HERMAN MILKFOODS LIMITED
ANNUAL REPORT 2008-2009
Your Directors have great pleasure in presenting the 18th Annual Report
together with Audited Accounts of the company for the financial year ended
on 31st March 2009.
Rs. In lacs
Sales Turnover & Other Income 7781.22 4873.60
Operating Profit 219.88 175.21
Interest 7.39 15.36
Depreciation 75.80 72.16
Profit before tax 144.08 103.04
Provision for tax including for:
- Current year NIL NIL
- Earlier years NIL NIL
- Deferred tax NIL NIL
Net profit after tax 144.08 103.04
Proposed Dividend NIL NIL
Transfer to General Reserves NIL NIL
In view of the inadequate profits, your Directors are not in a position to
recommend any dividend for the year.
The sales turnover and other income during the financial year was
Rs.7781.00 lacs resulting in net profit of Rs 144.08 lacs.
During the year 2008-09, the company has entered into an agreement with The
Ambala Coop. Milk Producer's Union Ltd., Ambala, Haryana, The Bihar State
Coop. Milk Producers' Federation Ltd., The H.P. State Coop. Milk Producers
Federation Ltd., Totu, Shimla and The Nestle India Ltd., Moga for
processing of milk into various milk products.
MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:
1. Outlook for the Industry:
The Dairy Industry in India has the cooperative sector on the one hand
which have an excellent milk procurement network. These companies are now
becoming more market savvy and are launching new products and expanding
their market. On the other hand the role of the private sector is also
important and MNCs and large Indian companies co-exist side by side. With
the government placing more emphasis on the agriculture sector the domestic
dairy industry is keenly waiting for the government policy on this front.
2. Future Prospects:
The company has been able to develop a strong marketing and distribution
network for selling its products to The Nestle India Ltd., Moga, COMPFED,
Patna and under the HERMAN BRAND name consisting of 200 distributors and
1000 retailers in various states. However the profit margin has continued
to be squeezed due to competitive market conditions in the domestic dairy
industry. Further, the Company has also set up a marketing Controlling
office at New Delhi which controls the entire marketing in India and
abroad. The Company receiving enormous Orders from abroad. The Company has
already applied for the various requisite licenses with the concerned
3. Operational vis-a-vis Financial Performance:
The company manufactures quality dairy products and certified as ISO-
9001:2000 and HACCP certified Company. The intense competition among
private manufacturers to procure quality milk at a very high price had an
adverse effect on Dairy Industries performance in the last few years.
4. Material Development in Human Resources / Industrial Relations Front:
The team of people in the organization has been working with dedication,
diligence, devotion, determination, dynamism, discipline and direction. The
company believes that motivated employees are its most important resource
and asset to the Company. Industrial relations during the year were
cordial, cooperative, concerted and peaceful. As a result no labor disputes
are pending with the Company in any Court of Law.
Mrs. Rachna Garg and Mr. Virsa Singh Sidhu, Directors of the company are
retiring by rotation at the forthcoming Annual General Meeting and being
eligible have offered themselves for re-appointment.
M/s Taranjeet & Associates, Chartered Accountants, Chandigarh, the retiring
auditor's of the Company will hold office till the conclusion of the next
Annual General Meeting and are recommended for reappointment. The Company
has received certificate from Auditors for their reappointment.
The company has not accepted any deposit within the meaning of section 58 A
of the Companies Act, 1956 and rules made there under for the period under
PARTICULARS OF EMPLOYEES:
None of the employee was in receipt of the remuneration over and above the
limits prescribed u/s 217(2A) of the Companies Act, 1956 read with
Companies (Particular of Employees) Rules, 1975 as amended.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
The information required under section 217 (1) (e) of the Companies Act,
1956 read with the Companies (Disclosure of particulars in the report of
Board of Directors) Rules, 1988 with respect to the conservation of energy,
technology absorption and foreign exchange earning and outgo is attached.
The Management feels pleasure in informing the shareholders that Hon'ble
BIFR has discharged the Company from the purview of the SICA/BIFR on
15.01.2009. Hence, the Company is no more a sick industrial company u/s
3(1) (o) of the SICA Act, 1985.
The observations in the Auditors report have been dealt with in notes to
accounts and same being self explanatory, do not requires further
The Company is regularly filing all the quarterly/annual reports required
to be submitted under Listing Agreement to the Bombay Stock Exchange/
Ludhiana Stock Exchange. Further, the management is making all efforts to
revoke the suspension of trading of shares of the company which is still in
DIRECTORS RESPONSIBILITY STATEMENT:
As required under section 217 (2AA) of the Companies Act, 1956 the
Directors state that:
i) In preparation of annual accounts, the applicable accounting standards
had been followed along with proper explanation relating to material
ii) 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.
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the act for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities.
The Directors have prepared the annual accounts on going concern basis.
The Directors, place on record their appreciation for the support and
assistance received from banks and government authorities for their
valuable support. Your directors also wish to place on record their
gratitude to the valued shareholders of the company. The Board also records
their appreciation to the contribution of their dedicated milk suppliers,
dealers, employees and all concerned during the year.
Date : 01.09.2009 For and on behalf of the Board
Place : Chandigarh HERMAN MILKFOODS LIMITED.