The Members of Alufluoride Limited
Your Directors have pleasure in presenting the Annual Report of your Company along withthe audited Statement of Accounts for the financial year ended 31st March2016. The Report also includes the Management Discussion and Analysis Report in accordancewith the Guidelines on Corporate Governance and consolidated Financial Statements.
The Financial results of the Company for the period under review are as follows:
| ||31-03-2016 ||31-03-2015 |
|Sales and other revenue ||3175.85 ||2361.93 |
|Profit before Finance charges Depreciation Tax & other adj's ||427.23 ||421.03 |
|Less : Finance charges ||0.11 ||0.29 |
|Profit before Depreciation Tax & other adj's ||427.12 ||420.74 |
|Less: Depreciation ||83.39 ||61.42 |
|Profit before Tax & other adj's Less: Extraordinary & ||343.73 ||359.32 |
|Exceptional Expenses || ||0.47 |
|Provision for current tax ||131.85 ||111.42 |
|Taxes of earlier years ||4.03 ||4.17 |
|Deferred Tax Asset / Liability adj's ||(8.54) ||(60.72) |
|Profit before appropriations and carried to Balance Sheet ||216.39 ||303.98 |
Your Directors report that the Company produced 4930 MT of Aluminium Fluoride duringthe year under review as against 4113 MT during 2014-15. During the year the Company sold5086 MT Aluminium Fluoride as against 3331 MT in 2014-15. With the increased salesvolume the sales and other revenue reported at Rs. 3175.85 lakhs as against Rs.2361.93lakhs during 2014-15. With the controlled consumption norms with the increasedproduction with the efficient working capital management planned increase in otherincome and with effective cost control measures though the selling price of AlF3 is lowerduring the year compared to last year the Company posted a net profit of Rs.216.39 lakhsfor the year under review as against net profit of Rs.303.98 lakhs in 2014-15.
OUT LOOK FOR THE CURRENT YEAR
The sale price of Aluminium Fluoride for the current year has further dropped due to amajor decrease in LME price of Aluminium global metal industry recession. With theadjacent fertilizer complex assurance for increasing their Acid supplies for the currentyear as against low acid supplies of 2365 MT acid in 2015-16 the Company is hoping topost good returns in the current year provided aluminium fluoride prices do not furtherdecrease.
During the year under review the Company has not registered any Export sales asagainst Rs.120.10 lakhs during 2014-15.
All the properties of the Company including Buildings Plant and Machinery and Stockshave been adequately insured.
Your Directors wish to record that the Company is making all its efforts for enteringin to long term agreements for acid supply and JV agreements for the proposed shifting ofthe plant to expand capacity where the Company will get assured acid supplies and isexpected to be finalized very shortly. In view of the proposed major expansions yourDirectors are not recommending any Dividend with a veiw to conserve resources.
As per chapter IV of the SEBI (Listing obligations & Disclosure Requirements)Regulations 2015 a separate section on Corporate Governance is enclosed herewith whichforms part of the Annual Report. A certificate from the Auditors of the Company oncompliance with the conditions of Corporate Governance as stipulated under the SEBI(Listing obligations & Disclosure Requirements) Regulations 2015 is annexed to thisReport.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed section of the Management Discussion and Analysis for the period underreview as required under SEBI (Listing obligations & Disclosure Requirements)Regulations 2015 is given as a separate statement forming part of the Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134 (5) of the Companies Act 2013 withrespect to the Director's Responsibility Statement it is hereby confirmed:
i. In the preparation of the annual accounts for the financial year ended 31stMarch 2016 the applicable accounting standards had been followed along with properexplanation relating to material departures.
ii. The Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for that period;
iii. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv. The Directors had prepared the accounts for the financial year ended 31stMarch 2016 on a going concern' basis; and
v. The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
vi. The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating efficiently.
DIRECTORS & KEY MANAGERIAL PERSONNEL (KMP)
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Sri Ashok Vemulapalli Director will be retiring at theensuing Annual General Meeting. The members are informed that Sri Ashok Vemulapalli hasexpressed his willingness for reappointment.
The Board of Directors based on the recommendation of Nomination & RemunerationCommittee had in their meeting held on 29th April 2016 reappointed Sri VenkatAkkineni Managing Director Smt Jyothsana Akkineni Executive Director and SriK.Purushotham Naidu Director (Finance & Admn) for another three years. Theirreappointment is subject to the approval of shareholders in the ensuing AGM.
Key Managerial Personnel
The company has designated the Managing Director Director Finance (as CFO) and CompanySecretary as its Key Managerial Personnel in accordance with the provisions of Section 203of the Companies Act 2013.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
Dr. T.R. Ramachandran Sri A.V.V.S.S.Ch.B. Sekhar Babu and Sri Grandhi Sreeramakrishnaare the Independent Directors of the Company. The terms and conditions of appointment ofIndependent Directors are as per Schedule IV of the Act. They have submitted a declarationthat each of them meets the criteria of independence as provided in Section 149(6) of theAct and there has been no change in the circumstances which may affect their status asIndependent Director during the year
NUMBER OF MEETINGS OF THE BOARD
Four Meetings of the Board were held during the year. For details of the meetings ofthe Board please refer to the Corporate Governance Report which forms part of thisreport.
The Board of Directors has carried out an annual evaluation of its own performanceBoard Committees and Individual Directors pursuant to the provisions of the Act and theCorporate Governance requirements as prescribed by Securities and Exchange Board of India("SEBI") under SEBI (Listing Obligations & Discloser Requirements)Regulations 2015. The performance of the Board was evaluated by the Board after seekinginputs from all the Directors on the basis of the criteria such as the Board compositionand structure effectiveness of Board processes information and functioning etc. Theperformance of the committees was evaluated by the Board after seeking inputs from thecommittee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Remuneration Committee reviewed the performance of the IndividualDirectors on the basis of the criteria such as the contribution of the Individual Directorto the Board and committee meetings like preparedness on the issues to be discussedmeaningful and constructive contribution and inputs in meetings etc. In addition theChairman was also evaluated on the key aspects of his role.
In a separate meeting of Independent Directors performance of Non-IndependentDirectors performance of the Board as a whole and performance of the Chairman wasevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors. The same was discussed in the Board meeting that followed the meeting of theIndependent Directors at which the performance of the Board its committees andIndividual Directors was also discussed.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The Company's policy on Directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the corporate governancereport which forms part of the Directors' report.
DISCLOSURE AS REQUIRED UNDER RULE 5 OF COMPANIES (APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES 2014
The Disclosure as required under Rule 5 of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is given in Annexure - A to the Board Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED IN SUB - SECTION(1) OF SECTION 188
Details of transactions with related parties falling under the scope of Section 188(1)of the Act & Information on transactions with related parties pursuant to Section134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 (Form No.AOC.2) is given in Annexure - B to the Board Report.
M/s Rao & Kumar Chartered Accountants Visakhapatnam the Auditors of the Companywill be retiring at the conclusion of this Annual General Meeting and have conveyed theirconsent for reappointment.
Pursuant to the provisions of Section 205 of the Act and the rules framed thereunderM/s. GMVDR & Associates Company Secretary was appointed as Secretarial Audit of theCompany and the Secretarial Audit Report issued by them for the financial year 2015-16 ismade a part of this Report.
Cost Audit for financial year 2015-16 is not applicable in view of the Cost AuditAmendment Rules 2014 Government of India Ministry of Corporate Affairs NotificationNew Delhi dated 31.12.2014.
EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act the extract of annual return is given inAnnexure - C in the prescribed Form MGT-9 which forms part of this report.
AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT
The Auditors' Report and Secretarial Auditors' Report does not contain anyqualifications reservations or adverse remarks.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments affecting the financial position of theCompany from the date of closure of financial year to the date of Board Report.
The Company has not availed loans from any Bank/ Financial Institutions during thefinancial year under review.
The Company has not accepted any fixed deposits during the year under review. As suchno amount of principal or interest was outstanding on the date of the Balance Sheet.
UNPAID / UNCLAIMED DIVIDEND
Dividend which is unclaimed for a period of 7 years shall be transferred to InvestorEducation & Protection Fund (IEPF). An amount of Rs. 279660/- for the FY 2008-09which was unclaimed by the shareholders of the Company will be transferred to InvestorEducation and Protection Fund (IEPF) on or before 23.10.2016.
The Company has a proper and adequate system of internal control to ensure all theassets are safeguarded and protected against loss from unauthorized use or disposition andthe transactions are authorized regarded and reported correctly. The internal control issupplemented by an extensive program of internal audits review by management andprocedures. The internal control is designed to ensure that the financial and otherrecords are reliable for preparing financial statements and other data and formaintaining accountability of assets.
The Company's Internal Audit Department is regularly carrying out the Audit in allareas. Additionally the Audit committee is reviewing all Audit Reports with significantcontrol all issues raised by internal and external auditing regularly reports on thebusiness development all the past and the future plans are given to the Board ofDirectors Internal Auditor's reports are regularly circulated to all the seniormanagement to comply with the findings.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGO
Additional information on conservation of energy technology absorption and foreignexchange earnings and outgo as required to be disclosed in terms of Section 134(3)(m) ofthe Companies Act 2013 read with the Companies (Accounts) Rules 2014 is given inAnnexure - D and forms part of this report.
During the year under review the Company has enjoyed cordial relationship with allsection of employees. The Company believes that the employees play a vital role inincreasing the turnover and profitability of the Company and the strength of the Companylie in harnessing the manpower in achieving sustained long-term growth in all spheres.
ENVIRONMENT & SAFETY MEASURES
Following the ISO Certifications of 9001 14001 and OHSAS 18001 the Company willcontinue taking all the necessary measures to maintain high standards of EnvironmentClean and Green Belt Water Harvesting Pollution Control Health and Safety Precautions.
Your Directors take this opportunity in expressing their gratitude to the Government ofIndia the State Government. The Board is also thankful to all its Bankers ContractorsCustomers and Shareholders for their unstinted support to the Company.
| ||For and on behalf of the Board |
| ||For ALUFLUORIDE LIMITED |
| ||VENKAT AKKINENI |
| ||Managing Director |
| ||DIN: 00013996 |
| ||G. SREERAMAKRISHNA |
|Hyderabad ||Director |
|4 August 2016 ||DIN: 06921031 |