The Directors submit their Report and Accounts for the year ended 30th June 2011.
Financial Results and Accounts
The results for the period 1.7.2010 to 30.6.2011 are given below:
| || |
| ||2011 ||2010 |
| ||(12 months) ||(15 months) |
|Sales & Other Income ||9.87 ||8.26 |
|Profit/(Loss) (before interest and depreciation) ||3.48 ||(0.88) |
|Depreciation ||0.29 ||0.36 |
|Profit/(Loss) (after interest and depreciation) ||3.19 ||(1.24) |
|Exceptional Items ||13.77 ||5.94 |
|Profit before tax ||16.96 ||4.70 |
In last year's Directors' Report reference had been made to the lead institution, theAsset Reconstruction Company of India Ltd, the lead bank, Standard Chartered Bank andState Bank of India for having extended support in convincing IFCI and IDBI to releasecharges upon acceptance of their settlement without interest on delayed payment ofcrystallized dues. It may be noted that the Scheme provides for no interest on paymentdelays to banks/financial institutions (FIs)-debenture holders (DHs) and in respect ofworkmen dues-settlements, as well. This made it possible for the amount of Rs. 7.0 Cr tobe placed by 31.3.2011 with the lead bank and lead Fl towards settlement of the consortiumbanks and FIs/DHs, respectively. Now that this has taken place, offers have been made tobanks/Fls-large DHs to avail of their full and final dues-settlement in a fixed timeframe. As this would be the last payment of the crystallized dues to be made to them, thebanks/FIs require to give a no dues certificate. This process will necessarily take sometime due to the various internal approvals which are necessitated in public sector banks.It is hoped that the in principle agreement with most of the consortium members would takeplace by end of this financial year, making it possible to make the full and finalsettlement payments in an agreed time frame thereafter.
The Production and Sales for the Mangalore Unit which had been affected in the initialmonths of the last 15-month financial year ended 30.6.2010 has stabilized. However, demandfrom customers of cine cans/photo-film outers remains sluggish.
As at the close of the period ending 30.6.2011 payments to the banks/ FIs-DHs amountedto approximately Rs. 36.2 Crores against the total quantum of Rs.48.8 Crores to be paid asat the end of the Scheme implementation period. The number of employees who have receivedtheir full and final settlement of dues aggregate to over 6,150 nos as at 30.6.2011 cf5,600 nos as at 30.6.2010. Payments for employee dues and settlement payments, includinggratuity-dues, over the 12-month period amounted to Rs. 2.4 Crores cf Rs. 4.2 Crores inthe previous 15-month period. The carried forward losses reduced from Rs. 45.9 Crores asat 30.6.2010, to Rs. 29.0 Crores as at 30.6.2011.
The observations in the Auditors' Report read with the relevant Notes to Accounts areself-explanatory.
Though the results for the period show a profit after tax of Rs. 16.96 Crores, thecumulative losses aggregate to Rs. 29.0 Crores. In view of the cumulative losses, theDirectors regret their inability to recommend any dividend.
Directors' Responsibility Statement
Pursuant to section 217 (2AA) of the Companies Act, 1956, the Board of Directors statethat:
In the preparation of annual accounts the applicable accounting standards have beenfollowed along with proper explanation relating to material departures.
The selected accounting policies have been applied consistently and judgments andestimates that are reasonable and prudent have been made, so as to give a true and fairview of the state of affairs of the Company as at 30th June 2011 and the profit/loss ofthe Company for the year ended on that date.
Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies (Amendment) Act, 2000.
The implementation of the Scheme continues in full force and workmen who have notavailed of their dues-settlement in terms of the provisions of the Sanctioned Scheme keepcoming forward to accept the same. There are some pockets of resistance from a smallsegment of workmen who are holding out and some workmen are taking recourse to litigativeapproaches. Their purpose is to try to build pressure to get more than what is provided inthe Sanctioned Scheme. But, there is a growing feeling that it would be best to resolvethe matter within the framework of the Scheme parameters/AAIFR Order dated 4.12.2007,updating the Sanctioned Scheme.
Progress has also been made on upgradation of the Mangalore Unit of the Company.Attention is drawn to the Technology Absorption sub-heading under the heading, Section217(1)(e) of the Companies Act, 1956.
The prospects for the Company's net worth turning positive are bright.
Section 217 (1)(e) of the Companies Act. 1956
As required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies(Disclosure of Particulars in the Report of Board of Directors) Rules 1988, the relevantinformation is given hereunder:
Conservation of Energy: Energy conservation in the Company's locations/set-upscontinues to be pursued.
Technology Absorption: Some capital investment for upgradation of facilities andincreasing volumes for tinplate packaging have been made at the Mangalore Unit. As thebanks/DHs-FIs take their full and final settlement of their crystallized dues in terms ofthe Sanctioned
Scheme, and as the number of employees who have availed of their dues-settlementsapproaches 7,000 nos, these aspects will be further pursued.
Mr M. Simmons retires by rotation and being eligible offers himself for re-appointment.
Mr D. K. Chakravorty retires by rotation and being eligible offers himself forre-appointment.
Particulars of Employees
The provisions of Companies (Disclosure of Particulars in the reports of the Board ofDirectors) Rules 1988, were not applicable to the Company during the year. There was noemployee in respect of which particulars under Section 217 (2A) of the Companies Act 1956,are required to be given.
Messrs Haribhakti & Co, Chartered Accountants, have expressed that they would notbe offering themselves for reappointment as Auditors at the Annual General Meeting to beheld on 27th December 2011.
There is a proposal to appoint Messrs S. Jaykishan, Chartered Accountants as theAuditors of the Company at the Annual General Meeting on 27th December 2011. Messrs S.Jaykishan, Chartered Accountants have indicated their willingness to act as Auditors ofCompany. The Board of Directors recommned their appointment as Auditors.
We would like to thank Messrs Haribhakti & Co, the outgoing Auditors, for theirvaluable services rendered to the Company during their long association spanning 15 years.
| ||for and on behalf of the Board |
|New Delhi ||V. Krishna |
|2nd December 2011 ||Chairman |