gmmco ltd Directors report

REPORT OF THE DIRECTORS

TO THE SHAREHOLDERS OF GMMCO LIMITED FOR THE YEAR ENDED 31ST MARCH, 2014

The Directors have pleasure in presenting their 47th Annual Report and Audited Accounts of the Company for the year ended 31st March, 2014.

FINANCIAL RESULTS :	Rs. in Lacs
Profit before interest, tax, depreciation and amortisation	12399.64
Less : i) Interest Income	(538.69)
ii) Finance Costs	2372.15
iii) Depreciation and Amortization	2504.76
	4338.22
Profit Before Taxation	8061.42
Less: i) Provision for taxation	2025.00
ii) Deferred tax	882.00
	2907.00
Net profit after tax	5154.42
Add: Balance brought forward from last year	5471.15
Balance available for Appropriations	10625.57
APPROPRIATIONS:
Interim dividend	730.09
Proposed dividend	730.09
Tax on Dividend	248.16
Transfer to General Reserve	4000.00
Profit & Loss Account balance carried forward	4917.23
	10625.57

DIVIDEND:

The company has already paid an Interim Dividend @ Rs.15/- per equity share during the year. The Directors are pleased to recommend further Final Dividend @ Rs.15/- per equity share for the year ended 31^st March, 2014. The Company has paid Income-tax on interim dividend and will pay Income-tax on final dividend as per provisions of the Income-tax Act. Total outgo for dividend (both interim and final) shall be Rs. 1708.34 lacs (including tax on dividend of Rs.248.16 lacs).

BUSINESS ACTIVITIES :

The overall performance of the company has been satisfactory considering continuing slow down/challenges in the Infrastructure and Mining Industry.. The overall revenue from operations has been Rs. 1667 Crores compared to Rs. 1452 Crores in the previous year registering a growth of about 15%

During the year Company the Company has acquired mining equipment sales, distribution and after sales, service and support business of Bucyrus range of products from Bucyrus India Pvt. Ltd for a total consideration of Rs. 329.53 Crores. The regular business of Caterpillar products continues to be good. Satisfactory progress has been made in developing business of after sales support of Mercedes Benz Trucks wherein the company had been appointed as Authorised Service Centre by Daimler India Pvt. Limited last year. We are pleased to inform that they have further appointed the Company a dealer (Sales and Service) for Bharat Benz range of trucks used in mining operations.

The Companys products are mainly catering to infrastructure and mining sector. The company believes that there will be improvement in this sector by second half of the current year and is hopeful of a better performance.

PROFITABILITY :

Profit before tax at Rs.80.61 Crores is lower by about 5.91% compared to previous year and profit after tax at Rs.51.54 Crores is lower by about 10.62%. This is mainly due to increase in finance cost and depreciation/amortization expenses.

SUBSIDIARY COMPANY :

The annual accounts of the wholly owned subsidiary company GMMCO Singapore Pte. Ltd. is annexed to the Annual Accounts of the Company. Statement under Section 212 of the Companies Act, 1956 is also enclosed.

DIRECTORS:

Shri K.P.Chaudhary retires by rotation (by agreement) and being eligible offers himself for reappointment. He is an Independent Director and shall, therefore, be appointed as such for a period of 5 (five) consecutive years not liable to retire by rotation.

AUDIT COMMITTEE:

The Audit Committee of the Board consists of 3 (three) Directors viz. Shri H. Jayaram, Shri K.P. Chaudhary and Shri J.P.Chhaochharia.

NOMINATION AND REMUNERATION COMMITTEE :

Nomination and Remuneration Committee consists of three non-executive independent Directors viz. Shri M.L.Pachisia, Shri K.P.Chaudhary and Shri J.P.Chhaochharia. The Nomination and Remuneration Committee reviews remuneration payable to the Executive Director and also lays down policies for remuneration of other Key Managerial Personnel and other employees of the Company.

BORROWING COMMITTEE:

The Borrowing Committee consists of three non-executive independent Directors viz. Shri M.L.Pachisia, Shri K.P.Chaudhary and Shri J.P.Chhaochharia. The Committee has the power to take decisions on borrowings within permissible limits.

CORPORATE SOCIAL RESPONSIBILITY:

The Company has been contributing to various Trusts for carrying out educational, charitable, religious and philanthropic activities.

COST AUDITORS:

M/s JV & Associates, Cost Accountants, were appointed as Cost Auditors of the Company for the purpose of auditing of cost records in relation to manufacturing activities of the Company for the year 2013-14.

The Board of Directors have also appointed M/s JV Associates as Cost Auditors for the financial year 2014-15 and their remuneration fixed by the Board at Rs.60,000/- plus service tax and reimbursement of out of pocket expenses is required to be ratified by the Shareholders at the ensuing Annual General Meeting.

OTHER INFORMATION :

The relations between the Management and the Staff continue to be satisfactory. The Company lays emphasis on training and development of personnel of the Company. The particulars of employees as required under Section 217(2A) of the Companies Act, 1956, as amended and the rules framed thereunder, are given in the Statement annexed to the Report.

Steps as possible to reduce the consumption of energy and technology absorption are being taken through training programmes and other measures as practical.

The foreign exchange earnings amounted to Rs.14222.84 lacs and outflow to Rs.31978.52 lacs.

The Directors Responsibility Statement is given in the Annexure to this Report. AUDITORS:

M/s. Singhi & Company, Chartered Accountants, Auditors of the Company, hold office until conclusion of ensuing Annual General Meeting and offer themselves for reappointment for three financial years 2014-15, 2015-16and 2016-17. They have furnished necessary certificate of their eligibility as required under Section 139 of the Companies Act, 2013. The reappointment of M/s Singhi & Company shall be for three financial years as aforesaid subject to annual ratification thereof.

	Shri. M.L.Pachisia
	Shri. H.Jayaram
	Shri. J.P.Chhaochharia
9/1 R.N.Mukherjee Road, Kolkata 700 001	Shri. K.P.Chaudhary
Dated the 14th May, 2014	Directors

ANNEXURE TO DIRECTORS REPORT DIRECTORS RESPONSIBILITY STATEMENT THE BOARD OF DIRECTORS CONFIRMS :

1. That in the preparation of the annual accounts for the year ended 31^st March, 2014, all the applicable Accounting Standards prescribed by the Institute of Chartered Accountants of India have been followed.

2. That the Directors have adopted such accounting policies and have applied them consistently and have made judgments and estimates in a reasonable and prudent manner so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for the year.

3. That 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 fraud and other irregularities.

4. That the annual accounts have been prepared on a going concern basis.

STATEMENT REGARDING SUBSIDIARY COMPANIES PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956

1. Name of Subsidiary Company	GMMCO Singapore Pte. Ltd.
2. Holding Companys interest	Holder of 100% of Subscribed Capital
3. Net aggregate of subsidiarys Profit or (Loss) which concerns the members of GMMCO Limited (the Holding Company) not dealt with in that Companys Account
(i) For the subsidiarys Financial period ended 31.3.2014	Rs.1160.52 lacs (US$ 1937110 converted @ Rs.59.91 per US$)
(ii) For the previous Financial Years since the date of becoming subsidiary	Rs.182.57 lacs (US$ 336219 converted @ Rs.54.30 per US$)

Shri. M.L.Pachisia

Shri. H.Jayaram

Shri. J.P.Chhaochharia

Shri. K.P.Chaudhary

Directors

Dated 14th May, 2014