jord engineers india ltd share price Management discussions

JORD ENGINEERS INDIA LIMITED ANNUAL REPORT 2010-2011 MANAGEMENT DISCUSSION AND ANALYSIS FINANCIAL HIGHLIGHTS: (Rs. in Lacs) 2010-11 2009-10 Sales and other Income (Net) 11889.53 5329.99 Profit/Loss before Depreciation, Interest & Tax 692.56 (415.25) Less: Interest 478.63 116.93 Depreciation 650.51 642.65 Profit/(Loss) from Operations (436.58) (1174.83) Extra Ordinary Items 33.51 28.32 Profit/(Loss) before Tax (470.09) (1146.51) Provision for Tax/FBT 0.00 0.47 Profit/(Loss) after Tax (470.09) (1146.04) PERFORMANCE REVIEW: During the year under review, the Company has recovered business in a major way, which is mainly due to the buoyant business scenario in the capital goods sector. The Company has recorded increase in sales turnover during the last few years consistently, the previous year 2009-10, being an exception when it experienced a fall in Sales. In fact the sales during the year under review has grown by almost 123% over the previous year as compared to a decline in revenues by almost 27% during 2009-10. Though the Company has incurred a Net Loss of Rs.470.09 Lacs (Rs.1146.04 Lacs), it has earned a cash profit of Rs. 213.93 Lacs (Cash Loss of Rs.532.18 Lacs during the previous year 2009-10). Your Directors are pleased to inform you that there has definitely been improvement in the business scenario during the last year and this is steadily gaining momentum. The comparative sales during the year under review is an evidence, which shows a significant rise in sales over the previous year. The quantum of current orders in hand also shows a significant improvement from earlier figures. The quantum of business inquiries is also very encouraging. During the year under review, the focus was still on Air Cooled Heat Exchangers for the Refinery Sector and Fintubes and Harps for the Power Sector. This year, company will continue to focus in a major way in bothrthese sectors. Certain important development has also taken place which gives proper focus to the company in operations. After visualizing for quite some time, manufacture of total HRSG unit should be one of our goals, we are pleased to inform that we have received our first order for this unit in association with M/s Heat Recovery Solutions (HRS), UK from Matix Fertilizer of _ssar Group through Heurtey Petroleum. This will influence our position in the market in future for such type of equipment and will give us a foothold in the boiler segment. Another area where, along with our technical collaborator from the U K in which the company has entered is Air Cooled Condensers. Another very important area in which the company has entered into is the Solar Power Sector. We had detailed discussions with a European Company who have the necessary technology; Technical collaboration agreement is in the offing. With the technical expertise of the prospective collaborator, and our manufacturing capacity for a large number of equipment required for Solar Project, the company quite definitely aims to be a big player in this Sector. Generally, the business scenario of the Power Sector in the country in the years to come is very bright. CORPORATE SOCIAL RESPONSIBILITY (CSR): The Company has taken an initiative under its CSR Policy by adopting Industrial Training Institute (ITI), Waghodia, under Public Private Partnership (PPP) with the Govt, of Gujarat. The state-of-the-art building constructed by the PPP is planned to be inaugurated by the Labour, Finance and Employment Minister of Govt, of Gujarat-Shri Vajubhai Vala. The ITI is located in the rural area of Waghodia Taluka of Vadoadara district for imparting technical and vocational training to the local students to enable them to take up employment in the engineering industries located in and around the area. Your Company, being one of the major industrial unit in the area, provides the local students employment opportunity. Special focus is being given vocational training to the female students fortheir social and economic upliftment. STATUS OF REFERENCE TO BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION (BIFR) AND REHABILITATION PROCESS: The Company has been declared sick by BIFR. The Company has submitted a fully tied-up Draft Rehabilitation Scheme (DRS) to Operating Agency appointed by BIFR.-The said DRS has been submitted by OA to BIFR for their examination and approval. The DRS has consent from 98% lenders. Pending approval of the DRS, the effect of DRS has not been given in this Balance Sheet as the same is still under examination by BIFR and its approval is awaited. The Company expects to complete this exercise in the next year and hence the effect of the same shall be given appropriately in the accounts.