To the Members of
INOX LEISURE LIMITED
Your Directors take pleasure in presenting to you their Nineteenth Annual Reporttogether with the Audited Financial Statements for the Financial Year ended 31st March2018.
1. FINANCIAL RESULTS
| ||(Rs in Lakhs) |
| ||Consolidated ||Standalone |
| || |
|2016-17 || |
|Income || || || || |
|Revenue from operations (net of taxes) ||126732.28 ||114980.94 ||126732.28 ||114980.94 |
|Other operating Income ||8079.55 ||7090.47 ||8079.55 ||7090.47 |
|Total Income from Operations ||134811.83 ||122071.41 ||134811.83 ||122071.41 |
|Less: Total Expenses ||122746.78 ||116000.05 ||122747.18 ||116001.03 |
|Profit from operations before Other Income and ||12065.05 ||6071.36 ||12064.65 ||6070.38 |
|Finance Cost and Exceptional Items || || || || |
|Add: Other Income ||1446.53 ||911.55 ||1444.00 ||905.42 |
|Profit from operations after Other Income and before Finance Cost and Exceptional Items ||13511.58 ||6982.91 ||13508.65 ||6975.80 |
|Less: Finance Cost ||2889.63 ||2528.11 ||2889.47 ||2528.09 |
|Profit from ordinary activities after finance cost but before exceptional items and share profit of joint ventures ||10621.95 ||4454.80 ||10619.18 ||4447.71 |
|Share of profit / (loss) of joint ventures ||(3.43) ||8.12 ||- ||- |
|Profit before exceptional items and tax ||10618.52 ||4462.92 ||10619.18 ||4447.71 |
|Add/(Less): Exceptional items ||(854.16) ||- ||(854.16) ||- |
|Profit from ordinary activity before Taxation ||9764.36 ||4462.92 ||9765.02 ||4447.71 |
|Add/(Less): Provision for Taxation || || || || |
|For the year ||(3671.89) ||(1559.97) ||(3671.28) ||(1558.72) |
|Taxation pertaining to earlier years ||5370.47 ||158.54 ||5370.47 ||158.70 |
|Net Profit for the year ||11462.94 ||3061.49 ||11464.21 ||3047.69 |
|Profit for the year attributable to: || || || || |
|Equity holders of the Parent ||11462.92 ||3061.45 ||- ||- |
|Non-controlling interests ||0.02 ||0.04 ||- ||- |
| ||11462.94 ||3061.49 ||- ||- |
|Other Comprehensive Income || || || || |
|A) Items that will not be reclassified to Profit & Loss || || || || |
|(i) Actuarial gain/(loss) on employee defined benefit plan ||100.21 ||(61.77) ||100.21 ||(61.77) |
|(ii) Tax on above ||(35.02) ||21.38 ||(35.02) ||21.38 |
|Total Other Comprehensive Income ||65.19 ||(40.39) ||65.19 ||(40.39) |
|Total Comprehensive Income for the year comprising Profit & Other Comprehensive Income ||11528.13 ||3021.10 ||11529.40 ||3007.30 |
|Profit brought forward form earlier year/s ||18023.93 ||15002.87 ||18028.75 ||15021.45 |
|On account of change in non-controlling interest ||(0.02) ||(0.04) || || |
|Balance Carried forward to Balance Sheet ||29552.04 ||18023.93 ||29558.15 ||18028.75 |
During the year under review 6 Multiplex Cinema Theatres with 24 screens and onescreen in an existing Multiplex Theatre were added. An agreement for 1 Multiplex CinemaTheatre with 1 Screen was discontinued. Accordingly the tally of Multiplex CinemaTheatres of your Company stands at 123 Multiplexes with 492 screens and 121573 seats ason 31st March 2018.
Detailed analysis of the Financial Performance of the Company has been given in theManagement Discussion and Analysis annexed to this Report.
2. CONSOLIDATED FINANCIAL STATEMENTS
As per Regulation 33 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") and applicable provisions of the Companies Act 2013 ("theAct") read with the Rules issued thereunder the Consolidated Financial Statements ofthe Company for the Financial Year 2017-18 have been prepared in compliance withapplicable Accounting Standards and on the basis of Audited Financial Statements of theCompany and its subsidiaries companies (including a joint venture company which became asubsidiary on 5th March 2018) as approved by the respective Board of Directors.
The Consolidated Financial Statements together with the Auditors' Report form part ofthis Annual Report. The Audited Standalone and Consolidated Financial Statements for theFinancial Year 2017-18 shall be laid before the Annual General Meeting for approval of theMembers of the Company.
With a view to finance the Company's ongoing projects and considering future expansionplans no Dividend has been recommended by the Board of Directors for the Financial Yearended 31st March 2018.
In accordance with Regulation 43A of the Listing Regulations the Company hasformulated a Dividend Distribution Policy' and details of the same have beenuploaded on the Company's website https://www.inoxmovies.com/Corporate.aspx?Section=3.
4. TRANSFER TO RESERVES
During the year under review the Company has not transferred any amount to GeneralReserves.
5. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Mr. Vivek Jain (DIN: 00029968) retires by rotation and being eligible offers himselffor re-appointment.
Mr. Haigreve Khaitan (DIN: 00005290) Mr. Amit Jatia (DIN: 00016871) and Mr. KishoreBiyani (DIN: 00005740) Independent Directors of the Company were appointed in the 15thAnnual General Meeting of the Company for a period of 5 consecutive years from 1st April2014 upto 31st March 2019. Their first term as Independent Director after thecommencement of the Companies Act 2013 will conclude on 31st March 2019 and accordinglythe approval of the Members is being sought by way of Special Resolution for there-appointment of the above mentioned Independent Directors for a period of 5 consecutiveyears from 1st April 2019 upto 31st March 2024.
Necessary resolutions in respect of Director seeking re-appointment and in respect ofappointment of above mentioned Independent Directors along with their brief Resumepursuant to Regulation 36(3) of the Listing Regulations are provided in the Notice of theAnnual General Meeting forming part of this Annual Report.
During the year under review there is no change in the Key Managerial Personnel of theCompany. Subsequent to the end of the financial year Mr. Dhanraj Mulki Company Secretary& Compliance Officer resigned with effect from 17th April 2018 and Mr. ParthasarathyIyengar was appointed as a Company Secretary & Compliance Officer and designated as aKey Managerial Person of the Company with effect from 18th June 2018.
6. NOMINATION & REMUNERATION POLICY
The Nomination and Remuneration Policy of the Company is annexed to this report asAnnexure A.
7. DECLARATION OF INDEPENDENCE
The Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions of Section149 (6) of the Act read with the Schedules and Rules issued thereunder as well asRegulation 16 of Listing Regulations (including any statutory modification(s) orre-enactment(s) thereof for the time being in force).
8. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
Details of Familiarisation Programme for Independent Directors is given in theCorporate Governance Report.
9. PERFORMANCE EVALUATION
Performance Evaluation forms containing criteria for evaluation of Board as a wholeCommittees of the Board and individual Directors and Chairperson of the Company were sentto all the Directors with a request to provide their feedback to the Company on the AnnualPerformance Evaluation of Board as a whole Committees of Board Individual Directors andChairperson of the Company for the Financial Year 2017-18. Further based on the feedbackreceived by the Company the Compensation Nomination and Remuneration Committee at itsMeeting held on 29th January 2018 had noted that Annual Performance of each of theDirectors including Chairman is highly satisfactory and decided to continue the terms ofappointment of all the Independent Directors of the Company.
10. MEETINGS OF THE BOARD
During the year under review the Board met 4 (Four) times and details of BoardMeetings held are given in the Corporate Governance Report. The intervening gap betweenthe two Meetings was within the time limit prescribed under Section 173 of the Act readwith Regulation 17 (2) of the Listing Regulations.
11. DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134 (3)(c) of the Act:
i. in the preparation of the Annual Accounts for the financial year ended 31st March2018 the applicable Accounting Standards and Schedule III of the Companies Act 2013have been followed and there are no material departures from the same;
ii. the Directors had selected such Accounting Policies and applied them consistentlyand made judgments 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 of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv. the Directors had prepared the Annual Accounts 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; and
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.
12. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIESPROVIDED
Particulars of loans given investments made guarantees given and securities providedalong with the purpose for which the Loan or Guarantee or Security is proposed to beutilized by the recipient are provided in the Standalone Financial Statements of theCompany. Please refer to Note nos. 8 9 10 42 45 and 48 to the Standalone FinancialStatements of the Company.
13. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All Contracts / Arrangements / Transactions entered by the Company during the yearunder review with Related Parties are approved by the Audit Committee and/or Board as perthe provisions of Section 188 of the Act read with the Rule 15 of the Companies (Meetingsof Board and its Powers) Rules 2014 and Regulation 23 of the Listing Regulations. Duringthe year under review the Company had not entered into any Contract / Arrangement /Transaction with Related Parties which could be considered material in accordance with thePolicy of the Company on Materiality of Related Party Transactions.
The Policy on Materiality of Related Party Transactions and dealing with Related PartyTransactions as approved by the Board may be accessed on the Company's Website at the linkhttps://www.inoxmovies.com/Corporate.aspx?Section=3.
All transactions entered with Related Parties for the year under review were on arm'slength basis. Further there are no material related party transactions during the yearunder review with any Related Party. Hence disclosure in Form AOC-2 is not required to beannexed to this Report.
The Company has not accepted any deposits covered under Chapter V of the Act.
15. SUBSIDIARY COMPANY INCLUDING JOINT VENTURE
The Company has following Subsidiaries:
A. Shouri Properties Private Limited
The Company is holding 99.29% Equity Shares of Shouri Properties Private Limited(SPPL). SPPL is engaged in the business of operating a multiplex cinema theatre.
B. Swanston Multiplex Cinemas Private Limited
Swanston Multiplex Cinemas Private Limited (SMCPL) has become a wholly-owned subsidiaryof the Company with effect from 5th March 2018. SMCPL was engaged in the business ofoperating multiplex cinema theatres in India. The Company has filed the Scheme ofAmalgamation (the Scheme) of SMCPL with the Company with National Company Law TribunalBench at Ahmedabad for its approval and the same is awaited.
A separate statement containing the salient features of financial statements of allsubsidiaries of the Company (including a joint venture company which became a subsidiaryon 5th March 2018) forms a part of consolidated financial statements in compliancewith Section 129 and other applicable provisions if any of the Act. In accordance withSection 136 of the
Act the financial statements of the subsidiary companies are available for inspectionby the members at the Registered Office of the Company during business hours on all daysexcept Saturdays Sundays and public holidays upto the date of the Annual General Meeting(AGM').Any member desirous of obtaining a copy of the said financial statements maywrite to the Company Secretary at the Registered Office of the Company. The financialstatements including the consolidated financial statements financial statements ofsubsidiaries and all other documents required to be attached to this report have beenuploaded on the website of the Company www.inoxmovies.com. The Company has formulated apolicy for determining material subsidiaries. The policy may be accessed on the website ofthe Company www.inoxmovies.com.
The Report on the highlights of performance and financial position of each of theSubsidiary Companies of the Company in Form no. AOC-1 pursuant to first proviso tosub-section (3) of Section 129 of the Act and Rule 5 of Companies (Accounts) Rules 2014along with the contribution of the Subsidiary Companies to overall performance of theCompany during the year in terms of Rule 8 of Companies (Accounts) Rules 2014 is annexedto this Report as Annexure B.
16. INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls commensurate with its size andnature of its business. The Board has reviewed internal financial controls of the same inconsultation with Internal Auditors of the Company and these are tested Independently byM/s. BSR &
Associates LLP Chartered Accountants.
17. INDEPENDENT AUDITOR'S REPORT
There are no reservations qualifications or adverse remarks in the IndependentAuditor's Report. The notes forming part of the accounts are self-explanatory and do notcall for any further (3) (f) of the Act.
18. INDEPENDENT AUDITORS
Members at their 18th Annual General Meeting (AGM) held on 28th September 2017 hadappointed M/s Kulkarni and Company (Firm Registration No.: 140959W) CharteredAccountants Pune as Independent Auditors of the Company from the conclusion of theeighteenth AGM till the conclusion of the twenty-third AGM of the Company to be held in2022 subject to the ratification of their appointment at every AGM if required underlaw. The requirement to place the matter relating to appointment of Auditors forratification by Members at every Annual General Meeting has been done away with videnotification dated May 7 2018 issued by the Ministry of Corporate Affairs New Delhi.Accordingly no resolution is proposed for ratification of appointment of Auditors whowere appointed in the Annual General Meeting held on 28th September 2017.
M/s. Kulkarni and Company Chartered Accountants (Firm Registration No.: 140959W) haveconfirmed that they are not disqualified from continuing as Auditors of the Company.
19. COST AUDITORS
In terms of Section 148 of the Act read with the Companies (Cost Records and Audit)Rules 2014 the Company is not required to include Cost Accounting Records in its booksof accounts in respect of generation of electricity by Wind Mills of the Company since theWind Mills of the Company satisfy the criteria of Captive Generating Plant as defined inRule 3 of The Electricity Rules 2005. Accordingly the Company is not required to appointthe Cost Auditors for the Financial Year 2018 19.
20. SECRETARIAL AUDIT REPORT
In terms of Section 204 of the Act read with Rule 9 of the Companies (Appointment &Remuneration of Managerial Personnel) Rules 2014 the Company has appointed M/s. SamdaniShah & Associates a firm of Practising Company Secretaries to conduct SecretarialAudit of the Company. The Secretarial Audit Report given by M/s. Samdani Shah & Kabra(erstwhile M/s. Samdani Shah & Associates) in Form No. MR-3 is annexed to this Reportat Annexure - C.
There is no qualification in the Secretarial Report submitted by M/s. Samdani Shah& Kabra (erstwhile M/s. Samdani Shah & Associates) to the Company.
21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 of the Listing Regulations is presented in a separate Section formingpart of this Annual Report.
22. CORPORATE GOVERNANCE REPORT
Pursuant to Regulation 34 of the Listing Regulations Corporate Governance Report andAuditors' Certificate regarding compliance of conditions of Corporate Governance isannexed to this report.
In compliance with the requirements of Regulation 17 (8) of the Listing Regulations aCertificate from the Chief Executive Officer and Chief Financial Officer of the Companywas placed before the Board.
All the Board Members and Senior Management Personnel of the Company had affirmedcompliance with the Code of Conduct for Board and Senior Management Personnel. Adeclaration to this effect duly signed by the Chief Executive Officer is enclosed as apart of the Corporate Governance Report.
23. BUSINESS RESPONSIBILITY REPORT
Since your company is not part of the top 500 companies as per market capitalization onthe stock exchanges where the shares of the Company are listed as on 31st March 2018 itis not mandated to publish Business Responsibility Report. However as best governancepractice Business Responsibility Report is included. A Business Responsibility Report asper Regulation 34 of the Listing Regulations detailing the various initiatives taken bythe Company on the environmental social and governance front forms an integral part ofthis report. The said report is available on the website of the Companyhttps://www.inoxmovies.com/Corporate. aspx?Section=3.
24. EXTRACT OF ANNUAL RETURN
In terms of Section 92 (3) of the Act read with Rule 12 of the Companies (Management& Administration) Rules 2014 the extract of Annual Return as provided in Form No.MGT -9 is annexed to this Report at Annexure D.
25. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
Information in respect of Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo pursuant to Section 134 of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 in the manner prescribed is annexed to this Report atAnnexure E.
26. EMPLOYEE STOCK OPTION SCHEME
During the year under review 167500 options were granted to the employees of theCompany. However no shares were allotted pursuant to the grant in the current year. Thereare no changes in the Scheme and the Scheme is in compliance with the SEBI (Share BasedEmployee Benefit) Regulations 2014.
The disclosures as required under the SEBI (Share Based Employee Benefit) Regulations2014 have been disclosed on the website of the Company and the same can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.
27. PARTICULARS OF EMPLOYEES
Disclosure pertaining to remuneration and other details as required under Section 197(12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are annexed to this Report at Annexure - F.
In accordance with the provisions of Section 197 (12) of the Act read with Rules 5 (2)and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 as amended a statement showing the name and other particulars of the employeesdrawing remuneration in excess of the limits set out in the aforesaid Rule forms part ofthis Report. However in terms of Section 136 of the Companies Act 2013 the Report andAccounts are being sent to the Members of the Company excluding information on employees'particulars which is available for inspection by the Members at the Registered Office ofthe the business hours on working days of the Company up to the date of the ensuing AnnualGeneral Meeting. If any Member is interested in obtaining such information the member maywrite to the Company Secretary at the Registered Office of the Company.
28. CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES
The Corporate Social Responsibility (CSR) Committee of the Company comprises of Mr.Haigreve Khaitan Independent Director Mr. Pavan Jain and Mr. Deepak Asher NonIndependent Directors of the Company. The CSR Policy of the Company is disclosed on thewebsite of the Company which can be viewed at https://www.inoxmovies.com/Corporate.aspx?Section=3.
The report on CSR activities as per Companies (Corporate Social Responsibility) Rules2014 is annexed to this Report at Annexure - G.
The Company's property and assets have been adequately insured.
30. RISK MANAGEMENT
The Board of Directors of the Company at its Meeting held on 31st October 2017 hasapproved Enterprise Risk Management (ERM) of the Company which is derived from COSO ERM Aligning Risk with Strategy and Performance 2016 (Draft) framework established bycommittee of sponsoring organizations. Enterprise Risk Management is "The culturecapabilities and practices integrated with strategy-setting and its execution thatorganizations rely on to manage risk in creating preserving and realizing value".The Company has therefore adopted Residual risk approach and the Board of Directors atits Meeting held on 7th May 2018 have approved Enterprise Risk Register Risk Reportingand its Monitoring system. In the Board's view there are no material risks which maythreaten the existence of the Company. For further details please refer to the ManagementDiscussion and Analysis Report annexed to this report.
31. INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has in place a Policy on Prevention Prohibition and Redressal of sexualharassment at the workplace in line with the requirements of The Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013. The Company hasformed Internal Complaints Committee to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis Policy.
The following is the summary of sexual harassment complaints received and disposed offduring the year 2017-18.
|Number of complaints received ||14 |
|Number of complaints disposed off ||13 |
32. 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 THIS REPORT
There are no material changes and commitments 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 this Report.
33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There are no orders passed by the Regulators or Courts or Tribunals impacting the goingconcern status and Company's operations in future.
Your Directors express their gratitude to all other external agencies for theassistance co-operation and guidance received. Your Directors place on record their deepsense of appreciation for the dedicated services rendered by the workforce of the Company.
| ||By Order of the Board of Directors |
| ||Pavan Jain |
|Place: Mumbai ||Chairman |
|Date: 24th July 2018 ||(DIN:00030098) |