To the Members
The Directors have pleasure in presenting before you the 51st Annual Report of theCompany together with the Audited Statements of Accounts for the year ended 31stMarch2017.
COMPANY ACTIVITY & PERFORMANCE
The principal activity of the company continues to be manufacture and marketing of foamand other related products.
Financial Summary or highlights/performance of the company
|Particulars ||Financial year ended ||Financial year ended |
| ||March 31 2017 ||March 31 2016 |
| ||Rs in Lakhs ||Rs in Lakhs |
|Revenue from Operations ||2012.62 ||1875.95 |
|Operating Expenditure ||1915.26 ||1788.09 |
|Earnings Before Interest Tax Depreciation &Amortization (EBITDA) ||114.34 ||100.86 |
|Other income (net) ||16.98 ||12.99 |
|Finance costs ||61.94 ||67.12 |
|Depreciation &amortization expense ||8.41 ||8.00 |
|Profit for the year after tax ||43.99 ||25.73 |
|Balance brought from previous year ||-43.09 ||-63.97 |
|Amount available for appropriation ||1.14 ||-38.03 |
|Adjustment relating to fixed assets ||- ||- |
|Adjustment relating to TDS & FBT ||- ||-8.90 |
|Adjustment relating to Income Tax provision ||- ||3.80 |
|Provision for taxation ||- ||- |
|Amount transferred to General reserve ||1.14 ||-43.13 |
|Dividend ||- ||- |
|Balance carried to balance sheet ||1.14 ||-43.13 |
|The position of reserves is as under: || || |
|General Reserve ||1.14 ||-43.13 |
OPERATIONS & PERFORMANCE:
Your directors are happy to inform that the company has maintained and in fact slightlyincreased its turnover as compared to previous year. However on account of tight controlover costs the company was able to improve its profitability to Rs.43.99 lakhs ascompared to previous year profit of Rs.25.73 lakhs the company was also(able to wipe offits carry forward loss.
The company is taking steps to shift the present manufacturing facilities from rentedpremises to its own premises at Ranipet in the coming year. The company has alsoidentified improved production process thereby production efficiency i s expected toimprove. Your directors are confident that with this move company's turnover and theprofitability would improve in the coming year.
As already indicated above company was able to wipe off all its carry forward loss andis expected to improve its performance and post healthy profit in the coming year.
At the close of the year the matured deposit of Rs. 17000/- remain unclaimed.YourDirectors are taking steps to deal with the same in accordance with the provisions ofCompanies Act 2013.
LISTING WITH STOCK EXCHANGES:
The Company confirms that it has paid the Annual Listing Fees for the year 2017-18 toBSE Limited where the Company's Shares are listed.
DEMATERIALISATION OF SHARES:
Your company's 41% of the company's paid up Equity Share Capital is in dematerializedform as on 31st March 2017 and balance 59% is in physical form. The Company's Registrarsand Transfer Agent is M/s CAMEO CORPORATE SERVICES LIMITED having their registered officeat "Subramanian Building"No.l Club House Road Chennai - 600002.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 Directors of your Company herebystate and confirm that: a) In the preparation of the annual accounts for the year ended31st March 2017 the applicable accounting standards have been followed and there are nomaterial departures; b) they have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit of the company for the same period; c) the directors havetaken proper and sufficient care for the maintenance ofadequate accounting records inaccordance with the provisions of the Companies Act 2013 for safeguarding the assets ofthe company and for preventing and detecting fraud and other irregularities; d) they haveprepared the annual accounts on a going concern basis; e) They have laid down internalfinancial controls that are adequate and were operating effectively; f) They have devisedproper systems to ensure compliance with the provisions of all applicable laws and theseare adequate and are operating effectively.
Based on the Internal Financial Controls and Compliance Systems established andmaintained by the company work performed by the internal statutory and secretarialauditors and reviews performed by the management the Board isof the opinion that thecompany's internal financial controls were adequate and effective during the financialyear 2016-17.
CONTRACTS AND ARRANGEMENT WITH RELATEDPARTIES:
During the year the company has 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. Refer Note No.21.9 tothe financial statement which sets out related party disclosures.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Mr. Jacob Mammen (DIN 0078010) Director of the company retires by rotation and iseligible for reappointment. Mr. Karun Philip (DIN 01091468) Director of the companyretires by rotation and is eligible for reappointment. The present tenure of Mr. RoyMammen (DIN 00077409) as Managing Director of the Company comes to end during September2017. As the Company has made substantial progress under the guidance of Mr.RoyMammen theBoard of directors have re-appointed Mr. Roy Mammen as Managing Director on such terms andconditions which is subject to approval by the members at the ensuing Annual GeneralMeeting.
NOMINATION AND REMUNERATION POLICY:
The Nomination and Remuneration Committee of Directors reviews the composition ^i theBoard to ensure an appropriate mix of abilities experience and diversity to serve theinterests of all shareholders of the Company.
Nomination and RemunerationPolicy was approved by the Board at its meeting held on30.05.2017.In terms ofSection 178 of the Act2013. The objective of such policy shall beto attract retain and motivate executive management and remuneration structured to linkto Company's Strategic long-term goals appropriateness relevance and risk appetite ofthe company.
The Process of appointing a director/Key Managerial Personal is that when there is aneed or a vacancy arises or is expected the NRC will identify ascertain the integrityqualification appropriate expertise and experience having regard to the skills that thecandidate will bring to the board in addition to what the existing members hold.
NUMBER OF BOARD MEETINGS HELD:
The Board of Directors duly met four times during the financial year from IstApril2016 to 31st March 2017. The dates on which the meetings were held are as follows:
|Date of meeting ||No. of directors as on the date ||No. of Directors Present |
|30.5.2016 ||6 ||4 |
|22.7.2016 ||6 ||6 |
|27.10.2016 ||6 ||4 |
|23.01.2017 ||6 ||4 |
NUMBER OF AUDIT COMMITTEE MEETING HELD:
The Committee consisting of three Directors namely Mr. Ashok Kuriyan IndependentDirector Mr. Jacob Mammen Director and Mrs. Susan Kurian Independent Director.
|Date of Committee Meeting ||No.of Member as on date ||No.of Members Present |
|30.05.2016 ||3 ||3 |
|22.07.2016 ||3 ||3 |
|27.10.2016 ||3 ||3 |
|23.01.2017 ||3 ||3 |
i ) Statutory Auditors :
The AuditorsMessrs. S R.Mandre &Company Chartered Accountants (Firm registrationNo 001962S) Statutory Auditors of the Company would retire on the conclusion of thisAnnual General Meeting on completion of their term of appointment. Since Messrs S R.Mandre &Company Chartered Accountants are not eligible for re-appointment asStatutory Auditors of the Company as per Companies Act 2013 the Board of Directors onrecommendation of the Audit Committee recommended the appointment of Messrs Vandana Raoand Company Chartered Accountants(Firm Registration No.011628S) as Statutory Auditorsof the Company for a period of 5(five) years in place of Messrs S R. Mandre &Company Chartered Accountants to hold office from the conclusion of 51st Annual GeneralMeeting until the conclusion of 56th Annual General Meeting subject to ratification oftheir appointment at every Annual General Meeting. Consent and Certificate from the saidfrim has been received to the effect that their appointment as Statutory Auditors of theCompany if appointed at ensuing Annual General Meeting would be according to the termsand conditions prescribed under Section 139 of the Act and Rules framed thereunder.
A resolution seeking their appointment forms part of the Notice convening the 51stAnnual General Meeting and the same is recommended for your consideration and approval.
The notes on financial statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' report does notcontain any reservation or adverse remark.
The Material changes and commitments if any affecting the financial position of thecompany occurred between the end of the financial year to which these financial statementsrelate and the date of the report.
No material changes and commitments affecting the financial position of the companyoccurred from the end of the financial year 2016-17 till the date of this report. Furtherthere was no change in the nature of the business of the company.
ii) Cost Auditors :
Since the Company's turnover has not exceeded Rs.35 crores in the previous financialyears the cost audit is not applicable.
iii) Secretarial Audit:
M/s.M.Damodaran & Associates Chennai was appointed as Secretarial Auditors forcarrying out the secretarial audit for the financial year 2016-17.
As required under Section 204 of the Companies Act 2013 read with Rule 9 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theSecretarial Audit Report submitted by Company Secretary in Practice is enclosed as a partof this report Annexure-A.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
1. Specific areas in which R&Dcarried out by the Company
The Company has an ongoing programme on latex technology development and its relatedapplication to various products. Accordingly the Company has in the past launched newproducts such as dual deluxe mattress contour pillow hemorrhoid cushions neck care andcoccyx cushions.
2. Technology Absorption Adaptation and Innovation
The latest technology is being adopted in the factory for improving productivity andproduct quality and reducing consumption of raw materials and fuel. In this connectionpre-vulcanized latex is being adopted.
3. Foreign Exchange Earning and Outgo
Statutory particulars with regards to foreign exchange and outgo appear in the notespertaining to the accounts.
EXTRACT OF ANNUAL RETURN :
The details forming part of the extract of the Annual Return in Form MGT-9 is annexedherewith as Annexure-B.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act2013 are given in the notes to the Financial Statements.
REMUNERATION RATIO OF THEDIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and Companies(Particulars of Employees) Rules 1975 in respect of employees of the Company andDirectors is furnished hereunder:
|SI. No. ||Name ||Designation ||Remuneration paid FY 2016-17 lakhs ||Remuneration paid FY 2015-16 lakhs ||Increase in remuneration from previous year in lakhs ||Ratio/Times per Median of employee remuneration |
|1. ||Mr. Roy Mammen ||Managing ||17.82 ||16.50 ||1.32 ||8.61 |
| || ||Director || || || || |
|2. ||Mr. Mammen ||Director ||2.07 ||2.07 ||- ||0.00 |
| ||Philip ||corporate affairs || || || || |
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:
The Company's Development and Implementation of Risk Management Policy is providedelsewhere in this Annual Report in Management Discussion and Analysis as Annexure-C.
POLICY ON VIGIL MECHANISM:
The Audit committee has adopted a policy on vigil Mechanism in accordance with theprovisions of the Act2013 and Regulation 22 of SEBI (LODR) Regulations which provides aformal mechanism for all Directors employees and other stakeholders of the company toreport to the management their genuine concerns or grievances about unethical behaviorsactual or suspected fraud and any violation of the Company's Code of Conduct or ethicspolicy.
The policy also provides a direct access to the Chairperson of the Audit Committee tomake protective disclosures to the Management about grievances or violation of theCompany's code of conduct.
The policy disclosed on the Company's website in the following link www.mmfoam.in
Directors take this opportunity to express their thanks to various departments of theCentral and State Government Bankers Material Suppliers Customers and Shareholders fortheir continued support and guidance.
The Directors wish to place on record their appreciation for the dedicated efforts putin by the Employees of the Company at all levels.
| || ||BY ORDER OF THE BOARD |
| || ||For M.M.RUBBER CO.LTD. |
|PLACE: BANGALORE ||ASHOK KURIYAN ||ROY MAMMEN |
|DATE: 30.5.2017 ||Director ||Managing Director |
| ||(DIN: 00081374) ||(DIN: 00077409) |