TO THE MEMBERS
Your Directors take pleasure in presenting the Twenty Fourth Annual Report of yourCompany together with the Audited Accounts for the year ended 31st March 2016.
The highlights of the financial results of the Company for the year ended 31st March2016 are as under:
|Particulars || |
| || |
Year Ended 31.3.2016
Year Ended 31.3.2015
Year Ended 31.3.2016
Year Ended 31.3.2015
|Revenue from operations ||42710.70 ||32542.33 ||42710.70 ||32927.14 |
|Total Expenses ||38994.11 ||29630.99 ||38995.81 ||30016.75 |
|Operating Profit Before Depreciation & Finance Costs ||3716.59 ||2911.34 ||3714.89 ||2910.39 |
|Finance Costs ||411.50 ||488.01 ||478.97 ||488.63 |
|Depreciation/Amortization ||780.03 ||912.50 ||780.03 ||912.50 |
|Operating Profit After Depreciation & Finance Costs ||2525.06 ||1510.83 ||2455.89 ||1509.26 |
|Other Income ||1167.13 ||500.55 ||1342.46 ||657.84 |
|Gross Profit before Tax & Exceptional Items ||3692.19 ||2011.38 ||3798.35 ||2167.10 |
|Tax Expense (including Deferred Tax) ||1228.17 ||687.83 ||1246.93 ||711.57 |
|Profit for the year ||2464.02 ||1323.55 ||2551.42 ||1455.53 |
|Balance brought forward from previous year ||423.20 ||495.55 ||677.05 ||617.42 |
|Amount available for appropriation ||2887.22 ||1819.10 ||3228.47 ||2072.95 |
|Appropriations: || || || || |
|Provision for Proposed Dividend ||314.01 ||314.01 ||314.01 ||314.01 |
|Dividend Tax ||63.92 ||63.92 ||63.92 ||63.92 |
|Transfer to General Reserve ||2000.00 ||800.00 ||2000.00 ||800.00 |
|Adjustment on evaluation of useful life of Fixed Assets || ||217.97 || ||217.97 |
|Balance carried forward ||509.29 ||423.20 ||850.54 ||677.05 |
DIVIDEND AND RESERVES
Your Directors are pleased to recommend for your approval a dividend of 30% i.e Rs 3/-per equity share for the year ended 31st March 2016 after taking into consideration theBonus Issue passed by the shareholders vide Postal Ballot on 11th May 2016. The totaloutflow for dividend will be Rs 377.93 lakhs including Rs 63.92 lakhs by way of dividendtax.
During the year under review a sum of Rs 2000 lakhs was transferred to GeneralReserve.
During the last few years there has been an impressive growth in the performance ofthe Company and consequently significant additions have been made to the free reserves.Therefore your Directors have recommended issue of bonus shares in the ratio of one bonusequity share to be issued for every one equity share of face value of Rs 10/-held by themembers at their meeting held on 29.03.2016. The members of the Company have approved thesame through postal ballot process . The Bonus Shares shall rank pari passu in allrespects with existing fully paid up equity shares.
OPERATIONS & STATE OF COMPANY'S AFFAIRS
The production during the year under review has been 49158 MT in comparison to 44752MT in the previous year resulting in a growth of 9.85%. Sales & Turnover for the yearunder review stood at 48604 MT & Rs 42212.88 lakhs as against 45151 MT & Rs32056.02 lakhs in the previous year resulting in an increase of 7.65% & 31.68%respectively.
During the year net Profit of the Company stood at Rs 2464.02 lakhs as against Rs1323.55 lakhs registering an increase of 86.17% over last year due to better pricing andoperational eficiencies. The current financial year i.e. 2016-17 is expected to be normal.First half of the financial year 2015-16 was dificult for the jute industry with sluggishdemand from Government sugar industry and other quarters. The second half of the yearwitnessed an unprecedented increase in the prices due to short supply of raw-material ofraw jute resulting in the OFF ce of Jute Commissioner to put in place various controlmeasures to ensure equal distribution of available raw jute.
The initial forecast of raw jute crop in the forthcoming jute season seems to be verygood due to better sowing and expected good monsoon. The prices of raw jute in the currentjute season are likely to be firm at the beginning with a sharp correction in prices asfresh arrivals from the new crop hits the market.
Your Companys continuous thrust on developing new products and new overseasmarket and aggressive efforts have helped increase its export performance from Rs 8919.91lakhs in the year 2014-15 to Rs 10632.88 lakhs in the year 2015-16 i.e increase by19.20%. Your Directors are hopeful of a good export performance during the currentfinancial year also.
Your Company believes in sustainable development and continues to maintain its thruston modernization and diversification. The 5th Phase of modernization is completed and theCompany has taken up the 6th Phase of modernization.
Various bank facilities of the Company are rated by CRISIL Limited based on Basel IInorms followed by the banks under the guidelines of Reserve Bank of India. During the yearratings for all existing & proposed bank facilities have been reviewed and rated byCRISIL Limited.
CRISIL has reafirmed its rating for long-term bank facilities to CRISIL A/Stable andfor short-term bank facilities to CRISIL A1.
The rating afirmation reffects the consistency in Companys business risk proff lemarked by sustained scale of operations and Profitability.
CHANGE IN NATURE OF BUSINESS IF ANY
During the year there was no change in the nature of business of the Company.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
SCHEME OF AMALGAMATION BETWEEN "THE COMPANY" AND KETTLEWELL BULLEN &COMPANY LIMITED
During the year under review the Board of Directors of the Company at its meeting heldon 29th March 2016 has approved the Scheme of Amalgamation of the Company with KettlewellBullen & Company Limited in terms of the provisions of Section 391 to 394 and otherapplicable provisions of the Companies Act 1956 & Companies Act 2013 to the extentapplicable with effect from the Appointment Date i.e. 1st January 2015. As the Schemewill come into effect after the approval from the statutory authorities shareholders andcourt with effect from the Appointment Date no effects of the above Scheme ofAmalgamation has been recognized in the financial statements.
Gloster Lifestyle Limited and Gloster Specialities Limited continue to be wholly ownedsubsidiaries of your Company.
Pursuant to the provisions of Section 129(3) of the Companies Act 2013 and AccountingStandard-21 issued by the Institute of Chartered Accountants of India ConsolidatedFinancial Statements presented by the Company include the financial statement of itssubsidiaries.
Furrther a separate statement containing the salient features of the financialstatements of subsidiaries of the Company in the prescribed Form AOC 1 is attached withthis Report.
The Annual accounts of the subsidiary companies and other related detailed informationwill be kept at the Registered OFF ce of the Company and also at the Registered OFF ce ofthe subsidiary company and will be available to the investors seeking information at anytime during the working hours of the Company except Saturday. Further as per section 136of the Companies Act 2013 the audited financial statements including the consolidatedfinancial statements and related information of the Company and audited accounts of eachof the subsidiaries are available at www.glosterjute.com/ Acctssubco.html. APolicy has been formulated for determining the Material Subsidiaries of the Companypursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015('Listing Regulations'). The said Policy has been posted on the Company's website at theweblink www.glosterjute.com/ documents/PDMS/pdf.
PERFORMANCE OF SUBSIDIARY COMPANIES
Gloster Lifestyle Limited
The Gross revenue of the Company stood at Rs 87.79 lakhs (Previous Year Rs 269.12lakhs). Profit after tax for the year stood at Rs 42.95 lakhs (Previous Year Rs 64.24lakhs).
Gloster Specialities Limited
The Gross revenue of the Company stood at Rs 89.07 lakhs (Previous Year Rs 271.86lakhs). Profit after tax for the year stood at Rs 44.46 lakhs (Previous Year Rs 66.65lakhs).
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements are prepared in accordance with accountingprinciples generally accepted in India including the Accounting Standards specified underSection 133 of the Companies Act 2013 read with Rule 7 of the Companies (accounts) Rules2014 forms part of the Annual Report and are reffected in the Consolidated FinancialStatements of the Company.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion and Analysis Report as required under the ListingRegulation Report is attached as Annexure I and forms part of this Report.
The Company has been practicing the principles of good corporate governance over theyears and lays strong emphasis on transparency accountability and integrity. As perRegulation 34 (3) read with Schedule V of the Listing Regulations the detailed report onCorporate Governance and a certificate from the practising Company Secretary confirmingcompliance with the requirements of the Corporate Governance is separately attached andforms part of this Annual Report.
The Paid-up share capital of the Company as on 31st March 2016 stood at Rs 523.34lakhs. During the year under review the Company has not issued any shares with or withoutdifierential voting rights nor has granted any stock options or sweat equity. As on 31stMarch 2016 none of the Directors of the Company hold instruments convertible into equityshares of the Company.
NUMBER OF BOARD MEETINGS HELD
During the financial year ended 31st March 2016 five Board Meetings were held on16.05.2015 13.08.2015 06.11.2015 12.02.2016 and 29.03.2016. The intervening gap betweenthe Meetings was within the period prescribed under the Companies Act 2013.
The details of number of meetings of the Board held during the Financial Year 2015-16forms part of Corporate Governance Report.
MEETINGS OF INDEPENDENT DIRECTORS
During the financial year 2015-16 the Independent Directors met separately on 12thFebruary 2016 and inter-alia discussed the following:
Evaluation of performance of Non- Independent Directors and the Board of Directors as awhole.
Evaluation of performance of the Executive Chairman of the Company taking into accountthe views of Executive and Non-Executive Directors.
Evaluation of the quality contents and timelines of flow of information between themanagement and the Board that is necessary for the Board to effectively and reasonablyperform its duties.
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theBoard of Directors have evaluated its own effectiveness for the financial year 2015-16along with that of its various committees and details of such evaluation has beenmentioned in the Corporate Governance Report. The Board of Directors expressed theirsatisfaction with the evaluation process.
COMMITTEES OF THE BOARD
Audit Committee: The composition and terms of reference of the Audit Committee hasbeen furnished in the Corporate Governance Report forming a part of this Annual Report.There has been no instance where the Board has not accepted the recommendations of theAudit Committee.
Nomination and Remuneration Committee:
The composition and terms of reference of the Nomination and Remuneration committee hasbeen furnished in the Corporate Governance Report forming a part of this Annual Report.
Stakeholders Relationship Committee:
The composition and terms of reference of the Stakeholders Relationship committee hasbeen furnished in the Corporate Governance Report forming a part of this Annual Report.
The details pertaining to Audit Committee Nomination &
Remuneration Committee and Stakeholders Relationship Committee are included inthe Corporate Governance Report which forms part of this Annual Report.
DIRECTORS & KEY MANAGERIAL PERSONNEL
Your Directors express their profound grief and sorrow on the sad demise of Shri GopalDas Bangur (DIN 00040856) Executive Chairman of the Company on 8th June2016. His demiseis a great loss to your Company. Your Directors pay their respectful homage and tribute tothis extraordinary human being a great leader and an iconic industrialist.
During the year Shri Hemant Bangur (DIN 00040903) was appointed as Managing Directordesignated as Executive Chairman of the Company for a period of three years with effectfrom 1st September 2015 in the Board meeting held on 13th August 2015. The saidappointment was subsequently approved by the Members of the Company at the Annual GeneralMeeting held on 26th September 2015. The off ce of Shri Hemant Bangur shall be liable toretire by rotation.
In accordance with the provisions of Section 152 of the Companies Act 2013 andCompanys Articles of Association Shri Hemant Bangur Executive Chairman (DIN00040903) retires by rotation at the forthcoming Annual General Meeting and beingeligible off ers himself for re-appointment.
As per the provisions of Section 149(1) of the Companies Act 2013 and Regulation17(1)(a) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 theCompany has one Woman Director on its Board.
The independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
A Formal Letter setting out the terms and conditions of appointment has been issued toall the Independent Directors as per the provisions of Companies Act 2013 and the ListingRegulation. The same has been hosted on the Companys website and can be accessed athttp://www.glosterjute.com/ documents/appntdir.pdf.
None of the Directors of the Company are disqualified for being appointed as Directorsas specified in section 164(2) of the Companies Act 2013 and rule 14(1) of the Companies(Appointment and Qualification of Directors) Rules 2014.
A brief resume of the Directors seeking appointment/ re-appointment at the ensuingAnnual General Meeting is incorporated in the Notice calling the said meeting.
During the year the Company had four Key Managerial Personnel Shri Gopal DasBangur Executive Chairman upto 7th June 2016 Shri Hemant Bangur Executive Chairman(w.e.f. 1st September 2016) Shri Dharam Chand Baheti Managing Director Shri Ajay KumarAgarwal Company Secretary and Shri Shankar Lal Kedia CFO.
NOMINATION & REMUNERATION POLICY
The Nomination and Remuneration Committee has formulated a policy relating to theremuneration for the Directors Key Managerial Personnel and Senior Managerial Personnel.The philosophy for remuneration is based on the commitment of fostering a culture ofleadership with trust. The remuneration policy has been prepared pursuant to theprovisions of Section 178(3) of the Companies Act 2013 Regulation 19 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
The Nomination & Remuneration Policy is attached as Annexure-II and forms part ofthis report.
The Independent Directors have been familiarized with the nature of operations of theCompany & the industry in which it operates business model of the Company. Thedetails of familiarization programme have been posted in the website of the Company andcan be accessed at http://www.glosterjute. com/documents/FPID.pdf.
WHISTLE BLOWER POLICY
The Company has adopted a Vigil Mechanism / Whistle Blower Policy and has establishedthe necessary mechanism for employees to report concerns about unethical behavior orsuspected fraud in violation of Companys Code of Conduct or any other point ofconcern. The mechanism provides for adequate safeguards against victimization of employeesand Directors to avail of the mechanism and also provide for direct access to the Chairmanof the Audit Committee in exceptional cases. The policy has been uploaded in the websiteof the Company and can be accessed at http://www.glosterjute.com/documents/WBPolicy.pdf.
RELATED PARTY TRASACTIONS
The contracts/arrangements/transactions entered into by the Company with the relatedparties during the financial year under reporting were in ordinary course of business andwere negotiated on an arms length basis with the intention to further theCompanys interest. No material Contracts or arrangement with related parties wereentered into during the year under review. There are no material related partytransactions during the year under review with the Promoters Directors or Key
Managerial Personnel. Accordingly no transactions are being reported in Form No. AOC 2 in terms of section 134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014.
All Related Party Transactions are placed before the Audit Committee as also to theBoard for approval. Where required prior omnibus approval of the Audit Committee isobtained for transactions which are of a foreseen and repetitive in nature and thecorresponding actual transactions become a subject of review at subsequent Audit CommitteeMeetings.
The policy on Related Party Transactions has been uploaded on the website of theCompany and can be accessed at http://www.glosterjute.com/documents/RPTPolicy.pdf.
The details of the transactions with related parties during 2015-16 are providedin the accompanying financial statements.
None of the Directors has any pecuniary relationship or transactions vis--vis theCompany.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to Section 135 of the Companies Act 2013 read with the Companies (CorporateSocial Responsibility Policy) Rules 2014 the Board of Directors of your Company hasconstituted a CSR Committee and has simultaneously approved and adopted a CSR policy basedon the recommendations of the CSR Committee. The said policy is available on the websiteof your Company and can be accessed at http://www.glosterjute.com/documents/CSRPolicy.pdf.
As on 31st March 2016 the Committee consists of four Members comprising:
|Name of the Members ||Category |
|Shri Hemant Bangur ||Executive Chairman |
|Shri Dharam Chand Baheti ||Managing Director |
|Smt Nandita Sen ||Independent Director |
|Shri Krutibas Mahapatra ||Independent Director |
The Report on CSR activities as required under Companies (Corporate SocialResponsibility Policy) Rules 2014 is given in Annexure III and forms part of this Report.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has effective internal controls in place which are constantly reviewed. TheCompanys internal control system is commensurate with its size scale andoperations. Detailed procedures are in place to ensure that all assets are safeguarded andprotected against loss.
The Internal Audit is carried on by M/s. S.S. Kothari & Co. Chartered Accountants.The Internal Audit function gives thrust to test and review controls and systems that arein place. The Audit Committee of the Board also reviews the Internal Audit functions
The Audit Committee of the Board reviews the Internal Audit Report and correctiveactions taken on the findings are also reported to the Audit Committee.
The main aim of risk management is to identify monitor and take precautionary measuresin respect of the events that may pose risks for the business. The Company has beenaddressing various risks impacting the Company through a Risk Management procedure inplace. Major risks identified by the businesses and functions are systematically addressedthrough mitigating actions on a continuing basis.
AUDITORS & AUDITORS REPORT
The members had at the 22nd Annual General Meeting held on 6th September 2014 approvedthe appointment of Messrs Lovelock & Lewes Chartered Accountants (Firm RegistrationNo. 301056E) as Statutory Auditors of the Company from the conclusion of 22nd AnnualGeneral Meeting till the conclusion of the 25th Annual General Meeting of the Company. Thesaid appointment of the Statutory Auditors would be proposed for ratification at theensuing Annual General Meeting
The Auditors Report on the financial statements for the year 2015-16 does notcontain any qualifications reservations or adverse remarks.
The Board of Directors have appointed M/s D. Radhakrishnan & Co. Cost Accountantsas Cost Auditors for conducting the audit of cost records of the Company for the financialyear 2016-17.
In accordance with section 148 of the Companies Act 2013 read with rule 14 of theCompanies (Audit and Auditors) rules 2014 the remuneration payable to the Cost Auditorsfor the financial year 2016-17 would be placed at the ensuing Annual General Meeting forratification.
Pursuant to provisions of Section 204 of the Companies Act 2013 and rules made thereunder the Board has appointed M/s. M K B & Associates Company Secretaries toconduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report forthe financial year ended 31st March 2016 is attached as Annexure IV and forms part ofthis Report.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
EXTRACT OF THE ANNUAL RETURN
The extracts of Annual return pursuant to Section 92 of the Companies Act 2013 readwith Rule 12 of the Companies (Management and Administration) Rules 2014 is attached asAnnexure V and forms part of this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS &OUTGO.
Information required under section 134(3) (m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 is attached as Annexure VI and forms part ofthis Report.
PARTICULARS OF EMPLOYEES
The information required under section 197 of the Companies Act 2013 read with rule5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014is attached as Annexure VII A and forms part of this Report.
The details of employees who are in receipt of remuneration exceeding the limitsprescribed under Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is attached as Annexure VIIB and forms part of this Report.
Your company has not accepted deposits from public as envisaged under Section 73 to 76of Companies Act 2013 read with Companies (Acceptance of Deposit) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of provisions of Section 134(3)(c) of the Companies Act 2013 your Directorsconfirm that :
i) In the preparation of Annual Accounts the applicable Standards have been followedand that there are no material departures;
ii) The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are 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 have taken proper and suficient 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 annual accounts have been prepared on a going concern basis;
v) The Directors have laid down internal financial controls for the Company which areadequate and are operating effectively;
vi) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and such systems were adequate and operating effectively.
ENVIRONMENT AND SAFETY
TheCompanyisconsciousoftheimportanceofenvironmentally clean and safe operations. TheCompanys policy requires the conduct of all operations in such manner so as toensure safety of all concerned compliance of statutory and industrial requirements forenvironment protection and conservation of natural resources to the extent possible.
The Board desires to place on record its appreciation for the support and co-operationthat the Company has received from suppliers brokers customers and others associatedwith the Company as its enterprise partners. The Company has always looked upon them aspartners in its progress and has happily shared with them rewards of growth. It will beCompanys endeavor to build and nurture strong links with trade based on mutualityrespect and co-operation with each other.
As the members are aware your Companys shares are tradable compulsorily inelectronic form. In view of the numerous advantages off ered by the Depository systemmembers are requested to avail of the facility of dematerialization of the Companysshares either in National Securities Depository Ltd or Central Depository Services (India)Ltd.
DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN
AT WORKPLACE (PREVENTION PROHIBITION &REDRESSAL) ACT 2013
The Company has zero tolerance for sexual harassment at work place and has adopted apolicy in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013 and the Rules thereunder forprevention prohibition and redressal of complaints of sexual harassment at workplace.During the year no complaint was lodged with the Internal Complaints Committee.
Your Directors wish to place on record their appreciation for the contribution made bythe employees at all levels but for whose hard work solidarity and support yourCompanys achievements would not have been possible. Your Directors also wish tothank its customers brokers dealers agents suppliers investors and bankers for theircontinued support and faith reposed in the Company.
The enthusiasm and unstinting efforts of the employees have enabled the Company toremain at the forefront of the industry despite increased competition from severalexisting and new players.
Your Directors take this opportunity to thank all investors customers vendorsbankers regulatory and government authorities depositories and stock exchanges for theircontinued support and faith reposed in the Company.
| ||For & on behalf of the Board |
|Place : Kolkata ||Hemant Bangur -Executive Chairman |
|Dated : 14th May 2016 ||Dharam Chand Baheti -Managing Director |