vishal chairs ltd Directors report

ANNUAL REPORT 1998-99 VISUAL CHAIRS LIMITED DIRECTORS REPORT Dear Members, Your Directors have pleasure in presenting the Tenth Annual Report and Audited Accounts of your Company for the year ended 30th June 99. DIVIDEND : The company has earned profits during the year but since the amount is meagre your directors want to conserve the resources for meeting the requirements of working capital As such the Board of Directors do not recommend any Dividend for the year. OPERATIONS: The Companys Financial Performance during the year 1998-99 has been affected due to the recessionary conditions prevailing world wide. The chair industry comes within the luxury segment and due to overall sluggish conditions the performance has been affected. The Sales and Operating Income has increased from Rs.1,066.82 lakhs to Rs. 1,324.35 but due to competition from the unorganised sector the margins have declined which has resulted in the profits decreasing from Rs 48.41 lakhs in the earlier year to Rs 13.96 lakhs in the current year. EXPANSION The company had undertaken expansion of its activities by commisioning a new plant at Silvassa. The expansion was funded by borrowings from Financial Institutions and promoters through its associates and friends and partly through internal accruals. The chairs introduced have been accepted in the market and it has helped the company in increasing its market share FUTURE PROSPECTS: The user industry had been passing through severe recessionary trend but upturn of the industry is expected from early 2000 The market has continued to be sluggish but still the company has got a good order position. The company hopes that it may be able to show improvement is its working in the current year. FIXED DEPOSITS: The company has not accepted any public deposits during the year under review. INDUSTRIAL RELATIONS: The company continues to maintain harmonious relations at all levels of the organisation. It has been the endeavour of the company to maintain the good relations with its work force Yours Directors appreciate the devotion and commitment shown by employees at all levels and acknowledge their contribution towards sustained progress of the company. Y2K COMPLIANCE: The company has already taken steps for ensuring that the systems are Y2K compatible The possibility of system breakdown failure due to the Y2K problem does not arise as all the software versions have been tested and found to be Y2K compatible. No significant expenditure has been incurred to carry out remedial measures. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION The requirement for disclosure of particulars with respect to Conservation of Energy is not applicable to the Company. A statement giving details of Technology Absorption and Foreign Exchange Earnings and Outgo in accordance with the disclosure of particulars in the report of the Board of Directors rules 1988 is annexed hereto in Annexure A and forms cart of this report. COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES 1988. During the year none of the employees of the company was in receipt of remuneration exceeding Rs 6,00,000/- per annum or Rs 50,000/- per month when employed for part of the year. AUDITORS REPORT With regard to the observations made by the Auditors in paragraph 2(d) of the Auditors Report, the relevant notes to the Accounts referred to therein are self explanatory and do not require further clarification. DIRECTORS In accordance with the provisions of the Companies Act 1956 and Articles of Association of the company, Mr Randhir K. Javeri and Mr Lalit P. Mehta retire by rotation, at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. AUDITORS M/s. D. M. Damle & Co Chartered Accountants, the present Auditors of the Company retire at the ensuing Annual General Meeting and offer themselves for reappointment They have furnished a certificate stating that their appointment, if made, will be within the limits laid down under section 224(1B) of the Companies Act, 1956. APPRECIATION Your Directors express their gratitude to the Financial Institutions and Banks for their timely assistance. Your Directors are grateful to the continued co-operation and support received from its esteemed Customers and Suppliers and the loyalty of its large family of Shareholders. By Order of the Board of Directors for VISHAL CHAIRS LIMITED JITEN S. CHOKSEY CHAIRMAN & MANAGING DIRECTOR. Place: Mumbai Dated: 15th November,1999. ANNEXURE TO THE DIRECTORS REPORT Information as per Section 217(1)(e) read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules,1988 and forming part of the Directors Report for the year ended 30th June,1999. A. TECHNOLOGY ABSORPTION FORM B Disclosure of Particulars with respect to Technology Absorption (to the extent applicable) Research and Development (R & D) 1. Specific areas in which R & D carried out by the Company : None 2. Benefits derived as a result of the above R & D : Not Applicable 3. Future Plan of Action : Not at Present 4. Expenditure on R & D : None a. Capital b. Recurring c. Total d. Total R & D expenditure as a percentage of total turnover. Technology Absorption, Adaption & Innovation 1. Efforts in brief, made towards In pursuance of Technical technology,absorption,adaption and Agreement with Drabert Gmbh innovation the Knowhow for Manufacture of Ergonomic Chairs has been 2. Benefits derived as a result of absorbed technologies are the above efforts e.g. product being studied in order to improvement, cost reduction, product ensure greater economies in developments, import substitution etc. production. 3. In case of imported technology (imported during the last 5 years reckoned from the beginning of the financial year) following information may be furnished a. Technology imported and In pursuance of Technical Year of Import Assistance Agreement with Drabert the technology for manufacture of Ergonomic Chairs has been imported in the year 1991 for Ergo style, Ergo visit SM400 & Series 7 & in a year 1992 for Series 7 & in a year 1994 for Ergo lux chairs. b. Has Technology been fully absorbed ? Technology has been fairly well absorbed. c. If not fully absorbed areas where this has not taken place reason therefore and future plans of action Not applicable. C) FOREIGN EXCHANGE EARNINGS AND OUTGO Particulars with regard to Foreign Exchange Earnings and Outgo are as set out in note No. 6 (a), b) & (c) in Notes to the Accounts. II. Information under Section 217(2A) Expenditure incurred on Employees during the year who were in receipt of remuneration of Rs.6,00,000 per annum or Rs. 50,000/- per month if employed for part of the year - NIL For and On Behalf of the Board of Directors VISHAL CHAIRS LIMITED JITEN S. CHOKSEY CHAIRMAN & MANAGING DIRECTOR Place : Mumbai Dated : 15th November,1999.