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CABOT INDIA LIMITED
ANNUAL REPORT 2010-2011
MANAGEMENT DISCUSSION AND ANALYSIS
FINANCIAL RESULTS: (Rupees in lakhs)
Oct. 2009 to Oct. 2008 to
March 2011 Sept. 2009
Sales & Other Income 227,34.98 237,78.46
Operating Profit/(Loss) (Before
Interest, Depreciation & Tax) (41,06.85) (21,32.20)
Less/(Add):
(i) Financial Charges (8,25.36) (9,53.13)
(ii) Depreciation & Amortization (64,17.76) (9,16.66)
Profit/(Loss) Before Taxation (113,49.97) (40,02.00)
(Provision)/Deferred Tax credit - 6.03
Profit/(Loss) After Taxation (113,49.97) (40,08.03)
(Loss)/Surplus brought forward (77,98.31) (37,90.28)
(Loss) carried to Balance Sheet (191,48.28) (77,98.31)
REVIEW OF OPERATIONS:
During the period under review, production was stopped at Thane Plant in
line with the resolution adopted at the EGM on May 14th, 2010.
All the workmen at the Thane Plant have separated under the VRS scheme
offered post the decision to cease manufacturing. A few members of the
management staff are still engaged in the decommissioning operations, to
ensure compliance with the requirements of applicable laws.
The Company has started importing Carbon Black from overseas, to service
some key segments of the market during the year. The country has seen
strong growth in the IP, inks and plastic segments which value high quality
carbon black. Over a period, it is expected that reasonable profits can be
made via selling into these segments. The Company has made a start and
understanding of the logistics of this trade has been established and
customer acceptance of servicing via imports has now begun.
SAFETY, HEALTH & ENVIRONMENT:
Cabot accords top priority to Safety, Health and Environmental issues. The
Cabot Safety Health and Environmental Standards are applicable across Cabot
facilities worldwide and its S H & E program covers all employees and
contractors working at every site. In keeping with the excellent record
established with the local Regulatory authorities, Cabot S H & E standards
are being diligently followed during the present de-commissioning
activities at the Thane Plant.
HUMAN RESOURCE AND PARTICULARS OF EMPLOYEES:
The Directors wish to place on record their appreciation and recognition of
the wholehearted support and co-operation extended by the ex-employees at
all levels of the organization and the efforts put in by them to ensure a
smooth and safe stoppage of manufacturing operations. The Directors also
thank the current employees for their continuing support.
Information as per Section 217(2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules, 1975 forms part of this report.
FUTURE OUTLOOK:
In the short-term, dismantling and clearing of the Thane site, is
scheduled. This activity is expected to be completed over the next two
years.
At the moment, sales via imports are small and constrained due to limited
availability of product in overseas manufacturing plants. However, it is
expected that greater volume will be available to be imported into India
once new capacity announced by Cabot in China and Indonesia becomes
available. These capacities will come into place at different stages over
the next 18-24 months. In the meantime, company is continuing to work with
potential customers on market assessment and technical qualification. This
work with customers is planned to be converted to future sales when
adequate supplies become available.
The strong automotive growth in India is likely to continue. It is expected
that a profitable business will be built overtime with high quality Cabot
products.
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