| Disclosure in board of directors report explanatory MALANKARA PLANTATIONS LTD
Report of the Directors
Your Directors are pleased to present the 102nd Report of the Directors for the year 2012-13 as well as the Balance Sheet as on 31st March 2013 and the Profit and Loss Account for the year ended 31st March 2013 annexed hereunder duly audited and certified by the Auditors appointed at the previous Annual General Meeting.
Financial Highlights:
It may be noted from the summary of accounts below that the profit from operations of the Rubber Division and minor produce amounted to Rs 436.56 lakhs. Profit from operations of the Tea Division and minor produce is Rs 59.55 lakhs. Loss from the operations of rubber trading amounts to Rs 0.24 lakhs and the loss in tea trading amounts to Rs. 9.05 lakhs reducing the profit to Rs. 486.82 lakhs. This together with Other Income (Rubber Division) Rs. 178.70 lakhs, Tea Division Rs. 0.26 lakhs and income of exceptional nature Rs. 70.23 lakhs on the sale of old and uneconomic trees adds upto a profit of Rs. 736.03lakhs before providing for interest, depreciation, tax, gratuity and other provisions as required under the Accounting Standards. Details are given below:
(Rs.in lakhs)
Particulars 2012 - 13 2011 - 12
i) Profit from Operations of Rubber Division and Minor Produce 436.56 722.65
ii) Profit from Operation of Tea Division and Minor Produce 59.55 103.08
iii) Rubber Trading (0.24) 1.84
(excluding Interest and Depreciation)
iv) Tea Trading (9.05)
(5.92)
v) Other Income - Rubber Division 178.70 98.17
- Tea Division 0.26 178.96 0.84 99.01
Vi) Exceptional items 70.23 927.77
Profit before provisions 736.03 1848.43
Less: Replanting Reserve 29.24 37.97
Interest 30.69 13.15
Depreciation 100.62 81.98
Provision for Taxes 110.00 270.00
Provision for Gratuity as per AS-15 138.47 409.02 34.75 437.85
Deferred Tax 37.29 6.54
Net Profit 364.3 1404.04
Add: Previous Year's Balance 677.13 657.07
Total 2061.11
Proposed Dividend 72.26 72.26
Tax on Proposed Dividend 11.72 11.72
Transfer to Development Reserve 66.44
Transfer to General Reserves 200.00 350.42 1300.00 1383.98
Balance to be Carried Forward 691.00 677.13
(Figures in brackets indicate Net Loss)
From the above statement, it may be seen that the operating profit from Rubber Division decreased from Rs 722.65 lakhs in the previous year to Rs 436.56 lakhs and income from other sources in the current year is Rs 178.70 lakhs compared to Rs 98.17 lakhs in the previous year. The Tea Division made an operating profit of Rs 59.55lakhs as against Rs 103.08 lakhs in the previous year. After providing for interest, depreciation, tax, gratuity and other provisions, the Rubber Division made a net profit of Rs.410.25 compared to Rs 1352.85 lakhs in the previous year. Tea Division made a net loss of Rs 45.98 lakhs compared to a profit of Rs 51.19 lakhs in the previous year after the above mentioned provisions. The total net profit for the year is Rs 364.30lakhs compared to Rs. 1404. 04 lakhs in the previous year. The Profit and Loss Accounts of the two divisions are shown separately for the information of the Shareholders.
During the year under report, the Company has advanced a loan of Rs 116.04 lakhs to the wholly owned subsidiary; Malankara Wood Ltd for purchase of land in Tamil Nadu and to provide an advance to purchase property and building, on MC Road, in the name of the Company Malankara Wood Limited.
During the year under report, the Company has advanced a loan of Rs 25.74 Lakhs to the wholly owned subsidiary; Malankara Enterprises Ltd for purchase of land in Tamil –Nadu for a solar power project.
New venture and Significant Expansion plans
During the year the company has entered into a new venture – an automotive unit under the name of MK Motors, and has signed a dealership agreement with TATA Motors.
Consolidated Financial Statements:
The consolidated Balance Sheet as on 31st March 2013 and the Profit and Loss Account for the year ended on that date together with Directors’ Report and Balance Sheet and Profit and Loss Account of the subsidiary companies are annexed to Annual Report, as required under the Companies Act. The Subsidiary Company Malankara Wood Ltd made an operational profit of Rs. 4.32 lakhs and a net loss of Rs.6.03 lakhs after providing for depreciation, interest etc. Malankara Enterprises Limited made a loss of Rs 0.15 lakhs during the year
Dividend:
Your Directors recommend payment of a dividend of 200% on the Paid up Capital amounting to Rs 20/- per share of Rs 10/- each. The Dividend will absorb a sum of Rs. 83.98 lakhs inclusive of Tax on Dividend.
Rubber Division:
The details of crop, price and cost for the past 10 years are given below:
Year Crop
( in Kg ) Estate
Expenditure
( Rs per Kg ) Total Cost
(Rs per Kg ) Average
Sale Price
(Rs per Kg) Average Crop per Hectare ( in Kg )
2003-04 778840 33.3 40.64 59.94 1756
2004-05 820777 33.74 40.34 65.95 1854
2005-06 830107 37.37 48.33 71.51 1875
2006-07 764617 48.55 58.72 98.88 1684
2007-08 742925 56.47 72.21 98.64 1724
2008-09 797019 60.89 79.23 106.77 1925
2009-10 750881 63.61 79.35 124.91 1795
2010-11 659935 79.76 101.63 203.33 1586
2011-12 634100 91.92 120.28 208.79 1554
2012-13 661071 119.05 148.23 180.63 1548
(Estate expenditure includes provision for Gratuity, Bonus and Depreciation)
It may be noted that the yield per hectare decreased by 0.39% and all efforts are being made to improve the yield.
Centrifuged Latex: Latex centrifuging operations made a marginal loss due to the stiff competition for field latex and volatility in the product prices during the year.
Tea Division: The Tea Division of the Company made a loss after three years of marginal profit.
The price of the Company’s tea increased from Rs 90.72 last year to Rs 106.30 this year showing an increase of Rs.15.58 per Kg, while the Cost of Production (COP) increased from Rs 88.07 to Rs 117.39 per Kg, an increase of Rs 29.32 per Kg. This was due to a substantial increase in the cost of inputs. However, the position of the Company in the tea growing area of Peermade/Vandiperiyar continued to be second highest for Yield per Hectare and fourth in Price. The average price for South Indian Tea for the year 2011 was Rs 70.03 per Kg, which is Rs 20.69 per Kg lower than the Company’s tea price. Even though the excess global tea production over the past decade had been corrected by the decrease in production in most of the tea growing areas in the world due to adverse weather conditions in 2008 and 2009, a huge increase in the Kenyan tea output dented our exports and consequently brought down the prices in South India in 2009-10. However the year under report saw only a marginal over supply of tea and the prices remained firm. The prices are currently around Rs 100 per Kg and show a steady trend inspite of the increased world production excluding Indian production in 2012-13.
The following table gives the details of the yield and cost for both Penshurst Estate and Karimtharuvi Estate for the past 10 years.
Year Crop (Quantity in Kg) Estate Expenditure (Rs. per Kg) All in Cost Average
Karimtharuvi Penshurst Total Karimtharuvi Penshurst Total ( per Kg ) Sales
Estate Estate Estate Estate Price
( Rs. per Kg )
2003-04* 164307 117965 282272 99.88 61.84 83.98 94.91 44.80
2004-05 336347 224414 560761 63.20 53.84 59.45 68.79 50.30
2005-06 414915 351019 765934 52.37 42.32 47.76 57.92 43.73
2006-07 328312 298035 626347 72.52 56.09 64.70 77.97 53.52
2007-08 331812 308752 640564 66.88 52.77 60.08 71.05 59.90
2008-09 301120 313517 614637 96.53 68.75 82.36 92.15 84.77
2009-10 417236 371224 788460 65.84 53.84 60.19 67.71 91.03
2010-11 405089 319500 724589 82.43 68.66 76.36 84.06 85.66
2011-12 385670 354509 740179 89.72 68.76 79.68 88.07 90.73
2012-13 379731 351908 731639 122.88 91.56 107.82 117.39 106.3
* Yield from 3½ months operation.
(Estate Expenditure includes provision for Gratuity, Bonus and Depreciation)
Note: Karimtharuvi prices shown above are for the financial year April to March. Kenya, North India and South India are based on the calendar year.
India produces over 90% of the CTC variety and 9% of the Orthodox variety of Tea. Kenya also produces more than 95% of its tea with the CTC process. It may be noted from the above graph that Kenya has been getting a higher price than North Indian tea and that our teas fetch a much lower price than North Indian teas. Karimtharuvi Tea has held its position above the South Indian average auction price for the past five years. During the calendar year 2012 Karimtharuvi tea was ranked 17th among seventy five factories in South India compared to 16th rank in the last year.
Packeting and Retail Sales:
Marketing of the Company’s tea in packets is gaining better acceptance from the consumers. The net sale rates improved marginally but the operation incurred a marginal loss. It is expected that Malankara Tea will improve its presence in the market.
Investments:
The cost of investments in Mutual Funds and Shares excluding Malankara Wood Ltd and Malankara Enterprises Ltd as on 31st March 2012 was Rs. 526.26 lakhs. During the year an amount of Rs 205.44 lakhs was invested in Mutual Funds and Shares.
The details are shown in the table below:
( Rs in Lakhs )
Year
Cost of Investments as on 1st April
Purchased during the year
Sold during the year
Cost of Investments as on 31st March
Profit/
Loss
Market Value as on 31st March
2008-09 413.59 1065.37 1064.24 414.72 (12.93) 349.14
2009-10 414.72 441.72 399.43 457.01 16.38 578.54
2010-11 457.01 209.10 318.25 347.86 0.00 415.44
2011-12 347.86 526.26 69.65 804.47 (3.24) 831.78
2012-13 804.47 205.44 - 1009.91 - 1081.45
Capital Expenditure:
The Capital Expenditure incurred during the year was Rs.460.27 Lakhs as detailed in Schedule ‘A’ including Rs.29.65 Lakhs spent on replanting 10.30 Hectares of Rubber. The Capital Expenditure on replanting 13.68 hectares of tea this year was Rs. 87.57Lakhs.
Subsidiary:
MALANKARA WOOD LTD:
The wholly owned subsidiary, Malankara Wood Ltd has not taken up any fresh activity. During the year, the Company has purchased 32.27 acres of land in Tamil Nadu. It has entered into an agreement with the holding company to lease out its factory buildings to the holding company to establish a service centre for its automobile dealership.
MALANKARA ENTERPRISES LTD:
During the year, the wholly owned subsidiary, Malankara Enterprises has purchased 35.35 acres of land in Tamil Nadu.
Corporate Social Responsibility:
As a CSR activity, the Company continues to provide a full scholarship to a child of any employee from the plantations of South India, every academic year, to study for an MBA degree at the Indian Institute of Plantation Management called the ‘Malankara Plantations Centenary Scholarship’ spending an amount of Rs. 2 lakhs (Rupees Two lakhs only) for the selected child..
Directors:
In terms of Section 256 of the Companies Act, 1956:
1)Mr Joseph Markos, Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re- appointment.
2)Mr M.K. Balagopalan Nair, Director retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.
DETAILS OF DIRECTORS SEEKING REAPPOINTMENT AT THE ANNUAL GENERAL MEETING
Name of the Director Mr Joseph Markos Mr M.K. Balagopalan Nair
Date of Birth 27/04/1960 09/02/1949
Date of appointment 27/02/2001 03/09/2010
Qualifications B.Com, LLb. Bsc Eng. ME
Expertise in specific functional area Legal Advisor Technical Advisor
Details of other Directorship Yes[ Malankara Wood Ltd,
Malankara Enterprises Ltd and
Stable Management Wire (P) Ltd] Yes [Malankara Wood Ltd and Malankara Enterprises Ltd]
The Managing Director was re-appointed for a period of 5 years from 16th May 2009 on the same terms and conditions on which he was appointed for the previous term. However, terms were marginally revised so that he becomes eligible to the commission on profits as recommended by the Remuneration Committee and in accordance with the provisions of Schedule XIII of the Companies Act, 1956.
Transfer of amounts to Investor Education and Protection Fund:
Pursuant to the provisions of Section 205A(5) and 205C of the Companies Act, 1956, relevant amounts which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund on 28.03.2013
Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 26/09/ 2012 (date of last Annual General Meeting) on the website of the Company(www.malankaraplantations.com), as also on the Ministry of Corporate Affairs website.
THE CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING/OUTGO:
Conservation of Energy – The Company installed a Solar system at its Head Office at Kottayam, which provides all the power required for its office operations. The Company has gained the distinction of being the first Net Zero Energy Office Complex in the country by installing the solar power system, which is capable of providing the entire electrical energy requirements of the Head Office. The Company is negotiating with the Kerala State Electricity Board to sell the excess energy produced.
Technology Absorption - This is not applicable to this Company as it has not purchased or acquired any technology for development of company’s business from an outside party.
Foreign Exchange Earning/Outgo - There was no foreign exchange earnings during the year.
FOREIGN EXCHANGE EARNINGS AND OUTGO 2012 – 13 2011 - 12
(Rs ) (Rs)
Earnings NIL NIL
Outgo on account of MD's foreign travel 73,390 101,900
Fixed Deposit - The Company has not accepted any deposit from the public as defined under section 58A of the Companies Act, 1956 and rules made there under.
Statement under Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules 1988 is annexed herewith as Form-A.
Auditors:
M/s O Thomas and Co, Chartered Accountants, Kottayam, the Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible and offer themselves for re-appointment.
M/s Abraham Jacob and Achankunju, Chartered Accountants, Kochi continue as Internal Auditors of the Company.
Auditors' Observations:
The remarks in the Auditors' Report are already explained in the Notes to the Accounts and as such, does not call for any further explanation or elucidation.
Secretarial Compliance Certificate:
The Secretarial Compliance Certificate from Ms. N Geetha, Company Secretary in Whole time Practice (No 9074) is annexed herewith, which forms part of the Directors Report.
Cost Audit
Pursuant to Order No.F. NO.52/26/CAB-2010 dated 24/01/2012; The Central Government has made it mandatory for the Company to conduct a cost audit and accordingly, the Company has appointed Mr. K.A Felix, Cost Accountant ,35/253 D, Automobile Road, Mamangalam, Palarivattom P.O, Kochi- 682025 for conducting audit of the Cost Accounting Records of the Company for the year 2012-13, with regard to the plantation business. The said appointment, as made pursuant to Section 233B of the Companies Act, 1956, has been approved by the Ministry of Corporate Affairs. The Audit is underway and the Report will be submitted to the Central Government within 180 days from the close of the financial year 2012-13 as mandated under Rule 5 of the Companies (Cost Audit Report) Rules, 2011.
Health, Safety and Environment:
Your Company has complied with all applicable environmental and labour laws and has taken all necessary measures to protect the environment and Workers Safety. The Company has continuously received approval from the Pollution Control Board. It’s Effluent Treatment Plant was adjudged as the best in the state by the Pollution Control Board in the year of installation. The existing capacity of the Effluent Treatment Plant has been enhanced. Trial runs on the additional equipments/structures were successful and the plant is operating continuously. During the year, Malankara Rubber Factory received the Kerala State Pollution Control Award – 2012 for the 2nd position among Medium – B industries. This is the 5th time and 3rd consecutive year the Company is bagging this award from the Kerala State Pollution Control Board.
Directors’ Responsibility Statement:
Your Directors are pleased to inform you that the audited accounts containing the Financial Statements for the year 2012-13 are in conformity with the requirements of the Companies Act and they believe that the financial statements reflect fairly the form and substance of the transactions carried out during the year and reasonably present the Company’s financial condition and results of operations.
In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 ("the Act") and, based upon the representations from the Management, the Board states that:
a) in preparing the Annual Accounts, applicable Accounting Standards have been followed and there are no material departures;
b) the Directors have selected such accounting policies, applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the Profit of the Company for the year;
c) the Directors have taken proper and sufficient care in maintaining adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the Annual Accounts of the Company on a "going concern" basis.
Corporate Governance:
The details required under Schedule XIII, Part II, Section II are given below:
i)None of the Directors other than the Managing Director receive any remuneration except Mr Cherian Thomas, who receives a remuneration of Rs.15,000/- per month as Consultant.
ii)None of the Directors receive any incentive.
iii)None of the Directors are eligible for Governance Fees. All the Directors except the Managing Director retire by rotation once in 3 years. The contract of employment of the Managing Director is for 5 years and expires on 15th May 2014. Mr C Thomas John was appointed as a Director of the Company at the previous Annual General Meeting held on 25th September 2009. He is also appointed as the Whole time Director of the subsidiary, Malankara Wood Ltd at a remuneration in accordance with Schedule XIII of the Companies Act.
iv)No stock options are offered to any of the Directors, but stock options will form part of the remuneration to the Managing Director, if and when a scheme in this regard is formulated by the Company and approved by the Shareholders.
v)Director Mr MK Balagopalan Nair was paid consultancy charges for preparing the layout of the machinery, factory extension and technical advise for commissioning the in line automated crumb rubber processing machines installed at a cost of Rs 122 Lakhs.
Particulars of employees:
The Company has not paid any remuneration attracting the provisions of the Companies (Particulars of Employees) Rules, 1975 read with Section 217(2A) of the Companies Act, 1956. Hence, no information is required to be appended to this report in this regard.
Corporate website:
The website of your company, www.malankaraplantations.com carries a comprehensive database of information of interest to the shareholders including the corporate profile, information with regard to products, estates, factories, various depots, financial performance of the Company etc.
Acknowledgement:
The Directors thank the Managers, Staff and Workers for their continued support and recognize the contribution made by them for the Company’s progress during the year under review. The Directors also thank the Banks, business associates and the shareholders for their continued support to the Company.
By Order of the Board
for Malankara Plantations Limited
Sd/- Sd/-
(CHERIAN THOMAS) (JK THOMAS)
DIRECTOR MANAGING DIRECTOR
Kottayam
31.07.2013
Annexure to the Directors’ Report
MANAGEMENT DISCUSSION AND ANALYSIS
This report discusses and analyses the performance for the year ended 31st March 2013.
? Overall review of operations
The company is in the business of plantation activities for the past 101 years. The Company achieved a turnover of Rs. 28 crores.
? Industry
The Plantation industry plays a vital role in the economy of the State as they cover over 1/5th of the net cultivated area of the State by contributing 1/3rd to State GDP of agricultural origin.
? Opportunities and Threats
Competition from other companies
Even though the competition is hectic the Company has an edge over others with its efficient staff and quality products. However competition from small holders is severe as the cost of production of small holders is much less than large plantations which have to bear all the Statutory payments such as PF, Gratuity, Paid Holiday Wages, Leave with wages, medical treatment, housing, water supply, power and other benefits. The international price of rubber is much lower than the domestic price and profits will be marginal if not absent if the domestic price becomes on par with international prices.
Increased production cost
The severe shortage of labour has increased the cost of production significantly, as rubber plantations cannot get the advantage of economies to scale in their tapping operation which is the single highest cost area, large plantations do not have much advantage over small holders in this respect.
Adverse trend of foreign exchange rate – is a major concern for the growth of the industry
? Outlook
The company has taken all efforts to improve the quality of its products and productivity.
Due to the implementation of mechanization to the maximum extent possible, the Company is able to maintain high quality and productivity at competitive rates. Thus the Company is expecting a reasonable result this year, excepting unforeseen circumstances.
? Internal Control Systems and their Adequacy
The Company has proper and adequate internal control systems to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition.
The internal control is exercised through documented policies, guidelines and procedures. It is supplemented by an extensive program of internal audits conducted by M/s Abraham Jacob and Achankunju, Chartered Accountants, Ernakulam, assisted by in house trained personnel.
The internal control is designed to ensure that the financial and other records are reliable for preparing financial statements and other data, and for maintaining accountability of persons.
? Financial and operational performance
The financial statements have been prepared in compliance with the requirements of the Companies Act, 1956 and Generally Accepted Accounting Principles in India. [Please refer Directors’ Report]
? Human Resources/Industrial Relations
The Company have dedicated staff, motivated to perform to the fullest capacity to contribute to developing and achieving individual excellence and corporate objectives.
The Company is giving direct employment to 688 employees, and Industrial relations are pleasant and satisfactory.
? Cautionary Statement
Statements made herein describing the Company’s expectations or predictions are “forward-looking statements”. The actual results may differ from those expected or predicted. Key factors that may make a difference to the Company’s performance include market conditions, input costs, govt. regulations, economic development within/outside the country, weather conditions etc, which are beyond the control of Management.
CORPORATE GOVERNANCE REPORT
1. COMPANY’S PHILOSOPHY ON CODE OF GOVERNANCE:
The Board of Directors and Management lay great importance on adopting and practicing principles of good Corporate Governance with a view to achieving business excellence by enhancing long term shareholder value and the interest of all its stakeholders through sound business decisions, prudent financial management and a high standard of business ethics.
2. BOARD OF DIRECTORS - Composition of the Board and category of Directors
Sl No Name of the Director
Category
1 Mr. JK Thomas Promoter – Executive - Managing Director
2 Mr. Cherian Thomas Promoter – Non Executive Director
3 Mr. MK Balagopalan Nair Independent non executive director
4 Mr. C Thomas John Non executive director
5 Mr. Joseph Markos Non executive director
6 Mr. K Balaji. Independent non executive director
Except Mr. Cherian Thomas and Mr. JK Thomas none of the above directors are related.
Six (6) Board meetings were held during the financial year ended on 31st March, 2013.The dates on which meetings were held are as follows:
28/04/2012, 31/07/2012, 24/08/2012, 26/09/2012, 26/10/2012, and 30/01/2013.
Sl. No. Name of the Director No. of Board Meetings attended Attendance at the last AGM[26/09/2012] No. of other Directorships held No of membership in Committees
1 Mr. JK Thomas 6 Present 8
2 Mr. Cherian Thomas 6 Present 4
3 Mr. MK Balagopalan Nair 6 Present 2 3
4 Mr. C Thomas John 6 Present 2 2
5 Mr. Joseph Markos 4 Absent 3 1
6 Mr. K Balaji. 3 Present 4 3
3. CODE OF CONDUCT
The Board has adopted a code of conduct for all Board members and senior management of the company. The term senior management means personnel of the company who are members of its core management team excluding Board of Directors. Normally this would comprise all members of management one level below the executive directors, including all functional heads. The code has been circulated to all members of the Board and senior management and the compliance of the same has been affirmed by them.
4. AUDIT COMMITTEE:
Brief description of terms of reference:
To oversee the company’s financial reporting process, internal control systems, reviewing the accounting policies and practices; ensuring that financial statements are correct, sufficient and credible; reviewing with management the annual financial statements for submission to the Board; reviewing the internal audit observations and action taken thereon; ensuring compliance with Stock Exchange and other legal requirements and also recommending the appointment and removal of statutory auditors, fixation of audit fee and also approval for payment for any other services. The composition, role, functions and powers of the Audit Committee are in consonance with the requirements of applicable laws, rules and regulations
Composition and names of members and chairperson:
Name of the Director Category
Mr. K Balaji, FCA Chairman
Mr. MK Balagopalan Nair
Member
Mr. Mr. C Thomas John Member
5. REMUNERATION COMMITTEE
The Remuneration Committee consists of 3 directors, namely Mr. Joseph Markos [Chairman], Mr. MK Balagopalan Nair and Mr.K Balaji. The Committee is appointed with the terms of reference of deciding the remuneration of executive director. During the year, the Committee met on 28/04/2012 and reviewed the remuneration policy of the company.
DIRECTORS’ REMUNERATION
The Managing Director was paid remuneration of Rs 30lakhs as salary and allowances, Rs. 12% of the basic salary as Provident Fund Contribution and 1% of the Net profit as commission for the year.
The Director Mr. Cherian Thomas was paid Rs.1.80 lakhs as consultation fee during the year.
The Director Mr. MK Balagopalan Nair was paid an amount of Rs One Lakh as consultancy charges for factory modernisation during the year.
The non-executive directors were paid sitting fees as follows:
1. Mr. Cherian Thomas - Rs. 42000/-
2. Mr. Joseph Markos - Rs. 28000/-
3. Mr. C Thomas John - Rs. 42000/-
4. Mr. MK Balagopalan Nair - Rs. 42000/-
5. Mr. K Balaji - Rs. 21000/-
6. SHAREHOLDER’S / INVESTORS’ GRIEVANCES COMMITTEE
Composition, and names of members:
The Committee with Mr. C Thomas John, MK Balagopalan Nair and Mr. Mr. Balaji met on 28/04/2012 and reviewed the status of the investor complaints. Company received oral / written enquiries from the shareholders, which were responded immediately.
7. GENERAL BODY MEETINGS
The Annual General Meetings for the last three years were held as follows:
Year Venue Date Day Time
2011-12 Malankara Bldgs, Kodimatha, 26/09/2012 Wednesday 10.00 AM
Kottayam, PIN 686 013
2010-11 Malankara Bldgs, Kodimatha, 29/09/2011 Thursday 10.00 AM
Kottayam, PIN 686 013
2009-10 Malankara Bldgs, Kodimatha, 03/09/2010 Friday 10.00 AM
Kottayam, PIN 686 013
? Whether any Special Resolution passed in the previous 3 AGMs; Yes
? Whether special resolutions were passed through postal ballots: No
? Are votes proposed to be conducted through postal ballots this year: No
8. DISCLOSURES
1. Disclosures on materially significant related party transactions i.e., transactions of the company of material nature, with its promoter, the directors or the management, their subsidiaries or relatives etc. that may have potential conflict with the interests of company at large:
All transactions with related parties were in the ordinary course of business and at arm’s length. The company has not entered into any transaction of a material nature with any of the related parties which are in conflict with the interest of the company.
The details of related party transactions are disclosed in Note No.27. OTHER NOTES ON ACCOUNTS, attached to and forming part of the accounts.
2. Details of penalties imposed on the company by Stock Exchange, SEBI or any statutory authority, on any matter related to capital markets, during the last three years - None
3. Compliance with Accounting Standards
In the preparation of financial statements there is no deviation from the prescribed Accounting Standards.
4. Compliance Certificate from the auditors
Certificate from the auditors of the company confirming compliance with the mandatory requirements under clause 49 of the listing agreement is annexed to this report. This certificate has also been forwarded to the Stock Exchanges where the shares of company are listed.
5. Adoption of non mandatory requirements under clause 49
The company complies with the following non-mandatory requirements under clause 49
Remuneration Committee
The Board has constituted a remuneration committee, which recommends/reviews remuneration of the ExecutiveDirector.
9. MEANS OF COMMUNICATION
Quarterly results:
The quarterly un audited abridged results of the company are published in Malayala Manorama /Deepika and Business Line and detailed results are posted on the Company -website.
A detailed report on Managerial Discussion and Analysis is enclosed herewith as part of Annual Report.
10. GENERAL SHAREHOLDER INFORMATION
1. Annual General Meeting Date : 18/ September,2013 at 10.00 A.M.
Venue : Malankara Bldgs, Kodimatha, Kottayam, PIN 686 013
2. Financial Year : 1st April 2012 to 31st March 2013
3. Book closure date :12/09/2013 to 18/09/2013
( both days inclusive.)
4. Dividend recommended for the year : 200% (Rs.20/-per Share of Rs10/-)
5. Listing on stock exchange : Madras Stock Exchange
7. Market price Data : not traded for the last 20 years
8. Performance in comparison to broad- : NA
based indices
9. Share transfer system : Share transfer documents which were valid and complete in all respects, received, were processed and the share certificates were returned within the prescribed time from the date of receipt.
10. Distribution of shareholding:
Category Number of shareholders Total number of shares Percentage
Promoter and Promoter Group -
Individuals 18 101182 28.01
Bodies Corporate 1 89713 24.83
Public shareholding -
Financial Institutions/ Banks 1 1 -
Insurance Companies 1 4971 1.38
Religious Institutions 35 2859 0.79
Bodies Corporate 6 2399 0.66
Individuals 1154 160169 44.33
TOTAL 1216 361294 100.00
Sd/-
Kottayam JK THOMAS
31.07. 2013 Managing Director
AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE
To
The Members,
Malankara Plantations Limited
Kodimatha
Kottayam - 686013
We have examined the compliance of conditions of Corporate Governance by Malankara Plantations Limited for the year ended 31st March, 2013 as stipulated in Clause 49 of the Listing Agreement of the said Company with the Stock Exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination has been limited to a review of the procedures and implementation thereof adopted by the Company for ensuring compliance with the conditions of Corporate Governance as stipulated in the said Clause. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the above-mentioned Listing Agreements.
We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.
for O.THOMAS and CO
Chartered Accountants
FRN. No. 004412S
Sd/-
ABRAHAM K THOMAS
PARTNER
(Membership No. F 09705)
Details regarding energy conservationConservation of Energy – The Company installed a Solar system at its Head Office at Kottayam, which provides all the power required for its office operations. The Company has gained the distinction of being the first Net Zero Energy Office Complex in the country by installing the solar power system, which is capable of providing the entire electrical energy requirements of the Head Office. The Company is negotiating with the Kerala State Electricity Board to sell the excess energy produced. Details regarding management discussion and analysis explanatoryMANAGEMENT DISCUSSION AND ANALYSIS
This report discusses and analyses the performance for the year ended 31st March 2013.
? Overall review of operations
The company is in the business of plantation activities for the past 101 years. The Company achieved a turnover of Rs. 28 crores.
? Industry
The Plantation industry plays a vital role in the economy of the State as they cover over 1/5th of the net cultivated area of the State by contributing 1/3rd to State GDP of agricultural origin.
? Opportunities and Threats
Competition from other companies
Even though the competition is hectic the Company has an edge over others with its efficient staff and quality products. However competition from small holders is severe as the cost of production of small holders is much less than large plantations which have to bear all the Statutory payments such as PF, Gratuity, Paid Holiday Wages, Leave with wages, medical treatment, housing, water supply, power and other benefits. The international price of rubber is much lower than the domestic price and profits will be marginal if not absent if the domestic price becomes on par with international prices.
Increased production cost
The severe shortage of labour has increased the cost of production significantly, as rubber plantations cannot get the advantage of economies to scale in their tapping operation which is the single highest cost area, large plantations do not have much advantage over small holders in this respect.
Adverse trend of foreign exchange rate – is a major concern for the growth of the industry
? Outlook
The company has taken all efforts to improve the quality of its products and productivity.
Due to the implementation of mechanization to the maximum extent possible, the Company is able to maintain high quality and productivity at competitive rates. Thus the Company is expecting a reasonable result this year, excepting unforeseen circumstances.
? Internal Control Systems and their Adequacy
The Company has proper and adequate internal control systems to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition.
The internal control is exercised through documented policies, guidelines and procedures. It is supplemented by an extensive program of internal audits conducted by M/s Abraham Jacob and Achankunju, Chartered Accountants, Ernakulam, assisted by in house trained personnel.
The internal control is designed to ensure that the financial and other records are reliable for preparing financial statements and other data, and for maintaining accountability of persons.
? Financial and operational performance
The financial statements have been prepared in compliance with the requirements of the Companies Act, 1956 and Generally Accepted Accounting Principles in India. [Please refer Directors’ Report]
? Human Resources/Industrial Relations
The Company have dedicated staff, motivated to perform to the fullest capacity to contribute to developing and achieving individual excellence and corporate objectives.
The Company is giving direct employment to 688 employees, and Industrial relations are pleasant and satisfactory.
? Cautionary Statement
Statements made herein describing the Company’s expectations or predictions are “forward-looking statements”. The actual results may differ from those expected or predicted. Key factors that may make a difference to the Company’s performance include market conditions, input costs, govt. regulations, economic development within/outside the country, weather conditions etc, which are beyond the control of Management.
Details regarding foreign exchange earnings and outgoForeign Exchange Earning/Outgo - There was no foreign exchange earnings during the year. FOREIGN EXCHANGE EARNINGS AND OUTGO 2012 – 13 2011 - 12 (Rs ) (Rs) Earnings NIL NIL Outgo on account of MD's foreign travel 73,390 101,900 Particulars of employees as per provisions of section 217Particulars of employees: The Company has not paid any remuneration attracting the provisions of the Companies (Particulars of Employees) Rules, 1975 read with Section 217(2A) of the Companies Act, 1956. Hence, no information is required to be appended to this report in this regard. Disclosures in director’s responsibility statementDirectors’ Responsibility Statement: Your Directors are pleased to inform you that the audited accounts containing the Financial Statements for the year 2012-13 are in conformity with the requirements of the Companies Act and they believe that the financial statements reflect fairly the form and substance of the transactions carried out during the year and reasonably present the Company’s financial condition and results of operations. In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956 ("the Act") and, based upon the representations from the Management, the Board states that: a) in preparing the Annual Accounts, applicable Accounting Standards have been followed and there are no material departures; b) the Directors have selected such accounting policies, applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the Profit of the Compan |