – – – 61
61 – – 61 279,572 – – 279,572 279,633
On balance sheet gap 282,815 502 – 283,317 86,490 958 – 87,448 370,765
OFF BALANCE SHEET ITEMS

Commitments – counter guarantees – – – – 80,132 – – 80,132 80,132
Capital – – – – 144,699 – – 144,699 144,699
Others – – – – 1,325,709 – – 1,325,709 1,325,709
– – – – 1,550,540 – – 1,550,540 1,550,540

29.1 Foreign exchange risk management
Foreign currency risk arises mainly wher e payables exist due to transactions with for eign
undertakings, especially group Companies. Payables exposed to foreign exchange risk are covered
mainly through forward foreign exchange contracts. In general the Company's policy is to enter
into foreign exchange contracts for almost all transactions in foreign currencies.
Forward foreign exchange contracts

The fair values of Company's derivative financial instruments (unfavorable forward foreign
exchange contracts) as on 31 December 2008 are Rs. (thousands) Nil (2007: Rs. (thousands) 57,966)
and (favorable forward foreign exchange contracts) as on 31 December 2008 are Rs (thousands)
Nil (2007: Rs (thousands) 19,717).
29.2 Interest rate risk management

Interest rate risk represents the value of financial instruments which will fluctuate due to changes
in market interest rate. Since the Company has no long term interest based financial instruments,
it is not exposed to interest rate risk.
29.3 Market risk management

The Company is not exposed to any significant market risk.
29.4 Concentration of credit risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation
and cause the other party to incur a financial loss. Out of total financial assets of Rs. 372,883
(thousands) (2007: Rs. (thousands) 650,398), the financial assets which are subject to credit risk
amount to Rs. (thousands) 111,304 (2007: Rs. (thousands) 91,906). Concentration of cr edit risk
may arise from exposure to a single debtor or to a group of debtors having similar characteristics
such that their ability to meet their obligations is ef fected similarly by changes in economic or
other conditions. The Company believes that it is not exposed to major concentration of credit
risk. To manage exposur e to cr edit risk, the Company applies appr oved credit limits to its
customers and also obtains collaterals.
29.5 Liquidity risk management

The Company limits its liquidity risk by ensuring that bank facilities are available. The Company's
terms of sales require amounts to be paid within 30 days of the date of sale. Trade payables are
normally settled within 15-30 days of the date of purchase.
29.6 Capital risk management

The Board's policy is to maintain an efficient capital base so as to maintain investor, creditor and
market confidence and to sustain the future development of its business. The Board of Directors
monitors the r eturn on capital employed, which the Company defines as operating income
divided by capital employed. The Boar d of Directors also monitors the level of dividends to
ordinary shareholders.
The company's objective when managing capital are:

to safeguard the entity's ability to continue as a going concern, so that it can continue to provide
returns for shareholders and benefit for other stakeholders, and
to provide and adequate return to shareholders.
The Company manages the capital str ucture in the context of economic conditions and risk
characteristics of the underlying assets. In order to maintain or adjust the capital structure, the
Company may, for example, adjust the amount of dividends paid to shareholders and issue new
shares.
For working capital requirement and capital expenditure, the Company primarily relies substantially
on short term borrowings.
29.7 Fair values of financial assets and liabilities

The carrying value of all the financial instruments reflected in the financial statements approximate
their fair values.

30 REMUNERATION OF CHIEF EXECUTIVE, PAID DIRECTORS AND EXECUTIVES
Chief Executive Directors Executives

2008 2007 2008 2007 2008 2007
Managerial remuneration 16,010 14,354 6,671 5,799 27,407 22,388

Rent, bonus and other allowances 9,258 8,114 8,881 7,708 33,241 25,622
25,268 22,468 15,552 13,507 60,648 48,010
Retirement benefits 2,582 3,242 1,076 1,310 4,420 5,057
Club subscription 59 75 24 56 27 72
Leave encashment 2,380 1,992 1,758 1,288 3,068 2,812
30,289 27,777 18,410 16,161 68,163 55,951
Number 1 1 2 2 31 26
Meeting fees aggregating to Rs. (thousands) 10 (2007: Rs (thousands) NIL) wer e paid to 5 (2007: None)
non–executive directors for attending board meetings. In addition, the Vice Chairman, Chief Executive
and Managing Director and two full time working directors and some executives are also provided with
Company's transportation.
31 TRANSACTIONS WITH RELATED PARTIES AND ASSOCIATES

The Company enters into transactions with major shareholders and associated concerns in the ordinary
course of business at commercial rates. Nature and description of transactions along with monetary values
and year end balances are as follows:
2008 2007
Nature of Nature and description of Total Total
relationship related party transaction value of Closing value of Closing
transaction balance transaction balance
Unilever Pakistan Food Limited Associate Sales 742,822 19,770 587,193 21,024
Services rendered 8 – 8 5
Corn Products International Holding company Purchase of spares – – 2,458 13
Services received – 1,455 – 1,018
Corn Products Kenya Ltd. Associate Export sales 100,105 18,758 203,094 31,450
Corn Products Ammardas, Thailand Associate Imports 84,925 – – –
Indumaiz del Ecuador S.a,–Ecuador Associate Export sales – – 5,502 –
Industriaz del Maiz S.a,–Columbia Associate Export sales – – 20,182 –
Employees benefits Other related parties Contribution to funds 34,340 68,931 34,906 96,537
The transactions were carried out at an arm's length basis, in accordance with the accounting policy as stated in Note 4.15.
No buying and selling commission has been paid to any associated undertaking.

2008 2007
(Metric Tons)
32 PLANT CAPACITY AND PRODUCTION
Average grind capacity per day 1,250 1,225
Grind capacity for 350 working days 437,500 428,750
Actual days worked 334 334
Actual grind 419,572 393,841
The reduction in grind days/ grind was attributable to lower sales demand.
33 DIVIDENDS
The Board of Directors have proposed a final dividend for the year ended 31 December 2008 of Rs. 40 per
share, amounting to Rs. (thousands) 369,457 at their meeting held on 12 Febr uary 2009, for approval of
the members at the Annual General Meeting to be held on 28 March 2009 (2007: Rs. 40 per share amounting
to Rs. (thousands) 369,457).
34 DATE OF AUTHORIZATION OF ISSUE

These financial statements were authorized for issue on 12 Febr uary 2009 by the Board of Directors of
the Company.
35 USE OF ESTIMATES AND JUDGMENTS

The preparation of financial statements in conformity with appr oved accounting standar ds requires
management to make judgments, estimates and assumptions that ef fect the application of policies and
reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions
and judgments are based on historical experience and various other factors that are believed to be reasonable
under the circumstances, the result of which form the basis of making the judgment about carrying values
of assets and liabilities that are not readily apparent from other sources. Actual results may differ from
these estimates.
The estimates and underlying assumptions ar e reviewed on an ongoing basis. Revision to accounting
estimates are recognized in the period in which the estimate is r evised if the revision effects only that
period, or in the period of revision and future periods if revision affects both current and future periods.
The areas where various assumptions and estimates are significant to Company's financial statements or
where judgments were exercised in application of accounting policies are as follows:
- Taxation- (note 4.2 & 27)
- Useful life of depreciable assets- (note 4.3 & 5)
- Employees retirement benefits- (note 4.4 & 8)
- Provision and contingencies- (note 4.12 & 19)
36 GENERAL
Figures in these accounts have been rounded off to the nearest thousands of rupees.
Rashid Ali
Vice Chairman
Director Director

As at 31 December 2008
NUMBER OF TOTAL
SHAREHOLDERS SHAREHOLDING SHARES HELD
660 1 - 100 37,531

148 101 - 500 34,733
50 501 - 1000 38,092
44 1001 - 5000 106,086
2 5001 - 10000 15,995
1 15001 - 20000 20,000
1 40001 - 45000 43,140
2 50001 - 55000 108,217
1 55001 - 60000 58,252
1 60001 - 65000 63,822
3 65001 - 70000 200,262
1 85001 - 90000 89,819
1 90001 - 95000 94,417
1 100001 - 105000 100,131
2 110001 - 115000 226,265
2 140001 - 145000 283,066
1 150001 - 155000 152,139
2 165001 - 170000 332,964
1 200001 - 205000 200,085
1 235001 - 240000 236,578
1 300001 - 305000 300,595
1 6490001 - 6495000 6,494,239
927 9,236,428
Sr. Categories of Number of Shares

No. Shareholders Shareholders Held Percentage
1. Individuals 904 2,527,691 27.37

2. Investment Companies 1 60 0.00
3. Insurance Companies 2 113,122 1.22
4. Joint Stock Companies 1 375 0.00
5. Modaraba Companies 2 3,378 0.04
6. Foreign Investors 5 6,494,287 70.31
7. Mutual Fund 2 95,017 1.03
8. Co-operative Societies 1 36 0.00
9. Others 9 2,462 0.03
Total: 927 9,236,428 100.00
The above two statements include 231 shareholders holding 384,867 shares through Central Depository Company
of Pakistan Limited.

As at 31 December 2008 as per format perscribed in Code of Corporate Governance
No. of
Shares
Associated Companies, undertakings and related parties
Corn Products International Inc. - Related Party 6,494,239
NIT 0
ICP 60
Directors
Mr. John F. Saucier 1
Ms. Cheryl K. Bebee 1
Ms. Mary A. Hynes 1
Mr. Ehsan A. Nomani 1
Mr. Zulfikar Mannoo 238,163
Mian M. Adil Mannoo 154,259
Mr. Wisal A. Mannoo 174,143
Mr. Ansar Yahya 82
Mr. Anis A. Khan 1,264
Directors' Spouses
Mrs. Sarwat Zulfikar W/o Mr. Zulfikar Mannoo 9,370
CEO
Mr. Rashid Ali 600
Executives 1,711
Public sector companies and corporations 0
Banks, DFIs, Non-Banking FI, Insurance, Modaraba, Mutual Fund 211,517
Shareholders holding ten percent or more voting interest

Corn Products International Inc. 6,494,239

Notes

Proxy Form
115th General Meeting (Annual Ordinary)
The Company Secretary,

Rafhan Maize Products Co. Ltd.,
Rakh Canal East Road, P. O. Box 62,
Faisalabad.
I / We
of
being shar eholder(s) of Rafhan Maize Pr oducts Company Limited her eby appoint
of
or failing him
as my / our pr oxy to vote for me / us and on my / our behalf at the 1 15th General Meeting
(A n n u a l O r d i n a r y ) o f t h e C o m p a n y t o b e h e l d a t K a r a c h i o n S a t u r d a y, M a r c h 2 8 , 2 0 0 9
at 10:00 a.m. and / or at any adjournment thereof.
Dated this day of 2009.
Affix Revenue
(Signature of Proxy) Stamp of
Rs. 5/-
Witness Signature of Shareholder
Place Folio No. / CDC No.
No. of Shares held
Notes:
a) This Form of Proxy, duly completed and signed across a revenue stamp, must be deposited at
the Company’s Registered Office not less than 48 hours before the time of holding the meeting.
b) A proxy need not be a member of the Company.
Rafhan Maize Products Co. Ltd.

AFFIX
CORRECT
POSTAGE
The Company Secretary,

Rafhan Maize Products Co., Ltd;
Rakh Canal East Road, P. O. Box 62,
Faisalabad.
www.vantagepakistan.com

Rafhan AR 2008

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10 Years at a Glance

Profit After Tax

Earnings per Share

* Data for 15 months

IN THE NAME OF ALLAH THE MERCIFUL, THE COMPASSIONATE

06 Chief Executive's Review

16 Horizontal Analysis – P&L and B/S

17 Vertical Analysis – P&L and B/S

25 Forward Looking Statement

27 Summary of Cashflow Statements

28 Statement of Value Added & its Distribution

34 Profit and Loss Account

35 Cash Flow Statement

36 Statement of Changes in Equity

37 Notes to the Accounts

Rafhan Maize Products Co. Ltd. 01

Chairman Shares Transfer Committee Registered Office

02 Annual Report 2008

Rafhan Maize Products Co. Ltd. 03

To be the Premier Provider of Refined

04 Annual Report 2008

Define and direct every decision we make and

Excellence Financial Success

Rafhan Maize Products Co. Ltd. 05

Whereas the first thr ee quarters of 2008

06 Annual Report 2008

Rafhan Maize Products Co. Ltd. 07

08 Annual Report 2008

Rafhan Maize Products Co. Ltd. 09

10 Annual Report 2008

Rafhan Maize Products Co. Ltd. 11

and activities and with employee

In total, safety training was pr ovided to

12 Annual Report 2008

Rafhan Maize Products Co. Ltd. 13

culture and based on its str ong operating

14 Annual Report 2008

2008 2007 2006

Sales 142% 124% 118%

Horizontal Analysis of Balance Sheet

NON CURRENT ASSETS

EMPLOYEES RETIREMENT BENEFITS 75% 290% 94%

TOTAL ASSETS 133% 112% 100%

NON CURRENT LIABILITIES

SHARE CAPITAL AND RESERVES

TOTAL LIABILITIES 133% 112% 100%

16 Annual Report 2008

2008 2007 2006

Sales 100.0% 100.0% 100.0%

Vertical Analysis of Balance Sheet

NON CURRENT ASSETS

EMPLOYEES RETIREMENT BENEFITS 1.4% 2.4% 0.9%

TOTAL ASSETS 100.0% 100.0% 100.0%

NON CURRENT LIABILITIES

SHARE CAPITAL AND RESERVES

TOTAL LIABILITIES 100.0% 100.0% 100.0%

Rafhan Maize Products Co. Ltd. 17

Profit and Appropriations Year ended December 31

Profit after taxation 1,492,365 1,089,184

Unappropriated Profit 3,447,983 2,895,238

Earnings per Share (Rupees) 161.57 117.92

Chief Executive’s Review