Annual Report 2011
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Contents Vision/Mission/Corporate Values 03 Notice of 55th Annual General Meeting 05 Corporate Profile 07 Board of Directors’ Profile 10 Board of Directors’ Committees 15 Directors’ Report 19 Attendance of Directors 27 Review Report on Statement of Compliance 29 Statement of Compliance 30 Pattern of Shareholding 32 Categories of Shareholders 35 Six-Year Summary 36 Auditors’ Report to the Members on Unconsolidated Financial Statements 38 Unconsolidated Financial Statements 40 Auditors’ Report to the Members on Consolidated Financial Statements 92 Consolidated Financial Statements 94 Form of Proxy 159 Annual Report 2011 01 Majestic Heritage The Cultural Heritage of Pakistan is spread over centuries and is home to some of the worldís leading civilizations of the past. Pakistan has inherited a wide array of heritage sites, six of which have been inscribed on the list of ìWorld Heritage Sitesî. Numerous archaeological discoveries from the pre-historic and historic era have proved that some of the most glorious civilizations of the past dwelled on this land. Takht-e-Bahi Qila Gujar Singh Makli Hills Taxila 02 Annual Report 2011 Vision PIA’s vision is to be a world class profitable airline meeting customer expectations through excellent services, on-time performance, innovative products and absolute safety Mission Employee teams will contribute towards making PIA a global airline of choice through: Offering quality customer services and innovative products Using state-of-the-art technologies Ensuring cost-effective measures in procurement and operations Developing Safety Culture Corporate Values Customer Expectations (Convenience, Care, Affordability) Service (Personalized, Courteous, Passionate) Innovation (New Ideas, Products, Value Added Services) Cohesiveness (Respect for Individuals, Teamwork and Effective Communication) Integrity (Business Ethics, Accountability, and Transparency) Reliability (Loyalty and Consistency) Safety (Passengers, Employees, Environment) Social Responsibility (Welfare, Health, Education) Annual Report 2011 03 Majestic Places Pakistan is a rainbow of landscapes. From coastal beaches, lagoons and mangrove swamps to mighty deserts, desolate plateaus, fertile plains, dissected upland, high mountains with beautiful valleys, snow-covered peaks and eternal glaciers, the landscape leaves the beholder speechless. The landscape of Pakistan is divided into the North High Mountainous Region, the Western Low Mountainous Region, the Balochistan Plateau, the Potohar Uplands, the Punjab and the Sindh Plains. Hanna Lake Shangrila Trango Towers Aansoo Lake Elevation: 8,611 m (28,251 ft) Ranked: 2nd on Earth, 1st in Pakistan Prominence: 4,017 m (13,179 ft) Located: Pak-China Border Range: Karakoram First ascent: 31st July 1954 by Achille Compagnoni and Lino Lacedelli (Italy) First Pakistani to Ascent: Ashraf Aman on 9th August 1977 04 Annual Report 2011 Notice of 55th Annual General Meeting Notice is hereby given that 55th Annual General Meeting of the Shareholders of Pakistan International Airlines Corporation will be held at 10:00 A.M. on Saturday, May 26, 2012 at Pearl Continental Hotel, Club Road, Karachi to transact the following business: 1. To receive and adopt the Audited Accounts for the Financial Year ended December 31, 2011, the Report of the Auditors thereon, and the Report of the Directors. 2. To transact any other business with the permission of the Chair. By order of the Board Karachi Muhammad Shuaib May 04, 2012 Secretary –PIA Notes 1. The shares transfer books of the Corporation will remain closed from Tuesday, May 15, 2012 to Saturday, May 26, 2012 (both days inclusive). Transfer documents (Physical Scrip Transfers / CDS Transaction IDs) received in order at the office of PIA Share Registrar / Transfer Agent, Central Depository Company of Pakistan Limited, CDC House, 99-B, Block B, S.M.C.H.S. Main Shahrah-e-Faisal, Karachi, upto 05:00 PM, by Monday, May 14, 2012 will be in time for registration of transfer of shares. 2. A Shareholder entitled to attend and vote at the Meeting may appoint another shareholder as his/her proxy. Proxy and Power of Attorney, in order to be effective, must be deposited at the registered office of PIA Share Registrar / Transfer Agent alongwith copy of CNIC not less than 48 hours before the time fixed for holding the Meeting i.e. upto 10:00 A.M. Thursday, May 24, 2012 unless the Power of Attorney has already been registered in the Corporation books, and must be stamped, signed and witnessed. 3. Any individual Beneficial Owner of CDC, entitled to attend and vote at the Meeting, must bring his / her CNIC or Passport to authenticate his / her identity alongwith CDC Account Numbers. However, if proxy is granted by such a shareholder, the same shall also have to be accompanied with an attested copy of CNIC or Passport of the granter. Representatives of Corporate Shareholders should bring the usual documents required for such purpose. 4. Shareholders are requested to promptly notify changes, if any, in their registered mailing addresses and also for the consolidation of folio numbers if any shareholder holds more than one folio to PIA Share Registrar / Transfer Agent. Annual Report 2011 05 Majestic Voices The distinctive sound of the music of Pakistan is a result of the fusion of many diverse elements and many diverse cultures that dwelled on this land from time to time. Pakistan music has been heavily influenced by Sufis and Sufi traditions belonging to various parts of South Asia as well as Central Asia, Persia, Turkey and Arabia. The music of Pakistan continues to evolve by accepting positive elements of modern Western music. Pakistan has produced the likes of Nusrat Fateh Ali Khan, Madam Noor Jahan, Abida Parveen, Mehdi Hasan and Rahat Fateh Ali Khan, just to name a few. Yueqin Sitar Dhol Yaktaro 06 Annual Report 2011 Corporate Profile (as at April 30, 2012) Board of Directors Executive Management External Auditors Ch Ahmed Mukhtar Air Chief Marshal (Retd) Messrs A. F. Ferguson & Co Minister for Defence and Chairman - PIA Rao Qamar Suleman (Member firm PWC). Managing Director Ms Nargis Sethi Messrs M. Yousuf Adil Saleem & Co Federal Secretary Defence Mr M. Salim Sayani (Member firm Deloitte). Deputy Managing Director Air Chief Marshal (Retd) Rao Qamar Suleman Capt M. Junaid Yunus Managing Director - PIA Deputy Managing Director Special Projects & Charters Mr Husain Lawai Share Registrar Mr Nayyar Hayat Mr Abdul Wajid Rana Chief Financial Officer Central Depository Company of Federal Secretary Finance Pakistan Ltd. Shares Registrar Mr Mahmood Ahmed Department CDC House, Makhdum Syed Ahmad Mahmud Director - Airport Services 99 - B, Block-B Sindhi Muslim Cooperative Housing Society, Malik Nazir Ahmed Mr Irshad Ghani Main Shahrah-e-Faisal Director - Corporate Planning Karachi - 74400, Pakistan Mr Javed Akhtar Ph: Customer Support Services Mr Maqsood Ahmed (Toll Free) 0800 - CDCPL (23275) Syed Omar Sharif Bokhari Director - Engineering Fax: (92-21) 3432 6053 & Maintenance Email: [email protected] Khawaja Jalaluddin Roomi Website: www.cdcpakistan.com Capt Naveed Ahmed Aziz Mr Yousaf Waqar Director - Flight Operations Mr Muzaffar Talpur Director - Flight Services Mr Saleem Ahmed Officiating Director - HRA & Coordination Mr Sher Muhammad Jamali Director - Information Technology AVM Amin Ullah Khan Director - Precision Engineering Complex Head Office Mr Amanullah Qureshi Director - Procurement PIA Building. & Logistics Jinnah International Airport, Karachi - 75200, Pakistan. Mr S. Aijaz Mazhar UAN: 111-786-786 / 111-FLY-PIA Corporate Secretary Director Standards & Mr Muhammad Shuaib Special Projects www.piac.aero Annual Report 2011 07 DirectorsBoard of 08 Annual Report 2011 Annual Report 2011 09 DirectorsBoard of Ch Ahmed Mukhtar Ms Nargis Sethi Air Chief Marshal (Retd) Rao Qamar Suleman Chairman Director Managing Director Ch. Ahmed Mukhtar, the Federal Minister Ms Nargis Sethi, Federal Secretary Defence ACM(R) Rao Qamar Suleman is Managing for Defence, was nominated as Chairman is a nominated Director since January 2012. Director PIA since March 2012. He joined of the Corporation in May, 2008. He holds She holds post graduate degrees in Pakistan Air Force in 1972 and graduated in a Masters Degree in Operational International Relations from Karachi 1975. He had been a Fighter Pilot, a qualified Management from California, USA and also University; Defence Studies from Flying Instructor and has served as Instructor a Diploma in Plastic Technology from West Quaid-e-Azam University, Islamabad and Germany. He is presently a member of the Pilot in various training and operational Development Administration from USA. In National Assembly of Pakistan. He is an institutions of PAF. He has vast experience of addition to the position of Federal Secretary experienced businessman and had been command and staff assignments at various Defence, she is also Federal Secretary Member of the Board of Directors of Service tiers. He has commanded PAF from March Cabinet Division. Ms Sethi has been a Industries Ltd. He also served the nation as 2009 till March 2012, where he managed over Member Directing Staff at Civil Services Federal Minister for Commerce in early 90s. 600 aircraft, more than 80, 000 personnel and Academy, Lahore; Additional Secretary in Ch. Mukhtar is a perfect blend of a all other resources of PAF. He is a graduate of Prime Minister’s Secretariat; Federal businessman and a politician. PAF Air War College and the National Defence Secretary Health, Government of Pakistan; University. In recognition of his services, he and, first female Principal Secretary to the has been decorated with Tamgha-i-Imtiaz (M), Prime Minister of Pakistan. In recognition Sitara-i-Basalat, Sitara-i-Imitaz (M) and Hilal-i- of her public service, she has been conferred Imtiaz (M). ACM(R) Suleman is Chairman with Hilal-i-Imtiaz. Skyrooms (Pvt) Ltd, Member CAA Board and also member of PIA Board’s Finance Committee as well as HR Committee. Makhdum Syed Ahmad Mahmud Malik Nazir Ahmed Mr Javed Akhtar Director Director Director Makhdum Syed Ahmad Mahmud is a Mr Javed Akhtar is a nominated Director since Malik Nazir Ahmed is an elected Director since nominated Director since September, 2011.