Your Directors are pleased to present the Twelfth Annual Report of the Company togetherwith the Audited Financial Statements for the financial year ended March 31 2019.
The financial performance of the Company is as follows:
( Rs. in crore)
|Particulars ||Standalone ||Consolidated |
| ||Financial Year ||Financial Year ||Financial Year |
| ||2018-19 ||2017-18 ||2018-19# |
|Revenue from Operations ||20164.90 ||18477.97 ||20332.58 |
|Other Income ||20.47 ||11.67 ||23.14 |
|Total Revenue ||20185.37 ||18489.64 ||20355.72 |
|Profit/(Loss) before Depreciation and Amortization ||833.40 ||668.61 ||831.22 |
|Expense & Tax expense || || || |
|Less: Depreciation and Amortization expense ||100.59 ||53.43 ||104.02 |
|Profit/(Loss) before Exceptional Item ||732.81 ||615.18 ||727.20 |
|Less: Exceptional Item ||- ||603.87 ||- |
|Profit/(Loss) before Tax ||732.81 ||11.31 ||727.20 |
|Less: Tax expense ||- ||- ||0.01 |
|Profit/(Loss) after Tax ||732.81 ||11.31 ||727.19 |
|Other Comprehensive Income for the year ||5.81 ||1.96 ||5.85 |
|Total Comprehensive Income for the year ||738.62 ||13.27 ||733.04 |
|Earnings Per Equity Share of Face Value of Rs. 2/- each || || || |
|- Basic and Diluted (in Rs. ) ||14.58 ||0.23 ||14.47 |
(#)The Company has prepared the consolidated financial results as required under theprovisions of the Companies Act 2013 (hereinafter referred to as "the Act") andthe applicable prescribed Accounting Standards under the Act since this is the firstyear when the Company has subsidiary and joint venture companies. There were nosubsidiary or joint venture companies in previous year and hence no comparable numbers ofprevious year are available.
REVIEW OF PERFORMANCE
During the year under review your Company recorded an increase of 9.13% in theStandalone Revenue from Operations at Rs. 20164.90 crore as compared to Rs. 18477.97crore in the previous financial year. Consolidated Revenue from Operations was reported atRs. 20332.58 crore during the year under review. Your Company also reported an increaseof 19.12% in the Profit of Rs. 732.81 crore as compared to Rs. 615.18 crore for theprevious financial year before exceptional item.
The year 2018-19 was a very fulfilling year. We now have a pan India presence with1511 stores in 428 cities as of March 31 2019 and total retail space of approximately16.14 million sq. ft. for various formats of our Company. As on March 31 2019 we have292 Big Bazaar/Hypercity stores 94 fbb stores 12 Foodhall stores 1106 small formatstores (including WHSmith stores) and 7 eZone stores. Our retail format business issupported by various other businesses operated by Future Group companies and throughinvestee companies of Future Group operating in various ventures including brandedfashion food & FMCG insurance warehousing & logistics media and textiles.
As regard the well-developed formats like Big Bazaar fbb Foodhall easyday etc. whichhas received good recognition and also acceptance by our stakeholders we have been ableto develop presence across India with good loyal customer base of approximately 50 millionmembers across all formats as of March 31 2019. Fiscal 2019 also firmed up the stage fora strong omni-channel business and Online to Offline conversions. The Company has set thefoot on a focused small-store membership program higher paid-loyalty membershipenrolments in large format stores and in parallel several functional enrichment to servesuch loyal customers better. To this extent we have increased the retail technology playacross our stores enriched the Future Pay wallet and introduced many member serviceaspects.
SCHEME OF ARRANGEMENT AND ACQUISITION a. Scheme of Arrangement between Hypercity Retail(India) Limited and the Company and their respective Shareholders ("HypercityScheme")
The Company had entered into Scheme of Arrangement with Hypercity Retail (India)Limited ("HRIL") and their respective Shareholders under Sections 230-232 andother applicable provisions of the Act in order to consolidate the retail business undersingly entity whereby the retail business undertaking of HRIL got demerged and vestedwith the Company. The Hypercity Scheme has been given effect on April 25 2018("Effective Date"). The Appointed Date under Hypercity Scheme for Demerger wasDecember 1 2017.
b. Acquisition of Travel News Services (India) Private Limited ("TNSI")
During the year under review the Company has executed necessary agreement(s) and onMay 11 2018 acquired the entire equity share capital of TNSI from its existingshareholders for cash consideration. Consequent to this TNSI has become a wholly ownedsubsidiary of the Company.
In addition to this TNSI Retail Private Limited a wholly owned subsidiary of TNSI andWelcome Retail Private Limited a joint venture of TNSI in which TNSI holds 51% of theshare capital have also become step down subsidiaries of the Company effective from thesame date i.e. May 11 2018. c. Acquisition of "Foodworld" business
During the year under review the Company has entered into necessary agreement(s) withFoodworld Supermarkets Private Limited and acquired the retail business undertaking underthe brand name "Foodworld" for cash consideration.
d. Acquisition of SHME Food Brands Private Limited ("SHME")
During the year under review the Company has acquired the entire equity share capitalof SHME (now known as SHME Food Brands Limited) for cash consideration from its existingshareholders on February 28 2019 and accordingly SHME has become a wholly ownedsubsidiary of the Company.
During the year under review the Company has issued and allotted in aggregate 623285Equity Shares of Rs. 2/- each to eligible employees of the Company upon exercise of thevested options granted to the concerned employees under Future Retail Limited EmployeeStock Option Plan - 2016 (FRL ESOP - 2016). None of the employees is in receipt of EquityShares exceeding 1% of Equity Share capital of the Company against the vested optionsexercised by them under FRL ESOP - 2016. The breakup of allotment is as follows:
|Sl. No. ||No. of Equity Shares allotted ||Date of allotment |
|1. ||528763 ||May 21 2018 |
|2. ||64522 ||August 09 2018 |
|3. ||30000 ||November 23 2018 |
During the year under review the Company has not issued any sweat equity shares orbonus shares or equity shares with differential rights.
Post March 31 2019 and on receipt of initial warrant subscription amount of Rs. 500crore equivalent to 25% of the warrant issue price as prescribed by the SEBI (ICDR)Regulations for allotment of the equity warrants on April 23 2019 the Company consideredand allotted 39603960 equity warrants to M/s. Future Coupons Limited a PromoterGroup entity on preferential basis. The conversion option can be exercised byWarrantholder(s) at any time during the period of 18 (Eighteen) months from thedate of allotment of equity warrants in one or more tranches as the case may be and onsuch other terms and conditions as applicable.
We believe that your Company with its unparalleled network of stores spread acrossIndia is poised to get the maximum benefit of the surge in the consumption drive. We alsobelieve that the network is strategically well placed to capture the growth in organisedsector over unorganised as well as yield incumbency advantages.
Our Retail 3.0 organisation of small format stores has come together and we have nowfocussed strategy on a combined expansion of member platform and member-retail stores. Thesmall stores are overlaid with digital & technology functionalities in many ways whichmakes the pace of the business management more efficient and allows the Company to expandat a very fast pace. We now have more than 11 lakh active paid members on our smallstores network. Currently we are rolling out the easyday app for members to orderdigitally or through inter active commerce from their mobile phones and track delivery athome. The app has unique features like voice search and scheduling in-store or at-homedelivery.
Future Group had launched a Future Consumer and Digital (C&D) Lab in Bengaluru thatfocuses on the consumer and digital space to bring in next-generation innovations usingArtificial Intelligence Big Data Analytics Blockchains Internet of Things Robotics andallied technologies. The C&D Lab brings together multiple teams and companies that areworking in these areas housed in a common collaborative space and will have ready accessto test experiment and prototype their technologies across Future Group's brand andretail platforms that serve over a million customers every day.
The Lab is pursuing technology developments that will influence consumer experiences inareas such as payments unique consumer identification and development of one-on-oneconsumer conversations analytics and predictive modeling as well as in back-end functionssuch as supplier engagements supply chain automation and infrastructure deployment.
As you are also aware Future Group is the chosen partner for the launch of 7-Elevenbrands of convenience stores in India. With over 67000 stores across 17 countries7-Eleven is an iconic global retail brand. In India we will be scripting a unique storyfor 7-Eleven combining food services convenience and superb customer service in everyurban neighbourhood. The growth and expansion of 7-Eleven will be a critical part ofgrowing our food and FMCG brands and bringing new services formats and conveniences forour customers. A dedicated team is being set up to bring together the best practices of7-Eleven Inc. and our understanding of India to create the best proposition and offeringsfor our customers. As a consumer-driven business it is important for us to build upon newtrends new categories and new ideas that are going to shape consumption in the yearsahead. Future Group's own brands represents one of our strongest pillars for the growthand value creation of our business. Our own brands allows us to earn higher end-to-endmargins for the organisation. More importantly it helps us own and deepen therelationship with customers addresses gaps not fulfilled by our suppliers and also tomeet the customers expectations. As reported during last year performance the Big Bazaarthe flagship format contributing good return as witnessed from Same Stores Sales Growth at10.9% in the year 2018-19 and the management is optimistic to see improvement inperformance going forward while their expansion plan of opening new stores and renovatingexisting Big Bazaar stores in place.
The Company is continuing its expansion plan for fbb format and will add more exclusivebrand outlets in coming years. Your Company has already taken fbb brand to internationalmarkets through its joint venture with Oman based conglomerate Khimji Ramdas LLC and havealready opened 2 (Two) stores in Oman in the current financial year. Over the past fewyears fbb has undergone a significant transformation and we will continue our journey ofimproving products assortments in-store experience and strengthening our supply chain.
DIVIDEND & RESERVES
Keeping in mind the future prospects and further expansion plans of the Company theBoard of Directors of the Company have decided not to recommend any Dividend during thefinancial year 2018-19. No amount is proposed to be transfer to General Reserve.
During the year under review the Company has made the following investments:
Travel News Services (India) Private Limited ("TNSI")
The Board of Directors of the Company had approved the acquisition of entire equityshare capital of TNSI and also executed necessary agreement(s) and related documents forthe said transaction.
On May 11 2018 the Company has paid Rs. 65.42 crore in cash (after adjustments) tothe existing shareholders of TNSI towards the said acquisition.
Further on March 29 2019 the Company had made an additional investment bysubscribing 3400000
7% Cumulative Redeemable Preference Shares of Rs. 100/- each aggregating to Rs.34 crore in cash.
Future Retail LLC
The Company had entered into shareholders agreement with Khimji Ramdas LLC andincorporated a joint venture company viz; Future Retail LLC ("JV Company") tooperate "fbb" brand in Oman and then across other member state of GCC. TheCompany has in aggregate invested fund to the tune of Rs. 4.57 crore towards total250000 shares of Omani Rial 1 each in the share capital and accordingly it holds 50% ofJV Company.
SHME Food Brands Private Limited ("SHME")
Pursuant to the approval of the Board of Directors the Company had acquired the entireequity share capital of SHME (now known as SHME Food Brands Limited) for cashconsideration of Rs. 0.01 crore from its existing shareholders on February 28 2019.
During the year under review the Company has not made any divestment.
The Company has obtained the approval of Members for acceptance of fixed deposits frompublic and/or Members of the Company. However the Company has not accepted any fixeddeposits during the year under review and accordingly no amount on account of principalor interest on deposits from public and/or Members were outstanding as at March 31 2019.
During the year under review the Members of the Company have granted the approval forissuance of Non-Convertible Debentures. However the Company has not issued anyDebentures during the year ended March 31 2019.
The Company's Corporate Governance Report for the year under review forms part of thisAnnual Report. A certificate from the Statutory Auditors of the Company regarding thecompliance with the conditions of the Corporate Governance as stipulated under theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 (hereinafter referred to as "SEBI Listing Regulations") isannexed to Corporate Governance Report and forms a part of this Report.
BUSINESS RESPONSIBILITY REPORT
Pursuant to SEBI Listing Regulations a Business Responsibility Report is included andforms part of this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis as required under Regulation 34 read withSchedule V of SEBI Listing Regulations forms part of this Annual Report.
AUDITORS AND AUDITORS' REPORT Statutory Auditors
M/s. NGS & Co. LLP Chartered Accountants (Firm Registration No. 119850W) have beenappointed for a period of 5 (Five) years from the conclusion of the Ninth Annual GeneralMeeting till the conclusion of the Fourteenth Annual General Meeting of the Members of theCompany.
Pursuant to the notification issued by the Ministry of Corporate Affairs on May 72018 the mandatory requirement for ratification of appointment of Auditors by the Membersat every Annual General Meeting ("AGM") has been omitted. Hence no resolutionwas proposed for the ratification of appointment of Statutory Auditors at the ensuing AGM.
The Company has received a written confirmation from the Statutory Auditors confirmingthat their continued appointment shall be in accordance with the applicable provisions ofthe Act.
The Auditors' Report on the financial statements for the financial year ended March 312019 is issued with unmodified opinion and does not contain any qualificationsreservations or adverse remarks.
As required under provisions of Section 204 of the Act and Rules made thereunder Ms.Bindu Darshan Shah (Membership No. A-20066 / CP No. 7378) Proprietor: K Bindu& Associates Practicing Company Secretaries was appointed as Secretarial Auditor toconduct the Secretarial Audit of the Company for the financial year 2018-19.
The Secretarial Audit Report for the financial year 2018-19 is appended as Annexure- I which forms part of this Report. The said Secretarial Audit Report doesn'tcontain any qualifications reservations or adverse remarks.
POLICIES & DISCLOSURE REQUIREMENTS
The Company has in place inter-alia following policies & code of conductduly approved by the Board of Directors the Company:
Details of programs for familiarization of Independent Directors with theCompany are available on the website of the Company at the link https://www.futureretail.in/investors/Policies.html
Policy for determining material subsidiaries of the Company is available on thewebsite of the Company at the link https://www.futureretail.in/investors/ Policies.html
Policy for determining Materiality of Events of the Company is available on thewebsite of the Company at the link https://www.futureretail.in/investors/ Policies.html
Policy for archival of documents of the Company is available on the website ofthe Company at the link https://www.futureretail.in/investors/Policies.html
The code of conduct for the Board of Directors and senior management personnelof the Company is available on the website of the Company at the linkhttps://www.futureretail.in/investors/corporate-governance-standards.html
Policy on dealing with related party transactions is available on the website ofthe Company at the link https://www.futureretail.in/investors/Policies.html
The Remuneration Policy is available on the website of the Company at the linkhttps://www.futureretail.in/ investors/Policies.html
The Dividend distribution policy is given as Annexure - II to thisReport. The same is also available on the website of the Company at the link https://www.futureretail.in/investors/Policies.html The Company has formulated and disseminated aWhistle Blower Policy to provide Vigil Mechanism for employees and Directors of theCompany to report genuine concerns that could have serious impact on the operations andperformance of the business of the Company. This Policy is in compliance with theprovisions of the Act and SEBI Listing Regulations.
DIRECTORS AND KEY MANAGERIAL PERSONNEL(S)
During the year under review Mr. Rajan Bharti Mittal ceased to be a Director of theCompany with effect from August 9 2018 due to pre-occupation which was noted by theBoard.
Based on the recommendation of Nomination and Remuneration Committee ("NRC")the Board has appointed Mr. Rahul Garg as an Additional Director (Non-Executive) of theCompany with effect from August 9 2018. Further the Members at Eleventh AGM heldon August 29 2018 have approved the appointment of Mr. Garg as a Non-ExecutiveDirector of the Company. Further as recommended by NRC the Board has considered andapproved the re-appointment of Mr. Kishore Biyani as Managing Director and Mr.Rakesh Biyani as Jt. Managing Director both for a period of 3 (Three) years witheffect from May 2 2019 subject to the approval of Members of the Company.
In terms of Section 152 of the Act Mr. Kishore Biyani who is liable to retire byrotation at the ensuing AGM and being eligible offers himself for re-appointment.
The Company has received necessary disclosure and confirmation from concernedDirector(s) in connection with their re-appointment. Additional information as requiredunder Regulation 36 of SEBI Listing Regulations and Secretarial Standards is given in theNotice convening the ensuing AGM.
The Company has received necessary declarations from Independent Directors underSection 149(7) of the Act stating that they meet the criteria of independence laid down inSection 149(6) of the Act and SEBI Listing Regulations.
COMMITTEES OF THE BOARD
Details of Committees of the Board of Directors of the Company along with their termsof reference composition and meetings held during the year are provided in the CorporateGovernance Report which forms part of this Annual Report.
NUMBER OF MEETINGS OF THE BOARD
During the year under review Six (6) meetings of the Board of Directors of the Companywere held. The details of date of above meeting including the attendance of the Directorsare given in the Corporate Governance Report which forms part of this Annual Report.
VIGIL MECHANISM/WHISTLE BLOWER
The Company has established a vigil mechanism to provide a framework to promoteresponsible and secure whistle blowing and to provide a channel to the employee(s) andDirectors to report to the management concerns about unethical behavior actual orsuspected fraud or violation of the code of conduct or policy/ies of the Company asadopted/framed from time to time. The mechanism provides for adequate safeguards againstvictimisation of employee(s) and Directors to avail of the mechanism and also provide fordirect access to the Chairperson of the Audit Committee in exceptional cases.
SUBSIDIARY JOINT VENTURE HOLDING COMPANY AND ASSOCIATE COMPANIES
During the year under review your Company has the following subsidiaries and jointventure:
Travel News Services (India) Private Limited ("TNSI")
TNSI is a wholly owned subsidiary and is mainly into retail trade of confectioneryfood beverages accessories etc. and it operates at various airports corporate parks andalso at universities in Delhi and NCR under the brand name "WHSmith" and alsoprovides rental/leasing services. During the year under review it has reported incomefrom operations amounting to Rs. 158.36 crore and its net profit stood at Rs. 0.60 crore.
TNSI Retail Private Limited ("TNSI Retail")
TNSI Retail is subsidiary of TNSI and is mainly into retail trading and operates atMetro stations in Delhi and NCR under the brand name "WHSmith" and also deals inwholesale trading. During the year under review it has reported income from operationsamounting to Rs. 64.83 crore and incurred a net loss of Rs. 2.23 crore.
Welcome Retail Private Limited ("WRPL")
WRPL is a joint venture of TNSI & Felmingo Group and is into business ofsetting-up developing operating renting and sub-leasing services for various spacesmainly at airports and metro stations. During the year under review it has reportedincome from operations amounting to Rs. 24.16 crore and its net profit stood at Rs. 0.29crore.
SHME Food Brands Private Limited ("SHME")
SHME (now known as SHME Food Brands Limited) is a wholly owned subsidiary of theCompany and is into business of operating developing maintaining and running ofconvenience stores and commercial establishments of similar nature. SHME and the Companyhave executed a master franchise agreement with 7-Eleven Inc to develop and operate7-Eleven stores within India. During the year under review it has reported income fromoperations amounting to Rs. 0.03 crore and a net profit of Rs. 0.02 crore.
Future Retail LLC ("FRLLC")
FRLLC is a joint venture incorporated in Oman to undertake business to operate"fbb"brand fashion outlets in Oman and across other member states of GCC. Forthe period ended December 31 2018 the joint venture has not commenced any operation andhas incurred expenses towards setting up of business and has reported loss of Rs. 0.49crore.
INDIAN ACCOUNTING STANDARD (IND AS)
The Company has adopted Indian Accounting Standards ("IND AS") from April 012016 with a transition date of April 01 2015. Accordingly the financial statement forthe year 2018-19 have been prepared in accordance with IND AS prescribed under Section133 of the Act read with the relevant rules issued thereunder and the other recognisedaccounting practices and policies to the extent applicable.
CONSOLIDATED FINANCIAL STATEMENT
During the year under review the Board has reviewed the affairs of subsidiaries andjoint venture. The Consolidated Financial Statement of the Company is prepared inaccordance with the Act and applicable IND AS along with the relevant documents andAuditors' Report thereon form part of this Annual Report.
Pursuant to the provisions of Section 129(3) of the Act a statement containing salientfeatures of the financial statement of the subsidiaries and joint venture in theprescribed Form AOC-1 is attached to the financial statement which forms part of thisAnnual Report. In accordance with the provisions of Section 136(1) of the Act the AnnualReport of the Company containing therein the audited standalone and consolidated financialstatement and the audited financial statements of each of the subsidiary companies havebeen placed on the website of the Company. The audited financial statements in respect ofsubsidiaries shall also be kept open for inspection at the Registered Office of theCompany during working hours for a period of 21 days before the date of ensuing AGM. Theaforesaid documents are also available to Members interested in obtaining the same upon arequest made to the Company.
PERFORMANCE EVALUATION OF BOARD
Pursuant to the provisions of the Act and SEBI Listing Regulations the Board hascarried out an annual evaluation of performance of its own the Committees thereof and theDirectors individually.
Based on guidance note the performance of the Board was evaluated after seeking inputson all the relevant factors from all the Directors on the basis of criteria such as theBoard and Committee composition structure effectiveness of board processes informationand functioning etc.
The performance of the Committees were evaluated by the Board after taking input fromthe respective Committee members on all the relevant factors material for evaluationpurpose.
A separate exercise was carried out at meeting of Independent Directors to evaluate theperformance of individual Directors including the Chairman of the Board who were inter-aliaevaluated on parameters such as level of engagement contribution independence ofjudgment safeguarding the interest of the Company and its minority shareholders etc. Theperformance evaluation of the Independent Directors was carried out by the entire Boardexcept the Director being evaluated. The performance evaluation of the Chairman andNon-Independent Directors was carried out by the Independent Directors.
The Directors expressed their satisfaction with the evaluation process.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Company's policy on Directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the Corporate GovernanceReport which forms part of this Annual Report.
The details of commission paid to Executive and Non-Executive Director is given inCorporate Governance Report forming part of this Annual Report.
RISK MANAGEMENT AND INTERNAL FINANCIAL CONTROL
The Company has a well-defined risk management framework in place which provides anintegrated approach for identifying assessing mitigating monitoring and reporting ofrisks associated with the businesses of the Company.
The Board has delegated responsibility to the Risk Management Committee to monitor andreview risk management assessment and minimisation procedures and to develop implementand monitor the risk management plan and identify review and mitigate all elements ofrisks which the Company may be exposed to. The major risks identified by the businessesand functions are systematically addressed through mitigating actions on a continuingbasis. The Audit Committee and the Board also periodically reviews the risk managementassessment and minimisation procedures.
The Company has in place adequate internal financial controls with reference tofinancial statements. Key risks and threats to the Company and internal controls and theiradequacy are analysed in the Management Discussion and Analysis which forms part of thisAnnual Report.
EMPLOYEES STOCK OPTIONS PLAN
The Members of the Company have passed necessary resolutions through Postal Ballot andapproved the FRL ESOP - 2016 and also approved to offer issue and allot at any time or toacquire by way of secondary acquisition to or for the benefit of eligible employees underFRL ESOP - 2016 not exceeding 9000000 Equity Shares of Rs. 2/- each in one or moretranches at such price and on such terms and conditions as may be fixed or determined bythe NRC or People Office.
Pursuant to the applicable provisions of the Act and the Securities and Exchange Boardof India (Share Based Employee Benefits) Regulations 2014 ("SBEBRegulations") the Company has set up a Future Retail Limited Employees'Welfare Trust' ("Trust") for implementation of the said Scheme.
The applicable disclosures as stipulated under SBEB Regulations as on March 31 2019with regard to the FRL ESOP - 2016 are provided in Annexure - III to thisReport.
Further the Company has constituted Employees Gratuity Trust in name of "FutureRetail Limited - Employees Gratuity Trust" and constituted a Fund through Trust inthe name of "Future Retail Employees Superannuation Trust" for benefits ofeligible employees of the Company.
The details pertaining to credit rating for the facilities obtained by the Companyduring the year under review is given in Corporate Governance Report forming part of thisAnnual Report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
Your Company has always believed in providing a safe and harassment free workplace forevery individual working in the Company through various training awareness and practices.The Company always endeavours to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment.
The Company has in place a robust policy on prevention of sexual harassment atworkplace. The policy aims at prevention of harassment of employees as well as contractorsand lays down the guidelines for identification reporting and prevention of sexualharassment. The Company has complied with the provisions relating to Internal ComplaintsCommittee ("ICC"). Further ICC is responsible for redressal of complaintsrelated to sexual harassment and follows the guidelines as provided in the policy. ICCconducts training workshop mainly focusing on investigation skills basic counsellingskills like listening paraphrasing and dealing with biases through various kind of casestudies role plays activities based on real life examples role of ICC criticalattitudes of an ICC member and investigation process & report writing etc.Information regarding the no. of complaints received/ resolved/remained unresolved isgiven in Corporate Governance Report forming part of this Annual Report.
CORPORATE SOCIAL RESPONSIBILITY STATEMENT
In terms of the provisions of Section 135 of the Act read with Companies (CorporateSocial Responsibility Policy) Rules 2014 the Board of Directors of your Company hasconstituted a Corporate Social Responsibility Committee ("CSR Committee"). Thecomposition and terms of reference of the CSR Committee is provided in the CorporateGovernance Report which forms part of this Annual Report.
The disclosures as per Rule 9 of above mentioned Rules is made in prescribed form whichis annexed to this Report as Annexure - IV.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
Details of loans granted guarantee provided and investment made by the Company whichare covered under the provisions of Section 186 of the Act is provided in Notes formingpart of financial statement.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the year under review the transactions entered into by the Company with relatedparties as defined under the Act and SEBI Listing Regulations were in the ordinary courseof business and on an arm's length basis. Omnibus approval is obtained for thetransactions which are foreseen and repetitive in nature with related parties. A statementof all such related party transactions was presented before the Audit Committee onperiodic and need basis for its review and approval.
Particulars of contracts or arrangements with related parties as required under Section134(3)(h) of the Act in the prescribed Form AOC-2 is given in Annexure - V whichforms part of this Report.
Disclosure of transactions with related parties (including entity belonging to thePromoter/Promoter Group which hold(s) 10% or more shareholding in the Company) as requiredunder SEBI Listing Regulations and the applicable Accounting Standards have been given inthe Notes forming part of the financial statement.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(5) of the Act the Board to the best ofits ability confirms that: i. in the preparation of the annual accounts for the financialyear ended March 31 2019 the applicable accounting standards have been followed alongwith proper explanation relating to material departures; ii. they have selected suchaccounting policies and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company at the end of the financial year and of the profit of the Company for the yearended March 31 2019; iii. they have taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities; iv. they have prepared the annual accounts for the financial year endedMarch 31 2019 on a going concern basis; v. they have laid down internal financialcontrols to be followed by the Company and that such internal financial controls areadequate and are operating effectively; and vi. they have devised proper systems to ensurecompliance with the provisions of all applicable laws and that such systems were adequateand operating effectively.
The Audit Committee of the Company comprises of Ms. Gagan Singh IndependentDirector as Chairperson of the Committee Mr. Ravindra Dhariwal Independent Director Ms.Sridevi Badiga Independent Director and Mr. Rakesh Biyani Jt. Managing Director as otherMembers of the Committee. There are no instances where the Board did not accept therecommendations of the Audit Committee. The terms of reference powers and roles of theCommittee are disclosed in the Corporate Governance Report which forms part of thisAnnual Report.
PARTICULARS OF EMPLOYEES
The information pertaining to the remuneration and other details as required underSection 197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided as Annexure - VIwhich forms part of this Report.
In terms of the provisions Section 197(12) of the Act read with Rule 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of employees drawing remuneration inexcess of the limits set out in the said rules are provided in this Annual Report. Interms of the proviso to Section 136(1) of the Act the Annual Report excluding theaforesaid information is being sent to the Members of the Company. The said information isavailable for inspection by the Members at the Registered Office of the Company duringbusiness hours on working days and Members interested in obtaining such information maywrite to the Company Secretary and the same will be furnished on request. Such details arealso available on Company's website at www.futureretail.co.in.
PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 relating to conservation of energy technology absorptionand foreign exchange earnings and outgo are provided in Annexure - VII which formspart of this Report.
EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3)(a) of the Act an extract of annual return in theprescribed Form MGT-9 is given as Annexure - VIII which forms part of this Report.
In accordance with Section 92(3) of the Act a copy of the Annual Return for thefinancial year ended March 31 2019 is available on the website of the Company athttps://www.futureretail.in/investors/annual-reports.html.
DETAILS UNDER REGULATION 39(4) OF SEBI LISTING REGULATIONS - UNCLAIMED SUSPENSE ACCOUNT
Pursuant to Regulation 39(4) read with Schedule V of SEBI Listing Regulations thedetails pertaining to outstanding shares lying in Unclaimed Suspense Account are given inCorporate Governance Report forming part of this Annual Report. All the unclaimed sharesare credited to a Demat Unclaimed Suspense Account and all the corporate benefits in termsof securities accruing on these unclaimed shares shall be credited to such account. Thevoting rights on these shares shall remain frozen till the rightful owner(s) claim suchshares.
During the year under review and in terms of Section 118(10) of the Act the Companyhas complied with Secretarial Standards on meetings of the Board of Directors("SS-1") and on General Meetings ("SS-2") as amended and issued fromtime to time by The Institute of Company Secretaries of India.
AWARDS AND RECOGNITIONS
The Company and its formats received awards in categories like:
Big Bazaar was ranked among the most valuable brand by Interbrand;Big Bazaar won IMAGES Most Admired Brand Retail Partnership of the Year 2018;Big Bazaar won IMAGES Most Admired Retailer of the Year under Digital Marketing Campaigncategory; Big Bazaar's Smart Search Campaign won MMG Awards Troxy Londonfor Best Campaign in Fashion Beauty & Retail Category for 2018 and the best MobileSearch Campaign globally by SMARTIES New York; Big Bazaar's 24hr FacebookLive Campaign won: Gold in Exchange4Media - Maddies of the Year 2018;
EMVIE Silver under the category Best Media Innovation Digital Social Media;
Best Online Advertising Campaign by Exchange4Media Indian Digital Media Awards2018.
Big Bazaar's Midnight Sale Campaign won Silver in Exchange4Media - Maddiesof the Year 2018; Big Bazaar's Decide Your price won Gold in DMA Asia Echo2018 under the Create Effect category; Big Bazaar Profit Club won CustomerLoyalty Awards for the Best Card Based Loyalty Program and Best Loyalty Program in RetailSector. fbb (Fashion @ Big Bazaar)
fbb's Airport Makeover won ET Now - Stars of the Industry Award under thebest Experiential and Brand Experience of the year; fbb's "NationalJeans Day" Campaign won:
ET Now - Stars of the Industry Award for the best use of social media andmarketing;
Best Branded Regional Campaign by Foxglove - Afaqs!;
Gold for the Best Use of Social Media to launch a product or service by SAMMIEs- Social Samosa;
Gold for the Best Lead Gen Campaign at 9th IDA - IAMAI; BestLaunch of a Product by LIDMA - Lighthouse Insights;
Digital Awards for the best lead generation campaign through mobile.
fbb won the best Print Campaign of the year at the Activation Venue Forum -Umbrella Aegis; fbb "500 Festive Looks" Campaign won:
Best Use of Instagram by Foxglove - Afaqs!;
Silver for the Best Content Marketing - Retail by DIGIXX - AdGully.
fbb's "World Shorts Day" Campaign won:
Silver under Social Media - Retail category by DIGIXX - AdGully;
the Best Digital Integrated Campaign by Global Marketing Congress - CMO Asia;
Silver for the Best Use of Social Media to generate leads or drive revenues bySAMMIEs - Social Samosa.
fbb won the Best Media Marketing Campaign for "Dil Se Desi"Campaign by Global Marketing Congress - CMO Asia. easyday
easyday Club awarded Most Admired Food & Grocery Retailer of the Yearunder National Supermarket Category by IMAGES.
Foodhall at MKT Chanakyapuri won VM&RD Awards 2019 North in FoodGroceries and General Merchandise; Foodhall at MKT Chanakyapuri wonVM&RD
Awards 2019 North in Best Shop Fitting;
Foodhall at Two Horizon Centre Gurugram won VM&RD Awards 2019 North inFood Groceries and General Merchandise.
Your Directors state that:
There were no significant and material orders passed by the regulators or courtsor tribunals impacting the going concern status and the Company's operations in future;
There were no material changes have taken place that could have an impact on thefinancial position of the Company from the date of closure of financial year under reviewtill the date of signing of Accounts;
There were no events relating to non-exercising of voting rights in respect ofshares purchased directly by employees under a scheme pursuant to Section 67(3) of the Actread with Rule 16(4) of Companies (Share Capital and Debentures) Rules 2014;
There were no events relating to receipt of any remuneration or commission fromany of its subsidiary companies by the Managing Director / Jt. Managing Director ofthe Company; Maintenance of cost records and requirement of cost auditas prescribed under the provisions of Section 148(1) of the Act are not applicable for thebusiness activities carried out by the Company.
Your Board of Directors would like to thank and place on record their appreciation forthe continued support and co-operation provided to your Company by its Members FutureGroup entities and in particular their employees regulatory authorities supplierscustomers and its banks and financial institutions. Your Directors would also like toplace on record its sincere appreciation for the efforts put in by employees of theCompany whose efforts hard work and dedication has enabled the Company to achieve thetargets and recognitions during the year.
| ||For and on behalf of the Board of Directors |
|Place : Mumbai ||Kishore Biyani |
|Date : May 25 2019 ||Chairman & Managing Director |