PMDC Annual Report 2016-2017

ANNUAL REPORT
2016 - 2017
PAKISTAN MINERAL DEVELOPMENT CORPORATION (PRIVATE) LIMITED

Head Office:
Plot # 13, Sector H-9/4, Islamabad.
Phone: +92 (051) 9265123-24
Email: pmdc@isb.comsats.net.pk
pmdhoaccounts@yahoo.com
www.pmdc.gov.pk
Annual Report 2016-17
Head Office:
Plot # 13, Sector H-9/4, Islamabad.
Phone: +92 (051) 9265123-24
Email: pmdc@isb.comsats.net.pk
pmdhoaccounts@yahoo.com
www.pmdc.gov.pk
SALT

COAL
MUSEUM AT TOURIST RESORT, KHEWRA

TOURIST RESORT, KHEWRA (The beauty inside the mine)

Contents
Description Page No.

About PMDC 01
Operational Information 02
Profile of MD, PMDC 05
Financial Performance in graphical form 06-07
Physical Performance in graphical form 08-09
Contribution towards National Exchequer 10
Vertical analysis of Balance Sheet 11
Vertical analysis of Profit & Loss Statement 12
Horizontal analysis of Balance Sheet 13
Horizontal analysis of Profit & Loss Statement 14
Key Financial Ratios 15
Notice of Annual General Meeting 16
Consolidated Financial Statements of the Company 17
Directors’ Report 18-19
Auditors Report to the members of the Company 21
Statement of Financial Position 22
Profit & Loss Account 23
Other Comprehensive Income 24
Statement of Changes in Equity 25
Statement of Cash Flows 26
Notes to the Accounts 27-49

About PMDC
Pakistan Mineral Development Corporation (Private) Limited (PMDC) is a private limited company
functioning under the administrative control of Ministry of Petroleum & Natural Resources, Government
of Pakistan. PMDC was incorporated on June 17, 1974 under the Companies Act, 1913 (now the
Companies Ordinance, 1984) after the bifurcation of Pakistan Industrial Development Corporation
(PIDC). The Company is wholly owned by the Government of Pakistan.
Registered office of the Company is situated at Plot No. 13, Sector H-9, Islamabad and it is domiciled in
Islamabad.
Equity/ Capital:
Authorized capital Rs. 1,000 million
Paid-up capital Rs. 10 million
Owned by GoP 100%
Vision Statement:
The management would strive to make PMDC the model role for mining sector through creating a
congenial atmosphere in which all stakeholders work as partners in a safe environment to achieve one
common goal: sustainable development through mining.
Mission Statement:
The primary responsibility is to explore, develop, exploit, ensure availability, foster the efficient and
effective regulation and management of the utilization and security of sustainable supply of minerals for
economic development and requirements of Pakistan and to coordinate development of natural resources.
Pattern of Shareholding:
No. of Face Value %age

Share-holding
Shares (Rs in million) Shareholding
Government of Pakistan (GoP) 1,000,000 Rs. 10.000 100%
Less: 12% shares transferred to employees under BESOS 120,000 Rs. 1.200 12%
Remaining share holding of GoP 880,000 Rs. 8.800 88%
As per policy of Government of Pakistan, 12% shares of the company have been transferred to the
employees under “Benazir Employees Stock Option Scheme” (BESOS) through a trust named PMDC
Employees Empowerment Trust (PEET), these 12% shares come to 120,000 numbers. The Trust has
assigned units to all eligible employees in proportion to their entitlement. The unit certificates are not
saleable/ transferable, however, these can be hypothecated. The employees have to surrender the unit
certificates to the trust on retirement, or otherwise ceasing to be an employee. The Trust would make
payment for surrendered units to the concerned employee.
Annual Report 2016-2017 01

Board of Directors:
Name Designation
Chairman BoDs (vacant) Chairman/ Director
Brig ® Muhammad Khalid S. Khokhar, SI (M), MD Director
Mr. Azhar Khan, DG (Minerals), M/o. P&NR Director
Syed Touqeer Hussain Shah, Joint Secretary M/o. P&NR Director
Rep of Ministry of Finance (vacant) Director
Mr. Faizan S. Syed Director
Mr. Shahzad Ali Khan Director
Raja Zahid Khurshid Director
Mr. Wasiq Mehmood Director
Rep of Employees under BESOS (vacant) Director
Company Secretary:
Muhammad Ilyas
Statutory Auditors:
M/s. Horwath Hussain Chaudhury & Co., Chartered Accountants
Bankers:
i. National Bank of Pakistan
ii. Habib Bank Limited
iii. Bank Al-Falah
iv. United Bank Limited
v. Allied Bank Limited
vi. Askari Commercial Bank Limited
vii. Soneri Bank Limited
viii. Muslim Commercial Bank
ORGANIZATION CHART OF PMDC
Board of Directors
Managing Director
SO to MD
GM GM GM GM DGM DGM GM(Coal)

(Salt) (F&A) (P&C ) (A&E) (Sales&Mktg.) (Audit)
DGM P.D. DGM Incharge

DGM
(F&A) - NW Copper (Pers.) Lahore P.M.
(Est.)
- Shirani Coal Office Lakhra Coal
P.M. - PMDC-FATA DA Project
JV–Soapstone Tourist Medical
Khewra Incharge
Kurram Resort Multan Office P.M.
Salt Mines
Sor-Range
P.M. Incharge Collieries
Warcha Peshawar Office
Salt Mines P.M.
Degari
P.M. Collieries
Kalabagh
Salt Mines
P.M.
Sharigh
P.M. Collieries
Jatta/B.Khel
Salt Quarries Branch Office
Quetta

Operational Information:
PMDC’s OPERATING MINES
JATTA/BAHADURKHEL SALT
QUARRIES
KALABAGH SALT MINES
Distt. Karak, KPK
Distt . Mianwali, Punjab
KHEWRA SALT MINES

SHARIGH COLLIERIES Distt . Jhelum, Punjab
(Distt. Harnai, Balochistan)
MAKRACH SALT MINES
DEGARI COLLIERIES Distt. Chakwal , Punjab
Distt. Quetta, Balochistan
WARCHA SALT MINES
SOR-RANGE COLLIERIES Distt . Khushab, Punjab
Distt. Quetta, Balochistan
LAKHRA COAL MINES
Distt . Jamshoro, Sindh
Salt Projects
Coal Projects
PMDC is engaged in the business of mining, exploration, development and exploitation of mineral deposits
e.g. salt, coal, silica sand and gypsum. PMDC has following operating projects:
Salt Projects:
(a) PMDC Salt Mines, Khewra, District Jhelum, Punjab.

(b) PMDC Salt Mines, Makrach, District Chakwal, Punjab.
(c) PMDC Salt Mines, Warcha, District Khushab, Punjab.
(d) PMDC Salt Mines, Kalabagh, District Mianwali, Punjab.
(e) PMDC Salt Quarries, Jatta/ Bahadur-Khel, District Karak, Khyber Pakhtunkhwa.
Coal Projects:
a) PMDC Collieries, Degari, District Quetta, Balochistan.

b) PMDC Collieries, Sor-Range, District Quetta, Balochistan.
c) PMDC Collieries, Sharigh, District Harnai, Balochistan.
d) PMDC Lakhra Coal Mining Project, District Jamshoro, Sindh.

Other Projects:
a) PMDC Silica Sand Project, Sindh.

b) PMDC Tourist Resort, Khewra.
Branch Offices/ Head Office:
a) PMDC Branch Office, Quetta, Balochistan.

b) PMDC Regional Office, Lahore, Punjab.
c) PMDC Marketing Office, Multan, Punjab.
d) PMDC Regional Office, Peshawar, Khyber Pakhtunkhwa.
e) PMDC Head Office, Islamabad.
Investment in Joint Venture Companies/ Projects:
PMDC has no subsidiary company, however, invested in following joint venture companies/projects:
a) Lakhra Coal Development Company Limited (50% shares).
b) Sarhad Minerals Limited (49% shares).
c) Soapstone Mining Project, near Parachinar, Kurram Agency (30% shares).
Future Planning:
a) PMDC has planned to establish state of the art salt grinding and iodizing plant at Salt Mines
Warcha, District Khushab.
b) PMDC is going to launch marketing of iodized packet salt of 800 grams.
c) Development of Gypsum Quarries at Karak, Khyber Pakhtunkhwa.
d) PMDC has planned to install a plant for production of Plaster of Paris at Karak, Khyber
Pakhtunkhwa.
e) PMDC has also applied for grant of lease for gravel stone near Kahuta, District Rawalpindi
for establishment of Gravel Stone Crushing Plant.
F) Renovation/ development of Tourist Resort, Salt Mines, Khewra.

Managing Director, PMDC
Brig. (R) Muhammad Khalid S. Khokhar, Sitara-e-

Imtiaz Miltary is holding the charge of the post of
Managing Director, PMDC.
Military Qualification:
Intelligence Staff Course (ISC)
Qualified Specialized Language in French
Civil Qualification:
B.Sc. (Hons.)
Member Chartered Institute of Logistics &
Transport, UK (MCIL&T-UK)
Military Experience: He served Pakistan Army for
34 years and has experience of command, staff and
instructional at all levels in the Army. He also has the
experience of command of operational and internal
security duties of sensitive nature and successfully discharged the duties in military intelligence as well.
Civil Experience: He has versatile experience of about 15 years in the Mineral Sector of the country. With
his effective managerial efforts, PMDC has been turned around and converted into a progressive profit
earning entity. He is Director on the Board of Directors of Lakhra Coal Development Company, Karachi (a
joint-venture company of PMDC, WAPDA and Govt. of Sindh), Saindak Metals Limited (SML) Quetta
and Chairman on the Board of Sarhad Minerals Limited, Peshawar.
Organizer/ Office Bearer: He has been Senior Vice President on various National Sports Federations in
the country and was Acting President of Pakistan Tennis Federation and President of Pakistan Athletics
Federation. He has been appointed as President of Pakistan Hockey Federation since 28.08.2015 for
uplifting of hockey. With best efforts, it is being organized on sound footings comparable with glorious
past.

FINANCIAL PERFORMANCE IN GRAPHICAL FORM
GROSS PROFIT COMPARISON FOR LAST FIVE YEARS

(Rs. in million)
Gross Profit Comparison
1000 929.346
900
809.923
800
700 645.876
588.915
600
466.094
500
400
300
200
100
0
2012-13 2013-14 2014-15 2015-16 2016-17
PRE-TAX PROFIT COMPARISON FOR LAST FIVE YEARS

(Rs. in million)
tax Profit Comparison
585.005
600
500
401.959
400
332.428
309.926
300
234.322
200
100
0
2012-13 2013-14 2014-15 2015-16 2016-17

PROFIT FOR FY 2016-17 IN COMPARISON WITH FY 2015-16

(Rs. in million)
1,000
929.346
900
809.923
800
700
600 585.005
500
431.878 401.959
400
300 296.914
200
100
-
2015-16 2016-17
Gross Profit Profit before tax Profit after tax
BREAKUP OF SALE REVENUE FOR FY 2016-17

Rs. in million
Total Sale Revenue: Rs.2,748 million

Gypsum
Sharigh, 5, 4% 3.300
Lakhra, 250,
10% Khewra, 493, Makrach, 102,
20% 4%
Sor-Range, 378,
15%
Degari,
16, 1%
Warcha, 1,008,
41%
Jatta/B.Khel, 15,
1%
Kalabagh, 103,
4%

PHYSICAL PERFORMANCE IN GRAPHICAL FORM
COMPARISON OF FIVE YEARS PRODUCTION/SALES OF SALT
Quantity in tonnes
1,800,000
1,700,000
1,600,000
1,500,000
1,400,000
1,300,000
1,200,000
1,100,000
1,000,000
2012-13 2013-14 2014-15 2015-16 2016-17
Production 1,264,059 1,313,494 1,330,009 1,433,152 1,310,426
Sales 1,254,674 1,280,499 1,391,123 1,387,791 1,321,385
PROJECT WISE PRODUCTION OF SALT FOR THE FY 2016-17
Kalabagh, Jatta/B.Khel,
146,687, 11% Khewra,
55,447, 4% 393,624, 30%
Warcha,
624,693, 48%
Makrach,
89,975, 7%
Total Salt: 1,310,426 tonnes

“Quantity in Tonnes”

PROJECT WISE PRODUCTION OF COAL FOR THE FY 2016-17

Degari, 16,500, Sor-Range,
3% 59,835, 10%
Lakhra, 284,537,
49%
Sharigh,
220,646, 38%
“Quantity in Tonnes” Total Coal: 581,518 tonnes
COMPARISON OF FIVE YEARS PRODUCTION/ SALES OF COAL
Quantity in tonnes
750,000
650,000
550,000
450,000
350,000
250,000
150,000
2012-13 2013-14 2014-15 2015-16 2016-17
Production 416,176 527,453 514,469 557,950 581,518
Sales 418,412 524,970 515,414 558,639 582,307

CONTRIBUTION TOWARDS NATIONAL EXCHEQUER
700 “Rs in million”
600
500
400
300
200
100
-
2012-13 2013-14 2014-15 2015-16 2016-17
Taxes 308.228 422.433 475.459 624.476 587.390
PMDC’S CONTRIBUTION TO
NATIONAL EXCHEQUER
(Rs. in Million)
Form of Tax 2012-13 2013-14 2014-15 2015-16 2016-17
Royalty 74.418 127.684 153.220 156.646 156.021
GST 156.308 193.794 220.184 328.993 345.628
Income Tax 83.706 91.928 92.521 127.830 74.801
Excise Duty 5.873 9.027 9.534 11.007 10.940
Total 323.305 422.433 475.459 624.476 587.390

VERTICAL ANALYSIS OF BALANCE SHEET
FOR LAST FIVE YEARS
2013 2014 2015 2016 2017
Thousand Rs. % Thousand Rs. % Thousand Rs. % Thousand Rs. % Thousand Rs. %
EQUITY AND LIABILITIES
SHARE CAPITAL AND RESERVES
Share capital 10,000 0.8% 10,000 0.6% 10,000 0.5% 10,000 0.4% 10,000 0.4%
Equity funds from government for specific projects 25,000 1.9% 25,000 1.6% 25,000 1.3% 25,000 1.0% 25,000 0.9%
Revenue reserves 792,254 61.6% 899,624 55.9% 1,124,750 57.6% 1,472,424 60.3% 1,514,520 56.3%
827,254 64.3% 934,624 58.1% 1,159,750 59.4% 1,507,424 61.8% 1,549,520 57.5%

NON CURRENT LIABILITIES 167,547 13.0% 278,106 17.3% 263,354 13.5% 405,129 16.6% 432,914 16.1%
DONATIONS / CONTRIBUTIONS 3,352 0.3% 2,471 0.2% 1,590 0.1% 795 0.0% 30 0.0%
CURRENT LIABILITIES
Trade and other payables 219,634 17.1% 308,053 19.1% 435,864 22.3% 398,795 16.3% 635,212 23.6%
Provision for taxation 68,129 5.3% 86,589 5.4% 92,532 4.7% 127,830 5.2% 74,801 2.8%
287,763 22.4% 394,642 24.5% 528,396 27.1% 526,625 21.6% 710,013 26.4%
1,285,916 100.0% 1,609,843 100.0% 1,953,090 100.0% 2,439,973 100.0% 2,692,477 100.0%
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 126,478 9.8% 163,956 10.2% 170,212 8.7% 254,305 10.4% 358,396 13.3%
LONG TERM INVESTMENTS 207,647 16.1% 248,681 15.4% 209,134 10.7% 187,590 7.7% 125,629 4.7%
LONG TERM LOANS AND ADVANCES 77,673 6.0% 94,189 5.9% 120,623 6.2% 160,861 6.6% 195,408 7.3%
LONG TERM DEPOSITS 11,439 0.9% 11,339 0.7% 9,674 0.5% 9,526 0.4% 9,680 0.4%
CURRENT ASSETS
Stores, spares and loose tools 23,545 1.8% 20,216 1.3% 28,686 1.5% 47,456 1.9% 39,210 1.5%
Stock in trade 40,141 3.1% 79,515 4.9% 15,102 0.8% 54,868 2.2% 48,936 1.8%
Trade debts - unsecured considered good 73,286 5.7% 79,573 4.9% 107,769 5.5% 99,607 4.1% 70,591 2.6%
Loans and advances 44,996 3.5% 40,391 2.5% 82,522 4.2% 105,277 4.3% 139,077 5.2%
Accrued interest 22,468 1.7% 17,529 1.1% 26,566 1.4% 34,424 1.4% 34,356 1.3%
Other receivables 15,270 1.2% 14,593 0.9% 54,924 2.8% 8,913 0.4% 4,387 0.2%
Short term investment 384,678 29.9% 458,978 28.5% 606,528 31.1% 1,088,678 44.6% 1,197,678 44.5%
Tax refunds due from government 93,794 7.3% 112,251 7.0% 109,123 5.6% 127,931 5.2% 204,780 7.6%
Cash and bank balances 164,476 12.8% 268,324 16.7% 412,227 21.1% 260,537 10.7% 264,349 9.8%
862,679 67.1% 1,091,678 67.8% 1,443,447 73.9% 1,827,691 74.9% 2,003,364 74.4%
1,285,916 100.0% 1,609,843 100.0% 1,953,090 100.0% 2,439,973 100.0% 2,692,477 100.0%
11
VERTICAL ANALYSIS OF PROFIT AND LOSS ACCOUNT
FOR LAST FIVE YEARS
2013 2014 2015 2016 2017

INCOME
Sales 1,687,869 100% 2,059,995 100% 2,318,247 100% 2,748,394 100% 2,450,984 100%
Cost of sales (1,221,775) 72% (1,471,080) 71% (1,672,371) 72% (1,819,048) 66% (1,641,061) 67%
Gross profit 466,094 28% 588,915 29% 645,876 28% 929,346 34% 809,923 33%
OPERATING EXPENSES
Administrative expenses (204,772) 12% (234,247) 11% (282,824) 12% (347,456) 13% (413,072) 17%
Distribution cost (82,892) 5% (130,018) 6% (136,207) 6% (134,147) 5% (132,385) 5%
(287,664) 17% (364,265) 18% (419,031) 18% (481,603) 18% (545,457) 22%
Operating profit 178,430 11% 224,650 11% 226,845 10% 447,743 16% 264,466 11%
Other operating income 68,225 4% 101,588 5% 123,079 5% 168,052 6% 158,649 6%

Workers' Profit Participation Fund (12,333) 1% (16,312) 1% (17,496) 1% (30,790) 1% (21,156) 1%
Profit before taxation 234,322 14% 309,926 15% 332,428 14% 585,005 21% 401,959 16%
Provision for taxation (64,762) 4% (114,865) 6% (103,693) 4% (153,127) 6% (105,045) 4%

Profit after taxation 169,560 10% 195,061 9% 228,735 10% 431,878 16% 296,914 12%
Earnings per share 169.56 195.06 228.74 431.88 296.91
12
HORIZONTAL ANALYSIS OF BALANCE SHEET
FOR LAST FIVE YEARS
2013 2014 2015 2016 2017
Thousand Rs. % Thousand Rs. % Thousand Rs. % % Thousand Rs. %
Share capital 10,000 100% 10,000 100% 10,000 100% 10,000 100% 10,000 100%
Equity funds from government for specific projects 25,000 100% 25,000 100% 25,000 100% 25,000 100% 25,000 100%
Revenue reserves 792,254 120% 899,624 114% 1,124,750 125% 1,472,424 131% 1,514,520 103%
827,254 119% 934,624 113% 1,159,750 124% 1,507,424 130% 1,549,520 103%

NON CURRENT LIABILITIES 167,547 119% 278,106 166% 263,354 95% 405,129 154% 432,914 107%
DONATIONS / CONTRIBUTIONS 3,352 79% 2,471 74% 1,590 64% 795 50% 30 4%
CURRENT LIABILITIES
Trade and other payables 219,634 109% 308,053 140% 435,864 141% 398,795 91% 635,212 159%
Provision for taxation 68,129 125% 86,589 127% 92,532 107% 127,830 138% 74,801 59%
287,763 113% 394,642 137% 528,396 134% 526,625 100% 710,013 135%
1,285,916 117% 1,609,843 125% 1,953,090 121% 2,439,973 125% 2,692,477 110%
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 126,478 104% 163,956 130% 170,212 104% 254,305 149% 358,396 141%
LONG TERM INVESTMENTS 207,647 49% 248,681 120% 209,134 84% 187,590 90% 125,629 67%
LONG TERM LOANS AND ADVANCES 77,673 117% 94,189 121% 120,623 128% 160,861 133% 195,408 121%
LONG TERM DEPOSITS 11,439 101% 11,339 99% 9,674 85% 9,526 98% 9,680 102%
CURRENT ASSETS
Stores, spares and loose tools 23,545 136% 20,216 86% 28,686 142% 47,456 165% 39,210 83%
Stock in trade 40,141 209% 79,515 198% 15,102 19% 54,868 363% 48,936 89%
Trade debts - unsecured considered good 73,286 103% 79,573 109% 107,769 135% 99,607 92% 70,591 71%
Loans and advances 44,996 93% 40,391 90% 82,522 204% 105,277 128% 139,077 132%
Accrued interest 22,468 139% 17,529 78% 26,566 152% 34,424 130% 34,356 100%
Other receivables 15,270 74% 14,593 96% 54,924 376% 8,913 16% 4,387 49%
Short term investment 384,678 465% 458,978 119% 606,528 132% 1,088,678 179% 1,197,678 110%
Tax refunds due from government 93,794 106% 112,251 120% 109,123 97% 127,931 117% 204,780 160%
Cash and bank balances 164,476 152% 268,324 163% 412,227 154% 260,537 63% 264,349 101%
862,679 182% 1,091,678 127% 1,443,447 132% 1,827,691 127% 2,003,364 110%
13
1,285,916 117% 1,609,843 125% 1,953,090 121% 2,439,973 125% 2,692,477 110%
HORIZONTAL ANALYSIS OF PROFIT AND LOSS ACCOUNT
FOR LAST FIVE YEARS

2013 2014 2015 2016 2017
INCOME
Sales 1,687,869 126% 2,059,995 122% 2,318,247 113% 2,748,394 119% 2,450,984 89%
Cost of sales (1,221,775) 123% (1,471,080) 120% (1,672,371) 114% (1,819,048) 109% (1,641,061) 90%
Gross profit 466,094 136% 588,915 126% 645,876 110% 929,346 144% 809,923 87%
OPERATING EXPENSES
Administrative expenses (204,772) 117% (234,247) 114% (282,824) 121% (347,456) 123% (413,072) 119%
Distribution cost (82,892) 101% (130,018) 157% (136,207) 105% (134,147) 98% (132,385) 99%
(287,664) 112% (364,265) 127% (419,031) 115% (481,603) 115% (545,457) 113%
Operating profit 178,430 204% 224,650 126% 226,845 101% 447,743 197% 264,466 59%
Other operating income 68,225 63% 101,588 149% 123,079 121% 168,052 137% 158,649 94%
Workers' Profit Participation Fund (12,333) 127% (16,312) 132% (17,496) 107% (30,790) 176% (21,156) 69%
Profit before taxation 234,322 127% 309,926 132% 332,428 107% 585,005 176% 401,959 69%
Provision for taxation (64,762) 114% (114,865) 177% (103,693) 90% (153,127) 148% (105,045) 69%
Profit after taxation 169,560 132% 195,061 115% 228,735 117% 431,878 189% 296,914 69%
Earnings per share 169.56 195.06 228.74 431.88 296.91
14
KEY FINANCIAL RATIOS
INTERNAL LIQUIDITY RATIO:

Current Ratio 2.82 Times
Quick Ratio 2.75 Times
Cash Ratio 2.11 Times
TURNOVER RATIO:
Receivable Turnover 28.80 Times
Inventory Turnover 31.62 Times
Payable Turnover 149.73 Times
OPERATING EFFICIENCY RATIOS

Net Fixed Asset Turnover 8.00 Times
Total Asset Turnover 0.96 Times
OPERATING PROFITABILITY RATIOS

Cost of Sales/Sales 66.96%
Gross Margin 33.04%
Operating Expenses/Sales 22.25%
Operating Margin 10.79%
Return on Assets (ROA) 95.51%
Return on Equity (ROE) 160.36%
FINANCIAL RISK (LEVERAGE) RATIOS

Long-Term Debt-to-Equity Ratio 27.94%
Other leverage ratios are not applicable as the company has no debt/loan liability.

PAKISTAN MINERAL DEVELOPMENT CORPORATION (PVT.) LTD.

HEAD OFFICE, 13-H/9, ISLAMABAD
Notice for 42nd Annual General Meeting
Notice is hereby given that 43rd Annual General Meeting of the Shareholders of PMDC is scheduled to be
held on 27th October, 2017 at 1500 hours in the Board Room of PMDC Head Office, 13-H/9, Islamabad to
transact the following business: -
i. To confirm the minutes of 42nd Annual General Meeting of the Company held on 20.10.2016.
ii. To receive and consider the Annual Audited Accounts of the Company for the year ended on
30.06.2017 along with Reports of Auditors and Directors thereon and also declaration of
dividend.
iii. To consider the proposal of appointment of Auditors for the year 2017-18 and fix their
remuneration.
iv. To transact any other business of the Company with permission of the Chairman.
2. You are requested to please attend the meeting.
By order of the Board,
(Muhammad Ilyas)
Secretary to BoD
Dated: 05.10.2017
N.B.
1. A member entitled to vote at this meeting may appoint his proxy to attend and vote. Proxies in
order to be effective must be received by the Company at the Registered Office, 13, Sector
H-9, Islamabad, 48 hours before the meeting (Form of Proxy is enclosed).
2. The Register of Members will remain closed and no transfer of shares will be accepted for
registration from 21.10.2017 to 27.10.2017 (both days inclusive).
To:
1. All Shareholders.
2. M/s. Horwath Hussain Chaudhury & Co., Chartered Accountants, 3rd Floor, Plaza No. 79,
Civic Center, Phase-4, Bahria Town, Islamabad.

CONSOLIDATED FINANCIAL
STATEMENTS OF PMDC
Director's Report
Gentlemen,
On behalf of the PMDC Board of Directors, I welcome you to the 43nd Annual General Meeting and present
the Audited Accounts of the Company together with the Auditor's Report for the year ended June 30, 2017.
Physical Review:
2. During the FY 2016-17, production of salt was recorded at 1,310,426 tonnes as against 1,433,152
tonnes of the previous year, showing a decrease of 122,726 tonnes due to less demand in the market,
shortage in supply of explosive and also ban imposed by the Directorate of Mines and Minerals (DMD),
Punjab for production of salt from Main Mine, Warcha due to legal case. During the year under review a
quantity of 1,321,385 tonnes of salt was sold as against previous year's total sale of 1,387,791 tonnes
showing decrease of 47,679 tonnes because of less demand from the industries and opening stock of salt for
56,944 tonnes at Salt Mines, Khewra and Warcha. Five years production and sales data of salt is as under:
“Quantity in tonnes”
1,500,000
1,400,000
1,300,000
1,200,000
1,100,000
2012-13 2013-14 2014-15 2015-16 2016-17
Production 1,264,059 1,313,494 1,330,009 1,433,152 1,310,426

Sales 1,254,674 1,280,499 1,391,123 1,387,791 1,321,385
3. Similarly during the year, production of coal was recorded at 581,518 tonnes as compared to
557,950 tonnes in previous year showing increase of 23,568 tonnes. Sale of Coal was 582,307 tonnes as
against 558,639 tonnes during last year thus showing an increase of 23,668 tonnes over last year. Five years
production and sales comparison of coal is as under:

“Quantity in tonnes”
600,000
400,000
200,000
0
2012-13 2013-14 2014-15 2015-16 2016-17
Production 416,176 527,453 514,469 557,950 581,518
Sales 418,412 524,970 515,414 558,639 582,307
Financial Review:
4. During the financial year 2016-17, the Corporation has earned a pre-tax profit of Rs. 402 million as
against previous year's pre-tax profit of Rs. 585 million registering decrease of Rs. 183 million. This profit
nd
is 2 ever highest in history of the corporation. The profit was decreased due to low production/ sales of salt.
Five years data of pre-tax profit of PMDC is as under:
“Rs. in million”
600
400
200
0
2012-13 2013-14 2014-15 2015-16 2016-17
Pre-tax Profit 234 310 332 585 402
Operational Overview:
5. By the grace of Almighty Allah, PMDC has been performing tremendously for the last so many
years when not only the accumulated loss has been wiped out but at the same time paid dividend of Rs. 549
million up to 30.06.2017 against the paid up capital of Rs.10 million. Similarly, sufficient funds have been
spent on development of mines and on replacement of old and obsolete machinery & equipment. At the
same time, the Corporation has been successful in securing the service dues of the employees through
th
Gratuity and Pension Trusts. The balance sheet of the company as at 30 June 2017 is depicting free of
debts and very healthy financial state of affairs.

6. I would like to put on record the appreciation of the Board for the hard work done by the
management and employees and hope that they would continue the same to bring more positive
physical and financial results in the coming years.
Future Planning:
I. PMDC has signed a Memorandum of Understanding (MOU) with M/s. China Smelters &
Traders (Pvt.) Ltd. for mining and quarrying of minerals and base metals in Copper
Mining Sites of PMDC in North Waziristan Area, FATA. The joint-venture project will
bring contemporary mining plants, machinery, technology for mine designing, quarrying,
excavating, beneficiation and processing of minerals and base metals from China. The
project will provide socio-economic benefits to the country.
II. PMDC has signed another Memorandum of Understanding (MOU) with M/s. Hong Kong
Zhong Huan Trading Company (Pvt.) Ltd. for installation of Soda-Ash manufacturing plant
as joint-venture at PMDC Salt Mines, Warcha, District Khushab against an estimated cost of
Rs. 4 billion which will be equally shared by both the parties.
III. PMDC has also signed an agreement with M/s. Zhoukou Sanshengwang Food Ltd. for sale/
supply of different dealers' qualities salt. The salt will be exported by the company to China
for further processing at their factory.
Changes in the Board of Directors:
7. Since the last Annual General Meeting of the Company, the following changes have taken place in
the Board of Directors of the Company.
I. Mr. Azhar Khan retired from the post of Director on 13th April, 2017 after retirement from
Government Services on attaining the age of superannuation.
Appointment of Auditors:
8. M/s. Horwath Hussain Chaudhury & Co. Chartered Accountants, Chartered Accountants firm has
been appointed as Statutory Auditors for the financial year 2016-17 of PMDC Projects/Offices along with
consolidation of accounts at last year's fee of Rs.0.900 million inclusive of out of pocket expenses.
Chairman
For and on behalf of the PMDC Board

AUDITORS REPORT TO THE MEMBERS OF

We have audited the annexed consolidated balance sheet of "PAKISTAN MINERAL DEVELOPMENT
CORPORATION (PRIVATE) LIMITED" as at June 30, 2017, the related profit and loss account, statement of
comprehensive income, statement of cash flows, statement of changes in equity together with the notes forming
part thereof, for the year then ended and we state that we have obtained all the information and explanations
which, to the best of our knowledge and belief, were necessary for the purposes of our audit.
It is the responsibility of the company's management to establish and maintain a system of internal control and
prepare and present the above said statements in conformity with the approved accounting standards and the
requirements of the Companies Ordinance 1984. Our responsibility is to express an opinion on these statements
based on our audit.
We conducted our audit in accordance with the auditing standards as applicable in Pakistan. These standards
require that we plan and perform the audit to obtain reasonable assurance about whether the above said
statements are free of any material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the above said statements. An audit also includes assessing the
accounting policies and significant estimates made by management, as well as, evaluating the overall
presentation of the above said statements. We believe that our audit provides a reasonable basis for our opinion
and after due verification we report that:
a) in our opinion, proper books of account have been kept by the company as required by the
Companies Ordinance, 1984 and;
b) in our opinion;
i) the balance sheet and profit and loss account together with the notes thereon, have been drawn-
up in conformity with the Companies Ordinance, 1984 and are in agreement with the books of
account and are further in accordance with accounting policies consistently applied;
ii) the expenditure incurred during the year was for the purpose of the company's business; and
iii) the business conducted, and the expenditure incurred during the year were in accordance with
the objects of the company;
c) in our opinion and to the best of our information and according to the explanations given to us, the
balance sheet and profit and loss account, statement of comprehensive income, statement of cash flows,
statement of changes in equity together with the notes forming part thereof conform with approved
accounting standards as applicable in Pakistan, and, give the information required by the Companies
Ordinance, 1984, in manner so required and respectively give a true and fair view of the state of the
company's affairs as at June 30, 2017 and of the profit for the year then ended; and
d) in our opinion no Zakat was deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of
1980).
e) without qualifying our opinion we draw attention to Note 2 to the financial statements relating to
the privatization of the operating units of PMDC.
Audit Engagement Partner: Iqbal Hussain (FCA)

HORWATH HUSSAIN CHAUDHURY & CO
Place: Islamabad.
(CHARTERED ACCOUNTANTS)
Dated: October 27, 2017


STATEMENT OF FINANCIAL POSITION
AS AT JUNE 30, 2017
2017 2016
Note
----(Rupees in '000')----
Share capital 5 10,000 10,000
Equity funds from government for specific projects 6 25,000 25,000
Revenue reserves 7 1,514,520 1,472,424
1,549,520 1,507,424
NON CURRENT LIABILITIES 8 432,914 405,129
DONATIONS / CONTRIBUTIONS 9 30 795
CURRENT LIABILITIES
Trade and other payables 10 635,212 398,795
Provision for taxation 11 74,801 127,830
710,013 526,625
CONTINGENCIES AND COMMITMENTS 12 - -
2,692,477 2,439,973
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 13 358,396 254,305
LONG TERM INVESTMENTS 14 125,629 187,590
LONG TERM LOANS AND ADVANCES 15 195,408 160,861
LONG TERM DEPOSITS 9,680 9,526
CURRENT ASSETS
Stores, spares and loose tools 16 39,210 47,456
Stock in trade 17 48,936 54,868
Trade debts - unsecured considered good 18 70,591 99,607
Loans and advances 19 139,077 105,277
Accrued interest 34,356 34,424
Other receivables 20 4,387 8,913
Short term investment 21 1,197,678 1,088,678
Tax refunds due from government 204,780 127,931
Cash and bank balances 22 264,349 260,537
2,003,364 1,827,691
2,692,477 2,439,973
CHIEF EXECUTIVE DIRECTOR


PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED JUNE 30, 2017
Note 2017 2016

----(Rupees in '000')----
INCOME
Sales 23 2,450,984 2,748,394
Cost of sales 24 (1,641,061) (1,819,048)

Gross profit 809,923 929,346
OPERATING EXPENSES
Administrative expenses 25 (413,072) (347,456)
Distribution cost 26 (132,385) (134,147)
(545,457) (481,603)
Operating profit 264,466 447,743
Other operating income 27 158,649 168,052

Workers' Profit Participation Fund (21,156) (30,790)
Profit before taxation 401,959 585,005
Provision for taxation (105,045) (153,127)

Profit after taxation 296,914 431,878
Earnings per share 296.91 431.88


STATEMENT OF OTHER COMPREHENSIVE INCOME
2017 2016
----(Rupees in '000')----
Profit for the Period 296,914 431,878
Other comprehensive income for the year
Remeasurement loss on staff retiring benefits (82,005) (78,897)
Share of changes in equity of associate net of tax (59,177) 44,693
Total comprehensive income for the year 155,732 397,674
The annexed notes form an integral part of these financial statements.

STATEMENT OF CHANGES IN EQUITY
Government Self
Share General Depletion Unappropriated
Particulars Equity Insurance Total
Capital Reserve Reserve Profit/(Loss)
Funds Reserve
----------------------------------------------------Rupees in '000------------------------------------------------

Balance as at June 30, 2015 10,000 25,000 483,633 12,000 311,544 317,573 1,159,750
Profit for the year - - - - - 397,674 397,674

Dividend paid - - - - (50,000) (50,000)
Allocation for Depletion reserve - - - - 80,919 (80,919) -
Allocation for General Reserve 100,000 - - (100,000) -
Profit for the year - - - - - 155,732 155,732

Dividend paid - - - - - (113,636) (113,636)
Allocation for depletion reserve - - - 44,866 (44,866) -
Allocation for General Reserve - - 100,000 - - (100,000) -
25

STATEMENT OF CASH FLOWS
2017 2016
----(Rupees in '000')----
CASH FLOW FROM OPERATING ACTIVITIES
Profit before taxation 401,959 585,005
Adjustment for:
Depreciation 52,022 39,122
Provision for workers profit participation fund 21,156 30,790
Provision for staff retirement benefits 115,730 90,977
Gain on sale of property, plant and equipment (1,356) (4,427)
Changes in equity due to associates 59,177 (44,693)
246,729 111,769
Cash flow before working capital changes 648,688 696,774
Working capital changes
Current assets
Stores and spares 8,246 (18,770)
Stock in trade 5,932 (39,766)
Trade debts 29,016 8,162
Loan, advances and prepayments (33,800) (22,755)
Accrued interest 68 (7,858)
Tax refund (76,849) (18,808)
Other receivables 4,526 46,011
(62,861) (53,784)
Current liabilities
Trade and other payable 236,668 (37,130)
Cash (used in)/from operating activities 822,495 605,860
Security deposit (3,313) 7,567

Cash generated from operating activities 819,182 613,427
Tax paid (124,745) (100,407)

Workers profit participation fund paid (21,407) (30,729)
Staff retirement benefits paid (117,961) 25,809
Donations / Contribution (765) (795)
Long term loan and advances (34,547) (40,238)
Long term deposits (154) 148
Net cash flow from operating activities 519,603 467,215
CASH FLOW FROM INVESTING ACTIVITIES

Acquisition of property plant and equipment (147,525) (121,498)
Capital work in progress (9,093) (2,764)
Disposal of property, plant and equipment 1,861 5,474
Dividend received - 72,612
Adjustment in profit/ (loss) due to equity adjustments of associates (59,177) 44,693
Long term investments 2,784 (6,375)
Short term investments (109,000) (482,150)
Net cash used in investing activities (320,150) (490,008)
CASH FLOW FROM FINANCING ACTIVITIES

Dividend paid (113,636) (50,000)
Remeasurement loss on staff retiring benefits (82,005) (78,897)
Net cash used in financing activities (195,641) (128,897)
Net (decrease)/increase in cash and cash equivalents 3,812 (151,690)

Cash and cash equivalent at the beginning of the year 260,537 412,227
Cash and cash equivalent at the end of the year 264,349 260,537


NOTES TO THE FINANCIAL STATEMENTS
1. LEGAL STATUS AND OPERATIONS

1.1 Pakistan Mineral Development Corporation (Private) Limited (the Company) was incorporated
in Pakistan on June 17, 1974 under the Companies Act, 1913 (now the Companies Ordinance,
1984). The Company is wholly owned by Government of Pakistan. Registered office of the
Company is situated at plot No. 13, Sector H-9, Islamabad and it is domiciled in Islamabad.
1.2 The Company is engaged in the business of mining, exploration, development and exploitation of
mineral deposits e.g. salt, coal, silica sand and gypsum. Currently the Company has the following
working projects:
1.2.1 Salt Projects
Salt Mines Khewra, Makrach, Warcha , Kalabagh and Salt Quarries Jatta Bahadur Khel
1.2.2 Coal Projects
Lakhra, Sharigh, Degari and Sor Range Collieries
1.2.3 Other Mineral Project
Tourist Resort, Khewra
Silica Sand Project
2. GOING CONCERN
The financial statements have been prepared on going concern basis.
The Govt of Pakistan approved privatization of the company consequent to which Privatization
Commission ( the Commission) invited Expression of interest (EOI) from prospective buyers through
an advertisement published on June 12, 2003. The Commission received nine EOIs but no one bid have
yet been invited. Presently the company is not included in current Privatization programm / list of public
enterprises to be privatized. Consequently the financial statements of the Company are prepared under
going concern assumption.
Privatization Commission (PC) of Pakistan initiated privatization process, of operating units of PMDC,
which was to be completed within 28 weeks starting from September 01, 2007. Accordingly a firm of
chartered accountants was appointed as financial consultants.
As per developments / decisions taken about two years ago, of the Transaction Committee on
privatization of PMDC's projects, the process of privatization was to be carried out through adopting
corporatization option / setting up of individual Private Limited Companies for each project. In Phase I,
two projects were to be put for privatization, one from each mineral category, named below:
i. Khewra Salt Mines; and
ii. Lakhra Coal Mining Project
No adjustment for future events has been made to the financial statements to reflect the fair value of
assets and liabilities as no binding agreement(s) have yet been prepared/ finalized and the same are also
not expected to be done in foreseeable future .The necessary adjustments will be made in the financial
statements on the completion of the formal process and final decision( s) made by Privatization
Commission, Government of Pakistan.

3. BASIS OF CONSOLIDATION
3.1 The financial statements of the Company has been prepared by consolidating the accounts of
Head office, Branch offices, the Company's projects, Insurance pool, and associated
companies(equity method).
3.2 The Company has no subsidiary.
3.3 All inter project balances and transactions of the Company have been eliminated.
3.4 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
Accounting / Financial Reporting Standards as are notified under the provisions of the Companies
Ordinance, 1984, provisions of and directives issued under the Companies Ordinance, 1984.
Wherever, the requirements of the Companies Ordinance, 1984 or directives issued by the
Securities and Exchange Commission of Pakistan (SECP) differ with the requirements of these
Standards, the requirements of Companies Ordinance, 1984 or the requirements of the said
directives take precedence.
3.5 Basis of Measurement
These financial statements have been prepared under the historical cost convention except that
investments available for sale and held for trading investments are measured at their fair values.
The identifiable assets and liabilities of PMDC have been measured at their fair value on
acquisition.
3.6 Functional and Presentation Currency
These financial statements are presented in Pak Rupees, which is the Company's functional
currency. All financial information presented in Pak Rupee has been rounded to the nearest
thousand.
3.7 Use of Estimates and Judgments
The preparation of financial statements in conformity with the approved accounting standards
require management to make judgments, estimates and assumptions that affect the application of
policies and reported amounts of assets, liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results of which form the basis of making
the judgments 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 are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimates are revised if the revision
affects only that period, or in the period of the revision and future periods. Judgments made by
management, if any, in application of the approved accounting standards that have significant
effect on the financial statements and estimates with a significant risk of material adjustment in
the next year are discussed in respective policy notes.
Significant areas requiring the use of management estimates in these financial statements relate to
the useful life of depreciable assets, provision for doubtful receivables, provision for taxation,
provision for advances and slow moving inventories etc. However, assumption and judgments
made by the management in the application of accounting policies that have significant effect on
the financial statements are not expected to result in material apparent from other sources. Actual
results may differ from these estimates.

4. SIGNIFICANT ACCOUNTING POLICIES

The principle accounting policies applied in the preparation of these financial statements are set out
below which have been consistently applied:
4.1 Basis of Accounting
The financial statements have been prepared using accrual basis of accounting, except for Cash
flow information.
4.2 Staff benefits
a) Pension
Pension Fund was created w.e.f. July 01, 1983 for officers and supervisors. Pensionable
salary comprises basic pay, qualification (education) pay, senior post allowance, and
officiating/orderly allowance, if any. Service of six months or more is taken as full year.
Maximum period of pensionable service is thirty years. Provision for pension is made at the
rate advised by the actuary.
b) Staff gratuity
Gratuity is provided to all the permanent Staff of the Company.
c) Contributory Provident Fund
The Company is operating Contributory Provident Fund covering all staff/workers of the
Company. No contribution is made towards Government's deputationist's Provident Fund.
Contribution for the year is charged to income.
d) Leave salary
Leave salary is provided for all eligible employees of the Company @ 1/11th of duty period
per annum. Un-availed leaves can be accumulated up to 365 days in case of staff and
without any upper limit for officers. Staff and officers can encash leave up to 60 days in a
calendar year.
4.2.1 The Company makes contributions to the defined benefit plans on the basis of actuarial
valuations, carried out annually by independent actuaries. The latest actuarial valuations were
carried out as of 30 June 2017. The calculations of actuaries are based on the Projected Unit Credit
Method, net of the assets guaranteeing the plan, if any, with the obligation increasing from year to
year, in a manner that it is proportional to the length of service of the employees The Company's
net obligation in respect of defined benefit plans is calculated separately for each plan by
estimating the amount of future benefit that employees have earned in return for their service in
the current and prior periods; that benefit is discounted to determine its present value.
The interest element of the defined benefit cost represents the change in present value of scheme
obligations resulting from the passage of time, and is determined by applying the discount rate to
the opening present value of the benefit obligation, taking into account material changes in the
obligation during the year.
The expected return on plan assets, if any, is based on an assessment made at the beginning of the
year of long term market returns on scheme assets, adjusted for the effect on the fair value of plan
assets of contributions received and benefits paid during the year. Contributions to defined
contribution plans are recognized in the profit and loss account in the period in which they become
payable and fair value of the benefit plans is based on market price information and while actuarial
gains/losses in excess of corridor limit (10% of the higher of fair value of plan assets and present
value of obligation) are recognized over the average expected remaining working lives of the
employees.

4.3 Taxation
Current
Provision for current taxation is based on taxable income on current rates of taxation after taking
into account tax rebates and credits available, if any.
Deferred
Deferred tax is accounted for using the balance sheet liability method in respect of all taxable
temporary differences arising from differences between the carrying amount of assets and
liabilities in the financial statements and the corresponding tax bases used in the computation of
taxable profit. Deferred tax liabilities are recognized for all taxable temporary differences and
deferred tax assets are recognized for all deductible temporary differences to the extent that it is
probable that taxable profits will be available against which the deductible temporary differences,
unused tax losses and tax credits can be utilized. Deferred tax assets are reviewed at each reporting
date and are reduced to the extent that it is no longer probable that the related tax benefit will be
realized.
Deferred tax is not recognized for the temporary differences arising from the initial recognition of
assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit or loss, and differences relating to investment in jointly controlled
entities to the extent that it is probable that they will not reverse in a foreseeable future. In addition,
deferred tax is not recognized for taxable temporary differences arising on the initial recognition
of goodwill.
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 reporting date,
adjusted for payments to Government of Pakistan on account of royalty.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current
tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and
assets on a net basis or their tax assets and liabilities will be realized simultaneously.
4.4 Property, Plant and Equipment And Work in Progress.
These are stated at cost less accumulated depreciation except land and capital work in progress,
which are stated at cost.
Depreciation on fixed assets, other than leasehold land, is charged to income by using straight line
method at the rates specified in Note 13. Leasehold Land is amortized over period of lease.
Full month's depreciation is charged on assets acquired and retired/disposed off during a specific
month.
Maintenance and repairs are charged to profit and loss account as and when incurred. Major
renewals and improvements are capitalized and the assets so replaced, if any, are retired. Gains
and losses on disposal of assets, if any, are included in profit and loss account currently.
The Company reviews the useful life and residual value of property, plant and equipment on a
regular basis. Any change in estimates in future years might affect the carrying amounts of the
respective items of property, plant and equipment with a corresponding effect on depreciation
charge.

4.5 Impairment
The carrying amount of the Company's assets are reviewed at each balance sheet date to determine
whether there is any indication of impairment. If such indications exist, the asset's recoverable
amount is estimated in order to determine the extent of the impairment loss, if any. Impairment
loss is recognized as expense in the profit and loss account. An impairment loss is reversed only to
the extent that the asset's carrying amount does not exceed the carrying amount that would have
been determined, net of depreciation or amortization, if no impairment loss had been recognized.
For non-financial assets and available-for-sale financial assets that are debt securities, the reversal
is recognized in profit and loss account. For available-for-sale financial assets that are equity
securities, the reversal is recognized directly in equity.
4.6 Investments
All purchases and sale of investments are recognized using settlement date accounting period.
Settlement date is the date on which investments are delivered to or by the Company. All
investments are recognized when the right to receive economic benefits from the investments has
expired or has been transferred and the Company has transferred substantially all the risks and
rewards of ownership.
a) Investments in associated companies
An associate is an entity over which the Company has significant influence and that is
neither a subsidiary nor an interest in a joint venture. Significant influence is the power to
participate in the financial and operating policy decisions of the investee but is not control
or joint control over those policies.
The results and assets and liabilities of the associate have been incorporated in these
financial statements using the equity method of accounting. Under the equity method,
investments in associates are carried in the balance sheet at cost as adjusted for post
acquisition changes in the Company's share of net assets of the associate, less any
impairment in the value of investment. Losses of an associate in excess of the Company's
interest in that associate (which includes any long term interest that, in substance, form part
of the Company's net investment in the associate) are recognized only to the extent that the
Company has incurred legal or constructive obligation or made payment on behalf of the
associate.
Associates are those entities in which the Company has significant influence and which is
neither a subsidiary nor a joint venture of the Company.
b) Investment in Joint Ventures (JVs)
These are incorporated in financial statements by using equity method.
c) Investments held to maturity
Investment with fixed and determinable payments and fixed maturity and where the
Company has positive intent and ability to hold to maturity are classified as held to maturity.
These are initially recognized at cost inclusive of transaction costs and are subsequently
carried at amortized cost using the effective interest rate method.
d) Investments available for sale
All investments classified as available for sale are initially recognized at cost being fair
value of consideration given. At subsequent dates these investments are measured at fair
value. Unrealized gains or losses from changes in fair values are recognized in equity.
Realized gains and losses are taken to profit and loss account.

e) Investments at fair value through profit or loss - Held for trading

All investments classified as investments at fair value through profit or loss are initially
measured at cost being fair value of consideration given. At subsequent dates these
investments are measured at fair value with any resulting gain or loss recognized directly in
the profit and loss account. The fair value of such investments is determined on the basis of
prevailing book value.
4.7 Revenue Recognition
Revenue from sales is recognized on dispatch of goods to customers. Income from investments
held to maturity and deposits is taken on accrual basis. Dividend income is recognized when
received.
4.8 Donations and Contribution
Donations and contributions for assets shall be recognised on receipt basis and shall be amortized
over the useful life of assets.
4.9 Trade and Other Payables
Liability for trade and other amount payables are carried at cost.
4.10 Trade and other receivables
Trade and other receivables are stated at invoice value less provision for doubtful debts. Full
provision is made against debts considered doubtful of recovery.
4.11 Stock in Trade
Stocks are valued at the lower of average cost and net realizable value. Net realizable value
signifies the estimated selling price in the ordinary course of business less net estimated average
cost of stock and selling expenses.
4.12 Stores, Spares and Loose Tools
These are valued at lower of moving average cost and net realizable value. The Company reviews
the carrying amount of stores and spares on a regular basis and provision is made for obsolescence
if there is any change in usage pattern and physical form of related stores, spares and loose tools.
Impairment is also made for slow moving and/or items identified as surplus to the Company's
requirement.
4.13 Foreign Currencies
Transactions in foreign currency are accounted for at the exchange rates prevailing on the date of
transactions. All monetary assets and liabilities denominated in foreign currencies at the year end
are translated at exchange rates prevailing at the balance sheet date. Non monetary items that are
measured in terms of historical cost in a foreign currency are translated using the exchange rate at
the date of the transactions. Exchange differences are included in profit and loss account for the
year.
4.14 Borrowing Costs
Borrowing costs incurred up to the date of commencement of commercial production are
capitalized. All other borrowing costs are recognized as an expense in the period in which these
are incurred.
4.15 Research and Development Costs
Development cost are capitalized as intangible asset, only when it meets the criteria as mentioned
in IAS 38 Intangible Assets. All the research costs are charge to Income as and when incurred.
Major repairs and improvements are capitalized.

4.16 Provisions
Provisions are recognized when the Company has a present legal or constructive obligation as a
result of past events, it is probable that an outflow of resources embodying economic benefits will
be required to settle the obligation and a reliable estimate can be made of the amount of obligation.
4.17 Related Party Transactions
All transactions with related parties are carried out at arm's length prices determined in
accordance with comparable uncontrolled price method.
4.18 Depletion Reserve
It is provided @ 20% of the taxable profit as permissible allowance in accordance with Rule-3,
Part-II of 5th Schedule to the Income Tax Ordinance, 2001.
4.19 Cash and Cash Equivalents
For the purpose of cash flow statement, cash and cash equivalents comprise cash in hand, cash
with banks on current, saving and deposit accounts, and other short term highly liquid
investments that are readily convertible to known amounts of cash and which are subject to
insignificant risk of change in value.
4.20 Financial Instruments
Financial assets and financial liabilities are recognized when the company becomes party to the
contractual provisions of the instrument. All purchases and sales of financial assets are recognized
on the trade date. All financial assets and liabilities are initially recognized at cost, which is the fair
value of the consideration given and received. These financial assets and liabilities are
subsequently measured at fair value, amortized cost or cost, as the case may be. Financial assets
are derecognized when the company loses control of the contractual rights that comprise the
financial asset. The company loses such control if it realizes the rights to benefits specified in
contract, the rights expire or the company surrenders those rights. Financial liabilities are
derecognized when the obligation specified in the contract is discharged, cancelled or expired.
Any gain or loss on subsequent measurement and derecognition is charged to the profit and loss
account currently.
4.21 Operating Leases
Rentals payable under operating leases are charged to profit and loss account on a straight line
basis over the term of the relevant lease.
4.22 Change in Accounting Policy
The Company applied revised IAS 1 "Presentation of Financial Statements", which became
effective from 01 January 2009. Accordingly all owners' changes in equity are presented in the
statement of changes in equity, whereas all non-owner changes in equity are presented in the
statement of comprehensive income. Comparative information has been re-presented in
conformity with the revised standard.
4.23 Offsetting
Financial assets and liabilities are offset and the net amount is reported in the balance sheet, if the
Company has a legally enforceable right to offset the recognized amounts and the Company
intends to settle either on a net basis or realize the asset and settle the liability simultaneously.

4.24 New Accounting Standards and IFRIC Interpretations That Are Not Yet Effective
The following standards, interpretations and amendments to approved accounting standards are
effective for accounting periods beginning from the dates specified below. These standards,
interpretations and the amendments are either not relevant to the Company's operations or are not
expected to have significant impact on the Company's financial statements except for
amendments to IFRS 2 as mentioned in note 4.22.1 below;
The IASB's annual improvements project published in May 2008, contains a number of
amendments which would generally be applicable for financial periods beginning on or after 1
January 2009. These amendments extend to 35 standards and include changes in terminology and
accounting requirements.
IFRS 2 (amendments relating to group cash-based Payments transaction) - Share based Payments
(effective for annual periods beginning on or after 01 January 2010).
IFRS 5 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Non-Current
Assets Held for Sale and Discontinued Operations (effective for annual periods beginning on or
after 01 January 2010).
IFRS 8 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Operating
Segments (effective for annual periods beginning on or after 01 January 2010).
IFRS 9 - (Classification and Measurement) - Financial Instruments (effective for annual periods
beginning on or after 01 January 2010).
IFRIC 17- Distribution of Non-Cash Assets to Owners (effective 1 July 2009)
IAS 1 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Presentation of
Financial Statements (effective for annual periods beginning on or after 01 January 2010).
IAS 7 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Statement of
Cash Flows (effective for annual periods beginning on or after 01 January 2010).
IAS 17 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Leases
IAS 24 (revised definition of related parties) - Related Party Disclosures (effective for annual
periods beginning on or after 01 January 2011).
IAS 32 (amendments relating to classification of right issue) - Financial Instruments: Presentation
IAS 36 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Impairment of
Assets (effective for annual periods beginning on or after 01 January 2010).
IAS 39 (amendments resulting from April 2009 Annual Improvements to IFRSs) - Financial
Instruments: Recognition and Measurement (effective for annual periods beginning on or after 01
January 2010).
IFRIC 19 - Extinguishing Financial Liabilities with Equity Instruments (effective for annual
periods beginning on or after 01 July 2010).
The Government of Pakistan launched Benazir Employees Stock Option Scheme (“the Scheme”)
on 14 August 2009 whereby the Government of Pakistan transferred 120,000 shares of the
Company to PMDC Employees Empowerment Trust (Refer note 5 to the financial statements).
Notwithstanding above, the amendments relating to IFRS 2 is effective for annual periods
beginning on or after 01 January 2010 and hence no adjustments is required in these financial
statements. The financial impact of amended IFRS 2 on ensuing financial statements cannot be
quantified at this stage in the absence of clear interpretation of the applicability of IFRS 2 on
various aspects of the scheme.

Note 2017 2016

----(Rupees in '000')----
5 SHARE CAPITAL
AUTHORIZED CAPITAL
100,000,000 (2016: 100,000,000) ordinary shares of Rs. 10 each 1,000,000 1,000,000
ISSUED, SUBSCRIBED AND PAID UP CAPITAL

880,000 ordinary shares (2016: 880,000) of Rs. 10/- each issued
in cash held by Government of Pakistan through its nominees.
8,800 8,800
120,000 ordinary shares (2016: 120,000) of 10/- each issued in
free to BESOS Trust 5.1 1,200 1,200
10,000 10,000
5.1 On 14 August 2009, the Government of Pakistan launched Benazir Employees Stock Option Scheme (BESOS) whereby the
Government of Pakistan transferred 120,000 shares to PMDC Employees Empowerment Trust ("the Trust") without any
payment by the eligible employees subject to transfer back of these shares to the Government of Pakistan as provided in the Trust
Deed. Accordingly, the Government of Pakistans shareholding in the Company is reduced to 88 % from 100 % with effect from
14 August 2009. As per the Trust Deed such shares have been allocated through Unit Certificates to eligible employees in
proportion to their entitlement on the basis of length of service. The Trust is entitled to receive dividends declared on or after 14
August 2009 and 50% of such dividends is being distributed among employees on the basis of units held while the balance 50%
is being transferred to the Privatization Commission of Pakistan for payment to employees against their surrendered shares/units.
6 EQUITY FUNDS FROM GOVERNMENT FOR SPECIFIC PROJECTS

The amount was provided by the Government for 50% equity contribution in the Lakhra Coal Development Company Limited
(LCDCL).
7 REVENUE RESERVES
General reserves 7.1 683,633 583,633
Insurance reserves 7.2 12,000 12,000
Depletion reserve 437,329 392,463
Unappropriated profit 381,558 484,328
1,514,520 1,472,424
7.1 GENERAL RESERVES

The Company created a General Reserve starting from the year 2004-05 to meet the future uncertainties of the company on
account of Privatization of PMDC, Projects.
7.2 SELF INSURANCE RESERVE

The Company created self financing insurance scheme for risks which are not covered by compulsory insurance under the
Insurance Ordinance, 2000. The scheme covers insurance requirements of Head Office and all its projects except specified
categories of mine Labor. Contribution by the projects and payments of claims are charged to income. It was decided by the
Board of Directors in its meeting held on March 01, 1989 that a sum of Rs 6 million may be retained as self insurance reserve
and further decided in its 140th AGM held October 26, 2011 that the amount of reserve be doubled over a period of two years to
cover following future contingencies and invest such reserves in fixed deposits with scheduled banks.
Workmen compensation claim 10,000 10,000
Group insurance claim 1,000 1,000
Motor vehicle accident claim 1,000 1,000
12,000 12,000
The cash funds have been invested with Askari Bank Limited keeping in view the privatization process initiated by the
Privatization Commission of Pakistan and the fund balance under scheme will be transferred to head office account on winding
up of schemes.

Note 2017 2016

----(Rupees in '000')----
8 NON CURRENT LIABILITIES
Security deposits 50,608 53,921
Staff retiring benefits 8.1 227,015 229,246
Deferred tax liability 155,291 121,962
432,914 405,129
8.1 STAFF RETIRING BENEFITS
Gratuity 8.1.1 16,127 8,354
Pension 8.1.2 126,225 150,284
Leave salary 84,663 70,608
227,015 229,246
8.1.1 Gratuity
Net Liability (Asset)
Beginning of year (48,446) 5,709
Cost 16,127 8,354
Paid (29,774) (62,509)
End of year (62,093) (48,446)
Obligation
Beginning of year 231,184 228,381
Current service cost 12,147 13,136
Interest cost 15,915 20,732
Remeasurement due to:
change in demographic assumptions - -
change in financial assumptions - (29,030)
experience 28,008 28,108
Settlement (4,991) (9,834)
Benefits paid (23,341) (20,309)
End of year 258,922 231,184
Plan assets
Interest income 20,326 22,692
investment return 19,617 1,900
Contributions (refund) 29,774 62,509
Settlement (4,991) (9,834)
Benefits paid (23,341) (20,309)
End of year 321,015 279,630
Cost
Service cost
current service cost 12,147 13,136
past service cost - -
Net interest (4,411) (1,960)
Chargeable in P&L 7,736 11,176
change in demographic assumptions
experience on obligation 28,008 28,108
investment return (19,617) (1,900)
Chargeable in OCI 8,391 (2,822)
Total cost 16,127 8,354
Reconciliation
Obligation 258,922 231,184
Plan assets (321,015) (279,630)
Net liability (asset) (62,093) (48,446)

Note 2017 2016

----(Rupees in '000')----
8.1.2 Pension
Net Liability (Asset)
Cost 126,225 150,284
Paid (174,112) (15,220)
End of year 134,641 182,528
Obligation
Current service cost 11,463 10,454
Past service cost 33,263 35,016
Interest cost 35,581 37,781
experience 87,276 140,064
Settlement 13,671 33,016
Benefits paid (87,767) (142,803)
End of year 628,136 534,649
Plan assets
Interest income 29,103 34,616
investment return 13,663 10,375
Contributions (refund) 174,112 15,220
Settlement 12,264 13,085
Benefits paid (87,767) (142,803)
End of year 493,495 352,120
Cost
Service cost
current service cost 11,463 10,454
past service cost 34,671 54,946
Net interest 6,477 3,165
Chargeable in P&L 52,611 68,565
experience on obligation 87,277 140,064
investment return (13,663) (10,375)
Chargeable in OCI 73,614 81,719
Total cost 126,225 150,284

Reconciliation
Obligation 628,136 534,649
Plan assets (493,495) (352,120)
Net liability (asset) 134,641 182,529
Principal actuarial assumptions used were as follows:

Discount rate per annum 7.75% 7.25%
Salary increases 7.00% 6.50%
9 DONATIONS/CONTRIBUTIONS
The amount represents donations received from various Oil Companies for the establishmentof an Asthma Resort at PMDC Salt
Mines Khewra as per detail below:
Total donations received 7,781 7,781
Less:- Amortization (7,751) (6,986)
30 795

Note 2017 2016

----(Rupees in '000')----
10 TRADE AND OTHER PAYABLES
Trade creditors 14,678 7,243
Accrued liabilities 10.1 252,935 184,577
Advance from customers 174,591 69,879
Payable to employees retirement benefit funds 10.2 53,219 13,752
Other liabilities 10.3 131,997 122,937
Provision for workers' profit participation fund 10.4 156 407
Dividend payable 7,636 -
635,212 398,795
10.1 Accrued liabilities
Salaries and wages 44,564 27,930
Bonus 139,464 123,548
Other staff benefits 41,409 6,182
Pension charges payable 158 -
Audit and legal fee 3,615 3,559
Utilities 653 480
Insurance claims 7,551 7,075
Rent, rates and taxes 3,130 1,820
Bills payable 5,847 2,265
Telephone and postage 84 116
Others 6,460 11,602
252,935 184,577
10.2 Payable to Employee Retirement Benefit Fund
Employee old age benefit contribution (EOBI) 13,656 13,752
Gratuity payable 39,563 -
53,219 13,752
10.3 Other liabilities
Royalty, excise duty and other taxes 32,611 24,728
Insurance fund 57,057 51,717
Contractors current account 17,141 23,795
Income tax deducted at source 8,701 6,404
Contribution for maintenance of road 6,731 4,173
Others 9,756 12,120
131,997 122,937
10.4 PROVISION FOR WORKERS' PROFIT PARTICIPATION FUND
Opening Balance 407 346
Charge for the year 21,156 30,790
Payments made (21,407) (30,729)
Closing Balance 156 407
11 PROVISION FOR TAXATION
Current tax 74,801 127,830
The Company in consultation with its tax consultant M/s Waterford Law Associates has been providing tax liability after availing
benefits of the different tax rebates, accounting depreciation and exemption on account of depletion reserves.
TAXATION EXPENSE
Prior year (3,251) (3,620)
Tax under final tax regime (FTR) 166 9,265
Current tax 74,801 127,830
Deferred tax 33,329 17,422
105,045 153,127
11.1 Reconciliation of current tax charge

Profit for the year 401,959 585,005
Tax at applicable tax rates of 31% (2016: 32%) 124,607 187,202
Net tax effect of inadmissible expenses for tax purpose 12,128 12,519
Tax effect on re-measurement loss on staff retiring benefits charged to OCI (25,422) (25,247)
Tax effect of tax depreciation and expenses allowable on paid basis (21,597) (19,937)
Tax effect of depletion allowance (13,908) (25,894)
Tax effect of exports 419 517
Tax effect of presumptive income (1,487) (1,330)
74,740 127,830

Note 2017 2016

----(Rupees in '000')----
11.2 Deferred taxation
Taxable temporary differences
- Depletion reserve 437,329 392,463
Deductible temporary differences
- Accelerated depreciation 80,309 14,076
Net taxable temporary difference 517,638 406,539

Deferred tax liability @ 30% 155,291 121,962
Total liability 155,291 121,962
Deferred tax expense 33,329 17,422
12 CONTINGENCIES AND COMMITMENTS
COMMITMENTS
PMDC has undertaken the exploration and development of Duddar Zinc Lead Project in District Lasbela Baluchistan
against an expenditure of Rs. 42.222 million. In 2003 an agreement was signed with MCC China (now through MCC
Huaye Duddar Mining Company) for further development and exploration of the mineral. In return the Chinese company
agreed to pay 20% share in profit of the project to PMDC when accrued. As per another agreement between PMDC and
Balochistan Development Authority (BDA) this profit would further be shared between PMDC and Baluchistan
Development Authority (BDA) on 50:50 basis.
13 PROPERTY, PLANT AND EQUIPMENT

(Schedule annexed) 358,396 254,305
14 LONG TERM INVESTMENTS
14.1 Investment in Related Parties (Associates - Unquoted)

Sarhad Mineral (Private) Limited. (Equity Held: 49%) 14.1.1 - -
Lakhra Coal Development Company Limited (Equity Held: 43.95%) 14.1.2 70,602 133,173
14.2 Investment In FATA Joint Venture 14.2.1 3,948 554

74,550 133,727
14.3 Other Investment - Investment Against Deferred Liabilities

(Held to Maturity)
Investment against security deposits 14.3.1 51,079 53,863
125,629 187,590
Reconciliation of Investment in Associated Companies Under Equity Method
Sarhad Mineral (Private) Lakhra Coal

TOTAL
Limited Development Co. Ltd.
2017 2016 2017 2016 2017 2016
Cost 1,225 1,225 25,000 25,000 26,225 26,225
Share of Post Acquisition Reserves
Share of Profit/(loss) - - (62,571) 44,693 (62,571) 44,693

for the year
Post acquisition profits/ (1,225) (1,225) 108,173 136,092 106,948 134,867
losses brought forward -
Dividend received - - - (72,612) - (72,612)
As at June 30 (1,225) (1,225) 45,602 108,173 44,377 106,948
As at June 30 - - 70,602 133,173 70,602 133,173

14.1.1 In Sarhad Mineral (Private) Limited. PMDC holds 137,200 (including Bonus Shares 14,700) ordinary shares fully paid up
of Rs. 10/- each. Equity held by the Company is 49 % ( 2015: 49%). Losses have been recognized up to cost of
investment made by PMDC as it has not incurred any legal or constructive obligations or made any payments on behalf of
the associate.
14.1.2 PMDC made investment in Lakhra Coal Development Company Limited (LCDCL) consisting of 2,500,000 ordinary
shares of Rs. 10/- each out of which 12% i.e. 299,640 shares have been transferred to the Lakhra Coal Development
Corporation Employees Empowerment Trust (LEET) under Benazir Employees Stock Option Scheme (BESOS).
Consequently Equity held by the Company is reduced to 43.95% (2015: 43.95%).
Summarized financial information in respect of associated undertakings is as follows:
Profit /
Name of Company Assets Liabilities Net Assets Revenues
(Loss)
Sarhad Mineral (Private) Annual 2017 -
Limited Unaudited 5,062 10,008 (4,946) 9,272 561
Lakhra Coal Development Annual 2017 -

Company Limited Unaudited 415,003 110,705 304,298 503,396 (142,369)
Sarhad Mineral (Private) Annual 2016 -

Limited Unaudited 3,045 8,560 (5,515) 8,917 1,568
Lakhra Coal Development Annual 2016 -

Company Limited Unaudited 342,862 89,788 253,074 608,557 101,691
14.2.1 Reconciliation of Investment in FATA Joint Venture - Under Equity Method
FATA JV - Kurram
Soapstone Project
2017 2016
Cost 1,926 1,926
Share of Post Acquisition Reserves
Share of Profit/(loss) 3,394 -

for the year
Post acquisition profits/ (1,372) (1,372)

losses brought forward
Dividend received - -
As at June 30, 2011 2,022 (1,372)
As at June 30, 2010 3,948 554
This represent cost of investment in FATA Joint Venture with Civil Secretariat NWFP, Peshawar through agreement
dated 07, 2003. The joint venture is for exploration of Soapstone in Kurram Agency, Fata. The Company has 30 %
(2016: 30% ) working interest in Kurram Soapstone Project. The work on the project was started in 2004 but suspended in
2007 due to law and order situation. The work re-started on the project in July, 2016 and produced 7,474 tonnes
soapstone up to 30-06-2017.
Summarized financial information in respect of FATA JV is as follows:
Name of Project Assets Liabilities Net Assets Revenues Profit / Loss
FATA Joint Venture - Annual 2017 - 18,746 5,586 13,160 11,211 10,553
Kurram Soapstone Project Unaudited
FATA Joint Venture -

Annual 2011 -
Kurram Soapstone Project 3,570 1,720 1,850 - -
Unaudited

14.3.1 Term Deposit Receipts 51,079 53,863
The face value of investment in TDRs is Rs.51.079 million. (2016: Rs.53.863 million). These carry effective interest rate
of 6.00% to 6.35 % ( 2016: 6.00% to 6.35 % per annum). These have maturity of one month to 9 months and are due to
mature in periods ranging between July, 2017 to March, 2018.
15 LONG TERM LOANS AND ADVANCES

Advances to employees - considered good
House building 153,914 130,967
Car/motor cycle 49,342 39,476
Marriage Loan 2,485 930
205,741 171,373
Less: current maturity (10,333) (10,512)
195,408 160,861
15.1 This represents house building advance and car/motor cycle advance given to employees. House building advances are
recoverable in fifteen years (180 installments) while car & motor cycle advances are recoverable in five years (60
16 STORES, SPARES AND LOOSE TOOLS
Stores 34,655 33,707
Spares 4,556 13,931
Loose tools 47 46
Provisions for warehousing recovery (48) (228)
39,210 47,456
17 STOCKS IN TRADE
Extracted mineral stock at:
Khewra 11,761 11,891
Warcha 29,376 26,662
Sor Range 7,799 16,315
48,936 54,868
18 TRADE DEBTS (UNSECURED, CONSIDERED GOOD)
Represent receivables of following projects:
Khewra 12,639 36,216
Warcha 22,926 51,207
Lakhra 35,026 12,184
70,591 99,607
19 LOANS AND ADVANCES
Advances-unsecured:
- Executives 2,622 2,174
- Others 126,122 92,591
128,744 94,765
Current portion of long term advances 10,333 10,512
139,077 105,277
20 OTHER RECEIVABLES
Gratuity /Provident Fund Trust - 5,425
FATA/SML 1,998 1,998
LCDC Karachi 166 -
Others 2,223 1,490
4,387 8,913
21 SHORT TERM INVESTMENT
Held to maturity
Term deposits with banks and financial institutions in local currency
having maturity period between 1 to 12 months 1,197,678 1,088,678

Note 2017 2016

----(Rupees in '000')----
22 CASH AND BANK BALANCES
Cash at bank
- Current accounts 203,010 205,745
- Deposit accounts 51,636 54,384
- Cash in hand/ Cheque in transit 9,703 408
264,349 260,537
23 SALES
Local sales 2,444,382 2,743,483
Export sales 6,602 4,911
2,450,984 2,748,394
24 COST OF SALES
Man power cost 367,752 302,961
Labor cost 429,520 721,869
Development cost 17,414 15,837
Material and stores 183,567 185,887
Other overhead 404,782 394,756
Carriage expense 198,633 213,683
Changes in stock 5,933 (39,766)
1,641,061 1,819,048
24.1 COST OF SALES SUMMARY
2017 2016
COST GROSS COST GROSS
SALES OF PROFIT/ SALES OF PROFIT/
SALES (LOSS) SALES (LOSS)
SALT MINES
Khewra 493,198 385,927 107,271 488,422 359,299 129,123
Makrach 102,095 57,821 44,274 86,294 46,110 40,184
Warcha 1,007,811 476,652 531,159 1,069,808 429,616 640,192
Kalabagh 103,328 41,977 61,351 77,314 39,997 37,317
Jatta/B-Khel 15,347 30,274 (14,927) 21,189 24,700 (3,511)
1,721,779 992,651 729,128 1,743,027 899,722 843,305
COAL MINES
Degari 15,985 13,143 2,842 12,174 9,663 2,511
Sor Range 377,809 397,790 (19,981) 383,281 383,339 (58)
Sharigh 85,476 49,762 35,714 80,516 47,047 33,469
Lakhra 249,537 187,259 62,278 528,984 478,846 50,138
728,807 647,954 80,853 1,004,955 918,895 86,060
OTHER PROJECTS
Silica Sand 398 456 (58) 412 431 (19)
Grand Total 2,450,984 1,641,061 809,923 2,748,394 1,819,048 929,346
24.2 QUANTITATIVE DATA (TONNES)
2017 2016
CLOSING PRODUCTIO CLOSING
PRODUCTION SALES SALES
STOCK N STOCK
SALT MINES
Khewra 393,624 395,616 11,200 419,202 416,357 13,192
Makrach 89,975 89,975 1,694 85,429 85,429 1,694
Warcha 624,693 633,660 34,785 716,542 674,026 43,752
Kalabagh 146,687 146,687 - 143,406 143,406 -
Jatta/B-Khel 55,447 55,447 - 68,573 68,573 -
1,310,426 1,321,385 47,679 1,433,152 1,387,791 58,638
COAL MINES
Degari 16,500 16,395 265 12,059 12,451 160
Sor Range 59,835 60,729 2,915 67,191 67,488 3,809
Sharigh 220,646 220,646 - 223,746 223,746 -
Lakhra 284,537 284,537 - 254,954 254,954 -
581,518 582,307 3,180 557,950 558,639 3,969
OTHER PROJECTS
Silica Sand 10,336 10,336 - 12,887 12,887 -

Gypsum 6,769 6,769 - 19,938 19,938 -

24.3 SUMMARY OF MINERAL RESERVES
SALT MINES
KHEWRA KALABAG
WARCHA JATTA/BK TOTAL
& H
MAKRACH QUANTITY IN THOUSAND TONNES
As per estimates of 2001 382,342 1,783,020 71,150 20,000 2,256,512
Accumulated Upto June 30, 2016 6,216 7,290 1,132 1,019 15,657
Production during the period 484 625 147 55 1,311
Accumulated Upto June 30, 2017 6,700 7,915 1,279 1,074 16,968
Net reserve as on June 30, 2017 375,642 1,775,105 69,871 18,926 2,239,544
Daily average production (tonnes) 1,613 2,083 490 183 4,370
COAL MINES
DEGARI SOR SHARIGH LAKHRA TOTAL
QUANTITY IN THOUSAND TONNES
As per estimates of 2001 2,029 7,845 3,731 36,110 49,715

Accumulated Upto June 30, 2016 115 851 2,117 3,086 6,169
Production during the period 17 60 221 285 583
Accumulated Upto June 30, 2017 132 911 2,338 3,371 6,752
Net reserve as on June 30, 2017 1,897 6,934 1,393 32,739 42,963
Daily average production (tonnes) 57 200 737 950 1,943
25 ADMINISTRATIVE EXPENSES
Salary and allowances 184,328 170,035
Staff expenses 180,347 130,655
Repair and maintenance 11,311 11,698
Audit fee and out of pocket expense 1,614 1,657
Miscellaneous 22,942 22,647
413,072 347,456
26 DISTRIBUTION COST
Salaries expenses 21,493 17,526
Loading and transportation 9,589 10,621
Royalty and other taxes 85,488 89,804
Export expenses 2,192 2,494
Miscellaneous expenses 11,635 12,099
132,385 134,147
27 OTHER OPERATING INCOME
Income from financial assets
Interest income on investments 72,437 72,742
Income from non-financial assets
Insurance pool net income 1,846 10,747
Other income
Forfeiture and penalties 1,014 674
Sale of stores and spares/scrapes etc. 1,356 4,427
Rental income 4,574 3,048
Income from deep area 18,815 13,953
Mine visiting fee 46,200 44,458
Miscellaneous income 12,407 18,003
84,366 84,563
158,649 168,052

2017 2016
----(Rupees in '000')----
28 TRANSACTIONS WITH RELATED PARTIES
Transactions with associated company (Lakhra Coal Development Limited) are as follows:
Dividend Received - 72,612

Sale of coal 25,366 32,895
25,366 105,507
29 EARNINGS PER SHARE

Net profit after tax (Rupees '000) 296,914 431,878
Weighted average number of shares in issue during the year ('000) 1,000 1,000
Basic and diluted earnings per share (Rupees) 296.91 431.88
Basic and diluted earnings per share (Rupees) after adjustment of associate's share of profit 155.73 397.67
There is no dilutive effect on the basic earnings per share of the company. Moreover updating for each year prior to previous year
is not possible to do due to non-availability of reliable related data.
30 NUMBER OF EMPLOYEES
Officers 82 86
Supervisors 41 46
Staff and workers 1,243 1,144
Apprentices/ management trainees 4 4
1,370 1,280
31 NUMBER OF MINERS
Salt cutters 808 807
Coal cutters 761 441
1,569 1,248
32 FINANCIAL INSTRUMENTS
The Company has exposure to the following risks from its use of financial instruments:
Credit
Liquidity risk
Market risk
This note presents information about the Companys exposure to each of the above risks, the Companys objectives,
policies and processes for measuring and managing risk, and the Companys management of capital. Further
quantitative disclosures are included throughout these financial statements.
The Board of Directors has overall responsibility for the establishment and oversight of the Companys risk
management framework. The Board is responsible for developing and monitoring the Companys risk management
policies.
The Companys risk management policies are established to identify and analyze the risks faced by the Company, to set
appropriate risk limitsand controls, and to monitor risks and adherence to limits.Risk management policies and systems
are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company, through its
training and management standards and procedures, aims to develop a disciplined and constructive control environment
in which all employees understand their roles and obligations.
32.1 Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to
meet its contractual obligations. To manage credit risk the Company maintains procedures covering the application for
credit approvals, granting and renewal of counterparty limits and monitoring of exposures against these limits. As part
of these processes the financial viability of all counterparties is regularly monitored and assessed.
The Company is exposed to credit risk from its operating and certain investing activitiesand the Company's credit risk
exposures are categorized under the following headings:

32.1.1 Counter parties

The Company conducts transactions with the following major types of counterparties:
Trade debts
Trade debts are essentiallydue from Chemical, Cement manufacturing and power generation companies and the
Company does not expect these companies to fail to meet their obligations. Majority of sales to the Companys
customers are made on open terms.
Sale of Coal and Salt is at a price determined in accordance with the agreed pricing formula as approved by
Board/ Higher Management under respective agreements. Sale of Coal and refined Salt products is made at
The Company establishes Provisions for impairment that represents its estimate of incurred losses in respect of
trade debts. This allowance is based on the management's assessment of a specific loss component that relates to
individually significant exposures.
Bank and investments
The Company limits its exposure to credit risk by investing in liquid securities and maintaining bank accounts
only with financial institutions of sound credit rating. The credit rating of various banks is obtained from "The
Pakistan Credit Rating Agency Limited" (PACRA). Given these high credit ratings, management does not
expect any counter party to fail to meet its obligations.
32.1.2 Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to
credit risk at the reporting date was:
2017 2016
----(Rupees in '000')----
Long term investments 125,629 187,590
Long term loans and receivable 195,408 160,861
Trade debts 70,591 99,607
Loans and advances 139,077 105,277
Deposits 9,680 9,526
Interest accrued 34,356 34,424
Other financial assets 1,285,824 1,191,002
Bank balances 264,349 260,537
2,129,301 2,057,737
The maximum exposure to credit risk for financial assets at the reporting date by type of customer was:
Chemical Companies 34,680 85,627

Power generation companies - 12,184
Cement Companies - -
Others 35,911 1,796
Deposits 9,680 9,526
Bank balances 264,349 260,537
Other Financial Assets 1,780,294 1,679,154
2,129,301 2,057,737
The Companys most significant customer, M /s ICI Khewra & Sitara Chemicals Faisalabad accounts for Rs.7.834
million & Rs. 13.370 million respectively of the trade debts carrying amount at 30 June 2017 (2016: Rs 23.821 million
& Rs. 15.571 million respectively).
The maximum exposure to credit risk for trade debts at the reporting date by type of product was:

2017 2016
----(Rupees in '000')----
Salt 35,565 87,423

Coal 35,026 12,184
70,591 99,607
32.1.3 Impairment losses

The aging of trade debts at the reporting date was:
2017 2016
Gross debts Impaired Gross debts Impaired
----(Rupees in '000')---- ----(Rupees in '000')----
Past due 0-30 days 33,054 - 56,955 -

Past due 30-60 days 5,749 - 18,768 -
Past due 60-90 days 6,491 - 15,001 -
Over 90 days 25,297 - 8,883 -
70,591 - 99,607 -
The Company believes that no impairment allowance is necessary in respect of trade debts provided. Trade
debts are essentially due from chemical, cement and power generation companies, the Company is actively
pursuing for recovery of debts and the Company does not expect these companies to fail to meet their
obligations.
The allowance in respect of trade receivables, loans and advances are used to record impairment losses unless
the Company is satisfied that no recovery of the amount owing is possible, at that point the amount considered
irrecoverable is written off against the financial asset directly.
32.2 Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability
of funding to an adequate amount of committedcredit facilitiesand the ability to close out market positions due
to dynamic nature of the business. The Companys approach to managing liquidity is to ensure, as far as
possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or risking damage to the Companys reputation.
The maturity profile of the Companys financial liabilities based on the contractual amounts is as follows:
2017 2016
Trade and other payables
Carrying Carrying Contractual
----(Rupees in '000')---- ----(Rupees in '000')----
All the trade and other payables 635,212 635,212 398,795 398,795
32.3 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates etc will affect
the Companys income. The objective of market risk management is to manage and control market risk
exposures within acceptable parameters, while optimizing the return on risk.
32.3.1 Foreign currency risk management

PKR is the functional currency of the Company and as a result currency exposure arise from transactions
and balances in currencies other than PKR. The Company's potential currency exposure comprise;
Transactional exposure in respect of non functional currency monetary items.
Transactional exposure in respect of non functional currency expenditure and revenues.
The potential currency exposures are discussed below;

Transactional exposure in respect of non functional currency monetary items

Monetary items, including financial assets and liabilities, denominated in currencies other than the
functional currency of the Company are periodically restated to PKR equivalent, and the associated gain
or loss is taken to the profit and loss account. The foreign currency risk related to monetary items is
managed as part of the risk management strategy.
Transactional exposure in respect of non functional currency expenditure and revenues
Certain operating expenditure is incurred by the Company in currencies other than the functional
currency. Certain sales revenue is earned in currencies other than the functional currency of the
Company. These currency risks are managed as a part of overall risk management strategy. The
Company does not enter into forward exchange contracts.
Exposure to foreign currency risk
2017 2016
----(Rupees in '000')----
Trade debts from foreign companies - -
Cash and bank balances - -
Trade and other payables - -
The following significant exchange rates applied during the year:
Average rate Reporting date mid

spot rate
2017 2016 2017 2016
(Rupees) (Rupees) (Rupees) (Rupees)
USD 1 104.74 101.36 104.65 104.29
Foreign currency sensitivity analysis

A 10 percent strengthening of the PKR against the USD at 30 June
would have decreased equity and profit or loss by the amounts shown - -
below. This analysis assumes that all other variables, in particular
interest rates, remain constant. The analysis is performed on the same
basis for 2016.
32.3.2 Interest rate risk management
The interest rate risk is the risk that the value of the financial instrumentwill fluctuate due to changes
in the market interest rates. Sensitivity to interest rate risk arises from mismatchesof financial assets
and liabilitiesthat mature in a given period. The Company adopts a policy to ensure that interest rate
risk is minimized by investing in fixed rate investments like DSCs and TDRs while the Company
has no borrowings.
Profile
At the reporting date the interest rate profile of the Companys interest bearing financial instruments
was:
2017 2016 2017 2016
% ----(Rupees in '000')----
Fixed rate instruments
Financial assets
Long term investments 6 % to 6.35 % 6% to 6.35% 51,079 53,863
Long term loans 3 % to 5% 3 % to 5% 195,408 160,861
Short term investments 4.65 % to 6.40 % 4.80% to 6.75% 1,197,678 1,088,678
Cash and bank balances 3% to 6 % 3% to 6 % 264,349 260,537

Fair value sensitivity analysis for fixed rate instruments

The Company does not account for any fixed rate financial assets and liabilitiesat fair value through
profit or loss, and the Company does not have derivatives as hedging instruments recognized under
fair value hedge accounting model. Therefore, a change in interest rates at the reporting date would
not affect profit or loss.
32.3.3 Other market price risk
The Company is following a policy to set aside reserves including General reserve, Insurance
reserve and Depletion reserve for the purposes to meet future uncertainties relating to Privatization
to cover insurance requirementsof Head Office and all projects and for development and expansion
of mines respectively. General reserves are created to meet the future uncertainties by the Board. The
primary goal of the Companys investment strategy is to maximize investment returns on surplus
funds. The Company's price risk arises from investments in TDRs which are designated at fair value
through profit or loss, however, in accordance with the investment strategy the performance of
TDRs is actively monitored and they are managed on a fair value basis.
32.3.4 Equity Risks
Equity risk is the risk that one's investments will depreciate because of stock market dynamics
causing one to lose money. The measure of risk used in the equity markets is typically the standard
deviation of a security's price over a number of periods. The standard deviation will delineate the
normal fluctuations one can expect in that particular security above and below the mean, or average.
However, since most of the companies would not consider fluctuations above the average return as
"risk".
33 REMUNERATION OF MANAGING DIRECTOR, DIRECTORS AND EXECUTIVES
The aggregate amounts charged in these financial statementsin respect of remuneration including benefits applicable to managing
director, directors and executives of the Company are given below:
(Rupees in '000) (Rupees in '000)
2017 2016
Managing Executives Managing Executives
Director Directors Director Directors
Managerial remuneration 8,340 927 8,340 1,418
Others benefits 234 18 156 323
Total 8,574 945 8,496 1,741
Number of persons 1 6 1 6
34 FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES

Note/Schedule attached
35 CORRESPONDING FIGURES
Figures have been rounded off to the nearest thousand rupees, unless otherwise stated.
36 POST BALANCE SHEET EVENTS

100/-
The Board of Directors has recommended a dividend for the year ended 30 June, 2017 of Rs. ________ per ordinary share
(2016: Rs. 113.64 per ordinary share). Such event is considered as non-adjusting event under IAS-10 " Events after the
reporting period" and has not been recognized in these financial statements.
37 DATE OF AUTHORIZATION
October 27, 2017
These financial statements were authorized for issue on _______________________ by the Board of Directors of the Company.

Res., office Res., office Mines and Mines and
Railway
Leasehold Freehold and other and other workshop workshop Plant and Transport Rail Furniture Office Computer Sundry Temp.
Particulars Roads sliding and Installation Books Total
Land Land building on building on building on building on machinery assets transport and fixture equipment equipment equipment Sheds
culverts
L.H. Land F.H. Land L.H. Land F.H. Land
------------------------------------------------------------------------------------------------------------------------------------- Rupees in 000 ----------------------------------------------------------------------------------------------------------------------------------------
At June 30, 2015

Cost 2,314 1,775 19,096 8,372 13,713 81,199 2,065 2,712 141,117 45,057 93,174 1,010 24,654 2,887 14,672 39,501 369 4,320 498,007
Accumulated Depreciation 339 - 10,881 7,218 12,438 49,466 2,065 2,158 91,142 28,567 63,810 1,010 13,636 2,115 10,613 28,078 336 3,923 327,795
Net Book Amount 1,975 1,775 8,215 1,154 1,275 31,733 - 554 49,975 16,490 29,364 - 11,018 772 4,059 11,423 33 397 170,212

Year Ended June 30, 2016
Opening Net Book Amount 1,975 1,775 8,215 1,154 1,275 31,733 - 554 49,975 16,490 29,364 - 11,018 772 4,059 11,423 33 397 170,212
Additions - - - - - 10,826 - 5,708 43,636 5,451 47,960 - 4,459 308 1,421 1,729 - - 121,498
Disposals - - - - - - - (90) (10) - (5,585) - (5) - - (275) - - (5,965)
Adjustment of Cost - - - - - - - - - - - - - - - - - - -
Depreciation for the year (70) - (1,111) (87) (60) (4,544) - (106) (8,841) (3,117) (15,019) - (1,800) (160) (2,208) (1,910) (7) (82) (39,122)
Depreciation-Disposal - - - - - - - 90 10 - 4,621 - 4 - - 193 - - 4,918
Adjustment of Depreciation - - - - - 67 (67) - - - (92) 92 -
Closing Net Book Amount 1,905 1,775 7,104 1,067 1,215 38,015 - 6,156 84,837 18,757 61,341 - 13,676 920 3,180 11,252 26 315 251,541
Cost 2,314 1,775 19,096 8,372 13,713 92,025 2,065 8,330 184,743 50,508 135,549 1,010 29,108 3,195 16,093 40,955 369 4,320 613,540
Net Book Amount 1,905 1,775 7,104 1,067 1,215 38,015 - 6,156 84,837 18,757 61,341 - 13,676 920 3,180 11,252 26 315 251,541
Year Ended June 30, 2017

Opening Net Book Amount 1,905 1,775 7,104 1,067 1,215 38,015 - 6,156 84,837 18,757 61,341 - 13,676 920 3,180 11,252 26 315 251,541
Additions - 7,819 - 2,473 1,716 25,195 - - 36,631 8,247 42,071 9,464 5,355 328 2,105 3,483 3 2,635 147,525
Disposals - - - - - - - - (3,407) - - - (60) - (287) (88) - - (3,842)
Adjustment of Cost - - - - - - - - (3) - - - - - - - - - (3)
Depreciation for the year (70) - (1,091) (97) (66) (5,873) - (258) (11,614) (3,431) (21,906) (946) (2,246) (193) (1,932) (2,240) (6) (53) (52,022)
Depreciation-Disposal - - - - - - - - 2,986 - - - - - 216 135 - - 3,337
Adjustment of Depreciation - - - - - - 3 - - - - - - 3
Closing Net Book Amount 1,835 9,594 6,013 3,443 2,865 57,337 - 5,898 109,433 23,573 81,506 8,518 16,725 1,055 3,282 12,542 23 2,897 346,539
Cost 2,314 9,594 19,096 10,845 15,429 117,220 2,065 8,330 217,964 58,755 177,620 10,474 34,403 3,523 17,911 44,350 372 6,955 757,220
Net Book Amount 1,835 9,594 6,013 3,443 2,865 57,337 - 5,898 109,433 23,573 81,506 8,518 16,725 1,055 3,282 12,542 23 2,897 346,539
2017 2016
13.1 Depreciation charge has been allocated as follows: Net book value 346,539 251,541
Rs. in "000" CWIP 11,857 2,764
2017 2016 TOTAL 358,396 254,305
Cost of sales 33,460 23,821

Administrative Expense 12,530 10,764
Selling Expenses 1,988 1,603
Tourist Resort 3,279 2,139
Charged to Donation/Contributions 765 795
52,022 39,122
49

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ANNUAL REPORT

PAKISTAN MINERAL DEVELOPMENT CORPORATION (PRIVATE) LIMITED

PAKISTAN MINERAL DEVELOPMENT CORPORATION (PRIVATE) LIMITED

Annual Report 2016-2017

MUSEUM AT TOURIST RESORT, KHEWRA

Annual Report 2016-2017

TOURIST RESORT, KHEWRA (The beauty inside the mine)

Annual Report 2016-2017

Description Page No.

Annual Report 2016-2017

No. of Face Value %age

Annual Report 2016-2017 01

GM GM GM GM DGM DGM GM(Coal)

DGM P.D. DGM Incharge

Annual Report 2016-2017 02

PMDC’s OPERATING MINES

KHEWRA SALT MINES

(a) PMDC Salt Mines, Khewra, District Jhelum, Punjab.

a) PMDC Collieries, Degari, District Quetta, Balochistan.

Annual Report 2016-2017 03

a) PMDC Silica Sand Project, Sindh.

Branch Offices/ Head Office:

a) PMDC Branch Office, Quetta, Balochistan.

Investment in Joint Venture Companies/ Projects:

Annual Report 2016-2017 04

Managing Director, PMDC

Brig. (R) Muhammad Khalid S. Khokhar, Sitara-e-

Annual Report 2016-2017 05

FINANCIAL PERFORMANCE IN GRAPHICAL FORM

GROSS PROFIT COMPARISON FOR LAST FIVE YEARS

Gross Profit Comparison

PRE-TAX PROFIT COMPARISON FOR LAST FIVE YEARS

Annual Report 2016-2017 06

PROFIT FOR FY 2016-17 IN COMPARISON WITH FY 2015-16

Gross Profit Profit before tax Profit after tax

BREAKUP OF SALE REVENUE FOR FY 2016-17

Total Sale Revenue: Rs.2,748 million

Annual Report 2016-2017 07

PHYSICAL PERFORMANCE IN GRAPHICAL FORM

COMPARISON OF FIVE YEARS PRODUCTION/SALES OF SALT

PROJECT WISE PRODUCTION OF SALT FOR THE FY 2016-17

Total Salt: 1,310,426 tonnes

Annual Report 2016-2017 08

PROJECT WISE PRODUCTION OF COAL FOR THE FY 2016-17

“Quantity in Tonnes” Total Coal: 581,518 tonnes

COMPARISON OF FIVE YEARS PRODUCTION/ SALES OF COAL

Annual Report 2016-2017 09

CONTRIBUTION TOWARDS NATIONAL EXCHEQUER

700 “Rs in million”

Form of Tax 2012-13 2013-14 2014-15 2015-16 2016-17

Royalty 74.418 127.684 153.220 156.646 156.021

GST 156.308 193.794 220.184 328.993 345.628

Income Tax 83.706 91.928 92.521 127.830 74.801

Excise Duty 5.873 9.027 9.534 11.007 10.940

Total 323.305 422.433 475.459 624.476 587.390

Annual Report 2016-2017 10

Annual Report 2016-2017

2013 2014 2015 2016 2017

Annual Report 2016-2017

Other operating income 68,225 4% 101,588 5% 123,079 5% 168,052 6% 158,649 6%

Provision for taxation (64,762) 4% (114,865) 6% (103,693) 4% (153,127) 6% (105,045) 4%

Earnings per share 169.56 195.06 228.74 431.88 296.91

Annual Report 2016-2017

Annual Report 2016-2017