Directors
To the Members,
Crew B.O.S. Products Limited
Your Directors have pleasure in presenting this Twenty-Fourth Annual Report and Audited
Accounts for the financial year ended 31st March, 2013.
FINANCIAL RESULTS
(Rs. In Lacs)
| Particulars |
Year ended March 31, |
Year ended March 31, |
|
2013 ( Rs. ) |
2012 ( Rs. ) |
| Net Sales /Income from operations |
26,794.99 |
42,742.39 |
| Other Income |
209.04 |
52.28 |
| Total Revenue |
27,004.03 |
42,794.67 |
| Total Expenses |
35,057.07 |
41,789.77 |
| Profit/(Loss) from operations before exceptional and Extraordinary items and tax |
(8,053.05) |
1004.90 |
| Exceptional Items prior period Expenses |
260.17 |
143.03 |
| Profit/(Loss) before Extraordinary items and tax |
(8,313.22) |
861.87 |
| Extraordinary items |
(13,697.10) |
(213.53) |
| Profit/(Loss) before tax |
(22,010.32) |
648.35 |
| Tax Expenses |
|
|
| 1. Current Tax |
- |
205.00 |
| 2. Income Tax for previous years |
464.11 |
- |
| 3. Deferred Tax |
(1856.08) |
(77.00) |
| Net Profit/(Loss) after Tax |
(20,618.36) |
520.35 |
| Net Profit/(Loss) for the period |
(20,618.36) |
520.35 |
PERFORMANCE REVIEW
Since the onset of the global meltdown, we have all been expecting a turnaround in the
global economy. It has become a continual wait. There are definitely some signs of the
global economic recovery in certain quarters with the US economy showing signs of growth;
as against that, the EU is yet to come back on track with the GDP still in the negative
zone. Indian Economy continues to oscillate over policy issues. Investment climate is
still a challenge with credit availability and cost of capital adversely impacting new
project build rate.
FY12-13 was a year in which Crew B.O.S. was trying to consolidate its business into
more efficient, productive factories. During the year we continued to expand our
capacities in hand bags and shoes. Crew B.O.S. is forging long term and strategic
relationships with customers to best utilize the capacities it has created. However, an
increase in the total expenditure (with increased interest costs, finance charges, higher
depreciation and staff and other costs going up) affected net profits during the year
under review. Your Company is confident of increasing its business during the current
fiscal and steps taken in the form of consolidations plans encompassing the high adherence
to world class quality standards shall contribute in realizing its aspirations. The
present year has had its share of misfortune in the international trade and your company
suffered heavily due to non realization of debts from exports /domestic trades due to the
economic downturn in the Global economy. Coupled with this the company was led to believe
by its senior financial head to enter into very ambitious transactions which led to
quantum losses and devastating financial collapse. The company had no options but to
accept these losses in its overseas business and in its subsidiaries. The company had to
take far reaching and urgent measures by removing the Chief Financial Officer and have
started serious investigation into the frauds and misappropriation in such dealing. The
matter is being investigated by the law enforcement authorities of the country. In spite
of these drastic setbacks your company is confident that the inherent robustness and
corrective actions will pave the path of recovery though slow.
The Net Loss after tax is Rs. 20, 618.37 Lakhs during the year as against the Net
profit after tax of Rs. 520.32 Lakhs in the previous financial year.
DIVIDEND
As the Company has continued to incur heavy losses in the last financial year due to
adverse factors as stated above, hence the board of directors does not recommend any
dividend for the financial year ended on 31st March 2013.
REFERENCE TO B.I.F.R.
Section 15(1) of the Sick Industrial Companies (Special Provisions)Act, 1985 provides
that where an Industrial Company has become a Sick Industrial Company, the Board of
Directors of the Company, shall, within 60 days from the date of finalization of the duly
audited accounts of the Company for the financial year as at the end of which the company
has became Sick Industrial Company, make a reference to the Board for Industrial and
Financial Reconstruction (BIFR) for determination of measures which shall be adopted with
respect to the Company.
The loss of the company for the financial year ended 31st March, 2013 have resulted in
erosion of entire Net Worth of company and the company is to make a reference to Board for
Industrial and Financial Reconstruction (BIFR).
The main reasons for the loss are as under.
1. Debts/Receivable/Sales:- Due to misfortune in the international trade,
company suffered heavily due to non realization of debts from exports/domestics trades due
to economic downturn in the Global Economy. Coupled with this company was led to believe
by its financial head to enter into very ambitious transactions which led to quantum
losses and resulting in devastating financial collapse and with no option for the company
but to accept these losses in its overseas business and it its subsidiaries. Further the
company had taken far reaching and urgent measures by removing the Chief Financial Officer
and has started serious investigation into the frauds and misappropriation in such
dealings. The company has also started legal cases and against those overseas parties
against whom amounts are pending/due.
2. Loss on Inventories:- Written-off/disposal of the obsolete and rejected
WIP/Finished Goods due to (a) cancellation and delay of lifting ordered quantity due
economic slowdown. (b) large scale rejection by foreign buyers on pretext of bad
workmanship and quality factors. (c) change of fashion by European buyers in the past for
which large stock holding of finished products were retained in the hope of alternate
buyers at cheaper prices. These stocks later became hazardous to store and were required
to be destroyed and burnt. Company had to take a huge decision in destroying these stocks
as they became pollution and health hazard problem. (d) Market value of saleable items
tailor made to customers’ requirements and had to be valued at prices less than cost
there was substantial loss on this account. In totality losses on stock had to be
corrected as otherwise the accounts would not reflect true and correct view, The Company
has taken the assistance of the Chartered Engineer to value of the stock at realistic
values.
3. Substantial Operating loss:- There was substantial fall in Net Income from
operation turnover in current year with tune of Rs. 159.47 crore which is 37.31% as
compared to previous year figure. As such there was substantial operating loss in the
current year.
4. Delay in execution of orders in hand:- On account of the uncertainty and
delayed payments, the suppliers were not willing to provide credit or accept letter of
credits for fear of default. This is turn resulted in customer order getting delayed and
even getting cancelled. Due to delay in completion of order, shipments were not lifted
thus reducing into operational loss in the current year.
5. Loss on account of foreign exchange fluctuation:- Due to adverse foreign
currency fluctuation, company incurred huge losses in forward and derivative contracts.
Similarly there has been increase in prices of imported raw material resulting a reduction
in gross margin
6. Increase burden of finance cost:- To curb rising prices, the Reserve Bank of
India has lifted interest rates, caused affecting the company’s overall
profitability. Due to this high interest cost wherein due to limited price elasticity, it
was not possible to pass the higher cost to buyers thus it has increasingly becoming
difficult to sustain company operations at present cost of capital.
DIRECTORS
Mr. Gautam Nair, Independent Director of the Company has resigned from the post of
Directorship and approve the same by Board of Directors of the Company during the year.
CAPITAL STRUCTURE
Authorised Capital
During the year there is no change in the authorised capital of the Company, hence it
remains the same i.e. INR 30 Crores.
Paid Up Capital
During the year there is no change in the Paid Up capital of the Company, hence it
remains the same i.e. INR 139934670/- comprising of 13993467 equity shares of Rs.
10/- each
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors to the best of
their knowledge and belief confirm that:
(a) In the preparation of the annual accounts for the year ended 31st March, 2013, the
applicable accounting standards have been followed along with proper explanation;
(b) Prudent accounting policies have been selected and have made judgements and
estimates that are reasonable and prudent so as to give true and fair view of the state of
affairs of the Company as at 31st March, 2013 and of the Profit of the Company for the
financial year ended 31st March, 2013;
(c) Proper and sufficient care has been taken for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 1956, for
safeguarding the assets of the company and for preventing and detecting fraud and other
irregularities;
(d) Annual accounts have been prepared on a going concern basis.
AUDITORS & AUDITOR’S OBSERVATION
M/s. Anil K. Goyal & Associates, Chartered Accountants, New Delhi Statutory
auditors of the Company have communicated that they do not wish to offer themselves for
reappointment at the conclusion of their present term of appointment, at the ensuing
Annual General Meeting of the Company, which has been accepted by the Board of Directors
of the Company.
Further, the Company has received consent letter from Mr. Atish Kumar Shaw, Chartered
Accountant indicating his willingness to serve as the statutory auditor of the Company, if
appointed at the ensuing Annual General Meeting. They have confirmed that if he is
appointed as the Statutory Auditor of the Company, his appointment will be in accordance
with the limits specified u/s 224(1B) of the Companies Act, 1956.
The Board recommends the appointment of Mr. Atish Kumar Shaw, Chartered Accountant as
the Statutory Auditor of the Company.
The Board recommends the ordinary resolution set forth at item no 3 of the notice for
the approval of the members.
The observation of the Auditors in the Auditors’ Report is explained, wherever
necessary, in the appropriate notes to the accounts.
CORPORATE GOVERNANCE
As required by Clause – 49 of the Listing Agreement, a Report on Corporate
Governance along with Certificate on Corporate Governance confirming compliances with the
conditions of Corporate Governance obtained from the Practicing Company Secretary is
annexed to this Report. (Annexure-1)
MANAGEMENT DISCUSSION & ANALYSIS
The Report as required by Clause-49 of the Listing Agreement is annexed herewith.
(Annexure-2)
LISTING AT STOCK EXCHANGE
The Equity Shares of the Company continues to be listed on Bombay Stock Exchange
Limited and The National Stock Exchange of India Limited. Global Depository Receipts are
listed on the Stock Exchange at Luxembourg. The Annual Listing Fees for the financial year
2013-14 have been paid to the Stock Exchanges.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
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
Information in accordance with the provisions of section 217 (1) (e) of the Companies
Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 regarding conservation of Energy, technology absorption, foreign
exchange earnings and outgo is given in the ‘Annexure A’ forming part of this
report.
SUBSIDIARY COMPANIES
VOGUE HOME PRODUCTS LIMITED
Vogue Home Products Limited, wholly owned subsidiary of Crew B.O.S. Products Limited is
engaged in manufacture and export of home furnishing and small leather goods.
CREW B.O.S. ENTERPRISES LIMITED
This is a wholly owned subsidiary of Crew B.O.S. Products Limited, carrying on the
business of creative and stylish designing of lifestyle products, wearing apparels made of
leather or non leather, consumer products, cosmetics, artificial furniture, beauty
products and designer goods and furnishing.
EMPORIO B.O.S. DESIGN LIMITED
A wholly owned subsidiary of Crew B.O.S. Products Limited, with the main objects of
carrying on the business of creative and stylish designing of lifestyle products, wearing
apparels made of leather or non leather, consumer products, cosmetics, artificial
furniture, beauty products and designer goods and furnishing.
CREW ROR PRODUCTS LIMITED
Incorporated as a wholly owned subsidiary of Crew B.O.S. Products Limited with the main
objects of carrying on the business of manufacturing and trading including import and
export of all kinds of fashion accessories made from leather, wood, metal, poly-urythene
and fabrics including leather bags, portfolios, travel bags, shoes, wallets, leather
garments and belts of all kinds, wearing apparel of leather and fabric, garments, textile,
furniture.
CREW REPUBLICA RETAIL LIMITED
Incorporated as a subsidiary of Crew B.O.S. Products Limited with the main objects to
establish/manage/carry retail business or trade in India through retail outlets, showrooms
for retailing in house manufactured leather goods and apparels as well as manufactured by
other popular brands.
CREW P.P.O LEATHERS LIMITED
Incorporated as a wholly owned subsidiary of Crew B.O.S. Products Limited with the main
objects to carry on the manufacturing of leather products and accessories
CREW MAG EXPORTS LIMITED
Crew MAG Exports Ltd. is a subsidiary of the Crew B.O.S. Products Limited and it is
engaged in the manufacturing of leather footwear.
I.BIZ TRADE POST
The wholly owned subsidiary incorporated in Mauritius is engaged in International
trading.
ALCHEMY TRADE POST
The wholly owned subsidiary incorporated in Mauritius is engaged in International
trading.
CREW B.O.S. PRODUCTS (INT) PTE LIMITED
The wholly owned subsidiary incorporated in Singapore is engaged in International
trading.
I. CONECT TRADE POST
The wholly owned subsidiary incorporated in Mauritius is engaged in International
trading.
JOINT VENTURE COMPANIES
CENTRE OF EXCELLENCE IN DESIGN LIMITED
Centre of Excellence in Design Limited is a joint venture between the Crew B.O.S.
Products Limited and Matrix Clothing Pvt Ltd. The object of the Company is to carry on the
business of creative and stylish designing of lifestyle products, retailing, processing,
assembling and crafting all type of apparel and wearing apparels made from all type of
leather and non leather materials.
PUBLIC DEPOSIT
The Company has neither invited/nor accepted any deposits during the year within the
meaning of Section
58A of the Companies Act, 1956, read with Companies (Acceptance of Deposit) Rules,
1975.
CONSOLIDATED FINANCIALS
As required by Accounting Standard-21 on Consolidation of Financial Statements,
Consolidated Financial Statements and Cash Flow Statement are appended.
PARTICULARS OF EMPLOYEES
During the year under review no employee, whether employed whole or part of the year,
was drawing remuneration exceeding the limits as laid down under Section 217(2A) of the
Companies act,1956 read with Companies (Particulars of Employees)Amendment Rules,2011
ACKNOWLEDGEMENTS
Your Directors place on record their deep sense of appreciation for the contribution of
employees at all levels and for the support from our valued customers, bankers and
financial institutions, business associates, shareholders, suppliers and other statutory
authorities.
For and on behalf of the Board
| Sd/- |
Sd/- |
| Tarun Oberoi |
Robin Bartholomew |
| (Managing Director) |
(Director) |
Place : Gurgaon
Date : 30/09/2013
ANNEXURE TO DIRECTORS’ REPORT Annexure-A
PARTICULARS REQUIRED UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF
BOARD OF DIRECTORS) RULES, 1988
1. CONSERVATION OF ENERGY
A. ENERGY CONSERVATION MEASURES TAKEN
The manufacturing operations of the Company are not energy intensive and do not consume
high level of power, however the Company has undertaken appropriate steps to conserve the
energy thereby enhancing energy conservation. These are:
1. Replacement of Copper chokes with Electronic blasts.
2. Installation of switches on each table so as to ensure that light is switched on as
per requirement.
3. Installation of Power Factor panel so as to achieve UNITY power factor.
4. Introducing concept of task lighting vis--vis ambient lighting.
B. ADDITIONAL INVESTMENT AND PROPOSAL, IF ANY, BEING IMPLEMENTED FOR REDUCTION OF
CONSUMPTION OF ENERGY-
C. IMPACT OF ABOVE MEASURES
Implementation of Energy Conservation measures have resulted-
1. In reduction of energy cost and thereby production cost.
2. In the increase of awareness in the employees.
3. Reduction of Carbon footprints
FORM’A’
Form for Disclosure of Particulars with respect to Conservation of Energy:
POWER AND FUEL CONSUMPTION
| Particulars |
|
Current Year |
Previous Year |
|
|
31.3.2013 |
31.3.2012 |
| 1. Electricity |
|
|
|
| (a) Purchased from Electricity Board |
|
|
|
| Total Units |
|
2220297 |
2184419 |
| Total Amount |
(Rs.) |
15209034.45 |
1,37,40,000 |
| Rate per unit (Rs./units) |
|
6.85 |
6.29 |
| (b) Own Generation |
|
|
|
| HSD/F.Oil/LSHS & LDO(Ltrs) |
|
170836 |
199009 |
| Cost of HSD/F.Oil/LSHS & LDO |
(Rs.) |
7993416.44 |
80,40,000 |
| Rate per ltr |
|
46.79 |
40.4 |
| 2. Furnance Oils/LSHS/LDO/HSD Qty.(Ltrs.) |
|
|
|
| Total Amount |
(Rs.) |
21600 |
21,600 |
| Total Quantity(Ltrs) |
|
210 |
210 |
| Average Rate(Rs./Ltrs) |
|
102.85 |
102.85 |
FORM ‘B’
Form for Disclosure of Particulars with respect to:
A) RESEARCH AND DEVELOPMENT (R & D)
Company has been giving thrust on R & D activities in the following areas:
1. New Product innovations
2. Increased efficiencies
3. Energy conservation
4. Improving yields
5. Improving quality
B) BENEFITS DERIVED AS THE RESULT OF THE ABOVE (R&D)
Increasing productivity and addition to value added products for better products
quality and process efficiency to the stakeholder’s satisfaction.
C) FUTURE PLAN OF ACTION
Steps are continuously taken for upgradation of technology which results in lower
costs, improvement of production yields and improvement in quality.
D) EXPENDITURE ON R&D
No specific account is kept.
2. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
Efforts in brief made towards technology absorption, adaptation and innovation
Company uses latest Technology to keep the manufacturing process more automated to
upgrade itself to the pertinent development as they occur.
Benefits derived as result of the above efforts.
Benefits derived from these efforts are improved product quality and higher
efficiencies.
3. Foreign Exchange earnings and outgo
a) Export initiatives, development of new export markets for products and export plans
The Company’s products continue to be well recognized and accepted in the
international market due to its exclusive superiority and diversified array. The Company
is continuously pursuing its proposals dynamically to further augment its existence in the
overseas market through tapping new customers and new markets. Going forward the Company
intends to keep its focus on finest leather products across the established markets., The
Company would continue to emphasis on giving customized service and its commitment to
excellence.
b) Foreign Exchange Earning (on FOB basis) and Outgo
Rs./Million
| Particulars |
2012-2013 |
2011-12 |
| Earning |
1752.25 |
3035.07 |
| Outgo |
812.80 |
1618.77 |
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