KARACHI, Oct 14: The General Tyre and Rubber Company of Pakistan Limited confirmed early this month that the company had executed a 7-year Technical Service Agreement with Continental Tire North America Inc. (CTNA), USA.

The agreement that allows the company to continue using CTNA’s trade marks: “General”, “General Tire” and the big “G” logo as a licensee, sets at rest apprehensions by some market quarters on whether the TSA would be renewed or not.

The Board of directors of General Tyre, which met on September 24 also approved the accounts for the year ended June 30, 2002, proposing to pay final cash dividend at 30 per cent, which together with the interim at 20 per cent already disbursed, would make the total cash payout at 50 per cent for the year. The board also approved bonus shares at 250 per cent (2.5 shares for each share) held by the members on November 11.

For this purpose, a resolution would be passed at the shareholders’ annual general meeting (AGM) scheduled to be held on November 20 at Karachi, to “capitalize a sum of Rs426.9 million out of capital reserve, revenue reserve and unappropriated profit brought forward as on June 30, 2002”. The meeting would also consider the increase in authorized capital from Rs300 to Rs750 million.

The operating results for the year ended June 30, 2002 reflected marginal decrease in sales volume, from 812,543 tyres sold in 2001, to sale of 804,749 tyres during financial year 2002. During the year, the General Tyre plant was stated to have produced total number of 817,545 tyres, which was stated to be the highest number of units produced in any year.

Turnover for the year decreased by 4 per cent to Rs2,257 million, from Rs2,348 million in 2001, drop in sales attributable to lower sales of rear tractor tyres which was 20pc down from last year in line with the reduction of 25 per cent in production of tractors by the OEMS. “This was primarily due to reduced funding provided to farmers by the Agricultural Development Bank of Pakistan (ADBP) for purchase of tractors”, the company stated. It said that the drop in sales of tractor tyres was compensated to a large extent by increased sale of light truck and truck/bus tyres.