Century Extrusions Ltd.
|BSE: 500083||Sector: Metals & Mining|
|NSE: CENTEXT||ISIN Code: INE281A01026|
|BSE 00:00 | 24 Sep||9.10||
|NSE 00:00 | 24 Sep||9.05||
|Mkt Cap.(Rs cr)||73|
|Mkt Cap.(Rs cr)||72.80|
Century Extrusions Ltd. (CENTEXT) - Director Report
Company director report
To the Members
Your Directors have pleasure in presenting the 32nd (Thirty-Second) AnnualReport on the business and operations of Century Extrusions Limited and the AuditedAccounts for the financial year ended 31st March 2020.
OVERVIEW OF COMPANY'S FINANCIAL AND OPERATIONAL PERFORMANCE
The Company reported a sales turnover in the financial year 2019-20 of Rs.23056 lacsas against Rs. 25513 lacs in the previous financial year recording decrease of about9.63%. in the sales turnover of the Company.
The Profit after Tax (PAT) for the financial year 2019-20 is Rs.370 lacs as againstprofit of Rs. 403 lacs reflecting of about 8.19% decrease in the financial performance ofthe Company.
The Decrease in turnover as well as consequently decline in Profit after Tax (PAT) incomparison to the previous financial year to this financial year in the backdrop of thecontinued global recession in the automobile industry further aggravated by the COVID-19pandemic.
(Rs. in Lacs except per share data)
The financial statements for the year ended 31st March 2020 have been prepared inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Companies Act2013 ("the Act") read with the Companies (Indian Accounting Standards) Rules2015 as amended.
DIVIDEND AND RESERVE
In view of meeting the capital requirement and for growth of the Company the Companyis retaining its earnings in the business. Therefore no dividend is being recommended bythe Board of Directors of the Company.
Further there is no statutory obligation on the Company to transfer a certain portionof its distributable profits for the year to General Reserve the entire profits isproposed to be re-invested back into the company for growth purposes.
In view of the lockdown across the country due to the COVID-19 pandemic themanufacturing operations of the Company had been suspended temporarily in compliance withthe directives/orders issued by the relevant authorities. The Company has made detailedassessments of the recoverability and carrying values of its assets comprising propertyplant and equipment inventories receivables and other current assets as at the balancesheet date and on the basis of evaluation has concluded that no material adjustments arerequired in the standalone financial results.
The Company is taking all the necessary steps and precautionary measures to ensuresmooth functioning of its operations and to ensure the safety and well-being of all itsemployees. Given the criticalities associated with nature condition and duration ofCOVID-19 the impact assessment on the Company's financial statements will be continuouslymade and provided for as required. Subsequent to year end Company's plants have resumedoperations as per government guidelines and directives prescribed. MANUFACTURING
Production of Aluminum Extrusions products during the financial year 2019-20 decline to12014 MT as compared to 12350 MT in the previous financial year 2018-19 Productionreduction has been observed due to lockdown imposed by the Government because of theCOVID-19 pandemic.
Your Company's has not issued and allotted any shares during the financial year2019-20. As on 31st March 2020 the Authorised share capital of your Company stood at Rs.120000000/- (Rupees Twelve Crores Only) comprising of 120000000 (Twelve Crores)number of Equity shares of Rs.1/- each fully paid up. However the issued subscribed andpaid up share capital of your
Company stood at Rs. 80000000/- (Rupees Eight Crores Only) comprising of 80000000(Eight Crores) number of Equity shares of Rs.1/- each fully paid up.
MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with Regulation 34 of the SEBI Listing Regulations a separate section onthe Management Discussion and Analysis as approved by the Board of Directors whichincludes details on the state of affairs of the Company is given in (Annexure-1) which isannexed hereto and forms a part of the Board's Report.
HUMAN RESOURCE AND INDUSTRIAL RELATIONS
Through the year your Company is recognized in the Aluminum Industry for the wealth ofits human capital which is asset of the Company. Human resource management at the Companygoes beyond the set of boundaries of compensation performance reviews and development.The Company is focused on building a high performance culture with a growth mindset whereemployee are engaged and empowered to excel.
We are well focused to maintain positive workplace environment which provides longlasting and fruitful career to our employee. Your Company believes that targets can onlybe reached with efforts from all its employees called Century team. Your Companyrecognizes that job satisfaction requires congenial work environment that promotesmotivation among employees and therefore results in enhanced productivity and innovationand also provide avenues for employee training and development to identify their potentialand develop their careers in the Company.
The Company is committed to maintain the highest standard of Corporate Governance andbound to the Corporate Governance principles set out by the SEBI. The report on CorporateGovernance for financial year ended March 31 2020 as prescribed under Regulation 34 (3)read with Schedule V of the SEBI (LODR) Regulations 2015 forms part of this AnnualReport. A Certificate from the Company's Auditor Confirming compliance of the CorporateGovernance is annexed to the Corporate Governance Report which is a part of Annual Reportas Annexure-2.
NUMBER OF MEETINGS OF BOARD OF DIRECTORS
The Board met four times i.e. on 22.05.2019 12.08.2019 12.11.2019 and 12.02.2020during the financial year 2019-20. However the details are also given in the CorporateGovernance report that forms a part of the annual report.
DIRECTORS & KEY MANAGERIAL PERSONNEL
Under the Chairmanship of Shri Vikram Jhunjhunwala the Company has an appropriate mixof Executive Non-Executive and Independent Directors to maintain the independence of theBoard and separate its functions of governance and management. Presently the Boardconsist of six board members which include Non-Executive-Independent DirectorNon-Executive-NonIndependent Director and Woman Director. The Number of Non-ExecutiveDirectors is more than fifty percent of total number of directors.
During the year there was one changes occurred in composition of Board of Directors ofthe Company vide appointment of Shri. Rajib Mazumdar as a Non-Executive Director w.e.f.12.08.2019.
During the year there was no change in the Key Managerial Personnel of the Company.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Company being a listed Company Policy on Directors' appointment is to follow thecriteria as laid down under the Companies Act 2013 and the Listing Agreement with StockExchanges and good corporate governance practices. Emphasis is given to persons fromdiverse fields or professions.
The guiding Policy on remuneration of Directors Key Managerial Personnel and employeesof the Company is that:
? Remuneration to Key Managerial Personnel Senior Executives Managers Staff andWorkmen is commensurate with the industry standards in which it is operating taking intoaccount the performance leverage and factors so as to attract and retain talent.
? For Directors it is based on the Shareholders' resolutions provisions of theCompanies Act 2013 and Rules framed therein circulars guidelines issued by the CentralGovernment and other authorities from time to time.
DECLARATION BY INDEPENDENT DIRECTORS
The company has received the necessary declaration from each independent director inaccordance with the section 149 (7) of the Companies Act 2013 that he/she meets thecriteria of independence as laid out in sub-section (6) of Section 149 of the CompaniesAct 2013 and Regulation 16 read with Regulation 25 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
The Board have taken on record these declarations after undertaking the due assessmentof the veracity of the same.
DETAILS RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL AND EMPLOYEESDisclosure pertaining to remuneration and other details as required under Section 197(12)of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is marked as 'Annexure-3 which isannexed hereto and forms a part of the Boards' Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3) (c) of the Act the Directors to the best of theirknowledge and belief confirm:
i. that in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation if any relating to material departures;
ii. that the selected accounting policies were applied consistently and the directorsmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at March 31 2020 and of the profit or lossof the Company for the year ended on that date;
iii. that 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 other-irregularities;
iv. That the annual accounts have been prepared on a going concern basis.
v. The company has in place an established internal financial control system and thesaid systems are adequate and operating effectively. Steps are also being taken to furtherimprove the same.
vi. The company has in place a system to ensure compliance with the provisions of allapplicable laws and the system is adequate. Steps are also being taken to further improvethe legal compliance monitoring.
COMMITTEES OF THE BOARD
Currently the Board has four committees: Audit Committee Nomination and RemunerationCommittee Stakeholders Relationship Committee and Corporate Social ResponsibilityCommittee. A detailed note on the composition of the Board and its committees is providedin the Corporate Governance Report section of this Report.
The constitution of the Audit Committee Terms of Reference and the dates on whichmeetings of the Audit Committee were held are mentioned in the Corporate Governance Reportfor the FY 2019-20 forming part of this Annual Report. There has been no instance whereBoard has not accepted the recommendations of the Audit Committee during the year underreview. NOMINATION AND REMUNERATION COMMITTEE
The constitution of the Nomination and Remuneration Committee Terms of Reference andthe dates on which meetings of the Nomination and Remuneration Committee were held arementioned in the Corporate Governance Report for the FY 2019-20 forming part of thisAnnual Report.
STAKEHOLDERS RELATIONSHIP COMMITTEE
The constitution of the Stakeholders Relationship Committee Terms of Reference and thedates on which meetings of the Stakeholders Relationship Committee were held are mentionedin the Corporate Governance Report for the FY 2019-20 forming part of this Annual Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE
The Company's commitment to create significant and sustainable societal value ismanifest in its Corporate Social Responsibility (CSR) initiatives and its sustainabilitypriorities are deeply intertwined with its business imperatives. In accordance withSection 135 of the Act and the rules made thereunder the Company has formulated aCorporate Social Responsibility Policy a brief outline of which along with the requireddisclosures is given in 'Annexure-4' which is annexed hereto and forms a part of theBoard's Report.
The Company has undertaken the CSR initiatives in the fields of promoting educationEradicating hunger and malnutrition and community development thereby helping in theupliftment of the underprivileged and disadvantaged sections of the society.
All the CSR activities fall within the purview of Schedule VII of the Act read with theCompanies (Corporate Social Responsibility Policy) Rules 2014.
The detail of the CSR Policy is also posted on the Company's website and may beaccessed at the link: https://www .centuryextrusions.com/pdf/18032020/CSR_Policy-CEL.pdf
The Company continues to do its best to support its communities during the currentsituation.
INTERNAL CONTROL SYSTEM
The Company has a strong and pervasive internal control system to ensure well-organizeduse of the Company's resources their security against any unauthorized use accuracy infinancial reporting and due compliance of the Company's policies and procedures as well asthe Statutes. Internal Audit reports are regularly placed before the Audit Committee andManagement analysis of the same is done to ensure checks and controls to align with theexpected growth in operations. The Internal audit is carried out by an independent firm ofChartered Accountants on regular basis and remedial actions are taken when anyshortcomings are identified.
The Audit committee reviews the competence of the internal control system and providesits guidance for constant upgrading in the system.
Risk management is the process of identification assessment and prioritization ofrisks followed by coordinated efforts to minimize monitor and mitigate/ control theprobability and / or impact of unfortunate events or to maximize the realization ofopportunities.
Management of risk remains an integral part of your Company's operations and it enablesyour Company to maintain high standards of asset quality at time. The objective of riskmanagement is to balance the tradeoff between risk and return and ensure optimalrisk-adjusted return on capital. It entails independent identification measurement andmanagement of risks across the businesses of your Company. Risk is managed through aframework of policies and principles approved by the Board of Directors supported by anindependent risk function which ensures that your Company operates within a pre-definedrisk appetite. The risk management function strives to proactively anticipatevulnerabilities at the transaction as well as at the portfolio level through quantitativeor qualitative examination of the embedded risks.
RELATED PARTY TRANSACTIONS
Details of transaction with related parties in Form AOC-2 are given in Annexure-5. TheCompany has entered into the related party transaction as per section 188 of the CompaniesAct 2013 read with Rule 15 of the Companies (Meetings of Board and its Powers) Rules2014. The details of transactions with related parties as per AS-18 are disclosed in notesto accounts.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In compliance with the provisions of Section 177(9) of the Act and SEBI ListingRegulations the Company has framed a Whistle Blower Policy / Vigil Mechanism forDirectors employees and stakeholders for reporting genuine concerns about any instance ofany irregularity unethical practice and/or misconduct. Besides as per the requirement ofClause 6 of Regulation 9A of SEBI (Prohibition of Insider Trading) Regulations as amendedby SEBI (Prohibition of Insider Trading) (Amendment) Regulations 2018 the Companyensures to make employees aware of such Whistle -Blower Policy to report instances of leakof unpublished price sensitive information.
The Vigil Mechanism provides for adequate safeguards against victimization of Directorsor Employees or any other person who avail the mechanism and also provide direct access tothe Chairperson of the Audit Committee. The details of the Vigil Mechanism / WhistleBlower Policy are also posted on the Company's website and may be accessed at the link:https://www . centuryextrusions.com/pdf/18032020/Whistle%20Blower%20Policy-CEL.pdf CREDITRATINGS
During the year under review the Company had received its credit ratings fromInfomerics Valuation and Rating Private Limited. the rating agencies have assigned theCompany a long term rating of IVR BBB-/Stable (IVR Triple B Minus with Stable Outlook)against its long term borrowings. IVR A3 (IVR Single A three) in respect of Company'sshort term bank facilities and Commercial Paper issuance programme.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION &REDRESSAL) ACT 2014
Company has a stringent policy for prevention of sexual harassment of women atworkplace and management takes a zero tolerance approach towards those indulging in anyform of sexual misconduct. No instance of sexual harassment was reported during FY2019-20.
Pursuant to the provisions of Section 139 of the Act read with the Companies (Auditand Auditors) Rules 2014 and pursuant to the recommendation made by the Audit Committeeof the Board of Directors of the Company the Members of the Company at its Twenty Ninth(29th) Annual General Meeting (AGM) held on 12th August 2017 approved theappointment of M/s. A. K.
Meharia & Associates Chartered Accountant (FRN - 324666E) Kolkata as theStatutory Auditors of the Company for an initial term of five consecutive years i.e.from the conclusion of the 29th AGM till the conclusion of the 34th AGM of the Company tobe held in the year 2022 subject to the ratification of their appointment by the Membersat every AGM of the Company. The requirement to place the matter relating to appointmentof Auditors for ratification by Members at every AGM has been done away by the Companies(Amendment) Act 2017 w.e.f. 7th May 2018. Accordingly no resolution is being proposedfor ratification of appointment of Statutory Auditors at the ensuing AGM and a note inrespect of same has been included in the Notice of the AGM.
The Report given by M/s. A. K. Meharia & Associates Chartered Accountant (FRN -324666E) Kolkata on the financial statements of the Company for the year 2019-20 isannexed hereto and forms a part of the Annual Report.
There are no qualification(s) reservation(s) or adverse remarks or disclaimer in theAuditors Report to the Members on the Annual Financial Statements for the financial yearended 31st March 2020.
COST AUDIT AND AUDITORS
In terms of the provisions of Section 148 of the Act read with the Companies (CostRecords and Audit) Amendment Rules 2014 the Board of Directors of your Company have onthe recommendation of the Audit Committee re-appointed M/s. N. Radhakrishnan & Co. afirm of Cost Accountants Kolkata to conduct the Cost Audit of your Company for thefinancial year 2020-21 at a remuneration as mentioned in the Notice convening the AnnualGeneral Meeting. As required under the Act the remuneration payable to the cost auditoris required to be placed before the Members in a general meeting for their ratification.Accordingly a resolution seeking Member's ratification for the remuneration payable toCost Auditors forms part of the Notice of the ensuing Annual General Meeting.
However the Company submits its Cost Audit Report for the financial year 2019-20 withthe Ministry of Corporate Affairs within the stipulated time period.
SECRETARIAL AUDITORS AND SECRETARIALSTANDARDS
The Secretarial Audit was carried out by Miss. Shruti Agarwal Company Secretaries(ICSI Membership No. ACS 38797 C.P. No. 14602) for the financial year ended on 31stMarch 2020.
The Report given by the Secretarial Auditors is marked as (Annexure-6) and forms a partof the Board's Report. The Secretarial Audit Report is self-explanatory and do not callfor any further comments.
The Secretarial Audit Report does not contain any qualification reservation adverseremark or disclaimer. During the year under review the Secretarial Auditors had notreported any matter under Section 143 (12) of the Act therefore no detail is required tobe disclosed under Section 134 (3)(ca) of the Act.
During the Financial Year your Company has complied with the applicable SecretarialStandards issued by the Institute of Company Secretaries of India.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors affirms that the Company has complied with the applicableSecretarial Standards issued by the Institute of Companies Secretaries of India (SS1 andSS2) respectively relating to meetings of the Board and its Committee which have mandatoryapplication during the year under review.
EXTRACT OF ANNUAL RETURN (MGT-9)
Pursuant of section 92 (3) 134(3) (a) of the Companies Act 2013 read with Rule 12 ofthe Companies (Management and Administration) Rules 2014 Extract of annual Return inForm MGT-9 is given in (Annexure-7).
There are no Significant/material orders of Courts/ tribunal/regulation affecting theCompany's going concern status. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments are given in the notes to the financialstatements.
CHANGE IN THE NATURE OF BUSINESS
During the year under review there was no change in the nature of the business of theCompany.
The Company does not have any Public Deposits under Chapter V of the Act and has repaidall Public Deposits that matured and were claimed by the depositors under the earlierPublic Deposit Schemes. There is no outstanding balance as on 31st March 2020.
PARTICULARS AS PER SECTION 134(3) OF THE COMPANIES ACT 2013
The information relating to Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo required under Section 134 (3) of the Companies Act 2013 readwith Rule 8 (3) of Companies (Accounts) Rules 2014 is set out in a separate statementattached to this report and forms part of it. (Annexure- 8)
As a responsible corporate citizen the Company supports the 'Green Initiative'undertaken by the Ministry of Corporate Affairs Government of India enabling electronicdelivery of documents including the Annual Report etc. to Members at their e-mailaddresses previously registered with the DPs and RTAs.
To support the 'Green Initiative' Members who have not registered their emailaddresses are requested to register the same with the Company's Registrar and ShareTransfer Agent/Depositories for receiving all communications including Annual ReportNotices Circulars etc. from the Company electronically.
Pursuant to the MCA Circulars and SEBI Circular in view of the prevailing situation ofthe Pandemic owing to the difficulties involved in dispatching of the physical copies ofthe Notice of the 32nd AGM and the Annual Report of the Company for the financial yearended 31st March 2020 including therein the Audited Financial Statements for the year2019-2020 the aforementioned documents are being sent only by email to the Members. Anewspaper advertisement in this regard has also been published and intimated to theMembers of the Company.
We express our sincere gratitude to our customers vendors investors and bankers fortheir continued support during the year. We place on record our sincere appreciation ofthe dedication and commitment of all employees in achieving excellence in all spheres ofbusiness activities.
We thank the Government of India the Customs and Excise Departments Goods &Service Tax Department the Income Tax Department the State Government and otherGovernment agencies for their support and look forward to their continued support in thefuture.
Statements forming part of the Management Discussion and Analysis covered in thisreport may be forward-looking within the meaning of applicable securities laws andregulations. Actual results may differ materially from those expressed in the statement.The Company takes no responsibility to publicly amend modify or revise any forwardlooking statements on the basis of any subsequent developments information or events.