H T Media Ltd.
|BSE: 532662||Sector: Media|
|NSE: HTMEDIA||ISIN Code: INE501G01024|
|BSE 15:50 | 16 Feb||93.65||
|NSE 15:40 | 16 Feb||93.55||
|Mkt Cap.(Rs cr)||2,180|
|Mkt Cap.(Rs cr)||2179.70|
H T Media Ltd. (HTMEDIA) - Director Report
Company director report
Your Directors are pleased to present their Report together with the Audited FinancialStatements (Standalone and Consolidated) tor the financial year ended on March 312017.
FINANCIAL RESULTS (STANDALONE)
Your Company's performance during the financial year ended on March 31 2017 alongwith previous year's figures is summarized below:
The Company has adopted the Indian Accounting Standards ("Ind AS") notifiedunder the Companies (Indian Accounting Standards) Rules 2015 w.e.f. April 1 2016.Financial Statements for the year ended and as at March 31 2016 have been restated toconform to Ind AS. Please refer note no. 51 to the Standalone Financial Statements forfurther explanation on the transition to Ind AS.
Your Directors are pleased to recommend a dividend of ' 0.40 per Equity Share of ' 2/-each i.e. @ 20% (previous year - ' 0.40 per Equity Share of ' 2/- each i.e. @ 20%) forthe financial year ended on March 312017 and seek your approval for the same.
The proposed equity dividend payout (including Corporate Dividend Distribution Tax)would entail an outflow of ' 11.21 Crore (previous year ' 9.87 Crore).
During the year the Board has framed a Dividend Distribution Policy pursuant to theprovisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ("SEBI Regulations") which appears as "Annexure-A"and is also available on the Company's website viz. www.htmedia.in.
COMPANY PERFORMANCE AND FUTURE OUTLOOK
Adetailed analysis and insight into thefinancial performance and operations of yourCompany for the year under review and future outlook is appearing in ManagementDiscussion and Analysis which forms part of the Annual Report.
SCHEME OF ARRANGEMENT
With a view to create a separate and focussed entity to avail future emergingopportunities in the digital media segment the Multimedia Content Management Undertakingof the Company was transferred and vested to and in HT Digital Streams Limited (HTDSL) asa going concern' on a slump exchange basis pursuant to a Scheme of Arrangement u/s391-394 of the Companies Act 1956 between the Company and HTDSL and the respectiveshareholders and creditors ("Scheme"). The Scheme was sanctioned by the Hon'bleDelhi High Court and Hon'ble High Court of Judicature at Patna with effect from theAppointed Date i.e. April 12016.
Pursuant to the Scheme HTDSL has issued and allotted to the Company on December 312016 (being the Effective Date) its 11412104 nos. Equity Shares of ' 10/- each whichconstitutes 57.17% of the Equity Shares Capital of HTDSL along with the Company's thenexisting shareholding.
Your Company has a robust risk management framework to identify evaluate and mitigatebusiness risks. The Company has constituted a Risk Management Committee of Directors whichreviews the identified risks and appropriateness of management's response to significantrisks. A detailed statement indicating development and implementation of a risk managementpolicy for the Company including identification of various elements of risk is appearingin the Management Discussion and Analysis.
EMPLOYEE STOCK OPTION SCHEME
The information required to be disclosed pursuant to the provisions of the Securitiesand Exchange Board of India
(Share Based Employee Benefits) Regulations 2014 read with SEBI's circular no.CIR/CFD/POLICY CELL/2/2015 dated June 16 2015 ("SEBI ESOP Regulations") isavailable on the Company's website viz. www.htmedia.in . The HTML Employee StockOption Scheme' and HTML Employee Stock Option Scheme - 2009' are in compliance withthe SEBI ESOP Regulations.
SUBSIDIARY COMPANIES AND JOINT VENTURE
During the year under review HT Overseas Pte. Ltd. (HT Overseas) (step-downsubsidiary) entered into a joint venture agreement with Sportority Limited (90MiN aleading soccer media website) and NBM Capital L.P to incorporate Sports Asia Pte.Ltd.' (Sports Asia) in Singapore. Sports Asia is authorized to operate website and variousother social media applications containing football content targeting users in India andnearby countries. HT Overseas will hold 50.50% of the capital of Sports Asia.
India Education Services Private Limited (IESPL) was operating as a 50:50 JointVenture between the Company and Apollo Global Singapore Holdings Pte. Ltd. (ApolloGlobal). In view of differences in the strategy of the JV Partners for future operationsof IESPL your Company has acquired 49% equity share capital of IESPL held by ApolloGlobal; and thus the JV agreement stands terminated. Accordingly IESPL is a subsidiaryof your Company.
A composite Scheme of Capital Reduction and Arrangement ("Scheme") under theapplicable provisions of the Companies Act 1956 and the Companies Act 2013 betweenFirefly e-Ventures Limited (Firefly) HT Digital Media Holdings Limited (HT Digital) andHT Mobile Solutions Limited (HT Mobile) ("Subsidiary Companies") and theirrespective shareholders and creditors is pending sanction by the Hon'ble National CompanyLaw Tribunal. The Scheme inter-alia provides for capital reduction of HT Digital andFirefly and demerger of HT Campus Undertaking of Firefly and transfer and vesting thereofto and in HT Mobile.
In terms of the provisions of Section 136 of the Companies Act 2013 the FinancialStatements of subsidiary companies for the financial year ended on March 312017 areavailable for inspection by the Members of the Company at the registered office of theCompany during business hours. The same is also available on the Company's website viz.www.htmedia.in .
A report on the performance and financial position of each of the subsidiary companiesand joint venture in prescribed Form AOC-1 is annexed to the Consolidated Financial
Statements and hence not reproduced here. The Policy for determining MaterialSubsidiary(ies)' is available on the Company's website viz. www.htmedia.in .
The contribution of the subsidiary companies and joint venture to the overallperformance of your Company is outlined in note no. 53 of the Consolidated FinancialStatements for the financial year ended March 312017.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review on the recommendation of Nomination and RemunerationCommittee the Board of Directors at its meeting held on May 26 2016 appointed ShriDinesh Mittal as Whole-time Director for a period of
5 (five) years w.e.f. May 26 2016 which was approved by the Members at the 14thAnnual General Meeting (AGM).
In accordance with the provisions of the Companies Act 2013 Shri Priyavrat Bhartiaretires by rotation at the ensuing AGM and being eligible has offered himself forre-appointment. Your Directors commend the re-appointment of Shri Priyavrat Bhartia forapproval of the Members at the ensuing AGM.
All the Independent Directors of the Company have confirmed that they meet the criteriaof independence as prescribed under both the Companies Act 2013 and SEBI Regulations.The Independent Directors have also confirmed that they have complied with the Codeof Conduct' of the Company.
During the year under review Shri Shamit Bhartia relinquished office of Joint ManagingDirector w.e.f. February 1 2017. However he continues to be a Non-executive Director ofthe Company.
Brief resume nature of expertise details of directorship held in other companies ofShri Priyavrat Bhartia proposed to be re-appointed along with his shareholding in theCompany as stipulated under Secretarial Standard-2 and Regulation 36 of SEBI Regulationsis provided in the Notice of ensuing AGM.
In line with the requirements under the Companies Act 2013 and SEBI Regulations theBoard undertook an annual formal evaluation of its own performance and that of itsCommittees
The Nomination and Remuneration Committee framed questionnaires for evaluation ofperformance of the Board as a whole Board Committees (viz. Audit Committee Stakeholders'Relationship Committee Corporate Social Responsibility Committee and Nomination andRemuneration Committee); Directors and the Chairperson
on various criteria outlined in the Guidance Note on Board Evaluation' issued bySEBI on January 5 2017.
The Directors were evaluated on various parameters such as value addition todiscussions level of preparedness familiarization with relevant aspects of Company'sbusiness/ activities etc. Similarly the Board as a whole was evaluated on parameterswhich included its composition strategic direction focus on governance risk managementand financial controls.
A summary report of the feedback of Directors on the questionnaire(s) was considered bythe Nomination and Remuneration Committee and the Board of Directors. The Board wouldendeavour to use the results of the evaluation process constructively improve its owneffectiveness and deliver superior performance.
In order to comply with the requirement of mandatory rotation of Auditors by theconclusion of the ensuing AGM and to appoint a new Auditor in place of S.R. Batliboi& CO. LLP Chartered Accountants [Firm Registration No. 301003E/ E300005]("SRB") the Audit Committee and Board of Directors at their respective meetingsheld on May 19 2017 have recommended the appointment of Price Waterhouse & CoChartered Accountants LLP (PwC) [Firm Registration No. 304026E/E-300009] as Auditors ofthe Company to hold office for a term of 5 (five) consecutive years from the conclusionof ensuing AGM till the conclusion of sixth AGM from the ensuing AGM (subject toratification of their appointment by the Members at every AGM to be held in theintervening period if so required by Companies Act 2013). The Company has received acertificate from PwC to the effect that their appointment as Auditors shall be inaccordance with the provisions of Sections 139 and 141 of the Companies Act 2013.
The Auditor's Report of SRB on Annual Financial Statements (Standalone andConsolidated) for the financial year ended on March 31 2017 is an unmodified opinion
i.e. it does not contain any qualification reservation or adverse remark.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Board of Directors had appointed Shri Arun Kumar Soni Company Secretaryin Practice (C.P No. 1726) as Secretarial Auditor to conduct the Secretarial Audit forthe financial year 2016-17. The Secretarial Audit Report is annexed herewith as"Annexure-B". The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
During the year under review the Auditors and the Secretarial Auditor have notreported to the Audit Committee any instance of fraud under Section 143(12) of theCompanies Act 2013 and Rules made thereunder.
RELATED PARTY TRANSACTIONS
All contracts /arrangements /transactions entered into by the Company with relatedparties during the year under review were in ordinary course of business of the Companyand on arms' length terms. The related party transactions were placed before the AuditCommittee for review and approval. During the year the Company did not enter into anycontract /arrangement /transaction with related party which could be considered materialin accordance with the Company's Policy on Materiality of and dealing with RelatedParty transactions' and accordingly the disclosure of related party transactions in FormAOC-2 is not applicable. The said policy is available on the Company's websitewz.www.htmedia.in .
Reference of the Members is invited to note no. 36 of the Standalone Annual FinancialStatements which sets out the related party disclosures as per Ind AS-24.
CORPORATE SOCIAL RESPONSIBILTY
As a responsible corporate citizen your Company is committed to undertake sociallyuseful programmes for welfare and sustainable development of the community at large. TheCompany has in place the Corporate Social Responsibility (CSR) Committee of the Directorsin terms of Section 135 of the Companies Act 2013. The composition and terms of referenceof the CSR Committee are provided in the Report on Corporate Governance which forms partof the Annual Report. The CSR Committee has formulated and recommended to the Board a CSRPolicy outlining CSR projects/activities to be undertaken by the Company during the yearunder review. The CSR Policy is available on the Company's website viz. www.htmedia.in .
The Annual Report on CSR for FY 17 is annexed herewith as "Annexure-C".
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 your Directors state that:
i. in the preparation of the annual accounts for the financial year ended on March312017 the applicable Accounting Standards have been followed and there are no materialdepartures;
ii. such accounting policies have been selected and applied consistently and judgmentsand estimates have been made that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as on March 31 2017; and
of the profit of the Company for the year ended on March 312017;
iii. proper and sufficient care has been taken 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. proper internal financial controls were in place and that such internal financialcontrols were adequate and operating effectively; and
vi. systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
DISCLOSURES UNDER THE COMPANIES ACT 2013 Borrowings and Debt Servicing: During theyear under review your Company has met all its obligations towards repayment of principaland interest on loans availed.
Particulars of loans given investments made guarantees /securities given: The detailsof investments made and loans/guarantees/securities given as applicable are given in thenotes to the Annual Standalone Financial Statements.
Board Meetings: A yearly calendar of meetings is prepared and circulated in advance tothe Directors. During the financial year ended on March 31 2017 the Board met five timeson May 26 2016 (two separate meetings) August 05 2016 November 02 2016 and January24 2017. For further details of these meetings Members may please refer Report onCorporate Governance which forms part of this Annual Report.
Committees of the Board: At present seven standing committees of the Board ofDirectors are in place viz. Audit Committee Nomination and Remuneration Committee CSRCommittee Banking and Finance Committee Investment Committee Stakeholder's RelationshipCommittee and Risk Management Committee. During the year under review the recommendationsof the aforesaid Committees were accepted by the Board.
Remuneration Policy: The Remuneration Policy of the Company on appointment andremuneration of Directors Key Managerial Personnel & senior management as prescribedunder Section 178(3) of the Companies Act 2013 and SEBI Regulations is available on theCompany's website viz. www.htmedia.in .
Vigil Mechanism: The Vigil Mechanism as envisaged in the Companies Act 2013 &rules made thereunder and the SEBI Regulations is addressed in the Company's"Whistle Blower Policy". In terms of the Policy directors/employees/stakeholders of the Company may report concerns about unethical behaviour actual orsuspected fraud or any violation of the Company's Code of Conduct. The Policy provides foradequate safeguards against victimization of the Whistle Blower. The Policy is availableon the Company's website viz. www.htmedia.in .
Particulars of employees and related disclosures:
In accordance with the provisions of Section 197(12) of the Companies Act 2013 readwith Rule 5(2) & (3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 details of employees remuneration are set out in the"Annexure-D" to this Report. In terms of the provisions of Section 136(1) of theCompanies Act 2013 the Board's Report is being sent to the Members without thisannexure. However the same is available for inspection by the Members at the RegisteredOffice of the Company during business hours 21 days before the ensuing AGM. Membersinterested in obtaining a copy of the said Annexure may write to the Company Secretary atthe Registered Office of the Company.
Disclosures under Section 197(12) of the Companies Act 2013 read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexedherewith as
Extract of Annual Return:
Extract of the Annual Return for the financial year ended on March 312017 in FormMGT-9 is annexed herewith as "Annexure-F".
Corporate Governance: The report on Corporate Governance in terms of the SEBIRegulations forms part of this Annual Report. The certificate issued by Company Secretaryin Practice is annexed herewith as "Annexure-G".
Conservation of energy technology absorption and foreign exchange earnings &outgo: The information on conservation of energy technology absorption and foreignexchange earnings & outgo is annexed herewith as "Annexure-H".
Business Responsibility Report: In terms of the provisions of Regulation 34 of the SEBIRegulations the Business Responsibility Report is available on the Company's website viz.www.htmedia.in .
Your Directors state that no disclosure is required in respect of the following mattersas there were no transactions/ events in relation thereto during the year under review:
1. Details relating to deposits covered under Chapter V of the Companies Act 2013.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme of the Company.
There was no change in the share capital of the Company during the year under review.
The Company has not transferred any amount to the General Reserve during the year underreview.
No material changes/commitments have occurred after the end of the financial year2016-17 and till the date of this report which would affect the financial position of yourCompany.
No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern' status and Company's operations in future.
Your Company has in place adequate internal financial controls with reference to thefinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operations were observed.
Your Directors place on record their sincere appreciation of the co-operation extendedby all stakeholders including Ministry of Information & Broadcasting and othergovernment authorities shareholders investors readers advertisers browserslisteners customers banks vendors and suppliers. Your Directors also place on recordtheir deep appreciation of the committed services of the executives and employees of theCompany.
For and on behalf of the Board (Shobhana Bhartia)
Place: New Delhi Chairperson & Editorial Director
Date: July 18 2017 DIN: 00020648