| Dear Shareholders,
The Directors take pleasure in presenting the Fifty first Annual
Report and the Audited Accounts of the Company for the year ended 31st
March, 2014.
FINANCIAL RESULTS:
(Rs in lakhs)
Current Previous
Year ended Year ended
31/03/2014 31/03/2013
Profit before Depreciation and Interest 48391 63476
LESS: Depreciation 29824 37149
Interest 7968 10605
Profit before Tax 10599 15722
LESS: Provision for Income Tax
- Current 43 2240
- Deferred (48) (272)
Profit after current and deferred tax 10604 13754
Surplus brought from previous year 69878 59353
Total available for appropriation 69878 59353
APPROPRIATIONS
Transfer to General Reserve 1100 1500
Proposed Dividend 1910 1909
Tax on the Proposed Dividend 325 326
Balance Carried over to Balance Sheet 66543 59353
DIVIDEND
Your Directors are pleased to recommend a Dividend of Rs 5/- per Equity
Share (i.e., 50% Dividend on the Equity Share Capital of the Company)
for the Financial year ended 31st March, 2014. An amount of Rs 1100
lakhs have been transferred to the General Reserve.
PRODUCTION AND SALES FOR THE YEAR 2013-14
MT
Clinker produced - 4584337
Cement produced - 5816358
Cement and Clinker Sales - 5854346
OPERATIONS
This is covered under the topic Management Discussion and Analysis.
MANAGEMENT DISCUSSION AND ANALYSIS
a) Discussion on financial performance with respect to operational
performance.
The Production and Sale of Cement during the financial year 2013-14 was
5816358 MT and 5854346 MT, a reduction 6% and 5% respectively over the
previous year. The Gross Turnover of the company for the financial year
2013-14 stood at Rs. 2557 crores as against Rs 2825 crores in the
previous year, a negative growth of 9.5% over the previous year, mainly
owing to sluggish market conditions. The Profit before Tax of Rs 106
crores was around 33% lower than the previous year, mainly on account
of spiraling rise in Raw Material and Transportation Costs and lower
realisation.
b) Economic Scenario and Future Outlook
The Indian Economic Scenario during the financial year 2013-14 was the
worst in the last decade. The economic growth was at its lowest of less
than 5% and inflation was also at its highest. The sluggish economic
scenario affected almost all industries and the case with Cement
Industry was no different, which is evident from the financial
performance of the company.
The Demand potential is the biggest advantage of India today and the
future lies in exploitation of the demand potential. With the
continuing impetus on infrastructure development and adequate
government support towards growth of economy, the future definitely
augurs well for Cement Industry.
c) Internal control system and their adequacy
The Company has got an adequate system of internal control in place
commensurate with the size of its operation and is properly designed to
protect and safeguard the assets of the Company. There is a proper
system for recording all the transactions which ensures that every
transaction is properly authorized and executed according to the norms.
The company had also appointed M/s C. Muthukumar & Co., M/s J. Karthik
Bharathi & Co., M/s M. Karuppiah & Co., and M/s Raghavan &
Muralidharan, Chartered Accountants as Internal Auditors to conduct the
Systems and compliance Audit of the company.
d) Material developments in Human resources / Industrial relations
front, including number of people employed.
As always, the Industrial relation during the current year also has
been very cordial and contributed to mutual development. Various
seminars, counseling sessions, trainings etc., were conducted to
improve the quality of the manpower available thereby increasing the
productivity and efficiency of the personnel. The number of personnel
employed in the company is: 1549
CAPTIVE THERMAL POWER PLANTS [CPP]
KARIKKALI WORKS
The Gross power generation from the 1 x 15 MW and 1 x 30 MW Captive
Thermal Power Plants during the year under review was 205499465 Units,
with an auxiliary consumption of 17147233 units. Out of the Net
Generation of 188352232 Units, 140564632 units were captively consumed
by the Cement Plant thereat and the remaining 47787600 units were sold
under Power Purchase Agreements.
PULIYUR WORKS
The Gross power generation from the 1 x15 MW Captive Thermal Power
Plant during the year under review was 100402100 Units, with an
auxiliary consumption of 8258000 units. The Net generation was 92143850
Units and that no sale of power was made during the year from the
Puliyur Captive Power Plant.
ARIYALUR WORKS
The Gross power generation from the 3 x 15 MW Captive Thermal Power
Plant during the year under review was 223471825 Units, with an
auxiliary consumption of 18877351 units. Out of the Net generation of
204594474 Units, 139565000 units were captively consumed by the Cement
Plant thereat and the remaining 65029000 units were sold under Power
Purchase Agreements.
KALLUR WORKS
The Gross power generation from the 1 x 30 MW Captive Thermal Power
Plant during the year under review was 73560000 Units, with an
auxiliary consumption of 6862000 units. Out of the Net generation of
66698000 Units, 64241000 units were captively consumed by the Cement
Plant thereat and the remaining 2457000 units were sold under Power
Purchase Agreements.
The company has installed Waste Heat Generation Plant with a capacity
of 7.3 MW. The Production during the financial year 2013-14 is
27,30,000 units.
INDUSTRIAL RELATIONS
The Employees at all ranks of the Company have been extending their
fullest co-operation for the smooth conduct of the affairs of the
Company and maintenance of cordial Industrial relations. The Directors
wish to place on record their appreciation to the employees of the
Company at all levels.
PUBLIC DEPOSITS
The company has no un-matured/unpaid Fixed Deposits at the end of
financial year 2013-14.
DELISTING OF EQUITY SHARES
The Equity Shares of the company have got delisted from all the Stock
Exchanges where they were listed with effect from the 7th June, 2013.
The Exit Offer period given to the residual Shareholders of the company
to surrender their Shares in favour of the Promoters at the Exit Price
fixed on Delisting came to an end on 6th June, 2014. The Promoter
acquired 253883 Equity Shares which have been surrendered by the
residual shareholders in the Exit Offer. With this, the total No. of
shares of the Promoters are 36343162 (95.14%).
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
As required under Section 217 (1) (e) of the Companies Act, 1956, the
details regarding Energy Conservation, Technology Absorption, Foreign
Exchange earnings and outgo are given in the Annexure hereto.
STATUTORY INFORMATION REGARDING EMPLOYEES
The particulars regarding employees fall within the purview of Section
217 (2-A) of the Companies Act, 1956 and the Rules made there under,
are mentioned in the Annexure hereto.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2- AA) of the Companies Act, 1956, the
Directors confirm that:
a) in the preparation of the Annual Accounts, the applicable accounting
standards had been followed.
b) The Directors had 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 and of the profit or loss
of the Company for that period.
c) The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities.
d) The Directors had prepared the Annual Accounts on a going concern
basis
DIRECTORS
Mr. SP.ST. Palaniappan, Director had passed away on 3rd March, 2014.
The Board condoled on the sudden demise of Mr. SP.ST. Palaniappan.
Mr.R.Ramakrishnan (DIN 00809342) has been co-opted on 30.07.2014 as
Director on the Board of the Company, in the place of Mr.SP.ST.
Palaniappan.
Dr. M.A.M. Ramaswamy, Chairman and Sri Ramanathan Palaniappan, Director
retire under Clause 102 of the Articles of Association of the Company
and being eligible, offer themselves for re - appointment.
AUDITORS
The Auditors, M/s P. B. Vijayaraghavan & Co., M/s Soundararajan & Co.,
and M/s Krishaan & Co., Chartered Accountants retire at the ensuing
Annual General Meeting and they are eligible for re-appontment.
The Cost Audit of the Company is conducted by M/s Geeyes & Co.,
Chennai.
The Cost Audit Report/Compliance report for the financial year 2012-13
were due to be filed by 27th September, 2013. As the MCA stipulated
that same had to be filed under the Extensible Business Reporting
Language [XBRL] mode, the Cost Audit Report and the Compliance Report,
in Form I and Form A, respectively, for the Financial Year 2012-13 have
been filed with the Central Government in the prescribed mode on
27.09.2013.
The Cost Audit Report and the Compliance Report for the financial year
2013-14 is due to be filed within 180 days from the closure of the
financial year in XBRL mode and will be filed within the stipulated
period.
CAUTIONARY STATEMENT
Statements made in this Report, including those stated under the
caption "Management Discussion and Analysis" describing the company's
objectives, expectations or projections may constitute "forward looking
statements" within the meaning of applicable securities laws and
regulations.
Important factors that could influence the Company's operations include
global and domestic supply and demand conditions affecting the selling
prices of finished goods, availability of inputs and their prices,
changes in the government regulations, tax laws, economic developments
within the country and outside and other factors such as litigations
and Industrial relations.
The Company assumes no responsibility in respect of the forward looking
statements which may undergo changes in the future on the basis of
subsequent developments, information or events.
ACKNOWLEDGEMENT
The Board of Directors wish to thank all the Shareholders, Government
Authorities and Financial Institutions and Bankers, Suppliers,
Customers and all the categories of Employees for the continued
assistance, support and direction to the company during the year under
review.
ADDENDUM
Auditors' Report:
Regarding the liability, if any, under the provisions of Jute Packaging
Materials (Compulsory use in the Packing Commodities) Act, 1987, the
Note No.42 of the Notes forming part of the Accounts is
self-explanatory and the Directors opine that as the amount of
liability is not ascertainable, necessary provision can be made in the
year in which the actual liability would arise.
For and on behalf of the Board,
M.A.M. Ramaswamy
Chairman
Place: Chennai
Date : 30.07.2014 |