Glory Films Ltd Directors Report

To The Shareholders, GLORY FILMS LIMITED

Your Directors are pleased to present the 16th Annual Report and the Audited Statements of Accounts for the year ended 31st March, 2013, and the Auditors Report thereon.

Financial Results

Financial results of the Company for the year under review along with the figures for previous year are as follows:

		(Rs in Lacs)
Particulars	2012-2013	2011-2012
Total Income	7,723.24	13,175.72
Total Expenditure	7,869.58	11,605.65
Profit / (Loss) before Interest, Depreciation & Tax	(146.34)	1,570.07
Depreciation	1,431.62	1,432.19
Interest & Financial Charges	651.53	2,134.40
Loss Before Tax	(2,229.49)	(19,96.52)
Less: Provision for Taxation :
Deferred Tax Asset / (Liability)	(318.32)	21.96
Loss After Tax	(2,547.81)	(1,974.56)

During the year under review, your Company has recorded a total income of Rs 7,723.24 lacs (previous year Rs 13,175.72 lacs), representing a decrease of approximately 41.38%. Your Company incurred a Loss before tax of Rs 2,229.49 lacs (previous year Profit Before Tax Rs 1,996.52 lacs). The Loss for the year was on account of increase in raw material prices, which largely depends on the movement of crude oil prices. Your Directors are optimistic of a turnaround in the coming years, due to the rise in demand for the plastic packaging products in India and abroad.

Dividend

Your Directors have not recommended payment of any dividend, on account of the loss incurred for the year under review.

Manpower Development Process

The Companys Human Resource Division has finalized an organization structure that supports the vision and strategy of the Company. The organization structure is divided into five bands: Strategic, Operational, Manager, Executive and Support, which have been further divided into various levels. All Glory employees are assigned a level under a particular band depending upon their role, impact and criticality of job and the contribution to the Companys strategy.

Particulars of Employees

None of the employees fall under the purview of the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 including Companies (Particulars of Employees) Rules, 2011, as amended.

Auditors

a) Internal Auditors

The Internal Auditors, M/s. A D V & Associates, Chartered Accountants, Mumbai have conducted the internal audits periodically and submitted their reports to the Audit Committee. Their reports have been reviewed by the Audit Committee and the Statutory Auditors.

b) Statutory Auditors

M/s. Mittal & Associates, Chartered Accountants, Mumbai, the Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received a letter from them to the effect that their appointment, if made, would be within the prescribed limit under Section 224 (1B) of the Companies Act, 1956. Your Directors recommend the re-appointment of M/s. Mittal & Associates, Chartered Accountants, as the Statutory Auditors of the Company, at the ensuing Annual General Meeting.

c) Auditors Report

With respect to the following comments on the Statement of Accounts referred to in the Report of Auditors, your Directors reply as under:

Auditors Comments:

1. Sr. No. v(b), of the Annexure to Auditors Report, transactions for purchase / sale of goods have not been made on cash basis, at prices which are reasonable;

2. Sr. No. (vi), of the Annexure to Auditors Report, the Company has accepted deposit falling within the purview of Sections 58A and 58AA and the compliances for the same is pending;

3. Sr. No. (xi), of the Annexure to Auditors Report, the Company has made delayed payment of Installments of term loans taken from State Bank of India and Indian Overseas Bank during the year and the Installments for certain months are still outstanding. Further, Company has over utilized Cash Credit Facilities from State Bank of India, Indian Oversea Bank, Central Bank of India & Dena Bank resulting the account of the Company is considered as Non Performing by these banks.

4. Sr. No. (xv), of the Annexure to Auditors Report, The Company has given a corporate guarantee of Rs 760 lacs to a bank for loans taken by a company in which directors relatives are interested.

Board of Directors Reply :

1. With respect to the sale or purchase of goods made on credit basis to a party, entered in the Register under Section 301 of the Act, the transaction are on the same terms and conditions to the credit period and pricing like any other parties and further the same does not fall within the purview of Section 297 of the Act;

2. The Company is in the process of filing necessary returns with the Registrar of Companies for the deposits accepted during the year. However these deposits are in nature of deposits accepted from supply and selling agents for the purpose of trade / for the business of the Company; and

3. The Board of Directors have submitted a proposal for Corporate Debt Restructuring to its bankers which is under consideration.

4. The Corporate Guarantee given is not prejudicial to the interest of the Company, as the company has given the said guarantee on commercial prudent in the business interest of the Company and none of the Directors are holding any shares or directorship in the said Company.

d) Cost Auditors

M/s. B. F. Modi & Associates, Cost Accountants, Mumbai have been re-appointed as the Cost Auditors of the Company to submit the Cost Audit / Cost Compliance Report along with the requisite annexures duly certified by them for the financial year commencing from 01st April, 2013 to 31st March, 2014, by the Board of Directors at their meeting held on 30th May, 2013.

The Cost Audit Report for the financial year ended 31st March, 2012 has been filed on 31st December, 2012 in XBRL format, which was within the due date of 31st January, 2013 vide the General Circular No. 43/2012 issued by the Ministry of Corporate Affairs dated 26th December, 2012.

Change in Board of Directors

Mr. Prakash N. Kela resigned as a Director of the Company with effect from 29th September, 2012. The Board accords its appreciation for his contributions during his tenure as a Director of the Company.

Mr. Navin C. Chokshi resigned as a Director of the Company with effect from 25th November, 2012. The Board accords its appreciation for his contributions during his tenure as a Director of the Company.

Mr. Rakesh Srivastava was appointed as an Additional Director of the Company with effect from 09th February, 2013 and he holds office upto the date of the ensuing Annual General Meeting. The Company has received a Notice under Section 257 of the Companies Act, 1956, from a member proposing his candidature as a Director, liable to retire by rotation.

In accordance with the requirement of the Companies Act, 1956 and Articles of Association of the Company, Mr. Muralidharan Iyengar, Director of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment.

Your Directors recommend the above appointment / re-appointments.

Change of Name of the Company

The name of the Company was changed from Glory Polyfilms Limited to Glory Films Limited, on obtaining the approval of the members vide a Special Resolution passed at the 15th Annual General Meeting held on 29th September, 2012. A Fresh Certificate of Incorporation consequent to the change in name of the Company was issued by the Registrar of Companies, Maharashtra, Mumbai on 04th February, 2013.

Directors Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors state:

(i) that in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with explanation relating to material departures, if any;

(ii) that the Directors have selected such accounting policies and applied them consistently and 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 ended 31st March, 2013 and of the Loss of the Company for that financial year;

(iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting record in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) that the Directors have prepared the Annual Accounts on a going concern basis.

Report on Corporate Governance

A detailed report on Corporate Governance has been provided elsewhere in the Annual Report, as stipulated in Clause 49 of the Listing Agreement with the Stock Exchanges.

Management Discussion and Analysis

A separate section on Management Discussion and Analysis, as stipulated in Clause 49 of the Listing Agreement with the Stock Exchanges is given in the Annual Report.

Fixed Deposits:

The Company has taken / availed unsecured loans from Directors / promoters to meet with the stipulations of the lending Banks, and from others to meet with the fund requirements for the business of the Company in the nature of deposits accepted from supply and selling agents for the purpose of trade / for the business of the Company. The Company would comply with the requirements of Section 58A of the Companies Act, 1956 and Rules made thereunder, to the extent as may be applicable.

Conservation of Energy & Technology Absorption, Foreign Exchange Earning and Outgo:

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 particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo are set out in Annexure to this Report.

Acknowledgements

Your Directors place on record their appreciation of the support extended by customers, investors, bankers, business associates, vendors and various government agencies. The Directors also sincerely acknowledge the significant contributions made by all the employees for their dedicated services to the Company.

	For and on behalf of the Board of Directors
Place: Mumbai	Yogesh P. Kela
Date: 12th August, 2013	Chairman and Managing Director

ANNEXURE TO THE DIRECTORS REPORT

I. CONSERVATION OF ENERGY

FORM A

Power and Fuel Consumption	Year ended 31.03.2013	Year ended 31.03.2012
Electricity -
Total Units	4713600	5427811
Amount (Rs. In lacs)	214.28	229.17
Rate Per Unit (Rs.)	4.55	4.22
Consumption per unit of Production (in unit/kg.)
Own Generation - (Through Diesel Generator)
Total Units (in liters)	Nil	Nil
Amount (Rs. In lacs)	Nil	Nil
Rate Per Unit (Rs.)	Nil	Nil

Form B

II. Technology Absorption & Research & Development

1) Specific area in which R & D carried out by the Company:

During the year under review, efforts were made in the following areas with the objective of optimizing process systems and adopting parameters that ensure product improvement and cost reduction:

• Total Quality Management (TQM) rolled out in the Company resulted in process improvements and new methods of increasing production and manpower efficiencies across divisions.

• Energy saving measures like single tank condensate, natural draft cooling tower and improved lighting system led to energy conservation and natural energy source optimization initiatives.

• Renewed focus on safety measures and proper training resulted in reduced wastage of resources and avoidance of unfortunate incidents thus increasing overall efficiency.

• Reducing cost of materials, effecting import substitution, simplifying processes and achieving time savings.

• Quality improvements and up-gradation of raw material supplier.

2) Benefits derived as a result of the above R & D:

• High quality, value added and cost effective multilayer films & laminates preferred by the consumers were developed.

• Reduction in cost of raw materials and packaging materials and higher productivity.

• Significant reduction in the emission of pollutants into environment; use of clean methods of energy generation.

• Improved quality of products and thereby strong market position and premium positioning of the products.

3) Future plan of action:

The Company will continue to pursue its R&D work on developing high quality products to meet the ever changing consumer needs and on adding value to our existing products.

4) Expenditure on R & D:

Charged to the respective heads of accounts and not allocated separately.

III. Foreign Exchange Earning and Outgo

The Company is exploring the possibilities of exporting its products to various countries and the Board has initiated the required marketing strategies in this regard. Your Directors are optimistic for a better overall performance with the penetration of new markets abroad.

Foreign Exchange Earned	Rs Nil
Foreign Exchange used	Rs 354.68 Lacs (import of Raw Material)

 

	For and on Behalf of the Board of Directors
Place: Mumbai	Yogesh P. Kela
Date: 12th August, 2013	Chairman