gunnebo india pvt ltd Directors report

GUNNEBO INDIA LIMITED (FORMERLY KNOWN AS STEELAGE INDUSTRIES LIMITED) ANNUAL REPORT 2008-2009 DIRECTORS REPORT TO THE SHAREHOLDERS Your Directors present the Seventy-Seventh Report of the Company together with the Statements of Audited Accounts for the year ended 31st March 2009. FINANCIAL RESULTS: Year ended Year ended 31.03.2009 31.03.2008 12 months 9 months Rupees Rupees Profit before Depreciation, 83,785,827 47.094,591 Interest, Taxation & Extraordinary Items Less: Depreciation 21,234,869 15,118,642 Interest/Finance Charges 19,712,558 28,796,160 Profit/(Loss) before tax 42,838,400 3,179,787 Less/(Add): Provision for Tax 4,700,000 10,926,651 Fringe Benefit Tax 2,258,879 2,500,000 Profit (Loss) after tax 35,879,521 (10,246,862) Loss brought forward from (379,962,455) (369,715,593) previous year Profit (Loss) carried to Balance (344,082,934) (379,962,455) Sheet DIVIDEND: In view of the accumulated losses for the year, the Directors regret their inability to recommend any dividend. PERFORMANCE REVIEW: In the year under review, the Company achieved a turnover of Rs. 116.7 crore which compares favourably against the previous (9 months) period turnover of Rs. 79.4 crore. Profit before Tax of Rs. 4.3 crore for the year is a significant improvement over the corresponding figure of Rs. 0.3 crore in the previous (9 months) period. The improvement in Profit is attributable to higher volumes and realization, cost efficiencies achieved out of restructuring carried out over the past few years and lower interest cost. AMALGAMATION WITH THE SUBSIDIARY COMPANY: The Company has proposed a Scheme of Arrangement for amalgamation of Security Equipment Manufactures Limited a wholly owned subsidiary, with the Company and the purchase and cancellation of Equity Shares from Specified Shareholders. The said Scheme has been approved by the Shareholders of the Company on 29th April 2009 as per directions of the Honble High Court Bombay and meeting of shareholders and creditors were dispensed with by the Honble High Court of Gujarat. The said Scheme has been approved by the Honble High Court Bombay vide its order dated 3rd July 2009. The Scheme is now pending before the Honble High Court of uujarat for approval. BUSINESS OUTLOOK: Improvement in performance if your Company will depend heavily on strong demand from the Banking segment for physical security products. Uncertainties in some key sectors like Real Estate and Infrastructure remains an area of concern. However, the governments thrust on growth particularly in these sectors is expected to have a favorable impact. The Company will continue its efforts to improve performance by focusing on achieving efficiencies in cost , process and working capital. DIRECTORS RESPONSIBILITY STATEMENT: In accordance with the provisions of Section 217 (2AA) of the Companies Act, 1956, your Directors confirm that: In preparation of the annual accounts, the applicable accounting standards had been followed and there is no material departure from them. The Directors have selected such accounting policies and applied them consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period. The Directors have taken proper and sufficient care 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 frauds and other irregularities. The Directors have prepared the annual accounts on a going concern basis. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: Information on energy conservation, technology absorption and foreign earnings and outgo is annexed herewith as Annexure-1. HUMAN RESOURCES DEVELOPMENT: Relationship with employees remained cordial during the year. A statement containing the particulars of employees as required under Section 217 (2A) of the Companies Act, 1956 is given in Annexure 2 SUBSIDIARY: As required under Section 212 of the Companies Act, 1956, the Statement of Accounts, the Reports of the Board of Directors and Auditors of Security Equipment Manufacturers Limited for the year ended 31st December 2008 are annexed herewith. DIRECTORS: Mr. Dhananjay Sowani has resigned as Director of the Company with effect from 16.10.2008. The Board places on record its sincere appreciation for the valuable services rendered by Mr. Dhananjay Sowani during his tenure as Director of the Company. In accordance with the Articles of Association of the Company, Mr. Sacha de La Noe retires by rotation and, being eligible, offers him self for re- appointment. FIXED DEPOSITS: The Company did not accept any fresh public deposits during the year. During the year under review the Company has transferred Rs. 124,000/- to Investor Education and Protection Fund, being the amount of Fixed Deposits unclaimed for 7 years from the date of maturity of the fixed deposit. AUDITORS: M/s. Deloitte Haskins & Sells, Chartered Accountants, who were appointed as Auditors of the Company and who retire at the conclusion of the ensuing Annual General Meeting of the Company and being eligible offer themselves for reappointment. EXPLANATION TO THE QUALIFICATION IN THE AUDITORS REPORT: With reference to point 4(a) of the Auditors Report, the Company had already applied to the Central Government for their approval as required. The approval of the Central Government is awaited. The Company will be obtaining approval of the shareholders in the ensuing Annual General Meeting of the Company. With reference to point 4(b) of the Auditors Report please refer to Schedule N clause 18(d) forming part of Profit & Loss account for the year ended 31st March, 2009 annexed thereto. OTHER DISCLOSURES: There was no buy back of Companys shares during the financial year under review in terms of the provisions of section 77A (4) of the Companies Act, 1956. There are no material changes and commitments, affecting the financial position of the Company which has occurred between the end of the financial year of the Company to which the Balance Sheet relates and the date of this report. ACKNOWLEDGMENT: Your Board sincerely thanks the Bankers for their continuing co-operation and assistance. The Board of Directors wish to place on record its appreciation of the assistance, support and co-operation extended by the employees at all levels and business associates. FOR AND ON BEHALF OF THE BOARD OF DIRECTORS WILLIAM MOUAT CHAIRMAN Place: Bangalore Date : 27th August 2009 ANNEXURE I TO DIRECTORS REPORT INFORMATION IN ACCORDANCE WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 CONSERVATION OF ENERGY: Energy conservation is a key priority of the Company, although its operations are not energy intensive. Some of the key energy conservation steps taken during the year are: 1. Synchronized operation of compressors during peak load demand and use only one compressor during off peak load. 2. Provision of Air blow Guns for Machine cleaning in place of open air point to regulate the air consumption. 3. Installation of special lighting transformers to reduce lighting feeder voltage to 215V on plant lighting , office lighting and street lighting feeders; to save energy and also increasing life of lamps. FOR AND ON BEHALF OF THE BOARD OF DIRECTORS WILLIAM MOUAT CHAIRMAN Place: Bangalore Date : 27th August 2009