TO THE MEMBERS OF ARCHIDPLY INDUSTRIES LIMITED
Your Directors are pleased to present the Twentieth Annual Report together with theAudited Statement of Accounts for the year ended 31st March 2015.
The financial results of the Company during the year under review are summarized asunder
(Rs In Lakhs)
|Particulars ||Year ended 31st March 2015 ||year ended 31st March 2014 |
|Net sales ||26012.39 ||22652.02 |
|Depreciation & Amortization Expenses ||491.91 ||546.42 |
|Finance Costs ||1109.15 ||1064.16 |
|Profit before tax ||630.46 ||508.86 |
|Taxation ||74.84 ||107.76 |
|Profit after tax ||555.62 ||401.10 |
The Net Sales during the year under review increased by 14.83% from 22652.02 lakhs inthe previous year to 26012.39 lakhs.
Export turnover of the Company increased by 27.63% from 1414.63 lakhs in the previousyear to Rs 1805.60 lakhs.
The Profit Before Tax (PBT) increased by 23.89 %from Rs 508.86 lakhs in the previousyear to Rs 630.45 lakhs.
The Profit After Tax (PAT) increased by 38.52 % from Rs 401.10 lakhs in the previousyear to Rs 555.61 lakhs.
During the year under review our concerted effort in growing the revenues andcontributions from the decorative laminates and veneerswhich are the value added productsin the overall product mix of the Company coupled with the increase in the exports of theCompany have resulted in the improved topline and bottom line performance.
The Board is happy to report an encouraging financial performance but regret itsinability to recommend any dividend as it is considered prudent to conserve the resourcesfor investments in the business.
transfer to reserve
The Board proposes to transfer Profit After Tax of Rs 555.62 lakhs to the GeneralReserve.
The paid up equity capital as on March 31 2015 was Rs 2206.50 Lakhs. The company hasnot issued shares with differential voting rights nor granted stock options nor sweatequity during the year.
Cash and cash equivalents as at March 31 2015 was Rs 954.13 lakhs. The companycontinues to focus on judicious management of its working capital Receivablesinventories and other working capital parameters were kept under strict check throughcontinuous monitoring.
Brickwork Ratings India Pvt Limited has upgraded Company's rating to BBB (outlookstable) for long term Bank loan facilities.
MATERIAL CHANGES AND COMMITMENTS
There is no material changes and commitments affecting our financial position betweenthe end of the financial year to which this financial statement relate and date of thisreport.
Significant and material orders passed by the regulators / courts / tribunals impactingthe going concern status and the Company's operations in future:
As such there is no significant and material order by the regulator/ court/tribunalsimpacting the going concern status and the Company's operation in future.
your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The Company has not given any loans or guarantees or investments covered under theprovisions of section 186 of the Companies Act 2013.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The Company has inhouse Internal Auditor. To maintain itsobjectivity and independence the Internal Auditor function reports to the Chairman of theAudit Committee of the Board & Managing Director.
The Internal Auditor monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their
respective areas and thereby strengthen the controls. Significant audit observationsand recommendations along with corrective actions thereon are presented to the AuditCommittee of the Board.
CORPORATE SOCIAL RESPONSIBILITY(CSR) INITIATIVES
We have constituted a CSR committee for the purposes of recommending and monitoring theCSR. The Board on the recommendation of CSR committee adopted a CSR Policy . The same isavailable on our website http://www.archidply.com. The details of the CSR Committee andits composition is given in the Corporate Governance Report.
As part of its initiatives under "corporate social responsibility" (CSR) thecompany has contributed funds for the schemes of promotion of education by way ofsupporting the school infrastructure development .
The annual report on our CSR activities is appended as Annexure A to the Board'sreport.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The statement containing the necessary information as required under Section 134 of theCompanies Act 2013 read with Companies (Accounts) Rules 2014 relating to conservation ofenergy technology absorption foreign exchange earnings and outgo are annexed hereto andforms an integral part of this report. (Annexure C')
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
Shri. Kamal Kishore Taparia an independent director submitted his resignation to theBoard on Feb 13 2015. The same was accepted by the Board in its meeting held on Feb 132015. The Board placed on record its sincerest thanks and gratitude for the invaluablecontribution made by Shri. Kamal Kishore Taparia towards the growth and development of thecompany during his tenure as a director.
Mr. Deen Dayal Daga as eligible to re-appoint as Executive Chairman of the Company fora period of five years are recommended by Board.
Mr. Shyam Daga as eligible to re-appoint as Managing Director & CFO of the Companyfor a period of five years are recommended by Board.
Mr. Rajiv Daga as eligible to re-appoint as Joint Managing Director & CEO of theCompany for a period of five years are recommended by Board..
Mrs. Shanthi Varadaraj Mallar was appointed as additional directors retires at theensuing Annual General Meeting as a women director in the Board on 11/03/2015. The Boardnow recommends the appointment of Mrs. Shanthi Varadaraj Mallar as independent Womendirector under section 149 (1) of the Companies Act 2013 and clause 49 of the listingagreement in the ensuing A.G.M. to hold office for 5 (Five) consecutive years i.e. for aterm up to the conclusion of 25th Annual General Meeting of the company in the calendaryear 2020.
A brief resume of the Directors being appointed / re-appointed are attached to theNotice for the ensuing Annual General meeting.
None of the Directors of your Company is disqualified as per provisions of Section 164of the Companies Act 2013. The Directors of the Company have made necessary disclosuresas required under various provisions of the Companies Act and clause 49 of the ListingAgreement.
All independent directors have given declarations that they meet the criteria ofindependence as laid down under section149(6) of the Companies Act 2013 and clause 49 ofthe Listing Agreement.
Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the ListingAgreement the Board has carried out an evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration Committees. The independent Directors meeting to review the performance ofthe non-independent Directors and Board as a whole was held on 13.02.2015.
The manner in which the evaluation has been carried out has been explained in theCorporate Governance Report.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.
A calendar of Meetings is prepared and circulated in advance to the Directors.
During the year Six Board Meetings and four Audit Committee Meetings were convened andheld. The details of which are given in the Corporate Governance Report. The interveninggap between the Meetings was within the period prescribed under the Companies Act 2013.
We have circulated the calendar of meetings for the year 2015-16 to the Directors.
DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:
i) In the preparation of the annual accounts applicable accounting standards have beenfollowed along with proper explanations relating to material departures.
ii) The directors have 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 or loss of the Company for the year under review.
iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual accounts on a going concern basis.
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 system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large.
The Company does not have any subsidiary company.
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company The Code has been posted on the Company's website www.archidply.com.
The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehavior from an employee in a given situation and the reporting structure.
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code.
WHISTLE BLOWER POLICY:
The Company has established a"Vigil Mechanism" for its employees andDirectors enabling them to report any concerns of unethical behavior suspected fraud orviolation of the Company's Code of Conduct.
The Whistle Blower Policy has been adopted by the Board which an Audit Committeeoverlooks into the implementation of the policy.. The Committee reports to the Board. Theemployees and other stakeholders have direct access to the Chairperson of the AuditCommittee for concerns if any for review. The Policy on vigil mechanism and whistleblower policy may be accessed on the Company's website http://www.archidply.com.
PREVENTION OF SEXUAL HARASSMENT:
We have zero tolerance for sexual harassment at workplace and have adopted a policy onprevention prohibition and redressal of sexual harassment at Work place in line with theprovisions of the Sexual Harassment of Women at Workplace ( Prevention Prohibition andRedressal) ACT 2013 and the Rules thereunder for prevention and Redressal of Complaintsof sexual harassment at workplace. There was no complaint related to sexual harassmentduring the year 2015.
The observation made in the Auditors' Report read together with relevant notes thereonare self-explanatory and hence do not call for any further comments under Section 134 ofthe Companies Act 2013.
As required under section 204 (1) of the Companies Act 2013 the Company has obtained aSecretarial Audit Report
The Auditors M/s GRV & PK Chartered Accountants Bengaluru appointment to beratified at the ensuing AnnualGeneral Meeting and being eligible offer themselves forre-appointment.
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Mr. J V Shivaprakash Practicing Company Secretary Bengaluru to undertake theSecretarial Audit of the Company. The Secretarial Audit report for the year ended 31stMarch 2015 is annexed herewith as " Annexure D"
EXTRACT Of ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure E"
RISK MANAGEMENT POLICY:
Pursuant to section 134 (3) (n) of the Companies Act 2013 & Clause 49 of thelisting agreement during the year the role of Audit Committee is enhanced to take careof Risk Management which has been entrusted with the responsibility to assist the Board in(a) Overseeing and approving the Company's enterprise wide risk management framework; and(b) Overseeing that all the risks that the organization faces such as strategicfinancial credit raw material foreign exchange fluctuation quality cost and otherrisks have been identified and assessed and there is an adequate risk managementinfrastructure in place capable of addressing those risks. A Risk Management Policy wasreviewed and approved by the Committee during the year is available on our websitehttp:// www.archidply.com.
PARTICULARS ON REMUNERATION OF EMPLOYEES:
The information required pursuant to Section 197(2) read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company are provided in Annexure B'.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Management Discussion & Analysis Report which form anintegral part of this Report are set out as separate Annexures together with theCertificate from the auditors of the Company regarding compliance with the requirements ofCorporate Governance as stipulated in Clause 49 of the Listing Agreement.
AUDIT COMMITTEE /STAKEHOLDER RELATIONSHIP COMMITTEE / NOMINATION AND REMUNERATIONCOMMITTEE / CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Board of Directors has constituted four Committees i.e. audit committeestakeholder relationship committee nomination and remuneration committee corporatesocial responsibility committee as per requirement of Corporate Governance under listingAgreement. The majority of the members of these committees are Independent andnon-executives. The more details are given under the Corporate Governance Report
The Equity shares of the Company are listed with Bombay Stock Exchange Ltd. (BSE) &National Stock exchange of India Limited (NSE). The annual listing fee for the year2015-16 was paid within the scheduled time to BSE & NSE.
Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government Local Bodies Customers Suppliers ExecutivesStaff and workers at all levels for their continuous co- operation and assistance.
| ||for and on behalf of the Board of Directors |
|Place : Bengaluru ||Deen Dayal Daga |
|Date :23rd May 2015 ||Chairman |