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Directors Report of Chowgule Steamships Ltd.

Mar 31, 2013

To The Shareholder

The Directors present the Fiftieth Annual Report and the Audited Accounts for the year ended March 31, 2013.

1. FINANCIAL RESULTS & APPROPRIATIONS:

(Rs. in Lakhs)

2012-13 2011-12

Profit/(Loss) before Financial Chafes, Depreciation, Exceptional Item & Tax (146.20) 1,318.26

Financial Charges 60.29 74.50

Depreciation 374.04 1,021.97

Profit/(Loss) before Exceptional Item & Tax '' (580.53) 221.79

Profit on Sale of Lan 269.30

• Impairment (994.36) (2,600.11)

Foreign Currency Translation difference '' (114.45) (415.35)

Loss before Taxation (1,420.04) (2,793.67)

Provision for Taxation - Current (314.00)

Loss before Deferred Tax Provision (1,420.04) (3,107.67)

Provision for Deferred Tax (Net) 352.00 1,446.77

Loss after Tax (1,068.04) (1,660.90)

Brought forward from previous year 4,054.20 5,713.70

Available for appropriation 2,986.16 4,052.80

Excess provision of dividend tax of earlier year 1.40

Balance Transferred to Balance Sheet . 2,986.16 4,054.20

In view of the loss, the Board of Directors has not recommended any dividend for the year under review.

2. LOAN REPAYMENT

During the year, the Company has repaid loan of X 1,615.45 lakhs (US$ 3 million). The total outstanding loan at year end is Rs. 1,918 lakhs (US $ 3.50 million).

4. DEFERRED TAX LIABILITY

In terms of the Accounting Standard AS-22 issued by The Institute of Chartered Accountants of India, there is a reversal of Deferred Tax liabilities amounting to X 352 lakhs for the Financial Year 2012-2013, which is reflected in the Statement of Profit 6> Loss. The net Deferred Tax Liability of X 1,342 lakhs as at March 31, 2013 is reflected in the Balance Sheet.

5. SUBSIDIARIES

During the year under review Chowgule Steamships Overseas Limited raised US $ 14.50 Million by way of Convertible Redeemable Shares (CRS) to meet its fund requirements for acquisition of vessel. Out of the above CRS, the Company has subscribed to CRS aggregating US $ 5.5 Million. The CRS have tenure of 10 years and each CRS can be converted in one equity share at the option of the subscriber. The total investment of the Company in the Share Capital of Chowgule Steamships Overseas Ltd. (CSOL), a wholly owned subsidiary, stands at US$ 9.2 million in Ordinary Shares (same as previous year) and US $ 5.5 Million in CRS. CSOL, in terms of its expansion plan, has so far taken delivery of four new built vessels. The financial highlights of CSOL''s operations are as under:

2012-13 2011-12 (In US $ million) (In US $ million)

Income 13.370 13.155

Gross Profit before depreciation (2.205) (2.725)

Depreciation and impairment '' (26.476) (19.400)

Net Loss (24.271) (16.675)

6. SUBSIDIARIES - EXEMPTION

In terms of general approval granted by the Central Government vide notification No.5/12/2007-CL—III dated 8th February, 2011 under Section 212(8) of the Companies Act, 1956, copies of the Balance Sheet, Statement of Profit and Loss, and Report of the Board of Directors and the Report of the Auditors of the Subsidiary Companies have not been attached with the Balance Sheet of the Company. The Company will make available these documents / details upon request by any m''ember of the Company. However, pursuant to Accounting Standard AS-21 issued by The Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the financial information of its subsidiaries.

7. INSURANCE

The fleet of the Company has been adequately insured against Marine and War Risks.

8. DIRECTORS

Mr. Jaywant Y Chowgule, Admiral (Retd.) Madhvendra Singh and Mr Mangesh Sawant, Directors, retire by rotation at the ensuing Annual

General Meeting and are eligible for re-appointment.

During the year under review, the Board of Directors.has appointed Mr. Farokh Guzder as an Additional Director, who holds office upto the date of ensuing Annual General Meeting. It is proposed to obtain approval of Shareholders at the ensuing Annual General Meeting for the appointment of Mr. Farokh Guzder as a Director liable to retire by rotation.

Pursuant to Clause 49 of the Listing Agreement, the background of the Directors proposed to be appointed / re-appointed at the Annual General Meeting is given in the Corporate Governance Report.

9. CORPORATE GOVERNANCE

In terms of the listing agreement with the Bombay Stock Exchange Ltd., the Corporate Governance Report is annexed hereto and forms a part of this Report.

10. CODE OF CONDUCT

The Board of Directors has laid down a Code of Conduct for all the Board Members and Senior Management of the Company. The said Code has been hosted on the website of the Company. All the Board Members and Senior Management have affirmed compliance to the Code.

11. DIRECTORS'' RESPONSIBILITY STATEMENT The Directors state as under:

"That

a) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.

b) The Directors have selected such accounting policies and applied them consistentry and made judgements 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 loss 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 the Companies Act, 1956, 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".

12. AUDITORS

The shareholders are requested to appoint auditors for the ensuing year and to fix their remuneration. M/s. S.B. Billimoria £Rs. Company, Chartered Accountants, the retiring Auditors, being eligible, have given their consent for re-appointment.

13. THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975, AS AMENDED

There are no employees covered under Section 217 (2A) of the Companies Act, 1956 in respect of whom particulars are required to be. furnished.

14. THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988

In accordance with the requirements of Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the statement annexed hereto gives the particulars as required under the said rules and forms part of this Report (Annexure I).

15. GENERAL

The Board of Directors expresses its appreciation for the help and co-operation extended by the Ministry of Surface Transport, Maharashtra Maritime Board, Ministry of Finance, The Directorate General of Shipping, Reserve Bank of India and the Company''s Bankers and Agents. The Board of Directors also appreciates the loyal services rendered and co-operation extended by the Company''s officers and staff, both ashore and afloat.

For Chowgule Steamships Limited

Place: Mumbai, VIJAy V. CHOWGULE

Date: May 09, 2013 Chairman


Mar 31, 2010

The Directors present the Forty Seventh Annual Report and the Audited Accounts for the year ended March 31, 2010.

1. FINANCIAL RESULTS & APPROPRIATIONS:

2009-10 2008-09 (Rs.in Million) (Rs.in Million) Profit before Financial Charges, Depreciation, Exceptional Item & Tax 31.224 821.342 Financial Charges 25.264 57.351 Depreciation 147.882 182.942 Profit before Exceptional Item & Tax (141.922) 581.049 Profit on Sale of a ship 615.635 - Foreign Currency Translation Difference 99.790 (223.850) Profit before Taxation 573.503 357.199 Provision for Taxation - Current (89.100) (179.515) MAT Credit Entitlement 89.100 - Provision for FBT - (0.429) Income Tax of earlier years 2.522 (3.252) Profit before Deferred Tax Provision 576.025 174.003 Provision for Deferred Tax (Liability Charged)/Asset Reversed (167.134) 58.306 Profit after Tax 408.891 232.309 Brought forward from previous year 298.909 391.935 Available for Appropriation 707.800 624.244 Transferred to General Reserve (statutory) 20.445 11.616 Transferred to General Reserve (others) - 250.000 Proposed Dividend 54.463 54.463 Tax on Proposed Dividend 9.256 9.256 Balance Transferred to Balance Sheet 623.636 298.909

DIVIDEND

In view of the satisfactory financial results, your Directors have pleasure in recommending a Dividend of Rs.1.50(15%) per equity share on 3,63,08,425 equity shares for the financial year 2009-2010.

3. LOAN REPAYMENT

During the year, the Company has repaid loan of Rs. 1,543.50 lakhs (US$ 3 million). The total outstanding loan at year end is Rs. 7,748.60 lakhs (US $ 17 million).

4. DEFERRED TAX LIABILITY

In terms of the Accounting Standard AS-22 issued by The Institute of Chartered Accountants of India, the Company has recognized Deferred Tax Liability of Rs.1,671.34 lakhs for the financial year 2009-2010, which is reflected in the Profit & Loss Account. The net Deferred Tax Liability of Rs. 3,690.67 lakhs as at March 31, 2010 is reflected in the Balance Sheet.

5. SUBSIDIARIES

The total investment of the Company in the Share Capital of Chowgule Steamships Overseas Ltd. (CSOL), a wholly owned subsidiary, stands at US$ 9.2 million (same as previous year). During the previous years, CSOL, in terms of its expansion plan, has signed contracts for acquisition of vessels. The deliveries of these vessels will start from July 2010 this year. The financial highlights of CSOLs operations are as under:

2009-10 2008-09 (In US $ million) (In US $ million) Income 13.272 27.246 Gross Profit before depreciation 9.221 22.864 Depreciation 1.072 1.072 Net Profit 8.149 21.792

6. SUBSIDIARIES - EXEMPTION

In terms of approval granted by the Central Government under Section 212(8) of the Companies Act, 1956, copies of the Balance Sheet, Profit and Loss Account, and Report of the Board of Directors and the Report of the Auditors of the Subsidiary Companies have not been attached with the Balance Sheet of the Company. The Company will make available these documents / details upon request by any member of the Company. However, pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company include the financial information of its subsidiaries.

7. INSURANCE

The fleet of the Company has been adequately insured against Marine and War Risks.

8. DIRECTORS

At the meeting of Board of Directors (Board) held on April 22, 2010, Mr. M.P. Patwardhan, Director, relinquished office as a

Director of the Company with immediate effect due to pre-occupation. The Board places on record its sincere appreciation for the advise and services rendered by Mr. Patwardhan during his tenure as a Director of the Company.

The Board at the said meeting has also appointed Mr. Mangesh S. Sawant, the erstwhile Manager pursuant to Section 269 of the

Companies Act, 1956, as the Whole-time Director of the Company, designated as Executive Director & CFO, for a period of three years w.e.f. April 22, 2010. Approval of members is being sought to the appointment of Mr. Sawant as the Whole-time Director of the Company.

Mr. M.R.B. Punja, Mr. Dhananjay N. Mungale and Mr. Jaywant Y. Chowgule, Directors, retire by rotation at the ensuing Annual

General Meeting and are eligible for re-appointment.

The background of the Directors proposed to be appointed / re-appointed at the Annual General Meeting pursuant to Clause 49 of the Listing Agreement is given in the Corporate Governance Report.

9. CORPORATE GOVERNANCE

In terms of the listing agreement with the Bombay Stock Exchange Ltd., the Corporate Governance Report is annexed hereto and forms a part of this Report.

10. CODE OF CONDUCT

The Board of Directors has laid down a Code of Conduct for all the Board Members and senior management personnel of the Company. The said Code has been hosted on the website of the Company. All the Board Members and senior management personnel have affirmed compliance to the Code.

11. DIRECTORS RESPONSIBILITY STATEMENT

The Directors state that:

a) In the preparation of annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.

b) The Directors have selected such accounting policies and applied them consistently and made judgements 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 profits 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 the Companies Act, 1956, 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.

12. AUDITORS

The shareholders are requested to appoint auditors for the ensuing year and to fix their remuneration. M/s. S.B. Billimoria & Company, Chartered Accountants, the retiring Auditors, being eligible, have given their consent for re-appointment.

13. THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975, AS AMENDED

The information required under Section 217 (2A) of the Companies Act, 1956 read with the Rules framed there under forms part of this report. In terms of Section 219 (1) (b) (iv) of the Companies Act, 1956, the Directors Report and Accounts are being sent to the Shareholders of the Company excluding the aforesaid information. Any Shareholder interested in obtaining a copy of the said information may write to the Company Secretary.

14. THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF

DIRECTORS) RULES, 1988

In accordance with the requirements of Section 217(l)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the statement annexed hereto gives the particulars as required under the said rules and forms part of this Report (Annexure I).

15. GENERAL

The Board of Directors expresses its appreciation for the help and co-operation extended by the Ministry of Surface Transport, Maharashtra Maritime Board, Ministry of Finance, the Directorate General of Shipping, Reserve Bank of India and the Companys Bankers and Agents. The Board of Directors also appreciates the loyal services rendered and co-operation extended by the Companys officers and staff, both ashore and afloat.

For Chowgule Steamships Limited Place: Mumbai, VIJAY V. CHOWGULE Date : April 22, 2010 Chairman

 
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