DIRECTORS' REPORT 1. Your Directors feel great pleasure in presenting 80th Annual Report of your Company comprising the Audited Financial Statements for the year ended 31st March, 2015. 2. DIVIDEND & RESERVES: Your Directors have pleasure in recommending payment of dividend of Rs. 1/- (10%) per equity share of Rs. 10/- each (previous year Rs. 1 (10%)), for the year ended 31st March 2015. This will absorb total cash outflow of Rs. 16.44 Lacs (previous year Rs. 15.97 Lacs) including Corporate Dividend Distribution Tax of Rs. 2.79 Lacs (previous year Rs. 2.32 Lacs). The Dividend, if approved, will be paid to those members whose names appear on the Register of Members / Register of Beneficial Owners maintained by Depositories as on 4th September, 2015 . During the year the Company has not transferred any amount to General Reserve. 3. PERFORMANCE: All the 3 divisions of the Company performed quite well, considering the highly competitive categories that they operate in. Health Care - This Division primarily focuses on the specialized Oral Care category and is dominated by the long & trusted brand of 'Emoform' made under license from Dr. Wild & Co., Switzerland. The medicated toothpaste for sensitive teeth sold under this brand has been consistently growing over the last few years inspite of aggressive OTC promotions and mass advertising by International brands. The Division through its Professional sales team shares a good rapport and relations with Dentists who support the brand because of its efficacy. Life Style - This Division caters to the selling & distribution needs of 2 international partners viz., 1. COTY - Paris, for its 'Playboy' &'Lamborghini' range of Deo Body Sprays & EDT Perfumes. 2. HOYU - Japan, for its 'Bigen' range of Hair colour products. This division continues to sustain inspite of higher competition. Own Brands - The focus in this Division is on expanding the Baby care range under the 'Morisons Baby Dreams' brand, and the efforts continue to grow this division for the future. The Company has also forayed into a new range of products. The Company continues to explore newer opportunities and shall assign the same to the respective Divisions depending on the infrastructural strength of each to match the Category/Channel. There was no change in business activities of the Company during the financial year under review. There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report 4. SHARE CAPITAL OF THE COMPANY: The paid up equity share capital of your Company is Rs. 1,36,50,340/- (Rupees One Crore Thirty Six Lakhs Fifty Thousand Three Hundred Forty only) divided into 13,65,034 Equity shares of the face value of Rs. 10/- (Rupee Ten) each. 5. SUBIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES: The Company do not have any subsidiary, joint venture or Associate Company during the financial year. 6. DIRECTORS AND KEY MANAGERIAL PERSONNEL: a) Retirement by Rotation: In accordance with the provisions of Section 152 of the Companies Act, 2013 read with Companies (Management and Administration) Rules, 2014 and Articles of Association of the Company, Mr. Raghu Nandan Mody, (DIN 00053329) Chairman of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment and your Board recommends his re-appointment. b) Appointment of Directors: The Board of Directors of the Company appointed Mrs. Sakshi Mody (DIN: 06518139), as Executive Director - Strategy w.e.f. 29th May, 2014 for a period of 3 years. Further, Mr. Sandip Das (DIN 02860902) was appointed as an Additional (Executive) Director w.e.f. 24th December, 2014 for a period of 3 years, subject to the approval of shareholders at the ensuing Annual General Meeting. Also, Mr. Dinesh Sharma, (DIN 06798909) and Mr. Chakrapani Brajesh Misra, (DIN 07184034) were appointed as Additional (Independent) Directors of the Company w.e.f. 24th December, 2014 and 20th May, 2015 respectively, for a period of 5 years, subject to approval of shareholders at the ensuing Annual General Meeting. The Company has received notices along with requisite deposit from a member of the Company under Section 160 of Companies Act, 2013 proposing their candidature for the office of Directors of the Company. Your Board recommends their appointment. c) Cessation of Directors: Mr. Brij Gopal Roy, Independent Director and Mr. Bipin Vengsarkar, Executive Director of the Company resigned from the directorship of the Company w.e.f. 15th December, 2014 and 24th December, 2014 respectively. Mr. Atul Tandan, Independent Director of the Company passed away on 1st March, 2015 due to cardiac arrest. The Board places on record its appreciation for their valuable contribution made during their tenure as Directors of the Company. As stipulated under the Clause 49 VIII (E) of the Listing Agreement with BSE Limited and The Calcutta Stock Exchange Limited, brief resume of the Directors proposed to be appointed/re-appointed are given in the Notice convening 80th Annual General Meeting. d) Declaration from Independent Directors: The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under Section 149 (6) of the Companies Act, 2013 and under Clause 49 of the Listing Agreement entered into with the Stock Exchanges, where the share of the Company are listed. e) Annual performance evaluation by the Board: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit and Nomination 6 Remuneration Committees. The Board has devised questionnaire to evaluate the performances of each of executive and nonexecutive and Independent Directors. The questions are prepared considering the business of the Company and the expectations that the Board has from each of the Directors. The evaluation framework for assessing the performance of Directors comprises of the following key areas: i. Attendance of Board Meetings and Board Committee Meetings; ii. Quality of contribution to Board deliberations; iii. Strategic perspectives or inputs regarding future growth of Company and its performance; iv. Providing perspectives and feedback going beyond information provided by the management. The details of the programs for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company at the link: www.jlmorison.com/public/downloads/Independent-Director.pdf <http://www.jlmorison.com/public/downloads/Independent-Director.pdf> f) Key Managerial Personnel (KMPs): Mr. Sohan Sarda was appointed as Chief Financial Officer and Mr. Kuldip Balasia, as VP - Corporate Affairs & Company Secretary of the Company, both w.e.f. 29th May, 2014. 7. DEPOSITS: During the year under review, the Company has not accepted any deposits within the meaning of Section 73 and 76 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. 8. EXTRACT OF ANNUAL RETURN: An extract of Annual Return in Form MGT 9 is appended to this Report as Annexure A. 9. MEETINGS OF THE BOARD: The Board met six times during the year, the details of which are given in the Report on Corporate Governance. The intervening gap between the two consecutive meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement. 10. DIRECTORS' RESPONSIBILITY STATEMENT: Your Directors, to the best of their knowledge and belief and according to the information and explanations obtained by them and as required under Section 134(3)(c) of the Companies Act, 2013 state that: a. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; b. the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as 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 that period; c. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this 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 on a going concern basis; e. the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and f. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 11. POLICY ON DIRECTORS' APPOINTMENT & REMUNERATION: The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Report on Corporate Governance. 12. REMARKS ON QUALIFICATION BY STATUTORY AUDITORS AND SECRETARIAL AUDITORS: There was no qualification/adverse remarks in both Statutory and Secretarial Audit Reports. 13. RISKS AND AREAS OF CONCERN: The Company has laid down a well defined Risk Management Policy covering the risk mapping, trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out to identify, evaluate, manage and monitoring of both business and non-business risk. The Board periodically reviews the risks and suggests steps to be taken to control and mitigate the same through a properly defined framework. 14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013: All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. Details of material related party transactions are given in the prescribed Form AOC - 2 and is appended to this report as Annexure B. The policy on Related Party Transactions as approved by the Board of Directors of the Company has been uploaded on the website of the Company. The web link of the same is as under: <http://www.jlmorison.com/public/downloads/Policy%20on%20> Related%20Party%20transaction.pdf 15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013: The details of loans, guarantee or investment under Section 186 of the Companies Act, 2013 is given under Notes to Accounts of financial statements. 16. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE: There was no significant or material order passed by any regulator or court or tribunal, which impacts the going concern status of the Company or will have bearing on company's operations in future. 17. AUDIT COMMITTEE AND ITS COMPOSITION: As on 31st March, 2015, the Audit Committee comprised of Mr. Sanjay Kothari, Mr. Dinesh Sharma and Mr. Sandip Das. Mr. Sanjay Kothari is the Chairman of Audit Committee of the Company. Mr. Kuldip Balasia, Company Secretary of the Company acts as Secretary of the Audit Committee. Other details with respect to the Audit Committee is given in the Corporate Governance Report as required under Clause 49 of the Listing Agreement, which is annexed to this report. The Audit Committee of the Company reviews the reports to be submitted to the Board of Directors with respect to auditing and accounting matters. It also supervises the Company's internal control, financial reporting process and Vigil Mechanism. 18. WHISTLE BLOWER POLICY / VIGIL MECHANISM POLICY: The Company has a Vigil Mechanism / Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The mechanism also provides for adequate safeguards against victimization of directors and employees who avail of the mechanismand also provide for direct access to the Chairman of the Audit Committee in the exceptional cases. The details of the Vigil Mechanism Policy is explained in the Corporate Governance Report and also posted on the Company' website. We affirm that during the financial year 2014-15, no employee or director was denied access to the Audit Committee. 19. SECRETARIAL AUDIT REPORT: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Manish Ghia & Associates a firm of Company Secretaries in practice to undertake Secretarial Audit of the Company. The Secretarial Audit Report is appended to this report as Annexure C and forms part of this report. 20. INTERNAL AUDIT: The Company has appointed M/s. Malpani & Associates, Chartered Accountants, Mumbai, as its Internal Auditor. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliances with operating systems, accounting procedures and policies at all locations of the Company and reports the same on quarterly basis to the Audit Committee. 21. CORPORATE GOVERNANCE REPORT: Pursuant to Clause 49 of the Listing Agreement entered into with the stock exchanges, the following have been made a part of the Annual Report and are attached to this report: • Management Discussion and Analysis Report • Corporate Governance Report • Auditors' Certificate regarding compliance of conditions of Corporate Governance 22. MANAGERIAL REMMUNERATION AND OTHER DETAILS: The necessary details/disclosures of Ratio of Remuneration to each Director to the median employee's remuneration and other details pursuant to the section 197(12) of the Companies Act, 2013 and as per Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended to this report as Annexure D. 23. STATUTORY AUDITORS: M/s. Haribhakti & Co.,LLP Chartered Accountants (Firm Registration No. 103523W), Mumbai, the Statutory Auditors of your Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received a letter from them to the effect that they are willing to continue as Statutory Auditors and if re-appointed, their re-appointment would be within the limits prescribed under Section 139 of the Companies Act, 2013 and they are not disqualified from being appointed as Statutory Auditors. Your Directors recommend the re-appointment of M/s. Haribhakti & Co., LLP Chartered Accountants, Mumbai, as Statutory Auditors of the Company to hold office from the conclusion of the ensuing Annual General Meeting upto the conclusion of next Annual General Meeting of the Company and to audit financial statements for the financial year 2015-16. 24. COST AUDITORS: As per the provisions of Companies (Cost Records and Audit) Rules, 2014 notified on 30th June, 2014, the Company is not required to appoint Cost Auditors. 25. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: The details of Conservation of Energy, Technology Absorption and Foreign Exchange earnings and outgo are appended to this report as Annexure E. 26. INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS: The Company has in place proper and adequate internal control systems commensurate with the nature of its business, size and complexity of its operations. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, compliance with policies, procedures, applicable laws and regulations and that all assets and resources are acquired economically and used efficiently and adequately protected. 27. INFORMATION UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013: The Company has constituted an Internal Compliant Committee under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year no complaint was filed before the said Committee. 28. LISTING : The Securities and Exchange Boards of India (SEBI) vide its order dated 26th December, 2014 de-recognised the Banglore Stock Exchange Limited, accordingly equity shares of the Company stand de listed from the said Stock Exchange w.e.f. that date. The equity shares of the Company continues to be listed on BSE Ltd. and the Calcutta Stock Exchange Ltd. 29. ACKNOWLEDGEMENT: Your Directors wish to place on record their gratitude for the continued co-operation and patronage extended by the esteemed customers, Shareholders, Bankers, Trade Partners and Employees and look forward for their continued support in the future as well. For and on behalf of the Board of Directors Sandip Das Executive Director & CEO Sanjay KothariDirector Place: Mumbai Date: 20th May, 2015 Registered Office: Rasoi Court,20, Sir R.N. Mukherjee Road, Kolkata - 700 001 |