Jan-07- 13, 2002

A performance oriented company

Fauji Fertilizer Company Limited (FFC), the largest urea manufacturer in the country, was incorporated on May 08,1978 as a joint venture between Fauji Foundation, Pakistan and M/s Haldor Topsoe A/S of Denmark. It was established to fill the projected gap in demand and indigenous production. Company shares are held by Fauji Foundation (43%) and various investment companies, financial institutions and individuals.

The Company was listed on Karachi and Lahore Stock Exchanges in 1991 and on Islamabad Stock Exchange in 1992. Company employees were also allotted shares for motivation and promoting a sense of participation. Based on related criteria of Karachi Stock Exchange, primarily quantum of dividend payout, FFC has been placed in the list of top 25 companies of Pakistan consecutively for seven years since 1994, topping the list in 1997.

FFC has many landmarks to its credit. Since commencement of its commercial production in mid June 1982 till December 2000, the Company has sold 22.89 million tons of fertilizers. This includes 17.79 million tons of Sona urea and 0.52 million tons Sona DAP in the domestic market and 0.39 million tons urea exports to China, Iran, Philippines, India, Bangladesh, Sri Lanka, Thailand and Tanzania. The remaining 4.19 million tons include imported fertilizers i.e. urea, DAP, NP, etc. Presently, it is marketing over 2 million tons of fertilizers annually and holds 44% share of the urea market. It has saved the country around US $ 3 billion through import substitution and contributed almost Rs. 30 billion to the Government by way of taxes, levies, custom duties, excise duty/ surcharge on gas purchases besides providing employment to hundreds of individuals.

FFC together with Fauji Foundation from Pakistan and Jordan Phosphate Mines Company from Jordan sponsored the establishment of a urea/ DAP complex at Port Qasim, Karachi. FFC-Jordan Fertilizer Company Limited (FJFC) was incorporated in November 1993 as a public limited company. FFC's shareholding is 30% of the paid up capital of FJFC. Under an agreement FFC is marketing the entire production of FJFC under its own brand name Sona.

FFC has progressed well from its inception till to-date. Three projects in a span of less than 20 years have been set up each incurring over US$ 300 million is a performance record unparalleled in the country. Building on its foundations the Company is confident to take on new challenges. FFC's vision for the 21st century is diversification and establishing projects beyond the territorial limits of the country in collaboration with world famous international industrial holdings.

The manufacturing facilities, located in Goth Machhi near Sadiqabad in Rahimyar Khan consist of two ammonia/ urea plants with a designed production capacity of 1.33 million tons of urea based on natural gas from Mari Gas Fields.

Over the years, the plants have demonstrated operational excellence which serves as a reference for the related process technology engineering concerns. Delegations from China, Middle East and Far East have visited the Plant site to acquire knowledge for their investment decisions.

Product quality is accorded high priority and ISO-9002 certification confirms the excellent operational and maintenance skills of the employees and their level of performance.

Great emphasis is placed on safe operations. Many awards of honour from National Safety Council, U.S.A. reflect strict compliance of plant safety standards.

FFC commenced marketing operations in April 1979 with a pre-production programme called the Seeding Programme. With the commencement of commercial production in June 1982, FFC launched its product under the brand name "SONA". Since inception, a growth oriented marketing strategy has been adopted keeping in view future expansions. FFC operates in all the four provinces of the country and Azad Kashmir. The marketing area has been divided into 3 sales zones, 11 sales regions and 61 sales districts with a network of over 3,000 well trained dealers. This network is spread over 1400 locations. Due to seasonality of fertilizer consumption, the Company has established a network of 120 field warehouses to meet its storage requirements. Company's sales activities are well supported by planning, distribution and warehousing, advertising and sales promotion, finance, administrative and farm agronomic services.

From the very beginning FFC was able to meet the challenges. It was able to market its entire production and capture the desired market share. Sona urea was accepted by the farming community and Sona brand was established as a premium brand. With the start-up of its plant, the country became not only self sufficient but also surplus in urea. FFC exported urea to many countries from 1983-86. However, when local demand again exceeded production in 1986 the country again started importing urea. FFC once again came forward and put-up another urea manufacturing facility at Goth Machhi to meet the growing demand. The new plant commenced commercial production in March 1993.

The Government of Pakistan deregulated the trade and prices of phosphatic fertilizers in Aug 1993. Subsequent to this decision FFC started self imports of these fertilizers and as a result timely imports were arranged. Farmers were provided quality product in bags with guaranteed correct weight. This brought a very positive qualitative change in the phosphatic fertilizer business.

FFC believes in selling a programme rather than just products. To this end, the Company has adopted a customer oriented strategy by marketing quality products backed by efficient and effective support services with emphasis on developing the market through practical and innovative farmer education. Farmer Advisory Service with well qualified agronomists was established by the Company in 1981, a year before the commencement of commercial production. This free of cost and on the spot service to the farmers is provided in the form of crop demonstrations, field days, farmer meetings, group discussions, farm visits and distribution of technical literature in Urdu/ Sindhi on important crops. The farmers are also provided highly subsidized soil/ water testing facilities through three laboratories equipped with the state of art equipment and computerized recommendation systems. The Company pursues an innovative education oriented advertising policy utilizing electronic/ print media and roadside advertising. Radio commercials are developed in regional languages.

FFC has conducted four international seminars on core agricultural issues. Through these seminars which were attended by various local and foreign luminaries, special recommendations were developed to address the issues and enhance agri. production.

Fauji Fertilizer Company Ltd. remains committed to continue to play its role in the development of agriculture in Pakistan by not only supplying high quality fertilizers but also technical services to the farmers in the years to come for improving agricultural productivity and increasing their income.