Aban Offshore Ltd.
|BSE: 523204||Sector: Oil & Gas|
|NSE: ABAN||ISIN Code: INE421A01028|
|BSE 00:00 | 23 Aug||22.50||
|NSE 00:00 | 23 Aug||22.50||
|Mkt Cap.(Rs cr)||131|
|Mkt Cap.(Rs cr)||131.29|
Aban Offshore Ltd. (ABAN) - Director Report
Company director report
The Directors of your company are pleased to present the Thirty Second Annual Reportalong with the accounts for the year ended 31st March 2018.
1. Financial Results
Rs. in Millions
The Revenue earned during the year under review stood at Rs.6517 Million. Rigs Aban IIand Aban ICE were working 5. satisfactorily under the existing contracts. Other Rigs arebeing actively marketed.
3. Changes In Share Capital
There was no change in the Share Capital of the Company during the year under review.
4. Subsidiary Companies INDIAN
Aban Energies Limited
The Subsidiary Company activities relating to the maintenance of windmills of theCompany has been satisfactory.
The subsidiary company accounts details are available in the Company's website.
Consolidation of Accounts
The consolidated financial statements of the Company are prepared in accordance withthe provisions of Section 129 of the Act 2013 read with the Companies (Accounts) Rules2014 and Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (LODR) along with a separate statement containing the salient featuresof the financial performance of subsidiaries/ associates in the prescribed form. Theaudited consolidated financial statements together with Auditor's Report forms part of theAnnual Report.
As per IND AS-108 if the revenue of an operating segment is less than 10 percent ofthe combined revenue of all operating segment then it is not mandatory for a company toreport separately information about that segment. The revenue from Wind Energy division isless than 10 percent of the combined revenue of all operating segments. Hence the Companyis not reporting its Wind Energy operating segment in its financials.
6. Management's Discussion and Analysis
Management Discussion and Analysis Report for the year under review as stipulated underRegulation 34 (2) (e) of SEBI (LODR) Regulations 2015 is presented in a separate sectionforming part of the Annual Report.
In order to conserve cash the Board of Directors do not recommend any dividend.
Ms.Deepa Reji Abraham is liable to retire by rotation and being eligible offers herselffor re-appointment.
Mr. Pradeep Kumar Khosla (Nominee Director of SBI) resigned from the Board of theCompany with effect from 1st November 2017. The board wish to place on record its sincereappreciation for the services rendered by him during his tenure.
9. Disclosures under Companies Act 2013:
Extract of Annual Return:
The details forming part of the extract of the Annual Return in Form MGT-9 as on March312018 is enclosed in Annexure.
Number of Board Meetings:
The Board of Directors met 5 (five) times in the year 2017
18. The details of the Board Meetings and the attendance of the Directors are providedin the Corporate Governance Report.
Constitution of Committees:
The details of various committees formed and their attendance during the year areprovided in the Corporate Governance Report.
Role of Audit Committee
The Role of Audit Committee is given in the Corporate Governance Report.
10. Director's Responsibility Statement
Pursuant to the requirement under Section 134 (3) of the Companies Act 2013 withrespect to the Directors' Responsibility Statement it is hereby confirmed that:
(i) in the preparation of the Annual Accounts for the financial year
ended on 31st March 2018 the applicable accounting standards had been followed alongwith a proper explanation relating to material departures.
(ii) the Directors had selected such accounting policies and applied them consistentlyand made judgements 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 had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safe guarding the assets of the Company and for preventing and detecting fraud andother irregularities.
(iv) the Directors had prepared the accounts for the financial year ended on 31st March2018 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 systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
11. Statement of Declaration by Independent Directors as required under 149(6) of theCompanies Act 2013
All the Independent Directors have given the declarations that they meet the criteriaof Independence as laid down under Section 149 (6) of the Companies Act 2013 and SEBI(LODR) Regulations 2015. In the opinion of the Board they fulfill the conditions ofIndependence as specified in the Act and Rules made there under and are independent of themanagement.
12. Explanation by the Board on every qualification reservation or adverse remark ordisclaimer made-
a) By the Auditor in his report Nil
b) By the Practising Company Secretary in his Secretarial Audit Report- Nil
13. Particulars of Loans Guarantees or Investments under Section 186 of the CompaniesAct 2013
Details of loans guarantees and investments covered under the provision of Section 186of the Companies Act 2013 are given in Notes to the financial statements.
14. Particulars of contracts or arrangements with related parties referred to in sub-section (1) of Section 188 of the Companies act 2013 in the prescribed form
All Related Party Transactions that were entered into during the financial year were onan arm's length basis and were in compliance with the applicable provisions of theCompanies Act 2013 and the listing Regulation. There were
no materially significant Related Party Transactions made by the Company during theyear that would have required the shareholder approval as required under the listingregulation.
All Related Party Transactions are placed before the Audit Committee for approval.Suitable disclosures as required under AS 18 have been made in the Notes to the FinancialStatements. Form AOC-2 is shown in Annexure B
The Board had approved policies on Related Party Transactions and Material Subsidiary.The Policies have been uploaded in the website under the weblink: http://abanoffshore.com/RelatedPartyTransactionsPolicy.pdf
15. Material changes and commitments if any affecting the financial position of theCompany which have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of the report
There were no material changes and commitments affecting the financial position of theCompany between the end of financial year March 312018 and the date of the Report.
16. Statement indicating development and implementation of a risk management policy forthe company including identification therein of elements of risk if any which in theopinion of the board may threaten the existence of the Company.
The Company's robust risk management framework identifies and evaluates business risksand opportunities. The Company recognizes that these risks need to be managed andmitigated to protect its shareholders and other stakeholders to achieve its businessobjectives and enable sustainable growth. The risk framework is aimed at effectivelymitigating the Company's various business and operational risks through strategicactions. Risk management is embedded in our critical business activities functions andprocesses. The risks are reviewed from the change in the nature and extent of the majorrisks identified since the last assessment. It also provides control measures for risksand future action plans.
The Company believes that the overall risk exposure of present and future risks remainswithin risk capacity.
17. Corporate social responsibility initiatives taken during the year
The Company has constituted CSR Committee in accordance with section 135 of theCompanies Act 2013. The CSR Committee has formulated and recommended to the Board a CSRPolicy indicating the activities to be undertaken by the Company which has been approvedby the Board. During the year the Company had engaged IL & FS Skills DevelopmentCorporation Limited to undertake program to provide vocational/employable skills trainingto youth from
marginal sections of society and spent around Rs.1.7 million for the same. The detailedreport is given in a separate Annexure E in the Annual Report. The CSR Policy may beaccessed on the Company's website at http://abanoffshore .com/pdf/CS R_Pol i cy. pdf
18. Board Evaluation
Pursuant to the provisions of Section 134(3) (p) of the Companies Act 2013 and SEBI(LODR) Regulations 2015 the Board has carried out an annual evaluation of its ownperformance performance of the Directors as well as the evaluation of the workings of itsCommittees. The manner in which the evaluation was carried out has been explained in theCorporate Governance Report.
19. The details of directors or key managerial personnel who were appointed or haveresigned during the year
Mr. Pradeep Kumar Khosla nominee director of State Bank of India resigned from theBoard of the Company with effect from 1st November 2017.
20. The name of companies which have become or ceased to be its subsidiaries jointventures or associate companies during the year
Aban Hydrocarbons Pte Ltd had ceased to become step down subsidiary of the company.
21. The details relating to deposits covered under chapter v of companies act 2013
During the year under review your Company did not accept any deposits within themeaning of provisions of Chapter V- Acceptance of Deposits by Companies of the CompaniesAct 2013 read with Companies (Acceptance of Deposits) Rules 2014.
22. The details of significant and material orders passed by the regulators or courtsor tribunals impacting the going concern status and Company's operations in future
No significant and material orders were passed by the Regulators or Courts or Tribunalswhich would impact the going concern status of the Company.
23. The details in respect of adequacy of internal financial controls with reference tothe financial statements.
Details of the same are provided in the Management Discussion and Analysis attached tothis Report
24. Internal financial Control:
Your Company maintains appropriate systems of internal controls including monitoringprocedures to ensure that all its assets are safeguarded against loss from unauthorizeduse/misuse or disposition. Company policies guidelines and procedures provide foradequate checks and balances and are meant to ensure that all transactions are authorizedrecorded and reported correctly. Your company through its own internal audit departmentcarried out periodic audits at all locations and functions. The internal audit departmentreviews the efficiency and effectiveness of these systems and procedures. Added objectivesincluding evaluating the reliability of financial and operational information and ensuringcompliances with applicable laws and regulations. The observations arising out of theaudit are periodically reviewed and compliance ensured. Appropriate controls are in placeto ensure: (a) the orderly and efficient conduct of business including adherence toCompany policies (b) safeguarding of its assets (c) prevention and detection of fraudsand errors (d) the accuracy and completeness of the accounting records and (e) timelypreparation of reliable financial information.
25. Stock Exchanges
Your Company's Equity shares are listed in BSE Limited and National Stock Exchange ofIndia Ltd.
Preference Shares aggregating to Rs. 2610 million issued by the Company which werelisted in BSE Limited are under suspension.
Necessary stock exchange regulations are complied with. Applicable listing fees for theyear 2017-18 have already been paid to the stock exchanges.
26. Compliance of Secretarial Standards
The Company has complied with the applicable Secretarial Standards issued by Instituteof Company Secretaries of India.
27. Vigil Mechanism/Whistle Blower Policy
The Company has adopted a Whistle Blower Policy to provide a formal mechanism to theDirectors and Employees to report about unethical behavior or violation of the Company'sCode of Conduct. The Policy provides for adequate safeguards against victimization ofemployees who avail of the mechanism and also provides for direct access to the Chairmanof the Audit Committee.
Your Company hereby affirms that no Director/employee has been denied access to theChairman of the Audit Committee and that no complaints were received during the year.
The whistle blower policy has been hosted in the Company's website under theweblink" http://abanoffshore . com/pdf/whistleblowerpolicy.pdf
28. Disclosure under the Sexual Harassment of Women at workplace (PreventionProhibition and Redressal) Act 2013.
The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of women at workplace (Prevention prohibition and Redressal)Act 2013. Internal Complaints Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) are covered under this policy. No complaints were received during the year2017-18.
M/s. P.Murali & Co Chartered Accountants Chennai to hold office till theconclusion of 32nd Annual General Meeting.
M/s. P.Murali & Co Chartered Accountants are being recommended for appointment asStatutory Auditors to hold office till the conclusion of the 36th Annual General Meeting.
The Audit Committee and the Board of Directors have recommended the appointment of M/s.P.Murali & Co. Chartered Accountants as the Statutory Auditors from the financialyear 2018-19 to 2021-22. The necessary resolution is being placed before the shareholdersfor approval.
30. Additional disclosures
In line with the requirements of Accounting Standards Rules 2006 of the Institute ofChartered Accountants of India your Company has made additional disclosures in respect ofthe financial reporting of interests in joint venture in the notes on accounts.
31. Particulars of employees
In accordance with provision to Section 136(1) of the Companies Act 2013 theDirectors' Report is being sent to all shareholders excluding the statement prescribedunder Rule 5(1) 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014. The said statement is available for inspection by theMembers at the registered office of the Company during office hours till the date of theAnnual General Meeting.
32. The particulars prescribed under section 134 (3)(m) of the Companies Act 2013 readwith Rule (3)(a) (b) & (c) of the Companies (Accounts) Rules 2014
(A) Conservation of Energy
The Company has undertaken several initiatives in this area like the following:
Variable Refrigerant Flow (VRF) system for ACs installed earlier in the officewhich is highly energy efficient. It saves approximately Fifty percent of powerconsumption.
Intelligent control system as a part of building management system to controlpower consumption in ACs by way of automatic switch off of electric equipment when an areais unutilized.
Changed the lifts to energy efficient technology with drives which will minimizepower consumption. The Project completed and saving is mentioned above.
Migration from traditional lighting system to LED lighting system at all ourRigs and office - on going project waste heat recovery units planned for new Gensetinstallation on vessel. This utilizes the heat wasted in Gas turbine exhausts.
(B) Technology Absorption
Migration from existing time based maintenance philosophy to predictivemaintenance with the help of latest electronic/digital instrumentation.
Changing out electrical systems and controls for critical equipments withdigital drives and Variable Frequency Drive (VFD) in all our offshore assets.
Complete process of material purchase from requirement to delivery isdigitalized for a paperless environment as a measure of go green initiative.
Company started using friction reduction products like polytron in lube oilapplications. This reduces consumed energy minimizes heating reduces friction by 90%. 5%of engine/ equipment is implemented with polytron during this financial year.
Foreign exchange earnings and outgo (Rupees in millions)
33. Corporate Governance
A detailed note on the Company's philosophy on Corporate Governance and such otherdisclosures as required under the listing regulations is separately annexed herewith andforms part of this report.
34. Compliance Certificate
A Certificate from the Auditors of the company has been attached to this report whichtestifies that the requirements of a sound Corporate Governance process as stipulatedunder Schedule V of the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 with the stock exchanges was met.
Your Directors wish to place on record their sincere appreciation for the contributionmade by the employees at all levels. The Directors also record their sincere appreciationof the support and co-operation received from the Bankers Financial InstitutionsInvestors relevant Central and State Governments Ministries Valued Clients and Membersof the Company.
Statement in the Management Discussion and Analysis describing the Company'sobjective's estimates expectation of projection may be Forward Looking Statement withinthe meaning of applicable laws and regulations. Actual results could differ materiallyfrom those expressed or implied. Important factors that could make a difference to theCompany's operations include Government Regulations Taw Laws economic developments inIndia and in the countries in which the Company conducts business litigations and otherallied factors.
ANNEXURE TO THE REPORT OF THE DIRECTORS
Statement as at 31st March 2018 pursuant to clause 12 (Disclosure in the Directors'Report) of the Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999
Employee Stock Options -2005
Disclosure pursuant to Rule 5 of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014
(i) & (ii) The ratio of the remuneration of each Director to the median and meanremuneration of the employees of the company for the financial year and the percentageincrease in remuneration of each director Chief Financial Officer Chief Executiveofficer Company Secretary or Manager if any in the financial year:
* Denotes non executive directors and the remuneration is sitting fees only.
iii. The median remuneration for the year 2017-18 is -Rs 0.47 million.
iv. The percentage increase /(decrease) in the median remuneration of employees in thefinancial year is- (6.71).
v. The number of permanent employees on the rolls of the Company- 576
vi. Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
There was no increase in the Remuneration during the year.
vii. Affirmation that the remuneration is as per the remuneration policy of theCompany:
The Company affirms that remuneration is as per the remuneration policy of the Company.