It gives me great pleasure to place before you the financial statements for the yearended 31st March 2018. Your Company could generate an EBITDA profit of ' 6090 lakhs forthe year 2017-18 as against an EBITDA profit of ' 4958 lakhs in the previous year. Theincremental profits was made possible due to better realisation in this year and also dueto contribution made by diamond and other value added products.
The year started with better gold price and the trend continued to be stable with amild positive bias on price movement throughout the year. A small set back was caused byintroduction of GST in the July 2017 sales but later on the tempo in sales was maintainedfor the rest of the year. The monsoon in the areas we operate though better it could notgenerate above average sales as the rural income could not improve as expected. Theturnover was at ' 1379 Crores as against ' 1299 Crores in the previous year resulting in amoderate growth of 6% only.
Going forward the current year 18-19 looks promising for the following reasons. Themonsoon prediction is normal for the southern districts of Tamilnadu. Gold price tends tobehave within a range thereby facilitating a normal off take of jewellery. The Companystarted to improve its Diamond sales that would marginally contribute to the bottom line.
Due to strict regulatory rules implementation by various Government Authoritiesincluding lenders the shift of business from unorganized to organized set up wouldsignificantly improve in the years to come. Due to our initiatives to broad base the sizeof the outlets and also by increased inventory stocking we are confident that the turnoverwould improve in the normal course.
Apart from the above structural issues having a bearing on performance your Company hastaken the following new initiatives to improve the turnover and profits in the currenton-going year.
a) Relaunching of all the remaining branches one by one. The entire exercise began inlater part of 1718 and will be completed by end of March 2019;
b) Strive to increase the market share by exploring "Brand Equity" built overa time;
c) Continued thrust on increasing sizably our own manufacturing of major items;
d) A paradigm shift had been taken place in promotional activities;
e) "Existing staff incentive system" will result in incremental turnover;
In continuation of our objective of improving the gross profit margin for the yearended the company obtained margin of 9.29 % as against 8.38% in the last year. Yourcompany has already embarked strategies to review cost aspects in every area of conduct ofbusiness that would ensure an improvement with the overall performance.
As indicated in my last year letter we could not continue with "TMJL plus"concept as the expected benefits could not be realised in our Tiruppuvanam outlet.However we are striving to make it economically viable units by incorporating certainmodifications in the business plan and may soon launch one or two modified version in theareas already selected.
As things stand today in spite of adverse factors shadowing the integrity of the tradeas such your Company is confident of achieving atleast 12% top line growth in the year18-19. The current blend of bank borrowing customer advances & our own resources isworking out well and it's our endeavour to continue with the same strategy in future aswell.
Taking into consideration our financial performance for the year 17-18 and with a viewto conserve resources for the furtherance of the business interests your Board hasrecommended for a dividend payment of 35% ('3.50 per share ( face value ' 10) for yourapproval as against 20% ('2.00 per share) of last year.
Before I conclude I would like to place on record my heartful gratitude to all ouremployees. Thanks are also due to our bankers under multiple banking system and to all ourbeloved shareholders who have extended their support informed feedback and advice.
Looking forward for a rewarding 18-19.
| ||With warm regards |
| ||For Thangamayil Jewellery Limited |
| ||BALARAMA GOVINDA DAS |
| ||Chairman Cum Managing Director |
|Place - Madurai || |
|Date - May 25 2018 || |