Mar 31, 2018
DIRECTORSâ REPORT
To,
The Members,
The Directors have pleasure in presenting their Eleventh Annual Report on the business and operations of DQ Entertainment (International) Limited (âthe Companyâ or DQE India) together with the Audited Statement of Accounts for the financial year ended March 31, 2018.
1. FINANCIAL RESULTS
During the year under review, performance of your company was as under:
INR in Mn
Standalone |
Consolidated |
|||
Particulars |
For the year ended 31-Mar-18 |
For the year ended 31-Mar-17 |
For the year ended 31-Mar-18 |
For the year ended 31-Mar-17 |
Income from Production |
939 |
837 |
616 |
747 |
Income from Distribution |
20 |
27 |
186 |
197 |
Other Income |
125 |
89 |
892 |
85 |
Total Income |
1084 |
953 |
1694 |
1029 |
Total Expenditure |
1371 |
1439 |
2062 |
3216 |
Profit before tax* |
(286) |
(486) |
(368) |
(2187) |
Tax Expense (Current Tax Deferred Tax [Net of MAT credit entitlement]) |
220 |
7 |
220 |
7 |
Profit after tax |
(66) |
(479) |
(148) |
(2180) |
EBIDTA |
170 |
123 |
341 |
(334) |
*Standalone: Profit before tax and Profit after tax includes the exceptional item by way of notional foreign exchange of approximately INR 53.18 Mn for the period ended 31st March 2018 (2017: INR (105.75) Mn). Also, includes Bad debts written off worth Rs. 2.15 Mn. (2017: 17.25 Mn).
*Consolidated: Profit before tax and Profit after tax includes the exceptional item by way of notional foreign exchange of approximately INR 803.90 Mn for the period ended 31st March 2018 (2017: INR (363.07) Mn). Also, includes Bad debts written off worth Rs. 4.46 Mn. (2017: 545.61 Mn).
After adjustment of the notional loss and gain as well as the bad debts written off, the profit before tax and profit after tax is as under for the consolidated financials:
INR in Mn
31 March 2018 |
31 March 2017 |
|
Adjusted Profit / ( Loss) before tax |
(1168) |
(1279) |
Adjusted Profit / ( Loss) after Tax |
(948) |
(1271) |
Cash & Cash Equivalent |
118 |
194 |
2. PERFORMANCE AND OPERATIONS
Your Company has witnessed a complete business cycle. It has grown and expanded since 2003 until 2011 which was the golden period for the Company. However, in the year 2012, the Company got adversely impacted on account of the last worldwide recession cycle which extended over 4 years. This was a depression phase for the Company where some of our large customers did not commence any new production as a result of which we had to source work from smaller production studios in order to ensure capacity utilization of our large manpower. Unfortunately, due to the extended recessionary period these smaller production houses could not sustain themselves and were not able to pay our dues. This resulted in steep increase in our debtors and we suffered severe financial crisis. In fact, a number of companies in our domain, globally, had to close down their operations. Your Company could sustain itself because of its foresightedness to get into own content development which helped us through these very stressful times.
Slowly from 2016, the Company has been able to redefine and rewrite the future after four years of downtrend and is on the path to recovery. The Company has emerged much stronger and now cautiously does business with particular clients who are capable enough to pay our dues on time. Our focus on improving operational efficiencies and the consolidation of artistic and technical skill sets continues, with productivity improvements being recognized across all processes of production.
The financial year 2018 has been a significant progressing year in terms of all growth aspects and your Directors are quite hopeful to achieve new milestones of achievement in the years to come. Your Company has a strong order book of production for the next two to three years and also has strong growth plans on the licensing and merchandising front.
Operational Highlights for the FY 2017-18:
Animation:
- Third season of our flagship property, The Jungle Book is in production as a result of the demand from the broadcasters after a successful run of season 1 & 2. The entire season is planned to be delivered by end of 2018.
- DQEâs new IP, 5 & IT "The Psammy Showâ (52x11â) TV series co-produced by Disney, Germany, Disney, France and Method Animation France, is now in production. The entire series is planned to be delivered by third quarter of FY 2018-19.
- Our very first Digital 90 min movie, "Peterpan - The quest for the Never Bookâ has been completed and is very well received by the distributors globally. We have succeeded to sell the movie for theatrical release in North America, Latin America, Middle East and North Africa, South Korea, Japan, Vietnam, Russia and CIS countries, Hungary and other European and ASEAN countries as well.
- Another own new IP "Toadlly Awesomeâ is in development stage and will go into production soon.
- Second Season of Robin Hood is being co-produced with Method Animation, France, as Robin Hood season 1, saw great success in the market in more than 130 countries.
- Disney Projects: Puppy Dog Pals - season I has been completed and season II is in production. Similarly, Mickey Mouse and the Roadster Racers (MRR) - season I has been completed and season II is in production. Miles from Tomorrow land - season
III has been completed and successfully delivered worldwide and Doc McStuffins - season V is in production. Couple of new projects from Disney is in the development stage and are expected to go into production soon.
- Co-production contracts: Miraculous Lady Bug
- season III and Power Players - season I are in production stage with Method Animation and Zagtoons. Further, Season II of 7D & Me - produced by Method Animation and supported by DQE, ZDF, RAI and France TV a hybrid show combining high quality CGI with live action footage is in production as season I was well received by the distributors.
- Other projects completed: Super 4 - season II based on Playmobil Toy with Method Animation, France and Zak Storm- TV series - season I by Zag Toons in co-production with Method Animation has been completed and successfully delivered worldwide.
- Projects in development stage: Pio the Chick TV series, an adaptation from Pulcino Pio (the hugely successful online musical sensation) with Rai Commercial, Italy in partnership with DQE, Italian producer Gruppo Alcuni and Planeta Jr, Spain. Ghost Force and Pixie Girl are the two major projects which will go into production soon.
Distribution:
- DQEâs Distribution and Licensing division has been quite actively working towards the distribution of our new and existing IPâs.
- 5&IT - The Psammy Show : Disney Germany and Disney France are on board as broadcast partners for the TV series while a discussion is ongoing with Disney EMEA, Disney ASIA and LAT AM for around 118 countries. Also there are huge merchandising opportunities once the world wide broadcasting deals are executed.
- Jungle book season 3 is widely being distributed around the world and is already committed by broadcasters who acquired the season 1 and 2 from us for more than 160 countries.
- Robin Hood season 1, saw great success in the market in more than 130 countries and has great ratings everywhere. The second season, which is currently in production is being distributed at the moment and our team is very confident of closing many distribution deals soon.
- The Company has signed an exclusive deal with Chiliad Procons to launch Jungle Book themed indoor theme parks across India. The Jungle Book TV series would be the franchiseâs first global expansion via India that will debut in Mumbai in 2018, Delhi in 2019 and further expand across major metro cities over the next few years. The Park will have a unique touch to it; its rides would be mostly inspired by The Jungle Book tales and its culture.
- The Company has recently signed Music Publishing deal with one of the well renowned Music Company i.e, Universal Music for three of its major IPs namely, Jungle Book Season III, 5 & IT "The Psammy Showâ and Toadlly Awesome.
- On the licensing and merchandising front, efforts are on to penetrate the European and American markets including Latin America with wide range of product categories for Jungle book, Peterpan and Robin Hood.
3. DIVIDEND
Considering the current losses of the Company, the Board has not recommended any dividend to the equity shareholders of the Company for the financial year 2017 -18.
4. SHARE CAPITAL
The authorized share capital of the Company as on 31st March, 2018 was Rs. 800,000,000/- divided into 80,000,000 equity shares of Rs.10/- each and paid-up capital was Rs. 792,830,000/- divided into 79,283,000 equity shares of Rs.10/- each.
The Company has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares (including sweat equity shares) to the employees or Directors of the Company, under any Scheme.
5. MANAGEMENTâS DISCUSSION AND ANALYSIS REPORT
Managementâs Discussion and Analysis Report for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [hereinafter called the SEBI (LODR) Regulations, 2015] is presented in a separate section forming part of the Annual Report.
6. CORPORATE GOVERNANCE
The report on Corporate Governance as stipulated under the SEBI (LODR) Regulations, 2015 forms an integral part of this Report. The requisite certificate from the Practicing Company Secretary of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.
The declaration by CEO/CFO that the Board Members and Senior Management Personnel have complied with the Code of Conduct forms part of the Annual Report.
7. DETAILS OF SUBSIDIARIES/JOINT VENTURES/ ASSOCIATE COMPANIES
DQ Entertainment (Ireland) Limited is the wholly owned subsidiary of the Company in Ireland. DQ Entertainment USA, LLC is the step down wholly owned subsidiary Company in USA. Further, there has been no material change in the nature of the business of the subsidiaries.
DQ Entertainment (International) Films Limited is a Joint Venture between DQ Entertainment (International) Limited and DQ Entertainment Plc, which was formed for the production and distribution of the Jungle Book Feature Film. The sharing ratio of DQE Plc is 60% and DQE India is 40% in the JV. The objective to form the JV was to benefit from the synergies of both the companies and to ensure that the interests of all the stakeholders are aligned.
There are no associate companies of DQE India within the meaning of Section 2(6) of the Companies Act, 2013 (âActâ). Method Animation S.A.S. is an associate company of DQ Entertainment (Mauritius) Limited, the Holding Company.
In accordance with Section 129 of the Companies Act, 2013 read with Rule 5 of Companies (Accounts) Rules, 2014, a separate statement containing the salient features of the financial statements of the subsidiary Companies and Joint Venture in Form AOC-1 is annexed to this Boardâs Report as Annexure- I.
Business highlights of DQ Entertainment (Ireland) Limited (âDQE Irelandâ)
DQ Entertainment (Ireland) Limited is engaged in the business of content development including all production activities for animation and live action for TV series, home video and various other media. During the FY 2017-18, it has achieved a turnover of Rs. 165.82 Mn. Further, DQE Ireland has incurred of loss of Rs. 155.45 Mn. Primary reason for the loss is the huge finance cost payable to the Bond holders. However, the Company has a positive operating profit. Your Company is quite hopeful for DQE Ireland in the years to come.
Business highlights of DQ Entertainment USA, LLC (âDQE USAâ)
DQE USA is a wholly owned subsidiary of DQE Ireland. There has been no activity in the Company during the year.
Business highlights of DQ Entertainment (International) Films Limited (âDQE Filmsâ)
DQ Films is a Joint Venture between DQ Entertainment (International) Limited and DQ Entertainment Plc. There has been no activity in the Company during the year.
Consolidated Financial Statements
The consolidated financial statements is prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 and as amended from time to time and other relevant provisions of the Companies Act, 2013.
As per the provisions of Section 136 of the Companies Act, 2013, the Company has placed its financial statements including the consolidated financial statements and separate audited accounts of its subsidiaries on its website www.dqentertainment.com.
8. DIRECTORSâ RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 134(3) (C) OF THE COMPANIES ACT, 2013 Your Directors state that:
a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
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 as at March 31, 2018 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of 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 on a âgoing concernâ basis;
e) the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
9. TRANSACTIONS WITH RELATED PARTIES
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 armâs length basis and were in compliance with the applicable provisions of the Act and the Listing Regulations.
All Related Party Transactions are placed before the Audit Committee for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are repetitive in nature. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.
Information on transactions with related parties pursuant to Section I34(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure II in Form AOC-2 and the same forms part of this report.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is disseminated on the website of the Company www.dqentertainment.com.
10. EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure III in Form MGT-9, which forms part of this report and the same is placed in the website of the Company at www. dqentertainment.com.
11. TRANSFER OF UNCLAIMED / UNPAID AMOUNTS TO THE INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
During the year, application money of Rs. 3,29,920/-(Rupees Three lakhs twenty nine thousand nine hundred and twenty only) lying as unpaid/unclaimed for seven years was transferred to Investor Education and Protection Fund pursuant to the provisions of the Companies Act, 2013 and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016.
Further, investor wise details of the unclaimed amount were uploaded on IEPF portal. Investors whose money has been transferred to IEPF can now claim their money from the IEPF authority by following the refund procedure as detailed on the website of IEPF Authority www.iepf.gov.in.
12. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure - IV of this Report in the format prescribed in the Companies (CSR Policy) Rules, 2014. The Policy is available on Companyâs web-site at www.dqentertainment.com.
13. RISK MANAGEMENT
The Company is exposed to inherent uncertainties owing to the sectors in which it operates. The Companyâs Risk Management process focuses on ensuring that these risks are identified on a timely basis and addressed. The Company has developed and implemented a Risk Management policy, which includes:
- ensuring that all the current and future material risk exposures of the company are identified, assessed, quantified, appropriately mitigated and managed;
- establishing a framework for the companyâs risk management process and to ensure the group wide implementation;
- ensuring systematic and uniform assessment of risks related with the intellectual property and production services rendered;
- enabling compliance with appropriate regulations, wherever applicable, through the adoption of best practices and
- assuring business growth with financial stability.
The Risk Management Policy was reviewed and approved by the Audit Committee. The Company manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.
14. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND ANNUAL GENERAL MEETINGS
The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board meetings and Annual General Meetings.
15. INTERNAL FINANCIAL CONTROLS
The Company has an internal control system, commensurate with the size, scale and complexity of its operations. The details on the internal control system are more elaborately explained in the Managementâs Discussion and Analysis Report.
16. DIRECTORS & KEY MANAGERIAL PERSONNEL
a. Appointment
The Board based on the recommendation of the Nomination and Remuneration Committee appointed Ms. Annie Jodhani as Company Secretary and Compliance Officer of the Company w.e.f. June 6, 2017.
Further, the Board based on the recommendation of the Nomination and Remuneration Committee approved the appointment of senior management personnel namely, Mr. Manoj Mishra as Chief Operating Officer w.e.f June 1, 2017 and Mr. C.S. Rajaram as President
- Global Productions w.e.f June 4, 2018.
b. Retirement by rotation
In accordance with the provisions of the Act and the Articles of Association of the Company, Ms. Rashida Adenwala, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible has offered herself for re-appointment.
c. Resignation
There were no resignations of the Directors or Key Managerial Person during the year under review.
d. Board evaluation
Pursuant to the provisions of the Act, the SEBI (LODR) Regulations, 2015 and the policy adopted by the Company for performance evaluation, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees i.e., Audit, Nomination & Remuneration, Stakeholdersâ Relationship and Corporate Social Responsibility.
The performance of the Board and Committees was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board/ committee composition and structure, effectiveness of Board/committee processes, information and functioning, etc.
The Board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.
In a separate meeting of Independent Directors, performance of non-independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive Directors and non-executive Directors.
The performance of Board, its Committees and individual Directors were found satisfactory.
e. Board Diversity
The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors. The Board Diversity Policy is available on our website www.dqentertainment.com
f. Policy on Directorsâ Appointment, Remuneration and Other Details
The Companyâs policy on Directorsâ appointment, remuneration and other matters as provided in Section 178(3) of the Act is given as Annexure V, which forms part of this report.
g. Familiarization programme of Independent Directors
The details of programme for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, and related matters are put up on the website of the Company www.dqentertainment.com.
Further, at the time of appointment of an independent Director, the Company issues a formal letter of appointment outlining his/her role, function, duties and responsibilities as a Director. The format of the letter of appointment is available on our website www. dqentertainment.com
h. Declaration by Independent Directors
The Company has received necessary declaration from each independent Director under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.
17. MEETINGS OF THE BOARD
Four meetings of the Board of Directors of the Company were held during the financial year 2017-18. These Board meetings were held on May 30, 2017 which was adjourned to June 6, 2017 due to lack of quorum, August 11, 2017, December 8, 2017 and February 14, 2018. For further details, please refer report on Corporate Governance of this Annual Report.
18. AUDITORS AND AUDITORSâ REPORT
a. Statutory Auditors
The present term of office of the statutory auditor of the Company, namely, M/s. MSKA & Associates., Chartered Accountants (Formerly known as MZSK & Associates, Chartered Accountants) expires at the conclusion of the ensuing Annual General Meeting (AGM); however the audit firm is eligible for re-appointment.
The re-appointment of MSKA & Associates., Chartered Accountants, as recommended by the Audit Committee and approved by the Board, is proposed for another term of three years i.e. from the conclusion of the Eleventh AGM upto the conclusion of the Fourteenth AGM to be conducted in the year 2021, thus completing the aggregate period of 10 years as per the provisions of Companies Act, 2013.
M/s. MSKA & Associates., Chartered Accountants has confirmed their eligibility under Section 141 of the Companies Act, 2013 and the rules framed thereunder for re-appointment as Auditors of the Company. The appointment is accordingly proposed in the Notice of the forthcoming AGM vide item no. 3.
The Board has placed on record its sincere appreciation for the services rendered by M/s MSKA & Associates., Chartered Accountants, as Statutory Auditors of the Company.
During the year under review, the Auditorsâ Report does not contain any qualification, reservation or adverse remark. No frauds have been reported by the auditors in terms of Section 143(12) of the Act. The Statutory Auditors have laid out emphasis of matter with regard to carrying value of intangible assets and carrying value of investment in wholly owned subsidiary (DQ Entertainment (Ireland) Limited).
The Auditors have mentioned in its report regarding the irregular deposit of statutory dues with the appropriate authorities. The Board explained that due to paucity of funds, dues could not be paid regularly and now all efforts are made to deposit the dues regularly on time with the appropriate authorities.
b. Secretarial Auditors
Mr. R. Ramakrishna Gupta of M/s. PI & Associates, Practicing Company Secretaries, New Delhi, was appointed by the Board to conduct the secretarial audit of the Company for the financial year 2017 -18, as required under Section 204 of the Companies Act, 2013 and Rules thereunder. The secretarial audit report forms part of the Annual Report as Annexure VI to the Boardâs report.
The following observations were given by the Secretarial auditor to which the Board has shared the following explanations:
a) There was a delay in submitting the financial results to BSE limited and National Stock Exchange of India Ltd (NSE) for the quarter and financial year ended 31st March, 2017. The Company has submitted the financial results on 6th June, 2017 as against the due date of 30th May, 2017 prescribed under regulation 33 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015. The company has been imposed a penally of Rs. 35,000 (Thirty Five Thousand only) by NSE, and the same has been paid by the company.
Explanation: The Company shall ensure that going forward, Audit Committee and Board meeting for considering and approving the quarterly results shall be conducted within the timelines as prescribed in the SEBI (LODR) Regulations, 2015.
b) The company has not published newspaper Advertisement/information in English language national daily newspaper for the adjourned Board Meeting held on 6th June, 2017 for approving the Financial Statements for the quarter and financial year ended 31st March, 2017 as required under regulation 47 of SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015.
Explanation: The Company shall ensure that going forward, utmost care shall be taken to publish the required information both in English language national daily newspaper and vernacular language daily newspaper.
c) There are delays in submission of Monthly, Quarterly and Annual Performance reports with Software Technology Park of India (STPI).
Explanation: The Company shall ensure that going forward the reports with STPI shall be submitted within the due date.
d) There are instances of delays in filing of Softex forms with Software Technology Park of India (STPI).
Explanation: The Company shall ensure that going forward the Softex forms shall be filed with STPI within the due dates.
19. COMMITTEES
The Board has formed the following Committees:
(i) Audit Committee
(ii) Nomination and Remuneration Committee
(iii) Corporate Social Responsibility Committee
(iv) Stakeholders Relationship Committee
The details of the membership and attendance of the meetings of the above Committees of the Board are included in the Corporate Governance Report, which forms part of this report.
20. VIGIL MECHANISM
As part of our corporate governance practices, the Company has formulated a Whistle Blower Policy to provide Vigil Mechanism for employees including Directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and SEBI (LODR) Regulations,
2015. The whistle blower policy may be accessed on the Companyâs website www.dqentertainment.com.
21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has duly complied with the provision of section 186 of the Companies Act, 2013 and Rules made thereunder. The particulars of loans, guarantees and investments have been disclosed in the financial statements.
22. DEPOSITS
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
23. PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO REQUIRED UNDER THE COMPANIES (ACCOUNTS) RULES,2014
The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are given hereunder:
(i) Energy Conservation: The operations of the Company involve low energy consumption. The Company has undertaken various energy efficient practices to conserve energy and strengthened the Companyâs commitment towards becoming an environment friendly organization.
(ii) Technology Absorption: We have developed following in-house plug-ins to maximize technology absorption at minimal cost.
- The 3ottle: It is a market competing software that is being developed for its CGI animation requirements such as hyper realistic lighting.
- Global Lighting Process (GLP): It automates the process of developing lighting asset to reduce rendering hours by 20%
- GATEWAY software: It is one of its kinds for complete automation of processes, live updates on productivity and status of project as well as server data management and facilitates backup. This robust and secured tool has helped to increase efficiency to a new level.
This automation process and software and hardware development will result in considerable savings of operational costs to company due to reduced human effort and time while not compromising on quant unit in
(iii) Research & Development: The Company constantly endeavors to be more efficient and effective in planning of production activities for achieving and maintaining the highest standards of quality.
(iv) Foreign Exchange Earnings and Outgo:
Amt. in INR
Particulars |
For the year ended |
For the year ended |
3IMarchl8 |
3IMarchI7 |
|
Earnings in Foreign Currency |
||
Income from production |
938,728,707 |
806,901,075 |
Other income |
5,376,128 |
4,365,839 |
Distribution Income |
13,598,631 |
19,762,427 |
Expenditure in Foreign Exchange (Subject to deduction of tax where applicable) |
||
Overseas business travel |
3,200,659 |
3,588,971 |
Production Expenses |
8,941,555 |
9,525,250 |
Consultancy and other expenses |
1,486,550 |
338,899 |
Financial Charges |
7,206,741 |
- |
Note: The above figures have been extracted from standalone financial statements, both for current and previous year.
24. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended is provided as Annexure VII to the Boardâs report.
The information required pursuant to Section 197(12) of the Act read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, in respect of the employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the members and others entitled thereto, excluding the information on employeesâ particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary in this regard.
25. GOING CONCERN
No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
26. MATERIAL EVENT RECORDED SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS
There are no material changes and commitments affecting the financial position of the Company, which has occurred between the end of the financial year of the Company i.e. March 31, 2018 and the date of the Directorsâ Report.
27. INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2014
Your Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
28. DISCLOSURE WITH RESPECT TO UNCLAIMED SUSPENSE ACCOUNT
The following are the details that are required to be provided under Schedule V (F) of the SEBI (LODR) Regulations, 2015:
No. of Shareholders and outstanding shares in the suspense account in the beginning of the year |
No. of Shareholders approached for transfer of shares during the year |
No. of Shareholders to whom shares were transferred and no. of shares transferred |
No. of shareholders and the no. of outstanding shares in the suspense account at the end of the year |
2 shareholder and 160 shares |
1 shareholder |
1 shareholder and 80 shares |
1 shareholder and 80 shares |
29. GREEN INITIATIVE
Electronic copies of the Annual Report 2017 -18 and Notice of the 11th Annual General Meeting are sent to all members whose email addresses are registered with the Company / Depository Participant(s). For members who have not registered their email addresses, physical copies of the Annual Report 2018 and the Notice of the 11th Annual General Meeting are sent in the permitted mode. Members requiring physical copies can send a request to the Company.
We encourage the other shareholders and request them to support us on this nationwide Green Initiative by registering/updating their email addresses with their Depository Participant(s) as required for receiving the notices and other documents via email.
The Company provides e-voting facility to all its members to enable them to cast their votes electronically on all resolutions set forth in the Notice. The instructions for e-voting are provided in the Notice.
30. ACKNOWLEDGEMENT
Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by every member of the DQE family.
Hyderabad For and on behalf of the Board
August 03, 2018 Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Mar 31, 2016
To,
The Members,
The Directors have pleasure in presenting their Ninth Annual Report on the business and operations of DQ Entertainment (International) Limited (âthe Companyâ or DQE India) together with the Audited Statement of Accounts for the financial year ended March 31, 2016.
1. FINANCIAL RESULTS
During the year under review, performance of your company was as under: INR in Mn
Particulars |
Standalone |
Consolidated |
||
For the year ended |
For the year ended |
For the year ended |
For the year ended |
|
|
31-Mar-16 |
31-Mar-15 |
31-Mar-16 |
31-Mar-15 |
Income from Production |
1,645 |
1,726 |
1,643 |
1,423 |
Income from Distribution |
65 |
90 |
461 |
525 |
Other Income |
196 |
29 |
533 |
13 |
Total Income |
1,906 |
1,845 |
2,637 |
1,961 |
Total Expenditure |
1,583 |
1,489 |
2,256 |
2,092 |
Profit before tax |
323 |
356 |
381 |
(131) |
Tax Expense (Current Tax Deferred Tax [Net of MAT credit entitlement]) |
82 |
66 |
82 |
66 |
Profit after tax |
241 |
290 |
299 |
(197) |
Standalone: Profit before tax and Profit after tax includes the exceptional item by way of notional foreign exchange of approximately INR 169 Mn for the period ended 31st March 2016 (2015: INR (24) Mn) as well as Bad debts write off / provisioning for bad debts to the tune of INR 103.76 Mn (2015: INR 0.78 Mn)
Consolidated: Profit before tax and Profit after tax includes the exceptional item by way of notional foreign exchange of approximately INR 312 Mn for the period ended 31st March 2016 (2015: INR (351) Mn) as well as Bad debts write off / provisioning for bad debts to the tune of INR 373.01 Mn (2015: INR 0.78 Mn)
After adjustment of the notional loss and gain as well as the bad debts write off / provision, the profit before tax and profit after tax is as under for the consolidated financials:
INR in Mn
|
31 March 2016 |
31 March 2015 |
Adjusted Profit before tax |
443 |
221 |
Adjusted Profit after Tax |
361 |
155 |
Cash & Cash Equivalent |
204 |
747 |
2. PERFORMANCE AND OPERATIONS
The financial year 2015-16 saw the beginning of the turnaround in the operations after very difficult period from 2012 -13 onwards. Slowly and steadily your company is receiving new orders and the development of its own IPâs is also progressing well.
Income from operations in 2015-16 on a consolidated basis was INR 2,104 Mn as compared to INR 1,948 Mn over the same period last year, an increase of 8%, which is indeed very encouraging.
The Company earned a profit before tax of INR 381 Mn as compared to a loss of INR (131) Mn over the same period last year, while profit after tax was INR 299 Mn, compared to a loss after tax of INR (197) Mn over the same period last year. However after considering the adjustments of exceptional items the profit after tax for the current year is INR 361 mn as compared to INR 155 mn in the previous year. There is a decrease of Adjusted EBITDA which is INR 891 Mn, compared to adjusted EBITDA of INR 1,067 Mn over the same period last year as a result of the write-off / provision made for debtors to the tune of INR 373 mn.
All efforts are being made to collect the old outstanding. In some of the cases we have made good progress while some parties are still struggling to get the financing in place. However, we have confirmations from all parties that they are committed to pay their dues.
As of now, we have a strong visibility of orders for production for next 18-24 months.
BUSINESS REVIEW:
Our focus on improving operational efficiencies and the consolidation of artistic and technical skill sets continues, with productivity improvements being recognized across all processes of production.
Operating Highlights for FY 2015-16:
Animation:
- Successfully completed and delivered our proprietary production âThe New Adventures of Peter Panâ season II with production partners Method Animation and other coproduction partners ZDF Germany, France Television, Telequebec and DeA Kids.
- Completed and delivered Popples - TV series, a co-production with Zag Toons, Saban Brands USA and Method Animation, France, which has debuted on Netflix world-wide.
- Another notable spin off âThe Jungle Book the Christmas movieâ was also delivered during the year. It has suitable length for TV features, DVD release and online SVOD.
- Disney projects under production are: Miles from tomorrow land season II, Sheriff Callieâs Wild West season II, The Hive - Season 2, Puppy Dog Tales and Mickey Road Racers.
- Other service projects that were in production include Black Beauty, Magic Lamp, Persian Gift, Rainbow City, Magic Wand and Dream land.
- Projects which commenced production include Zak Storm- TV series, Super 4 - TV series,
- Commenced production of Our own IPâs The Jungle Book season III, 5&IT TV series, Jungle Book Halloween Special, Peter Pan Christmas Special and other spin offs.
- Seven Dwarfs and Me, produced by Method Animation and supported by DQE, ZDF, RAI and France TV a hybrid show combining high quality CGI with live action footage is nearing completion.
- Several co-production and service agreement were finalized during the year to name a few Robinhood Season II Co pro with Method Animation, Sammy 2 being produced by Zag Toons, USA and Method Animation, France, Pio the Chick TV series, an adaptation from Pulcino Pio (the hugely successful online musical sensation with more than a billion views) with the main producer Rai Commercial, Italy in partnership with Italian producer Gruppo Alcuni and Planeta Jr, Italy.
VFX:
- DQEâs VFX division was involved in elements of this yearâs highly acclaimed films, SS Rajamouliâs âBahubaliâ and Gunasekharâs âRudrama Deviâ. DQE VFX team is currently working on Telugu/Tamil bilingual starring Nagarjuna & Karthi directed by Paidipally Vamshi. Complex sequences for Dil Rajuâs Krishnastami and Sai Dharam Tejâs new movie Thikka are under production.
Distribution:
- DQEâs licensing and distribution division has achieved a turnover of INR 461 Mn during 201516. Several deals are under negotiation and the revenue is expected to substantially increase in the current financial year.
- The Companyâs digital platforms continue to perform satisfactorily and are gaining traction with third party properties soon being hosted on âPower Kidsâ and âTiny Toonzâ channels.
3. DIVIDEND
Considering the current expansion plans as well as the financial health of the Company, the Board has not recommended any dividend to the equity shareholders for the financial year 2015 -16.
4. SHARE CAPITAL
The authorized share capital of the Company as on 31st March, 2016 was Rs. 800,000,000/- divided into 80,000,000 equity shares of Rs.10/- each and paid-up capital was Rs. 792,830,000/- divided into 79,283,000 equity shares of Rs.10/- each.
The Company has neither issued shares with differential rights as to dividend, voting or otherwise nor issued shares (including sweat equity shares) to the employees or Directors of the Company, under any Scheme.
5. MANAGEMENTâS DISCUSSION AND ANALYSIS REPORT
Managementâs Discussion and Analysis Report for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [SEBI (LODR) Regulations, 2015] is presented in a separate section forming part of the Annual Report.
6. CORPORATE GOVERNANCE
The report on Corporate Governance as stipulated under the SEBI (LODR) Regulations, 2015 forms an integral part of this Report. The requisite certificate from the Practicing Company Secretary of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.
The declaration by CEO/CFO that the Board Members and Senior Management Personnel have complied with the Code of Conduct forms part of the Annual Report.
7. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Companies Act, 2013 (âthe Actâ) and Accounting Standard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accounting for Investments in Associates and AS - 27 on Financial Reporting of Interests in Joint Ventures, the audited consolidated financial statements are provided in the Annual Report.
8. DIRECTORSâ RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 134(3) (C) OF THE COMPANIES ACT, 2013
Your Directors state that:
a) in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
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 as at March 31, 2016 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of 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 on a âgoing concernâ basis;
e) the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
9. TRANSACTIONS WITH RELATED PARTIES
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 armâs length basis.
Pursuant to Reg. 23(8) of SEBI (LODR) Regulations, 2015, the material related party transactions entered into prior to the date of notification of SEBI (LODR) Regulations, 2015 and which are likely to continue beyond such date are placed for approval before the members at the ensuing Annual General meeting.
Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure I in Form AOC-2 and the same forms part of this report.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at the link: http:// www.dqentertainment.com/ Investors.aspx
10. EXTRACT OF ANNUAL RETURN
As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure II in Form MGT- 9, which forms part of this report.
11. CORPORATE SOCIAL RESPONSIBILITY (CSR)
As part of the CSR activities, the Company intends to initiate projects aimed at promoting quality education and employability for vulnerable sections of society, either directly or through DQ Smile Foundation.
Due to financial liquidity issues faced by the Company, the Board was unable to spend any amount on CSR activities during the year.
The CSR Policy may be accessed on the Companyâs website and can be viewed on http:// www. dqentertainment.com/Investors.aspx.
The CSR annual report is attached separately and forms part of this report as Annexure III.
12. RISK MANAGEMENT
The Company is exposed to inherent uncertainties owing to the sectors in which it operates. The Companyâs Risk Management process focuses on ensuring that these risks are identified on a timely basis and addressed. The Company has developed and implemented a Risk Management policy, which includes:
- ensuring that all the current and future material risk exposures of the company are identified, assessed, quantified, appropriately mitigated and managed;
- establishing a framework for the companyâs risk management process and to ensure the group wide implementation;
- ensuring systematic and uniform assessment of risks related with the intellectual property and production services rendered;
- enabling compliance with appropriate regulations, wherever applicable, through the adoption of best practices and
- assuring business growth with financial stability.
The Risk Management Policy was reviewed and approved by the Audit Committee. The Company manages, monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.
13. INTERNAL FINANCIAL CONTROLS
The Company has an internal control system, commensurate with the size, scale and complexity of its operations. The details on the internal control system are more elaborately explained in the Managementâs Discussion and Analysis Report.
14. DIRECTORS & KEY MANAGERIAL PERSONNEL
a. Appointment
Mr. B.N.Sirish and Mr. Auknoor Goutam were appointed as Independent Directors for a period of five years with effect from 30th September 2015, by the members of the Company in the 8th Annual General Meeting (AGM) held on September 30, 2015 pursuant to the provisions of Section 149 & 152 of Companies Act 2013.
The Board at its meeting held on August 12, 2016 appointed Mr. Sachin Guha as Company Secretary and Compliance Officer of the Company w.e.f. August 23, 2016.
b. Retirement by rotation
In accordance with the provisions of the Act and the Articles of Association of the Company, Ms. Rashida Adenwala, Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible has offered herself for re-appointment.
c. Resignation
Ms. Sindhu M.S. resigned as Company Secretary & Compliance Officer with effect from March 28, 2016. The Board places on record its gratitude for the services rendered by Ms. Sindhu M.S. during her association with the Company.
d. Board evaluation
Pursuant to the provisions of the Act, the SEBI (LODR) Regulations, 2015 and the policy adopted by the Company for performance evaluation, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees i.e., Audit, Nomination & Remuneration, Stakeholdersâ Relationship and Corporate Social Responsibility.
The performance of the Board and Committees was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board/ committee composition and structure, effectiveness of Board/committee processes, information and functioning, etc.
The Board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.
In a separate meeting of Independent Directors, performance of non-independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive Directors and non-executive Directors.
e. Board Diversity
The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors. The Board Diversity Policy is available on our website, http:// www.dqentertainment.com/Investors.aspx
f. Policy on Directorsâ Appointment, Remuneration and Other Details
The Companyâs policy on Directorsâ appointment, remuneration and other matters as provided in Section 178(3) of the Act is given as Annexure IV, which forms part of this report.
g. Familiarization programme of Independent Directors
The details of programme for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, and related matters are put up on the website of the Company at the link http:// www.dqentertainment.com/Investors. aspx
Further, at the time of appointment of an independent Director, the Company issues a formal letter of appointment outlining his/her role, function, duties and responsibilities as a Director. The format of the letter of appointment is available on our website, http:// www. dqentertainment.com/Investors.aspx.
h. Declaration by Independent Directors
The Company has received necessary declaration from each independent Director under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015.
15. MEETINGS OF THE BOARD
During the Financial Year 2015-16, four meetings of the Board of Directors of the Company were held during the year on May 27, 2015, August 13, 2015, November 9, 2015 and February 12, 2016. For further details, please refer report on Corporate Governance of this Annual Report.
16. AUDITORS AND AUDITORSâ REPORT
a. Statutory Auditors
Your Company has at its Annual General Meeting held on September 30, 2014, appointed M/s. MZSK & Associates, Chartered Accountants, Hyderabad, as statutory auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in the calendar year 2017. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment M/s. MZSK & Associates, Chartered Accountants, Hyderabad, as statutory auditors of the Company, is placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.
The Auditorsâ Report does not contain any qualification, reservation or adverse remark. No frauds have been reported by the auditors in terms of Section 143(12) of the Act.
b. Secretarial Auditors
Mr. R. Ramakrishna Gupta of M/s. PI & Associates, Practicing Company Secretaries, New Delhi, was appointed by the Board to conduct the secretarial audit of the Company for the financial year 2015 -16, as required under Section 204 of the Companies Act, 2013 and Rules there under. The secretarial audit report forms part of the Annual Report as Annexure V to the Boardâs report.
The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
17. COMMITTEES
The Board has formed the following Committees:
(i) Audit Committee
(ii) Nomination and Remuneration Committee
(iii) Corporate Social Responsibility Committee
(iv) Stakeholders Relationship Committee
The details of the membership and attendance of the meetings of the above Committees of the Board are included in the Corporate Governance Report, which forms part of this report.
18. VIGIL MECHANISM
As part of our corporate governance practices, the Company has formulated a Whistle Blower Policy to provide Vigil Mechanism for employees including Directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and SEBI (LODR) Regulations, 2015. The Policy on vigil mechanism and whistle blower policy may be accessed on the Companyâs website at the link- http:// www.dqentertainment.com/Investors.aspx
19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of loans, guarantees and investments have been disclosed in the financial statements.
20. DEPOSITS
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
21. PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO REQUIRED UNDER THE COMPANIES (ACCOUNTS) RULES, 2014
The particulars as prescribed under Sub-section (3) (m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are given hereunder:
(i) Energy Conservation: The operations of the Company involve low energy consumption. The Company has undertaken various energy efficient practices to conserve energy and strengthened the Companyâs commitment towards becoming an environment friendly organization.
(ii) Technology Absorption: We have developed inhouse plug-ins to maximize technology absorption at minimal cost. The Company produces majority of the content in the 3D stereoscopic technology which is the latest offering in the entertainment industry.
(iii) Research & Development: The Company constantly endeavors to be more efficient and effective in planning of production activities for achieving and maintaining the highest standards of quality.
(iv) Foreign Exchange Earnings and Outgo:
Amount in INR
Particulars |
For the year ended |
For the year ended |
|
31March16 |
31March15 |
Earnings in Foreign Currency |
|
|
Income from production |
1,627,126,687 |
1,710,690,035 |
Others income |
5,056,040 |
16,944,309 |
Distribution Income |
62,271,448 |
87,500,989 |
Expenditure in Foreign Exchange |
|
|
(Subject to deduction of tax where applicable) |
|
|
Overseas business travel |
3,240,388 |
7,163,715 |
Production Expenses |
14,818,925 |
525,142 |
Consultancy and other expenses |
21,293,228 |
2,003,344 |
Financial Charges |
- |
9,959,515 |
Note: The above figures have been extracted from standalone financial statements, both for current and previous year.
22. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended is provided as Annexure VI to the Boardâs report.
The information required pursuant to Section 197(12) of the Act read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, in respect of the employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the members and others entitled thereto, excluding the information on employeesâ particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary in this regard.
23. GOING CONCERN
No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
24. INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2014
Your Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules there under for prevention and redressal of complaints of sexual harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
25. DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES
DQ Entertainment (Ireland) Limited is the wholly owned subsidiary of the Company in Ireland. Further, there has been no material change in the nature of the business of the subsidiary. During the year, DQ Entertainment USA LLC was incorporated as wholly owned subsidiary of DQ Entertainment (Ireland) Limited in USA.
The Companyâs two Indian subsidiaries - DQ Powerkidz Private Limited and DQE ITES Park Private Limited have been, on an application by the company, struck off by the Registrar of Companies on October 15, 2015.
DQ Entertainment (International) Films Limited is a Joint Venture between DQ Entertainment (International) Limited and DQ Entertainment plc, which was formed for the production and distribution of the Jungle Book Feature Film. The sharing ratio of DQE Plc is 60% and DQE India is 40% in the JV. The objective to form the JV was to benefit from the synergies of both the companies and to ensure that the interests of all the stakeholders are aligned.
There are no associate companies of DQE India within the meaning of Section 2(6) of the Companies Act, 2013 (âActâ). Method Animation S.A.S. is an associate company of DQ Entertainment plc, the Ultimate Holding Company.
Further, the report on the performance and financial position of the subsidiary and Joint venture and salient features of the financial statements in the prescribed form AOC - 1 is annexed as Annexure VII to the Boards report.
In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of its subsidiary, DQ Entertainment (Ireland) Limited, are available on the Company website.
The policy for determining Material Subsidiaries is disclosed on the companyâs website and is accessible on http:// www.dqentertainment.com/Investors.aspx.
26. GREEN INITIATIVE
Electronic copies of the Annual Report 2015 -16 and Notice of the 9th Annual General Meeting are sent to all members whose email addresses are registered with the Company / Depository Participant(s). For members who have not registered their email addresses, physical copies of the Annual Report 2016 and the Notice of the 9th Annual General Meeting are sent in the permitted mode. Members requiring physical copies can send a request to the Company.
We encourage the other shareholders and request them to support us on this nationwide Green Initiative by registering/updating their email addresses with their Depository Participant(s) as required for receiving the notices and other documents via email.
The Company provides e-voting facility to all its members to enable them to cast their votes electronically on all resolutions set forth in the Notice. The instructions for e-voting are provided in the Notice.
27. ACKNOWLEDGEMENT
Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by every member of the DQE family.
Hyderabad For and on behalf of the Board
August 12, 2016 DQ Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Mar 31, 2014
Dear members,
The directors have pleasure in presenting the Seventh annual report on
the business and operations of DQ Entertainment (International) Limited
("the Company") and its subsidiaries (together referred to as the Group
or DQE) for the period ended March 31, 2014.
1. FINANCIAL HIGHLIGHTS Rs. in Millions
Particulars For the For the
year ended year ended
31-Mar-14 31-Mar-13
Income from Production 1,873 1,820
Income from Distribution 523 474
Other Income 249 34
Total Income 2,645 2,328
Total Expenditure 2,197 1,915
profit before tax 448 413
Tax Expense (Current
Tax Deferred Tax [Net of 20 40
MAT credit entitlement])
profit after tax 428 373
2. performance review
During the last couple of years, DQE has remained focused on building
its own television content production and distribution business while
also leveraging its resources to benefit from alternate channels and
platforms.
The animation production market continues to face difficult times due
to lack of financial support on account of the overall depressed
conditions globally. However, your Company has been able to sustain
itself and grow, though marginally. While the revenue from production
has been flat, the revenue from distribution has increased by 10% as
compared to the previous year. Profit before tax has increased by 21%
over the previous year. This is because of the cost efficiencies
brought in terms of manpower costs.
During the year we have completed and delivered 13 projects, while we
have signed 5 new projects that will go into production in this current
year. Currently 14 projects are in production.
Furthermore, we continue to develop and progress on our feature film
production which will complement our existing production pipeline and
also adding several new intellectual properties to our portfolio that
comprise the foundation of our business.
Our licensing and distribution group has performed well, concluding 23
new agreements with international broadcast partners as well as 31
licensing deals for variety of merchandise products.
3. DIVIDEND
Your Company has earned reasonable profits, and continues to invest its
internal accruals in the development of the IP''s so as to build a
strong IP portfolio to ensure sustainability and growth for the future.
In view of the above, the directors have not recommended any dividend
to the equity shareholders for the financial year 2013-14.
4. SUBSIDIARIES
Our Company has three wholly owned subsidiaries, DQ Entertainment
(Ireland) Limited, DQ Powerkidz Private Limited and DQE ITES Park
Private Limited.
Pursuant to the general exemption granted by the Central Government
under the provisions of Section 212(8) of the Companies Act, 1956; the
Company has not included the detailed financial statements of its
subsidiaries in this Annual Report. The detailed financial statements
and audit reports of each of the subsidiaries are available for
inspection at the registered office of the Company during office hours
between 11 am to 1 pm and upon written request from a shareholder, your
Company will arrange to send the financial statements of subsidiary
companies to the said shareholder.
The annual accounts of DQE Ireland and the related detailed information
shall be made available to any member of the Company seeking such
information. They will also be kept open for inspection by any of the
shareholders at the registered office of the Company and of DQE
Ireland. The Company shall furnish a copy of detailed accounts of DQE
Ireland to any of the shareholders on demand.
5. DIRECTORS
In accordance with the Articles of Association, Ms. Rashida Adenwala,
shall retire by rotation at the ensuing Annual General Meeting and
being eligible, has offered herself for re-appointment. Details
regarding directors proposed to be appointed at the Annual General
Meeting to be held on September 30, 2014, due to changes arising from
the implementation of the Companies Act, 2013 are provided in the
annexure to the Notice convening the Annual General Meeting.
The detailed profiles of all the directors are available under the
chapter Board of directors.
6. AUDITORS
M/s. MZSK & Associates, Chartered Accountants, Hyderabad, the statutory
auditors of the Company, shall retire at the ensuing Annual General
Meeting and have confirmed their eligibility and willingness to accept
office, if reappointed.
7. fixed deposits
During the year under review, the Company has not accepted any public
deposits. As such no amount of principal or interest was outstanding as
on the Balance Sheet date.
8. particulars of employees and other
ADDITIONAL INFORMATION
In terms of the provisions of Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of concerned employees are required to
be set out in the Annexure to the Directors'' Report.
However, the provisions of Section 219(1)(b)(iv) of the Companies Act,
1956 exempt the Company from publishing the same in the Annual Report.
Hence, the Annual Report excluding the aforesaid information is being
sent to all the members of the Company and others entitled thereto. The
said statement is open for inspection at the Registered Office of the
Company. Any member interested in obtaining such particulars may write
to the Company Secretary at the Registered Office of the Company.
9. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH &
DEVELOPMENT, FOREIGN EXCHANGE EARNINGS AND OUTGO.
(i) Energy Conservation: The operations of the Company involve low
energy consumption. Adequate measures have however been taken to
conserve energy.
(ii) Technology Absorption: We have developed in-house plug-ins to
maximize technology absorption at minimal cost. The Company produces
majority of the content in the 3D stereoscopic technology which is the
latest offering in the entertainment industry.
(iii) Research & Development: It is the Company''s constant endeavor to
be more efficient and effective in planning of production activities
for achieving and maintaining the highest standards of quality.
10. DIRECTORS'' RESPONSIBILITY STATEMENT
On behalf of the directors, we confirm that as required under Section
217 (2AA) of the Companies Act, 1956,
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give 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 the period;
c) We 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; and
d) We have prepared the annual accounts on a going concern basis.
11. CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
As per clause 49 of the Listing Agreements entered into with the Stock
Exchanges, Corporate Governance Report and Management Discussion and
Analysis are attached and form part of this report.
12. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The CSR initiatives taken by the Company continued during the year
under review. A detailed mention of the CSR activities carried out by
the Company through its CSR wing - DQ Smile Foundation is given as a
part of the HR report on Page 31.
13. GREEN INITIATIVE
Out of our total shareholders, almost 50% receive shareholder
communications by e-mail. We are sending the print version of the
annual report only to the shareholders whose email addresses are not
registered with their Depository Participant(s) and to those
shareholders who have opted for receiving the physical copies.
We encourage the other shareholders and request them to support us on
this nationwide Green Initiative by registering/updating their email
addresses with their Depository Participant(s) as required for
receiving the notices and other documents via email.
14. ACKNOWLEDGEMENT
Your directors would like to take this opportunity to express their
sincere gratitude to all the employees, clients, vendors, investors,
advisors, bankers, government authorities and local bodies for their
support. The directors appreciate and value the contributions made by
every member of the DQE family globally and look forward to their
continued support in the future.
The Annual General Meeting of the Company will be held on Tuesday,
September 30, 2014.
May 30, 2014 For and on behalf of the Board
DQ Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Mar 31, 2013
To, The Members of DQ Entertainment (International) Limited
The Directors have pleasure in presenting the Sixth annual report on
the business and operations of DQ Entertainment (International) Limited
("the Company") and its subsidiaries (together referred to as the Group
or DQE) for the period ended March 31, 2013.
1. PRINCIPAL ACTIVITIES Rs. in Millions
For the year For the year
Particulars ended ended
31-Mar-13 31-Mar-12
Income from Productions 1, 820 1,755
Income from Distribution 474 517
Total income 2,294 2,272
Total Expenditure 1,916 1,933
Profit before tax 413 430
Tax Expense (Current
Tax Deferred Tax [Net of 40 100
MAT credit entitlement])
Profit after tax 373 330
2. PERFORMANCE REVIEW
With continuing downfall in the global economic scenario, where many
companies in our domain have gone in red your Company has resiliently
sustained itself and generated a total revenue of Rs. 2,294 mn during
the year under review (2012: Rs. 2, 272 mn). Our EBIDTA margins to
revenue have gone up from 42% for the financial year ended March 2012
to 49% in the current year. This is due to the well planned cost
reduction/ operational policies and as well as improved production
efficiencies across the organization.
DQE is now uniquely positioned as an integrated entertainment
production and distribution company, focused on 360 degree monetization
across all platforms. Investing in iconic co- productions, developing
our own Intellectual Properties and establishing the global licensing
and distribution business have been conscious and strategic decisions
by the Company.
As of now only one home-grown IP i.e. The Jungle Book TV Series Season
1 has been launched in the market on a global scale and the story of
its success is evident from the excellent worldwide ratings received
for ''The Jungle Book'' shows and quality of deals signed for licensing/
merchandising. The licensing and distribution revenues currently
represent approximately 21% of total revenues and have progressed very
well during the year under review to close at Rs. 474 mn.
Your Company had signed a major licensing and merchandising contract
during the previous year, with a leading licensing agency in the USA
for a period of four years. The said contract was on a non-cancellable
basis resulting into an upfront recognition of distribution revenue of
Rs. 16.39 crores. Under Indian GAAP and IFRS guidelines non-cancellable
licensing revenues must be recognized immediately and not spread over
the licensed term. This resulted in an unbudgeted gain of Rs. 14.40
crores during the year ending March 2012. Barring the above windfall
gain the L & D revenues have progressed very well during the year under
review.
The year ahead is well covered with productions of The Jungle Book
Second Season, The New Adventures of Peter Pan Second Season, Lassie &
Friends, 5 & IT 3D TV series, Winds in the Willows, Lanfeust First
Season, NFL Rush Zone Second Season, The Rising Star and other
developments including the Jungle Book Feature Film. These will also
give a major boost to our licensing & distribution revenues and the
Company is confident of achieving its targeted growth in the years to
come.
The Profit after tax is up by 13% to Rs. 373 mn (2012: Rs. 330 mn). In
spite of the global liquidity squeeze, the Group has managed to invest
substantial amount from its internal accruals for development of its
intellectual properties, the majority of which is for the
pre-production of ''The Jungle Book'' feature film. The Group is making
considerable efforts to reduce the amount of its debtors and improve
the cash flow position.
3. OPERATIONS REVIEW:
Global economic growth remains historically low for the second year
running with major centers of economic activity. Increased aversion to
risks by investors and perceived growth uncertainty have led to equity
price declines, capital outflows and currency depreciation.
Even in the backdrop of adverse global economic scenario, DQE remained
focused on creating the highest quality of content for the kids''
entertainment segment and strived to distribute that content in many
strategic and profitable ways. We are focused to achieve our
objectives, by deriving maximum efficiencies in our production pipeline
through optimal deployment of resources and ride on the global
distribution and licensing of key TV series and content of our library.
The production pipeline remains healthy with signing of new projects
such as:
- raz and Benny - 52 x 11'', CGI TV series with Foot Hill Entertainment,
Europe
- Leo & Pisa Gang - 52 x 11'' CGI TV series with MPP ,Germany
- nFL rush Zone 3 - 20 x 22'' CGI & 2D TV Series with Rollman
Entertainment, USA for Nick Toons(USA)
- Miles From Tomorrow Land - 26x26'' CGI TV series with Wild Canary(USA)
- iesodo -10x13'' CGI TV series with Rollman Entertainmen (USA)
- Manav - 65'' 2D TV Feature with Disney India
while successfully concluding prestigious projects such as ''Mickey
Mouse Club House'' (fourth & fifth season) for Walt Disney Television
Animation, ''The New Adventures of Peter Pan'' with ZDF Group and France
Television, Charlie Chaplin with Method Animation, ''Little Prince''
(second season) with France Television & Method Animation, ''Keymon TV
Feature'' with Nickelodeon India, ''Omkar'' (third season) with Turner
Group and Cartoon Network.
We have made substantial progress in licensing & distribution of our
Intellectual Properties and have concluded several deals with leading
networks and licensees globally. With the second season in production
''The Jungle Book'' has continued to gain traction with merchandisers
across the globe. Licensing & Merchandising for our second
international IP ''The New Adventures of Peter Pan'' is also on fast
track. 31 new merchandising deals were signed in relation to "The
Jungle Book" while 8 were signed for "The New Adventures of Peter Pan"
More than 26 new broadcasting and home video agreements have been
signed for a variety of properties including Ironman , Lassie, Jungle
Book, peter Pan and Tara Duncan. Next year and years to come will see
steady flow of revenues from these streams.
Development of our first international feature film ''The Jungle Book''
is progressing well with leading writers and directors on board. We are
gathering momentum for closing the production budget and to finalise on
the global distributors.
New developments on the digital front have encouraged us to monetize
through the digital world and utilize our IP library for various new
platforms. DQE has signed a non-exclusive agreement with Budge Studios,
Canada for the Jungle Book Mobile App on IOS & Android Platforms for
worldwide digital market. The apps are expected to be available in the
exponentially growing and potential mobile digital market very soon.
While in-house development of games based on DQE IPS for mobiles -
(Android and IOS) is underway and will be a new business vertical for
monetizing its portfolio of iconic global IPs.
4. DIVIDEND:
The members are aware that the Group is currently involved in the
development of various intellectual properties. In order to meet the
investment requirements for various ongoing projects, which will
contribute to the shareholders'' wealth in the long term, the Directors
have not recommended any dividend to the equity shareholders for the
financial year 2012-13.
5. SUBSIDIARIES:
Our Company has three wholly owned subsidiaries, DQ Entertainment
(Ireland) Limited, DQ Powerkidz Private Limited and DQE ITES Park
Private Limited.
Pursuant to the general exemption granted by the Central Government
under the provisions of Section 212 of the Companies Act, 1956; the
Company has not included the detailed financial statements of its
subsidiaries in this Annual Report.
The annual accounts of subsidiaries and the related detailed
information shall be made available to any member of the Company
seeking such information. They will also be kept open for inspection by
any of the shareholders at the registered office of the Company and of
the subsidiaries. The Company shall furnish a copy of detailed accounts
of subsidiaries to any of the shareholders on demand.
6. DIRECTORS
In accordance with the Articles of Association, Mr. K. Balasubramanian
and Mr. Girish Kulkarni shall retire by rotation at the ensuing Annual
General Meeting. Both the directors being eligible have offered
themselves for re-appointment.
Since the balance sheet date, Ms. Rashmi Chakravarti has resigned as an
Executive Non Independent Director of the Company and Mr. V.
Santhanaraman has been appointed as an Alternate Director to Mr. K.
Balasubramanian.
The detailed profiles of all the directors are available under the
chapter Board of directors.
7. AUDITORS
M/s. Haribhakti & Co., Chartered Accountants, Hyderabad, the statutory
auditors of the Company shall retire at the ensuing Annual General
Meeting and have confirmed their eligibility and willingness to accept
office, if reappointed.
8. FIXED DEPOSITS
During the year under review, the Company has not accepted any deposits
under the provisions of the Companies Act, 1956. As such no amount of
principal or interest was outstanding as on the Balance Sheet date.
9. PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of concerned employees are required to
be set out in the Annexure to the Directors'' Report.
However, the provisions of Section 219 (1) (b) (iv) of the Companies
Act, 1956 exempt the Company from publishing the same in the Annual
Report.
Hence, the Annual Report excluding the aforesaid information is being
sent to all the members of the Company and others entitled thereto. The
said statement is open for inspection at the Registered Office of the
Company. Any member interested in obtaining such particulars may write
to the Company Secretary at the Registered Office of the Company.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH &
DEVELOPMENT, FOREIGN EXCHANGE EARNINGS AND OUTGO.
Energy Conservation: The operations of the Company involve low energy
consumption. Adequate measures have however been taken to conserve
energy.
(ii) Technology Absorption: We have developed in-house plug- ins to
maximize technology absorption at minimal cost. The Company produces
majority of the content in the 3D stereoscopic technology which is the
latest offering in the entertainment industry.
(iii) Research & Development: It is the Company''s constant endeavor to
be more efficient and effective in planning of production activities
for achieving and maintaining the highest standards of quality.
Note: The above figures have been extracted from standalone financial
statements, both for current and previous year.
11. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act 1956, your Directors
confirm that;
i) in the preparation of the annual accounts for the financial year
ended on March 31, 2013, the applicable accounting standards have been
followed along with proper explanations relating to material
departures, if any.
ii) 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 as at March 31, 2013 and of the profit of the Company
for that period.
iii) proper and sufficient care has been taken 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;
iv) the annual accounts of the Company have been prepared on a ''Going
Concern Basis''.
12. CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
A report on the Corporate Governance standards followed by your Company
forms part of this report as also a Management Discussion and Analysis
statement.
13. GREEN INITIATIVE
During the previous fiscal we started a sustainability initiative with
an aim of going green and minimizing our impact on the environment.
Like last year, we are sending the print version of the annual report
only to the shareholders whose email addresses are not registered with
their Depository Participant(s) and to those shareholders who have
opted for receiving the physical copies.
The Ministry of Corporate Affairs has taken a "Green Initiative" in the
Corporate Governance by allowing paperless compliances by the
companies. We request our shareholders to support us on this nation
wide Green Initiative by registering/updating their email addresses
with their Depository Participant(s) as required for receiving the
notices and other documents via email.
14. ACKNOWLEDGEMENTS
Your directors would like to take this opportunity to express their
sincere gratitude to all the clients, vendors, investors, advisors,
bankers, government authorities, local bodies for their continued
support during the year. We place on record our appreciation for the
commitment shown by our employees in supporting the Company in its
journey to be ''A Global Entertainment Powerhouse''. Our consistent
growth was made possible by their hard work, solidarity, co-operation
and support. We look forward to their continued support in the future.
The Annual General Meeting of the Company will be held on September 27,
2013.
May 30, 2013 for and on behalf of the Board
DQ Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Mar 31, 2012
To,The Members of DQ Entertainment (International) Limited
The Directors have pleasure in presenting the Fifth annual report on
the business and operations of DQ Entertainment (International) Limited
("the Company or DQE") and its I 00% subsidiary "DQ Entertainment
(Ireland) Limited" (together referred to as the Group) for the period
ended March 3I, 20I2.
For the year For the year
Particulars
ended ended
3I-Mar-I2 3I-Mar-II
Ircome from
Productions 1,755,077 1,852,956
Income from 5I6,877 225,5I2
Distribution
Total Income 2,271,954 2,078,468
Total I,947,306 I,823,283
Expenditure
Profit before tax 429,86I 352,460
Tax Expense
(Current Tax
Deferred 99,634 73,880
Tax [Net of
MAT credit
entitlement])
Profit after tax 330,227 278,580
2. PERFORMANCE REVIEW
The Group generated revenue growth of 9.3% to Rs 2,272 mn (20II: Rs 2,078
mn). The revenues from production did not witness significant growth.
The reasons for the same were two-fold - delay in commissioning of some
of the new projects and deliberate stoppage of deliveries so as to
recover the overdue payments from the customers. However on the other
hand the Company, in line with its business vision and plan saw a I29%
increase in its revenues from distribution and licensing to Rs 5I7 mn
from Rs 226 mn. This growth is an indication that the decisions made by
the Company to invest in its own IPs and develop its own content for a
360 degree monetization have been in the right direction.
The management is confident that slowly and steadily the returns from
such investments will continue to accrue in the future.
The Profit before tax was up by 22% to Rs 430 mn (20II: Rs 352 mn) and
the net profit after tax was up by I8% amounting to Rs 330 mn (20II: Rs
279 mn).
3. OPERATIONS REVIEW
The challenges faced by key global economies have had trickledown
effect especially in terms of the interest rates hikes, delay in
collection of receivables, longer working capital cycles, increased
borrowings, decrease of outsourcing work and to top the list the ever
rising inflation.
However inspite of the adverse global economic scenario, DQE remained
focused on creating the highest quality of content for the kids'
entertainment segment and strived to distribute that content in many
strategic and profitable ways.
The production pipeline remains robust with signing of new projects
such as:
- 'Robin Hood Mischief in Sherwood' with TFI
- France, ZDF - Germany, ATV - Turkey, DeAgostini - Italy and Method
Animation - France
- 'Escape Hockey' with IMIRA - Spain,
- 'Lanfeust' - with Alphanim - France
- 'Franco and Formula Fun' with Formula Fun Entertainment Limited
- UK and Telegael - Ireland
- 'Mickey Mouse Club House - Season 5' for Disney - USA
- 'Omkaar - Season 3' with Turner Group, Cartoon Network
while successfully concluding prestigious projects such as Iron man
(second season), Casper (second season), Feluda (TV series for Disney
India) and Keymon TV series (with Nickelodeon India).
The progress on the licensing & merchandising side has risen
substantially after successful launch of The Jungle Book TV series -
Season
I. We have increased our ability to monetize our content across
geographies through licensing and merchandising of intellectual
properties owned and developed by us.
Development of our first international feature film 'The Jungle
Book' is progressing well with leading writers and directors on
board. It is scheduled for world wide release in the summer of 20I4.
The industry is witnessing considerable advancements in areas like
technology, marketing, exhibition with rampant digitalization across
the value chain; resulting in enhanced reach and access to high quality
content.
New developments on the digital front have encouraged us to monetize
through the digital world and utilize our IP library for mobile
applications, mobile games and mobile porting, for all major platforms
such as iPhone, iPad, ipod, itunes, blackberry, android, tablets,
windows and mobile internet platforms.
These innovations at DQE in the digital space will further strengthen
our position as a market leader in the dynamic international markets.
4. DIVIDEND:
The members are aware that the Group is currently involved in the
development of various Intellectual Properties. In order to meet the
investment requirements for various ongoing projects, which will
contribute to the shareholders' wealth in the long term, the
Directors have not recommended any dividend to the equity shareholders
for the financial year 20II-I2.
5. SUBSIDIARY
Our Company has a wholly owned subsidiary, DQ Entertainment (Ireland)
Limited ("DQE Ireland"), incorporated in Ireland. DQE Ireland is
engaged in the business of content development/ distribution for
animation, live action TV series, movies and various other medias.
Pursuant to the general exemption granted by the Central Government
under the provisions of Section 2I2 of the Companies Act, I956; the
Company has not included the detailed financial statements of its
subsidiary DQE Ireland in this Annual Report.
The annual accounts of DQE Ireland and the related detailed information
shall be made available to any member of the Company seeking such
information. They will also be kept open for inspection by any of the
shareholders at the registered office of the Company and of DQE
Ireland. The Company shall furnish a copy of detailed accounts of DQE
Ireland to any of the shareholders on demand.
6. DIRECTORS
In accordance with the Articles of Association,
Ms. Rashmi Chakravarti and Mr. S. Sundar shall retire by rotation at
the ensuing Annual General Meeting. Both the directors being eligible
are liable for re-appointment.
The detailed profiles of all the directors are available under the
chapter Board of Directors.
7. AUDITORS
M/s. Haribhakti & Co., Chartered Accountants, Hyderabad, the statutory
auditors of the Company shall retire at the ensuing Annual General
Meeting and have confirmed their eligibility and willingness to accept
office, if re- appointed.
8. FIXED DEPOSITS
During the year under review, the Company has not accepted any deposits
under the provisions of the Companies Act, I956. As such no amount of
principal or interest was outstanding as on the Balance Sheet date.
9. PARTICULARS OF EMPLOYEES AND OTHER
ADDITIONAL INFORMATION
In terms of the provisions of Section 2I7 (2A) of the Companies Act,
I956, read with the Companies (Particulars of Employees) Rules, I975,
the names and other particulars of concerned employees are required to
be set out in the Annexure to the Directors' Report.
However, the provisions of Section 2I9 (I) (b)
(iv) of the Companies Act, I956 exempt the Company from publishing the
same in the Annual Report.
Hence, the Annual Report excluding the aforesaid information is being
sent to all the members of the Company and others entitled thereto. The
said statement is open for inspection at the Registered Office of the
Company. Any member interested in obtaining such particulars may write
to the Company Secretary at the Registered Office of the Company.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH &
DEVELOPMENT, FOREIGN EXCHANGE EARNINGS AND OUTGO
(i) Energy Conservation: The operations of the Company involve low
energy consumption. Adequate measures have however been taken to
conserve energy.
(ii) Technology Absorption: We have developed in-house plug- ins to
maximize technology absorption at minimal cost. The Company produces
majority of the content in the 3D stereoscopic technology which is the
latest offering in the entertainment industry.
(iii) Research & Development: It is the Company's constant endeavor
to be more efficient and effective in planning of production activities
for achieving and maintaining the highest standards of quality.
(iv) Foreign Exchange Earnings and Outgo:
For the year For the year
Particulars
ended ended
CIF Value of Imports 31-Mar-12 31-Mar-11
Capital Goods 22,37I 253,920
Earnings in Foreign
Currency
Income from
production 1,639,026 I,309,472
License Fees/Others
3I9,033 I6I,570
income
Expenditure in Foreign
Exchange
(Subject to deduction of
tax where applicable)
Travel 3,598 3,333
Production Expenses I84,299 I38,640
Professional and
_ 2I,473 40,263
Consultancy Charges
Financial Charges I6,042 968
225,412 183,204
Note: The above figures have been extracted from standalone financial
statements, both for current and previous year.
11. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 2I7 (2AA) of the Companies Act, I956, your
Directors confirm that;
i) In the preparation of the annual accounts for the financial year
ended on March 3I, 20I2, the applicable accounting standards have been
followed along with proper explanations relating to material
departures, if any.
ii) 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 as at March 3I, 20I2 and of the profit of the Company
for that period.
iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, I956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
iv) the annual accounts of the Company have been prepared on a 'Going
Concern Basis'.
12. CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
A report on the Corporate Governance standards followed by your Company
forms part of this report as also a Management Discussion and Analysis
statement.
13. GREEN INITIATIVE
During the previous fiscal we started a sustainability initiative with
an aim of going green and minimizing our impact on the environment.
Like last year, we are sending the print version of the annual report
only to the shareholders whose email addresses are not registered with
their Depository Participant(s) and to those shareholders who have
opted for receiving the physical copies.
The Ministry of Corporate Affairs has taken a "Green Initiative" in
the Corporate Governance by allowing paperless compliances by the
companies. We request our shareholders to support us on this nation
wide Green Initiative by registering/updating their email addresses
with their Depository Participant(s) as required for receiving the
notices and other documents via email.
14. ACKNOWLEDGEMENTS
Your directors would like to take this opportunity to express their
sincere gratitude to all the clients, vendors, investors, advisors,
bankers, government authorities, local bodies for their continued
support during the year. We place on record our appreciation for the
commitment shown by our employees in supporting the Company in its
journey to be 'A Global Entertainment Powerhouse'. Our consistent
growth was made possible by their hard work, solidarity, co-operation
and support. We look forward to their continued support in the future.
The Annual General Meeting of the Company will be held on August I0,
20I2.
May 28, 20I2
for and on behalf of the Board
DQ Entertainment (International) Limited
Sd/-
Tapaas Chakravarti
CMD & CEO
Mar 31, 2011
The Members
DQ Entertainment (International) Limited
The Directors have pleasure in presenting the Fourth annual report on
the business and operations of DQ Entertainment (International) Limited
("the Company or DQE") and its 100% subsidiary company DQ Entertainment
(Ireland) Limited for the period ended March 31, 2011.
FINANCIAL HIGHLIGHTS
Rupees in thousands
For the year For the year
Particulars
ended ended
31-Mar-11 31-Mar-10
Total Income 2,162,602 1,766,067
Total Expenditure 1,810,142 1,497,555
Profit before tax 352,460 268,512
Tax Expense
(Current Tax
Deferred Tax [Net (73,880) (1,791)
of MAT credit
entitlement])
Profit after tax 278,580 266,721
BUSINESS REVIEW
DQE has continued to progress the animation value chain, into IP
creation and distribution of animation content globally We have been
developing and co-producing famous IPs such as The Jungle Book, Peter
Pan, 5 & IT, Charlie Chaplin, Iron Man, Lassie, as well as Indian IPs
such as Balkand, Omkar, Mysteries and Feluda, Suryaputra. This has
added famous brands to DQE's programming portfolio to exploit revenues
in perpetuity.
DQE's first home grown international IP The Jungle Book 1 has been a
global success. It is airing on marquee networks with highest
viewership ratings. The Jungle Book has attracted strong support and
interest from licensees worldwilde.
DQE's portfolio now consists of over 600 hours of animated content for
exploitation and will see further enhancement of the same with addition
of some more classical brands such as Charlie Chaplin, Young Robin Hood
, Lassie, Casper and others in 2011-12.
DQE's feature film division has successfully completed the production
of 3D stereoscopic animated feature film "The Prodigies" for Warner
Bros, Fidelite Films, Studio 37 and Onyx Films, France. Three new 3D
stereoscopic feature films are in development for the world market
scheduled for release from 2013 onwards.
The Company will continue to expand its portfolio of classical
properties for worldwide exploitation across all platforms of
audio-visual formats while licensing and distribution will add to the
production revenues of the Company. Exploitation through newer
delivery formats such as online and mobile content will be a focus area
for exploration and growth for the company's owned IP.
DIVIDEND
The Directors do not recommend payment of any dividend for this
financial year.
SUBSIDIARY
Our Company has a wholly owned subsidiary, DQ Entertainment (Ireland)
Limited ("DQE Ireland"), incorporated in Ireland which is engaged in
the business of content development for animation and live action for
TV series, movies and various other media.
Pursuant to the general exemption granted by the Central Government in
relation to the provisions of Section 212 of the Companies Act, 1956
for not attaching the balance sheet of the subsidiary company; the
Company has not included the detailed financials of its subsidiary DQE
Ireland in this report.
The annual accounts of DQE Ireland and the related detailed information
shall be made available to shareholders of the Company and DQE Ireland
seeking such information at any point of time. The annual accounts of
DQE Ireland shall also be kept for inspection by any shareholders at
the registered office of the Company and of DQE Ireland. The Company
shall furnish a hard copy of detailed accounts of DQE Ireland to any
shareholder on demand.
DIRECTORS
Ms. Rashida Adenwala was appointed as an Additional Director of the
Company w.e.f October 1, 2010.
As per Article 109 to 115 of the Articles of Association, Mr. K.
Balasubramanian and Mr. Girish Kulkarni shall retire by rotation at the
ensuing Annual General Meeting. Both the directors being eligible are
liable for re- appointment.
The detailed profiles of all the directors are available under the
chapter Board of Directors.
AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants has resigned as
the joint statutory auditor of the Company.
M/s Haribhakti Co., Chartered Accountants, Hyderabad, the existing
statutory auditor of the Company shall retire at the ensuing Annual
General Meeting and has confirmed its eligibility and willingness to
accept office, if re-appointed.
PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of concerned employees are required to
be set out in the Annexure to the Directors' Report.
However, the provisions of Section 219 (1) (b) (iv) of the Companies
Act, 1956 exempts the Company from publishing the same in the Annual
Report.
Hence, the Annual Report excluding the aforesaid information is being
sent to all the members of the Company and others entitled thereto. The
said statement is open for inspection at the Registered Office of the
Company. Any member interested in obtaining such particulars may write
to the Company Secretary at the Registered Office of the Company.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
(i) Energy Conservation: The operations of the Company involve low
energy consumption. Adequate measures have however been taken to
conserve energy.
(ii) Technology Absorption: We have developed in-house plug- ins to
maximize technology absorption at minimal cost. The Company produces
majority of the content in the 3D stereoscopic technology which is the
latest offering in the entertainment industry.
(iii) Foreign Exchange Earnings and Outgo:
Rupees in thousands
For the year For the year
ended ended
CIf value of Imports 31-Mar-11 31-Mar-10
Capital Goods 253,920 2,237
- -
earnings in foreign
- -
Currency
Income from production 1,523,306 1,358,447
License Fees 156,857 90,516
- -
expenditure in foreign
- -
exchange
(Subject to deduction of
- -
tax where applicable)
Travel 3,359 1,837
Production Expenses 200,946 62,693
Professional and 93,542 7,516
Consultancy Charges
Financial Charges 7 5,242
Others (Capex) 320,904 1,523
Total 618,759 78,811
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act, 1956, your
Directors confirm that;
i) In the preparation of the annual accounts for the financial year
ended on March 31, 2011, the applicable accounting standards have been
followed along with proper explanation relating to material departures,
if any.
ii) 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 as at March 31, 2011 and of the profit of the company
for that period.
iii) Proper and sufficient care has been taken 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;
iv) The Directors have ensured prepartion of the annual accounts of the
Company on a 'Going Concern Basis'.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
A report on the Corporate Governance standards followed by your Company
and Management Discussion and Analysis statement are given in the
respective sections of the Annual Report.
ACKNOWLEDGEMENT
Your directors would like to take this opportunity to express their
sincere gratitude to all the clients, vendors, investors, advisors and
bankers for their continued support during the year. We place on record
our appreciation for the commitment shown by our employees in
supporting the Company in its journey to be "A Global Entertainment
Powerhouse". Our consistent growth was made possible by their hard
work, solidarity, co-operation and support. We look forward to their
continued support in the future.
The Annual General Meeting of the Company will be held on September 23,
2011.
for and on behalf of the Board
DQ Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Place: Hyderabad
Date: August 10, 2011
Mar 31, 2010
The Directors have pleasure in presenting the third annual report on
the business and operations of DQ Entertainment (International) Limited
("The Company") and its 100% subsidiary company DQ Entertainment
(Ireland) Limited (together referred to as the Group) for the period
ended March 31, 2010.
BUSINESS
The year gone by has been quite eventful and exciting especially as the
Group is slowly and steadily making its way into the distribution,
licensing and merchandising segment of the entertainment industry. DQE
has established itself as a recognized entertainment group world wide
with marquee brand ownerships such as The Jungle Book, Charlie Chaplin,
Peter Pan, Iron Man and many more.
The total income for 2009-10 has gone up by 17 % from Rs. 1509.08
million in Fiscal 2009 to Rs. 1766.07 million during fiscal 2010. Our
revenues from Licensing and Distribution have increased from Rs. 74.63
million to Rs. 215.10 million at a growth rate of 188%. Profit after
tax increased by 65% to Rs. 266.72-million as against Rs. 161.23
million in the previous year.
Our strategy has been to expand our footprint in the entertainment
segment and consolidate our portfolio of global and Indian IPs for
worldwide distribution, licensing and merchandising.
Currently our library has a little over 450 hours of content for TV
broadcast with rights in various territories including South East Asia,
Australia-New Zealand, Arabic nations, Europe etc. DQEs library
comprises legendary brands including Iron Man, Casper, Jungle Book,
Peter Pan, Charlie Chaplin, Little Prince, Feluda, Tara Duncan, Lassie
for revenue exploitation.
DQEs first home grown IP, The Jungle Book is being produced with
International partners as a high end 3D 52x1 1 minutes TV series and is
slated for release in mid 201 while several Indian IPs like Mysteries &
Feluda, Omkar, Balkand I, II and III are being produced with
International Broadcasters.
During the year DQE had an impressive foray into the production of 3D
animated stereoscopic feature films
FINANCIAL HIGHLIGHTS Rs in Thousands
Particuiars For the For the
year ended year ended
March 32, March 31,
2010 2009
Total Income 1,766,067 1,509,076
Total Expenditure 1,497,555 1,309,986
Profit before tax 268,512 199,090
Tax Expense (Current (1,791) (37,858)
Tax-i- Deferred Tax+
Fringe Benefit Tax)
Profit after ta 266,721 161,232
DIVIDEND
The Directors do not recommend payment of any dividend for this
financial year.
INITIAL PUBLIC OFFER
As you are aware, the Companys Initial Public Offer ("IPO") which was
open from March 8th to March 10th 2010, received an overwhelming
response from investors and was subscribed 86.33 times. The HNI portion
was subscribed 272.88 times. The qualified institutional and retail
investors reserved portions were subscribed 93.86 times and 19.45
times, respectively. The equity shares of the Company were listed on
the Bombay Stock Exchange Limited (BSE) on March 29 2010. The opening
price was Rs. 135 per share, representing a premium of around 68.75%
to the issue price of Rs. 80 per share. SBI Capital Markets Limited,
were the book running lead managers and the syndicate members to the
issue were SBICAP Securities Limited, India Infoline Limited and Yes
Bank Limited. Karvy Computershare Private Limited is the Registrar to
the issue.
We would like to thank the investors for their overwhelming response
and trust in the fundamentals of the Company.
INCREASE IN SHARE CAPITAL
Authorised Capital: The authorised share capital of Rs. 38,100,000
divided into 3,010,000 Equity Shares and 800,000 % Redeemable
Optionally Convertible Non Cumulative Preference Shares of Rs. 10 each
was reclassified and increased to Rs. 800,000,000 divided into
80,000,000 Equity Shares of Rs. 10 each, pursuant to a resolution of
the shareholders passed on September 15, 2009.
Paid up Capital: On September 17, 2009, the Company had issued 58,01
1,920 bonus shares in the ratio of 40: I pursuant to capitalisation of
the share premium account. The Company had allotted an aggregate of
3,772,771 Equity Shares for cash at a price of Rs. 68.1 I per Equity
Share (including a share premium of Rs. 58.1 I per Equity Share) on
December 23, 2009 and January 06, 2010. Further, the Company issued
16,048,01 I equity shares of Rs. 10 each for cash at an issue price of
Rs.80 determined through the 100% book-building mechanism in accordance
with the SEBI (Issue of Capital and Disclosure Requirements)
Regulations 2009 in the Initial Public Offering ("IPO").
Due to this, the outstanding issued, subscribed and paid-up equity
share capital increased from 1,422,912 shares in March 31, 2009 to
79,283,000 shares as at March 31, 2010.
SUBSIDIARY
Our Company has a wholly owned subsidiary, DQ Entertainment (Ireland)
Limited ("DQ Ireland"), incorporated in Ireland which is engaged in the
business of content development for animation and live action for TV
series, movies and various other media.
The Company has been granted exemption for the year ended March 31,
2010 by the Ministry of Corporate Affairs from attaching to its Balance
Sheet, the individual Annual Report of its subsidiary company. As per
the terms of the Exemption Letter, a statement containing brief
financial details of the Companys subsidiary for the year ended March
31, 2010 is included in the Annual Report. The annual accounts of this
subsidiary and the related detailed information will be made available
to any Member of the Company/its subsidiary seeking such information at
any point of time and are also available for inspection by any Member
of the Company/ its subsidiary at the Registered Office of the Company/
its subsidiary and would be posted on the website of the Company.
DIRECTORS
Mr. Rusi Brij, the co-promoter and Director of the Company unexpectedly
passed away on May 20, 2009. The Board of Directors and all the
associates of DQE condone this untimely demise and stand by the family
with full support.
Mrs. Rashmi Chakravarti was appointed as Additional Director on May 25,
2009 and was regularized at the Annual General Meeting held on
September 15, 2009.
Mr. K Balasubramanian, Ms. Theresa Plummer Andrews, Mr. Girish Kulkarni
and Mr. Sanjay Saxena were appointed as Additional Directors of the
Company on August 26, 2009 and regularized at the Annual General
Meeting held on September 15,2009.
Mr. Akula Ramakrishna and Mr. Laxminarayana Nagu resigned from the
Board on August 26, 2009. Mr. Sanjay Saxena resigned from the Board on
September 17, 2009.
On April 30,2010, Mr. Neelesh Wagle was appointed as an Alternate
Non-Executive Director to Mr. Girish Kulkarni.
On July 26, 2010, Mr. S Sundar was appointed as an Additional Director
of the Company.
As per Article 109 to 115 of the Articles of Association, Mrs. Rashmi
Chakravarti and Ms.Theresa Plummer Andrews shall retire by rotation at
the ensuing Annual General Meeting. Mrs. Rashmi Chakravarti and Ms.
Theresa Plummer being eligible are liable for re-appointment.
The detailed profiles of all the directors are available under the
chapter Board of Directors.
AUDITORS
M/s. Deloitte, Haskins and Sells, Chartered Accountants, Hyderabad, the
statutory auditors of the Company shall retire at the ensuing Annual
General Meeting and have confirmed their eligibility and willingness to
accept office, if re-appointed.
PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION
In terms of the provisions of Section 217 (2A) of the Companies-Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of employees are required to be set out
in the Annexure to the Directors Report. However, the provisions of
Section 219 (I) (b)(iv) of the Companies Act, 1956 exempts the Company
from publishing the same in the Annual Report. Hence, the Annual
Report excluding the aforesaid information is being sent to all the
members of the Company and others entitled thereto. Any member
interested in obtaining such particulars may write to the Company
Secretary at the Registered Office of the Company.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
(i) Energy Conservation: The operations of the Company involve low
energy consumption. Adequate measures have however been taken to
conserve energy.
(ii) Technology Absorption: We have developed in- house plug- ins to
maximise technology absorption at minimal cost. The Company produces TV
series in the 3D stereoscopic technology which is the latest offering
in the entertainment industry.
(iii) Foreign Exchange Earnings and Outgo:
(Rs. in Thousands) (Rs.in Thousanda)
2009-10 2008-09
a) Value of export earnings:
Income from production 1,358,447 1,344,366
License Fees 90,516 43,472
b) Value of export
out flows towards:
Travel 1,837 4,229
Production Expenses 62,693 17,928
Professional and Consultancy 7,516 19,459
Charges
Financial Charges 5,242 16,634
Others 1,523 4,963
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act, 1956, your
Directors confirm that;
i) In the preparation of the annual accounts for the financial year
ended on March 31, 2010, the applicable accounting standards had been
followed along with proper explanation relating to material departures,
if any.
ii) The directors had 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 profit of
the company for that period.
iii) Proper and sufficient care had been taken for the maintenance of
adequate accounting records in accordance with the provisions of this
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities;
iv) The Directors had prepared the annual accounts for the financial
year ended on March 31, 2010 on a Going Concern Basis.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
STATEMENT
A report on Corporate Governance is attached to this Report as also a
Management Discussion and Analysis statement.
ACKNOWLEDGEMENT
Your directors would like to thank all the clients, vendors, investors,
advisors and bankers for their continued support during the year. We
place on record our appreciation for the contribution made by our
employees at all levels. Our consistent growth was made possible by
their hard work, solidarity, cooperation and support. We look forward
to their continued support in the future.
The Annual General Meeting of the Company will be held on September 29,
2010
Place: Hyderabad/ For and on behalf of the Board
Date: July 26, 2010 DQ Entertainment (International) Limited
Tapaas Chakravarti
CMD & CEO
Mar 31, 2009
The Directors have pleasure in presenting the second annual report on
the business and operations of the Company and its subsidiary company
(the Group) together with the audited annual accounts of DQ
Entertainment (International) Private Limited (ÃThe CompanyÃ) for the
period ended March 31, 2009.
FINANCIAL HIGHLIGHTS
The financial highlights of the Company during the last year are as
follows:
(Rs. in Thousands)
For the year ended
Particulars March 31, 2009
Total Income 1,509,076
Total Expenditure 1,309,713
Profit before tax 199,363
Tax Expense (Current Tax+Deferred 37,858
Tax+ Fringe Benefit Tax)
Profit after tax 161,505
Principal activities
DQ Entertainment (DQE) is a Global player in the ever-growing market of
media and entertain- ment. It has slowly and steadily paved its way as
a trusted leading partner and high quality producer and global
distributor of TV series, direct-to-home videos, feature films as well
as Game art for on- line, mobile and next-generation console games
across all formats not only in traditional and digital animation and
VFX but has also made its foray into live action television and feature
production and distribution.
Since its beginning as a service providing company for traditional 2D
Animation, DQE has consistently expanded its product mix and moved up
the value chain by adapting its business model from one of pure service
to co-producing major iconic brands with well-known international
partners as well as developing own IP for domestic and international
markets.
DIVIDEND
The Directors do not recommend payment of any dividend for this
financial year.
CHANGES AMONG DIRECTORS
Rusi Brij, the co-promoter and Director of the Com- pany unexpectedly
passed away on May 20, 2009. RusiÃs untimely demise is a tragic loss
for his family, friends, and colleagues at DQE.
To fill in the casual vacancy caused by the sad de- mise of Mr. Rusi
Brij, Mrs. Rashmi Chakravarti has been appointed as an additional
director of the Com- pany with effect from May 25, 2009. Mrs. Rashmi
ChakravartiÃs term of office shall expire at the con- clusion of
ensuing Annual General Meeting.
She is eligible for regularisation as Director of the Company by the
shareholders at the ensuing annual general meeting.
AUDITORS
M/s Deloitte, Haskins and Sells, Chartered Accoun- tants, Hyderabad
statutory auditors of the company shall retire at the ensuing annual
general meeting and have offered themselves to be re-appointed as
statutory auditors and tax auditors of te Company. M/s Deloitte,
Haskins and Sells have confirmed that if appointed, the same will be in
accordance with the limits specified in the Companies Act and other
statutory provisions.
SECRETARIAL COMPLIANCE CERTIFICATE
The company has obtained a Secretarial Compliance Certificate from M/s
R. & A Associates, a firm of practic- ing Company Secretaries as to the
Compliance of the provisions of the Companies Act, 1956 for the
financial year 31st March 2009.
PARTICULARS OF EMPLOYEES AND OTHER ADDITIONAL INFORMATION
The details of the employees of the company as per Section 217(2A) of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 are given as Annexure I.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
(i) Energy Conservation: This provision is not applicable as the
company does not belong to the category of the companies that are
required to disclose the particulars as required under section
227(1)(e) of the Com- panies Act, 1956 read with Companies (Disclosure
of Particulars in the Report of Board of Directors) Rules, 1988.
(ii) Technology Absorption: This provision is not applicable as the
company did not use or absorbed any technology.
(iii) Foreign exchange earnings and outgo:
(Rs. in Thousands)
2008-09
a) Value of export earnings:
Sales 359,845
Other Incomes 31,962
b) Value of export out flows towards:
Purchases 97,872
Others 257,757
DIRECTORSÃ RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of the Companies Act, 1956, your
Directors confirm that;
i) In the preparation of the annual accounts for the financial year
ended on March 31, 2009, the applica- ble accounting standards had been
followed along with proper explanation relating to material depar-
tures, if any.
ii) The directors had selected such accounting poli- cies and applied
them consistently and made judge- ments and estimates that are
reasonable and pru- dent 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 pe- riod.
iii) Proper and sufficient care had been taken for the maintenance of
adequate accounting records in ac- cordance with the provisions of this
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting fraud and other ir- regularities;
iv) The Directors had prepared the annual accounts for the financial
year ended on March 31, 2009 on a Ãgoing concern basisÃ.
ACKNOWLEDGEMENT
Your Directors wish to place on record their deep sense of appreciation
to the dynamic and efficient management team and employees having
varied industry experience and very strong relationships with the group
and its partners and its clients for their incredible teamwork,
excellent professionalism and fervent contribution during the year.
Your Directors are also grateful to shareholders, bankers, custom- ers
and suppliers of the company for their continued valued support.
The Annual General Meeting of the Company will be held on September 15,
2009.
For and on behalf of the Board
of DQ Entertainment (International) Private Limited
Place: Hyderabad (Tapaas Chakravarti)
Date: July 25, 2009 CMD & CEO
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