DIRECTORS'REPORT To, The Members, Simmonds Marshall Limited Your Directors have great pleasure in presenting their 55th Annual Report together with the Audited Accounts for the year ended March 31,2015. OPERATIONAL REVIEW: The turnover during the year increased to Rs.13359.93 lacs against Rs. 10314.10 lacs in the previous year; registering an impressive increase of 29.53% and the profitability has risen from Rs.694.93 lacs to Rs.1108.81 lacs registering an impressive increase of 59.55%. During the year, the weakness of rupee against USD continued to put inflationary pressures. In spite of this, your Company has been able to improve its performance. DIVIDEND: Your Directors recommend payment of Dividend of 25% on Equity Shares. SHARE CAPITAL OF THE COMPANY: The Paid up Equity share Capital, as at 31st March, 2015 was Rs. 2,24,00,000 /- divided into 1,12,00,000 Equity shares, having face value of Rs. 2/- each fully paid up. During the year under review, the Company has not issued any shares with differential voting rights nor granted any stock neither options nor sweat equity. SUBSIDIARIES & ASSOCIATE COMPANIES: The Company does not have any subsidiary but has an Associate Company. RESEARCH & DEVELOPMENT: The R&D department of the Company has been arduously working to provide quality and value for money to the customer in keeping with market trends. EXPORTS: During the year under review, the Company exported goods worth F.O.B. Rs. 1930.20 lacs against Rs. 739.27 lacs in the previous year registering an impressive increase of 161.09%. This is mainly due to the effort put in by the Company to improve their performance on export front. The Company hopes to do even better on this front in the future. BOARD OF DIRECTORS: In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the Company, Mr. Imran M. Panju, Director of the Company, retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. Mrs. Amrita Chowdhury was appointed as an additional Director at the Board Meeting held on 30.03.2015. Necessary resolution is placed for her regular appointment at the forthcoming Annual General Meeting. All Independent Directors have given declarations that they meet criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. DIRECTORS RESPONSIBILITY STATEMENT: As required under the provisions of Section 134 of the Companies Act, 2013, your Director's report that: i. In the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departure, if any. ii. The Directors had 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 and loss of the company for that period. iii. The Directors had 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. 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 the company and that such internal financial controls are adequate and were operating effectively. vi. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. BOARD EVALUATION: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation after taking into consideration various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, remuneration, obligations and governance. The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors in their meeting held on 30th March, 2015. The Board of Directors expressed their satisfaction with the evaluation process. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS: The details of the number of meetings of the Board held during the Financial Year 2014-15 forms a part of the Corporate Governance Report. AUDIT COMMITTEE: In accordance with the provisions of the Listing Agreement and Corporate Governance, the Company has constituted an Audit Committee comprising of Independent Directors.The Audit Committee acts in accordance with the terms of reference specified from time to time by the Board. The details of the terms of audit committee and other details are explained in the Corporate Governance Report. REMUNERATION & NOMINATION POLICY: The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The policy lays down the criteria for selection and appointment of Board Members. The details of the policy are explained in the Corporate Governance Report. VIGIL MECHANISM / WHISTLE BLOWER POLICY: The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns, grievances, frauds and mismanagements, if any. The Vigil Mechanism /Whistle Blower policy has been posted on the website of the Company (www.simmondsmarshall.com RELATED PARTY TRANSACTIONS: All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. The disclosure in Form AOC-2 is given as per Annexure'A'. Further, there are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. All related party transactions are placed before the Audit Committee and also before the Board for their approval in accordance with the Policy on Related Party Transactions formulated by the Board of Directors of the Company and has been posted on the website of the Company (www.simmondsmarshall.com). Omnibus approval was obtained on quarterly basis for transactions which are of repetitive nature. FIXED DEPOSITS: Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: There is no loan given, investment made, guarantee given or security provided by the Company to any entity covered under Section 186 of Companies Act, 2013. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES: During the year the Company has constituted a "Corporate Social Responsibility" (CSR) Committee. As part of its initiatives under CSR, the company has contributed funds for the schemes of eradicating hunger and poverty, promotion of education and medical aid. The contributions in this regard have been made to the registered trust which is undertaking these schemes. The company has also undertaken schemes of distributing food to the poor directly as part of the CSR initiative. The Annual Report on CSR activities is annexed herewith as Annexure'B'. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant and material orders passed by the Regulators or Courts that would impact the going status of the Company and its future operations. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure'C'and forms an integral part of this Report. DEPOSITORY SERVICES: The Company's Equity Shares have been admitted to the depository mechanism of the National Securities Depository Limited (NSDL) and also the Central Depository Services (India) Limited (CDSL). As a result the investors have an option to hold the shares of the Company in a dematerialized form in either of the two Depositories.The Company has been allotted ISIN No. INE657D01021. Shareholders therefore are requested to take full benefit of the same and lodge their holdings with Depository Participants [DPs] with whom they have their Demat Accounts for getting their holdings in electronic form. CODE OF CONDUCT: Your Company is committed to conducting its business in accordance with the applicable laws, rules and regulations and highest standards of business ethics. In recognition thereof, the Board of Directors has implemented a Code of Conduct for adherence by the Directors, Senior Management Personnel and Employees of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity. The Code has been posted on the Company's website (www.simmondsmarshall.com). All the Board Members and Senior Management Personnel have confirmed compliance with the Code. STATUTORY AUDITORS: M/s. SHR & Co., Chartered Accountants, (Firm Registration No. 120491W) were appointed as the Statutory Auditors of the Company at the AGM held on 23rd September, 2014 to hold office until the conclusion of the third consecutive AGM, are recommended for ratification of appointment for the Financial Year 2015-16. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s. SHR & Co. that their appointment, if made, would be in conformity with the limits specified in the said Section. COST AUDIT: As per the requirement of the Central Government and pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your company has been carrying out audit of the cost records of the Company every year. The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s. Joshi Apte & Associates, Cost Accountants as the Cost Auditors to audit the accounts of the Company for the Financial Year 2015-16 at a remuneration of Rs. 1,80,000 /- plus service tax as applicable and reimbursement of out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking member's approval for remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting. SECRETARIAL AUDIT: Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Rules made there under, the company has appointed M/s. GMJ & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure 'D' and forms an integral part to this Report. AUDITOR'S / SECRETARIAL AUDITOR'S OBSERVATIONS: The observations of the auditors contained in their Report have been adequately dealt with in the Notes to the Accounts which are self-explanatory and, therefore, do not call for any further comments INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board /and to the Chairman & Managing Director. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the report of internal audit function, the Company undertakes corrective action in their respective areas and thereby strengthens the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. ENVIRONMENT & ENERGY CONSERVATION: Efforts for control of Environment and Conservation of energy are an on-going process in your Company. As required by the Company's (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 relevant data pertaining to conservation of energy, technology, absorption and Foreign Exchange Earnings and Outgo are given in the prescribed format as per Annexure to this Report. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS: The Company adheres to the requirements set out by the Securities and Exchange Board of India's Corporate Governance practices and have implemented all the stipulations prescribed. The Company has implemented several best corporate governance practices. The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexures, together with the Certificate from the Auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in Clause 49 of the Listing Agreement. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO: The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 'E' to this Report. SEXUAL HARASSMENT: The Company has constituted an Internal Complaint Committee as required under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made there under. During the year under review, no complaints were reported. ENVIRONMENT AND SAFETY: The Company is aware of the importance of environmentally clean and safe operations. The Company's policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances, environmental regulations and preservation of natural resources at the Plant. RISK MANAGEMENT POLICY: During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board (a) to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management (b) to establish a framework for the company's risk management process and to ensure its implementation (c) to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices and (d) to assure business growth with financial stability. A Risk Management Policy was reviewed and approved by the Committee. PARTICULARS OF EMPLOYEES: The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable to the company as the company has no employee drawing salary as per the limits laid down in the section. LISTING: The Company's Shares are listed on BSE Limited, Mumbai. APPRECIATION: Your Directors would like to express their sincere appreciation to the company's Shareholders, Vendors and Stakeholders including Banks, Government authorities, other business associates, who have extended their valuable sustained support and encouragement during the year under review. Your Directors also wish to place on record their appreciation for impressive growth achieved through the competence, hard work, solidarity, cooperation and support of employees at all levels. By order of the Board of Directors For Simmonds Marshall Limited S.J. MARSHALL (DIN: 00085682) CHAIRMAN Date : May 29,2015 Registered Office: Mumbai - Pune Road, Kasarwadi, Pune 411 034 |