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Directors Report of Sakuma Exports Ltd.

Mar 31, 2015

THE MEMBERS OF SAKUMA EXPORTS LIMITED

The Directors take pleasure in presenting the Tenth Annual Report together with the audited financial statements for the year ended 31st March, 2015. The Management Discussion and Analysis has also been incorporated into this report.

1. FINANCIAL RESULTS

Financial Results For The Year Ended March 31, 2015 (Rsin lacs)

Standalone 2014-15 2013-14

Sales & Other Income 1,09,313.81 1,01,459.22

Profit before depreciation & Tax 1329.73 1,132.64

Depreciation 83.30 79.32

Profit before Tax 1246.43 1,053.32

Provision for Tax

- Current Tax 385.05 365.00

- Deferred Tax (12.88) (16.17)

- Income Tax of Earlier years 0.89 (0.61)

Minority Interest and share of loss of associate 0.00 0.00

Net Profit after tax 873.37 705.10

Add: Surplus from previous period 1639.99 1,127.07

Profit Available for Appropriation 2513.36 1,832.17

Appropriation

Dividend on Equity Shares 164.26 164.26

Dividend Tax - 27.92

Excess provision of Reversed back - -

Transfer to Statutory Reserve - -

Balance carried to Balance Sheet 2349.10 1,639.99

Consolidated 2014-15 2013-14

Sales & Other Income 181025.13 1,58,182.06

Profit before depreciation & Tax 2470.22 2,217.26

Depreciation 83.60 79.70

Profit before Tax 2386.62 2,137.56

Provision for Tax

- Current Tax 385.18 365.79

- Deferred Tax (12.88) (16.17)

- Income Tax of Earlier years 1.23 (0.61)

Minority Interest and share of loss of associate 54.79 158.32

Net Profit after tax 1958.30 1630.23

Add: Surplus from previous period 2901.20 1399.77

Profit Available for Appropriation 4859.50 3093.37

Appropriation

Dividend on Equity Shares 164.26 164.26

Dividend Tax - 27.92

Excess provision of Reversed back - -

Transfer to Statutory Reserve - -

Balance carried to Balance Sheet 4695.24 2,901.20

Note: During the relevant financial year, the company has received dividend from its foreign subsidiary, GKM General Trading LLC, of Rs. 1,75,39,246/- on which the company is liable to pay Rs26,30,887/- as dividend tax u/s 115BBD of the Income Tax Act. As the Dividend received from the foreign subsidiary is higher than the proposed dividend and as the tax paid or payable on the dividend received from foreign subsidiary is eligible for set-off against liability of dividend distribution tax payable u/s 115-O of the Act, no separate provision for dividend distribution tax is made.

The Company proposes to transfer an amount of Rs. Nil to the General Reserves and amount of Rs23,49,09,946 is proposed to be retained in the Statement of Profit and Loss.

2. HIGHLIGHTS OF PERFORMANCE

- Total income for the year increased by 7.75 % to Rs.1,09,313.81 Lakhs as compared to Rs1,01,459.24 Lakhs in Previous year

- Total net sales for the year was Rs1,08,085.35 Lakhs as compare to Rs.1,01,132.15 Lakhs in Previous year, a growth of 6.88 %

- Total profit before tax for the year was Rs12.46 Crores as compare to Rs10.53 Crores in Previous year

3. OPERATIONS REVIEW AND FUTURE PROSPECTS

The year under review was yet another year full of challenges for the Company under domestic front owing to late onset of monsoon. Commencement of Sugar production got delayed resulting in loss of business opportunities during the month of October & November in Sugar business which is a prime commodity of Company's business. The year started under global recessionary conditions, though there was improvement in U.S. economy. Global scenario continued to be grim with several economics including few European economies reeling under recession which lead to decline in the Global prices of commodities. In the circumstances Indian Agri products lost parity and business competitiveness. Weakening of major economies affected international trade adversely. The international prices of agricultural products were mostly lower than those prevailing in India. With bearish micro environment and lower returns, Overseas investors were shy and there was general exit of investment in commodities. This adversely affected Indian exports in agricultural commodities. Mismatch in prices continued throughout the year which resulted in overall fall in the export volume. Domestic prices of other Agri Commodities viz. Rice, Oilseed Extraction, Maize, Wheat etc. continued to mismatch rendering export business un-remunerative in general which adversely impacted topline of the Company. Weak demand of Raw Cotton from China & other importing countries also continued during the year. During the year China's Raw Cotton import dropped to US$ 690 Million as against US$ 1910 Million in 2013-14 registering a decline of about 65% year on year basis. Same is the case with other Raw Cotton importing countries viz. Bangladesh, Vietnam etc. as a result, the Company could not make much headway in cotton exports.

However, in the last quarter, turnover shortfall was largely compensated after announcement of export subsidy by the Govt. on Raw Sugar and the Company was able to secure large export orders. The Company achieved standalone turnover of Rs422 Crores only in the first 9 months (Previous year Rs627 Crores) in the face of tough global market conditions but the shortfall was largely compensated in the last quarter by achieving a turnover of Rs659 Crores (Previous year Rs384 Crores) on standalone basis which was the historic high turnover in any quarter so far.

During the lean period of first 10 month of the year when exports were not providing adequate business opportunities, the Company focused on domestic trade and import of edible oils to deploy it's resources gainfully to end first 9 months period of the year with marginal profits.

Since announcement of the subsidy on export of Raw Sugar, Indian Raw Sugar prices reconciled to some extent with Global markets and the Company secured large export orders which continued to be executed in the current financial year.

Despite many odds, the Company was able to show stable growth in overall turnover & margins on the back of efficiency and scale of economics. On standalone basis the Company achieved Turnover of ' 1081.00 Crores (previous year Rs1014.59 Crores) with Profit before tax at Rs12.46 Crores (previous year Rs10.53 Crores).

As reported last year the company is continuously strengthening it's marketing network, widening and diversifying it's product range & markets and planning to rope-in more & more customers and explore untapped markets to achieve higher growth in the years to come.

- Working of Subsidiaries :

The working of one subsidiary Company namely Sakuma Exim DMCC in Dubai continued to achieve stable growth. Turnover of Sakuma Exim DMCC during the financial year 2014-15 was AED 244,878,284 (previous year AED 193,266,830). An increase of 26.70% year on year basis with net profit of AED 4,926,092 (previous year AED 1,957,355). GKM General Trading LLC achieved turnover of AED 185,212,500 as against AED 202,294,280 in the previous year with net profit of AED 1,373,706 (previous year 3,05,7411). Looking to the profitability & healthy reserve position, GKM General Trading LLC declared & paid maiden dividend of AED 1,300,000 during the year under review.

Subsidiary Companies in Ghana & Tanzania could not make any significant contribution. As a measure of abundant precaution & safety of human capital, the Company's personnel were called back home due to outbreak of Ebola epidemic in many African countries. Management is considering to re-establish those offices as well as proposes to shortly re-operationalize & strengthen the subsidiary Company in Singapore. We are working to strengthen these subsidiary Companies and expect good performance in near future.

4. DIVIDEND

Your Directors are pleased to recommend a final dividend of Rs1/- per equity share of Rs10 each. The total outgo for the current year amounts to Rs1,97,10,165, including dividend distribution tax of Rs32,83,546/- as against including dividend distribution tax of Rs27,91,589 / - in the previous year.

Note: During the relevant financial year, the company has received dividend from its foreign subsidiary, GKM General Trading LLC, of Rs. 1,75,39,246/- on which the company is liable to pay Rs26,30,887/- as dividend tax u/s 115BBD of the Income Tax Act. As the Dividend received from the foreign subsidiary is higher than the proposed dividend and as the tax paid or payable

on the dividend received from foreign subsidiary is eligible for set-off against liability of dividend distribution tax payable u/s 115-O of the Act, no separate provision for dividend distribution tax is made.

5. SHARE CAPITAL

The paid up Equity Share Capital as on 31st March, 2015 was Rs16.43 Crores. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity. As on 31st March, 2015, the Directors of the Company hold the equity shares of the Company as follows:

Name of the Director Number of Shares % of Total Capital

Chander Mohan Malhotra 14,74,959 8.98

Saurabh Malhotra 32,20,000 19.61

Ashok Kumar Doda 100 0.001

Radhe Shyam 68,053 0.41

Om Parkash Singal 1000 0.01

Shipra Mediratta 500 0.003

6. FINANCE

Cash and cash equivalent as at 31st March, 2015 was Rs25,49,07,830. The Company continues to focus on judicious management of its working capital. Receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.

6.1 DEPOSITS

The Company has not accepted deposit from the public and shareholders falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

6.2 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

7. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

During the financial year the Company was required to spend Rs17.80 lacs towards Corporate Social Responsibility Activities. The Company has not spent any amount towards CSR activities since the Company could not find suitable NGOs or other CSR activity. The Company has provided the said amount in the books of accounts of the Company. The CSR Committee is actively pursuing the matter by talking with NGOs and other institutions through whom CSR corpus can be spent.

8. BUSINESS RISK MANAGEMENT

The nature of business is export and trading in commodities. The inheritant risk to the business of the company is as follows:

a. Foreign Exchange risk

b. Commodity Price risk

c. Risk elements in business transactions

d. Physical risk to cargo

All the above risk has been discussed in the Management Discussion and Analysis Report. The nature of risk is dynamic of business and entrepreneurship. The Company is of the opinion that the formation of Risk management committee is not feasible and in the board meeting there is a formal discussion on risk to the business and how to mitigate the same.

9. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit (IA) function is defined in the Internal Audit Charter. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

The Company monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

10. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The details of the Whistle Blower Policy are explained in the Corporate Governance Report.

11. SUBSIDIARY COMPANIES

11.1 GKM General Trading LLC

11.2 Sakuma Exim DMCC

11.3 Sakuma Exports Pte Limited

11.4 Sakuma Exports (Ghana) Ltd- Step Down Subsidiary

11.5 Sakuma Exports Tanzania Pvt. Ltd- Step Down Subsidiary

11.6 Audited Financial statement of the Company's Subsidiaries

The Statement containing the salient features of financial statement of Subsidiaries in Form AOC-I pursuant to Section 129(3) read with rule 5 of Companies (Accounts) Rules, 2014 are given below:

(Rsin Lacs)

Particulars GKM General Sakuma Exim Trading LLC DMCC (in AED ) (in AED)

Reporting Period Apr - Mar Apr - Mar

Reporting Currency AED AED

Country U.A.E U.A.E

Exchange Rate 16.97 16.97

Share Capital 4.98 8.47

Reserves and Surplus 851.02 1247.62

Total Assets 946.26 12584.61

Total Liabilities 90.26 11328.52

Investment other than Nil Nil

Investment in subsidiary

Turnover 31430.56 41555.84

Profit before taxation 233.12 835.96

Provision for Taxation Nil Nil

Profit after taxation 233.12 835.96

Proposed Dividend 220.61 Nil



Particular Sakuma Exports Sakuma Exports Pte Limited (Ghana) Ltd (in USD) (in GHC)

Reporting Period Apr - Mar Apr -Mar

Reporting Currency USD GHC

Country Singapore Ghana

Exchange Rate 62.52 16.46

Share Capital 103.16 NIl

Reserves and Surplus 20.30 82.49

Total Assets 131.09 119.27

Total Liabilities 7.63 36.78

Investment other than Nil Nil

Investment in subsidiary

Turnover 40.93 278.90

Profit before taxation 4.52 (18.01)

Provision for Taxation 0:47 NIl

Profit after taxation 4.05 (18.01)

Proposed Dividend NIL NIL

12. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company prepared in accordance with relevant Accounting Standards (AS) viz. AS 21 issued by the Institute of Chartered Accountants of India form part of this Annual Report.

13. DIRECTORS:

In terms of the articles of association of the Company, Ms. Shipra Mediratta, Non-Executive Director, retires by rotation at the ensuing annual general meeting and being eligible, offers herself for re-appointment.

In terms of the articles of association of the Company, section 149 (10) of the Companies Act, 2013 and revised clause 49 of Listing Agreement dealing with Corporate Governance norms, Mr. Om Parkash Singal has completed 1 year term as Independent Director as on 31st March, 2015. The Company proposes to re-appoint him, as Independent Director for a further period of 4 years till conclusion of the 14th Annual General Meeting of the Company in the calendar year 2019. The Company has received requisite notices in writing from members proposing Mr. Om Parkash Singal for appointment as Independent Director.

The Company has received declarations from the Independent Director of the Company confirming that they meet with the criteria of independence as prescribed both, under subsection 6 of section 149 of the Companies Act, 2013 and under clause 49 of the listing agreement with the stock exchanges.

13.1 Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholders Relationship Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

13.2 Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

13.3 Meetings

A calendar of Meetings is prepared and circulated in advance to the Directors.

During the year four Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

14. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013:

a) that in the preparation of the annual financial statements for the year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that such accounting policies as mentioned in Note 2 of the Notes to the Financial Statements have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the profit of the Company for the year ended on that date;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the annual financial statements have been prepared on a going concern basis;

e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

15. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. Thus disclosure in form AOC-2 is not required. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis.

None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

16. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

17. AUDITORS

17.1 Statutory Auditors

M/s. S. N. K. & Co., Chartered Accountants, the outgoing auditors has expressed their unwillingness to be re-appointed as auditors of the company.

It is proposed to appoint M/s M.L Sharma & Co., Chartered Accountant as Statutory Auditor of the company in place of M/s. S. N. K. & Co., Chartered Accountants. The Company has received a letter from M/s M.L Sharma & Co. Chartered Accountant to the effect that their appointment if made would be maintain be within the prescribed limit under Section 141(1)(g) of the Companies Act, 2013 and that they are willing to act as statutory auditors of the company.

17.2 Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs P. P. Shah & Co., a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith as "Annexure B".

17.3 Qualifications in the Secretarial Report

A. Appointment of Company Secretary & Chief Financial Officer:

As per section 203(1)(ii) & (iii), the Company is required to appoint Company Secretary & Chief Financial Officer. The Company has not appointed Company Secretary & Chief Financial Officer. In this regard the management of the Company has provided the following reply:

(i) The Company has appointed Mr. Raju Pillai as Compliance Officer of the Company who looks after the compliance of Companies Act, 2013 and SEBI Act and rules made thereunder.

(ii) The Company has availed the services of Practicing Company Secretary for advising on compliance of Companies Act, 2013 and SEBI Act and rules made thereunder

(iii) The Volume and Scope of work for the Company Secretary is less and it is not a full time work and the job of Company Secretary is not attractive commensurate with the scope of work and salary.

B. Corporate Social Responsibility:

As per section 135 of the Companies Act, 2013, the CSR is applicable to the Company. The Company is required to spend approximately Rs17.80 lakhs. During the financial year ended 31st March, 2015, the Company has not spent the said amount on eligible CSR activities. In this regard the management of the Company has provided the following reply:

(i) The Company has made the provisions in the books of accounts and transfer the amount Rs17.80 lakhs to CSR and the company will spent the same in current year

18. ENHANCING SHAREHOLDERS VALUE

Your Company believes that its Members are among its most important stakeholders. Accordingly, your Company's operations are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.

19. CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company's Auditors confirming compliance forms an integral part of this Report.

20. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is given below:

In pursuance of the provisions of section 143(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014, the particulars relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is given below:

A. Conservation of Energy

The operations of the Company are not energy intensive. However, wherever possible the Company strives to curtail the consumption of energy on continued basis.

B. Technology absorption, adaptation and innovation

No expenditure has been incurred by the Company on research and Development activities during the year under review.

C. Foreign Exchange Earning & Outgo:

(Amount in Rs.)

For the year ended For the year ended Particulars 31 March, 2015 31 March, 2014

(a) Expenditure in Foreign Currency

- Professional and consultation fees 15,336 -

- Business Promotion 58,316 -

- Inspection Charges 1,05,246 -

- Cargo Storage Charges 1,49,797 -

- Travelling Expenses 44,37,505 21,83,838

- Ocean Freight 10,68,77,949 14,15,383

- Import of Goods 1,38,23,83,752 19,16,55,112

(b) Earnings in Foreign Currency

- Export of goods on FOB basis. 4,39,08,57,964 8,54,76,06,724

21. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "Annexure C".

22. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of 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 employees' 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 Compliance Officer in this regard.

23. ACKNOWLEDGEMENTS

Your Directors thank the various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.

24. CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion & Analysis describing the Company's objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company's operations include global and domestic demand and supply conditions affecting selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.

For and on behalf of the Board of Directors

Sd/- Sd/- Mumbai (Chander Mohan) (Saurabh Malhotra) Date: 15th May, 2015 Chairman Managing Director


Mar 31, 2014

Dear Members,

The Directors take pleasure in presenting their Ninth Annual Report on the business and operations of your Company together with audited statement of accounts for the year ended 31st March 2014.

Financial Highlights

FINANCIAL RESULTS FOR THE YEAR ENDED MARCH 31, 2014 (Rs'' in lacs)

Standalone 2013-14 2012-13

Sales & Other Income 1,01,459.22 62,189.26

Profit before depreciation & Tax 1,132.64 694.32

Depreciation 79.32 88.56

Profit before Tax 1,053.32 605.76

Provision for Tax

- Current Tax 365.00 181.21

- Deferred Tax (16.17) (15.70)

- Income Tax of Earlier years (0.61) 21.69

Minority Interest and share of loss of associate

Net Profit after tax 705.10 418.56

Add: Surplus from previous period 1,127.07 899.42

Profit Available for Appropriation 1,832.17 1317.98

Appropriation

Dividend on Equity Shares 164.26 164.26

Dividend Tax 27.92 26.65

Excess provision of Reversed back - -

Transfer to Statutory Reserve - -

Balance carried to Balance Sheet 1,639.99 1,127.07

Consolidated 2013-14 2012-13

Sales & Other Income 1,58,182.06 81,576.11

Profit before depreciation & Tax 2,217.26 954.48

Depreciation 79.70 88.81

Profit before Tax 2,137.56 865.67

Provision for Tax

- Current Tax 365.79 181.21

- Deferred Tax (16.17) (15.70)

- Income Tax of Earlier years (0.61) 21.69

Minority Interest and share of loss of associate 158.32 35.74

Net Profit after tax 1630.23 642.73

Add: Surplus from previous period 1399.77 957.17

Profit Available for Appropriation 3032.12 1,599.90

Appropriation

Dividend on Equity Shares 164.26 164.26

Dividend Tax 27.92 26.65

Excess provision of Reversed back - 9.22

Balance carried to Balance Sheet 2,901.201 1,399.78

Operations Review and Future Prospects

During the year, company scaled new heights in its operations. As reported in the previous annual report, deficient crop production during the crop year 2012-2013, affected adversely our business in the first half of the year and turnover declined to Rs. 270.42 Crore for the half year ended 30th September 2013 including domestic sales of Rs. 71.75 Crore. Operations improved significantly from October 2013 onwards as sugar crop 2013-2014 was much better. Exports during the second half year improved nearly three times from Rs. 198.67 Crore to Rs. 683.72 Crore. During the whole year the company achieved turnover of Rs. 1000.45 Crore and profit before tax Rs. 10.53 Crore as against Rs. 608.23 Crore and Rs. 6.06 Crore respectively during 2012-13; increase of 64.50% and 73.76% over last year in top line and bottom line respectively Diversification drive in product range initiated during last year showed positive results and share of products other than sugar increased from Rs. 103.49 Crore in 2012-13 to Rs. 229.74 Crore 2013-14. While we made good beginning in export of cotton the company also exported rice, wheat, etc. We are further strengthening our marketing efforts in export of these commodities in the light of experience gained during the year. During the year we also added two new commodities to our import namely Edible oil and Coal. . With above initiatives the turnover and profitability of the company is expected to improve.

The Government Policy has been by and large stable as regards export of sugar. However we faced acute liquidity crunch during the year. We got enhancement in our credit limits under Consortium System by including two more banks namely Indian Overseas Bank and Axis Bank Ltd.

The working of our Subsidiaries in Dubai achieved impressive growth. The turnover of Sakuma Exim DMCC during the financial year 2013-2014 was AED 19,32,66,830 as against AED 5,84,06,848 an increase of 230.90%. The Turnover of G.K.M General Trading LLC increased from AED 8,69,28,024 in the preceding year to AED 20,22,94,280 during the financial Year 2014, an increase of 132.71%. Our Subsidiaries in Ghana and Singapore commenced operation, though in a humble way, after overcoming

the teething troubles and acclimatizing with the local business environment, regulatory requirements, local trade practices and logistics systems.

As a result of good performances of subsidiaries in Dubai we made a substantial gains in consolidated turnover and profits increased from Rs. 812.16 Crore and Rs. 6.78 Crores in 2012-13 to Rs. 1578.64 Crore and Rs. 17.89 Crore respectively in 2013-14; increase of 94.37% in topline and 163.86% in bottom line. With the heartening growth of subsidiaries in Dubai and stabilization of subsidiaries at Ghana and Singapore we expect further improvement in the consolidated performance of the company in future years.

Dividend

The Board of Directors has recommended dividend of 10% on equity shares (i.e. Rs. 1 per equity share) for the financial year ended 31st March, 2014 amounting to Rs. 164,25,943/-. The dividend tax liability on equity shares to be borne by your Company is Rs..27,91,589/-.

Directors:

In terms of the articles of association of the Company, Ms. Shipra Mediratta, Non-Executive Director, retires by rotation at the ensuing annual general meeting and being eligible, offers herself for re-appointment.

In terms of the articles of association of the Company, section 149 (10) of the Companies Act, 2013 and revised clause 49 of Listing Agreement dealing with Corporate Governance norms, Mr. Ashok Kumar Doda and Mr. Radhe Shyam has completed 5 years term as Independent Directors as on 1st April, 2014. The Company proposes to re-appoint them, as Independent Directors for a further period of 5 years till 2019. The Company has received requisite notices in writing from members proposing Mr. Ashok Kumar Doda and Mr. Radhe Shyam for appointment as Independent Directors.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both, under subsection 6 of section 149 of the Companies Act, 2013 and under clause 49 of the listing agreement with the stock exchanges.

Investment in Subsidiary Companies and Joint Ventures

During the financial year the Subsidiary Company at Singapore incorporated a wholly owned subsidiary in Tanzania named as Sakuma Exports Tanzania Private Limited. The company was incorporated on 13th July, 2013. During the financial year 2013-14 there was no operation in the company.

Subsidiary Companies

In terms of Section 212(a) of the Companies Act, 1956, the Central Government, Ministry of Corporate Affairs vide its General Circular 2/2011 dated 8th February, 2011 has granted a general exemption to the Company from the requirement of attaching to its annual report, the Balance Sheet, Profit and Loss Account and the report of the Directors and Auditors thereon of its subsidiary. Accordingly the same is not attached to the Balance Sheet of the Company. Shareholders who wish to obtain a copy of Annual Accounts of subsidiary company may write to the Compliance Officer at the registered office of the Company. Members can also email their request at the email address of the Compliance Officer, Mr. Raju Pillai; companysecreatary@sakumaexportsltd.com.

Statement pursuant to general exemption received under section 212(8) of the Companies Act, 1956 relating to subsidiary companies

(Amount in Lacs)

Particulars GKM General Sakuma Exim Sakuma Exports Sakuma Export Trading LLC DMCC Pte Limited (Ghana) Ltd

Reporting Currency AED AED USD GHC

Country U.A.E U.A.E Singapore Ghana

Exchange Rate 16.32 16.32 60.09 22.85

Share Capital 4.31 7.00 0.58 -

Reserves and Surplus 806.39 395.90 15.63 2.37

Total Assets 3260.57 3849.031 381.891 371.27

Total Liabilities 3260.57 3849.03 381.89 371.27

Investment other than Nil Nil Nil Nil

Investment in subsidiary

Turnover 34027.37 32063.02 1066.16 308.92

Profit before taxation 791.58 426.73 15.62 (147.58)

Provision for Taxation Nil Nil Nil 0.79

Profit after taxation 791.58 426.73 15.62 (148.37)

Proposed Dividend Nil Nil Nil Nil

Consolidated Financial Statements

In accordance with the accounting standards (AS — 21) on Consolidated Financial Statements, read with AS — 23 on accounting for investments in associates and AS — 27 on financial reporting of interest in joint ventures, the audited consolidated financial statement is provided in the annual report.

Corporate Social Responsibility

Pursuant to section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules, 2014, the provisions of Corporate Social Responsibility (CSR) are applicable to the Company w.e.f. 1st April, 2014. Accordingly, your Directors have constituted the CSR Committee comprising the following Directors:

a. Mr. Chander Mohan: Chairman

b. Ms. Shipra Mediratta: Member

c. Mr. O P Singhal: Member Public Deposits

The company has neither invited nor accepted any public deposits during the year under review.

Directors'' Responsibility Statement

Pursuant to section 217 (2AA) of the Companies Act, 1956, the Directors to the best of their knowledge and belief confirm that

(i) In the preparation of the annual accounts for the financial year ended March 31st, 2014, all the applicable accounting standards have been followed along with proper explanations relating to material departures.

(ii) Appropriate accounting policies have been selected and applied 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, 2014 and of the profit of the Company for the said 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; and

(iv) The annual accounts have been prepared on a ''going concern'' basis.

Auditors

M/s. S N K & Co., Chartered Accountants, will retire as Auditors of the Company at the conclusion of the Annual General Meeting and are eligible for re-appointment. The Company has received a letter from them to the effect that their appointment if made would be within the prescribed limit under Section 224(1B) of the Companies Act, 1956.

Audit Committee of the Board has recommended their re-appointment.

Corporate Governance

A Report on the Corporate Governance Code along with a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as also the Management Discussion and Analysis Report, stipulated under Clause 49 of the Listing Agreement are annexed to this Report.

Conservation of Energy, Research & Development, Technology Absorption, Foreign Exchange Earning and Outgo.

In pursuance of the provisions of section 217(2)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of particulars in the Report of Board of Directors) Rules 1988, the particulars relating to conservation of energy, technology absorption and foreign exchange earning and outgo is given below:

A. Conservation of Energy

The operations of the Company are not energy intensive. However, wherever possible the Company strives to curtail the consumption of energy on continuous basis.

B. Technology absorption, adaptation and innovation

No expenditure has been incurred by the Company on research and Development activities during the year under review.

C. Foreign Exchange Earning & Outgo:

(Amount in ''Rs)

Particulars 2013-14 2012-13

(a) Expenditure in Foreign Currency

- Professional and Consultation Fees - 88,400

- Travelling Expenses 21,83,838 14,50,175

- Commission 14,15,383 Nil

- Import 19,16,55,112 43,13,92,054

(b) Earnings in Foreign Currency

- Export of Goods on FOB basis. 8,54,76,06,724 5,16,78,41,786

Particulars of Employees

There is no employee in the Company drawing monthly remuneration of Rs. 5,00,000/- per month or Rs. 60,00,000/- per annum or more. Hence the Company is not required to disclose any information as per Companies (Particulars of Employees) Rules, 1975.

Acknowledgements

The Directors take pleasure in thanking the Company''s business associates / customers, vendors and bankers for their continued support. The Directors also acknowledge and appreciate the sincere efforts, contribution and cooperation of the employees.

For and on behalf of the Board of Directors

Place :Mumbai (Chander Mohan) (Saurabh Malhotra) Dated: 15th May, 2014 Chairman Managing Director


Mar 31, 2013

The Directors take pleasure in presenting their Eighth Annual Report on the business and operations of your Company together with audited statement of accounts for the year ended 31st March 2013.

Financial Highlights

FINANCIAL RESULTS FOR THE YEAR ENDED MARCH 31, 2013

(Rs.in lacs) Standalone Consolidated 2012-13 2011-12 2012-13 2011-12

Sales & Other Income 62,189.26 96,560.30 81,576.11 97,837.45

Profi t before depreciation & Tax 694.32 1093.53 954.48 1180.62

Depreciation 88.56 82.80 88.81 82.91

Profi t before Tax 605.76 1010.73 865.67 1097.70

Provision for Tax Current Tax 181.21 333.00 181.21 333.00

Deferred Tax (15.70) (22.03) (15.70) (22.03)

Income Tax of Earlier years 21.69 31.00 21.69 31.00

Minority Interest and share of loss of associate 35.74 19.93

Net Profi t after tax 418.56 668.76 642.73 735.81

Add: Surplus from previous period 899.42 420.30 957.17 420.30

Profi t Available for Appropriation 1317.98 1089.05 1,599.90 1156.10

Appropriation

Dividend on Equity Shares 164.26 164.26 164.26 164.26

Dividend Tax 26.65 26.65 26.65 26.65

Excess provision of Reversed back 0 (1.27) 0 (1.27)

Transfer to Statutory Reserve 0 9.22 9.29

Balance carried to Balance Sheet 1,127.07 899.42 1,399.77 957.17

Operations Review and Future Prospects

The year was full of diffi culties for the company. Delayed and defi cient rainfall during the year affected the sugar crop adversely, particularly in the state of Maharashtra, our main procurement centre. This not only led to shrinkage of domestic supply of sugar but also to increase in sugar prices making exports in-competitive. Alarmed by the situation, government of India put restrictions on export of sugar. Though later these restrictions were relaxed. Fast changing government policies resulted in high volatility in sugar prices making it diffi cult and risky to enter into contracts with extended periods which affected the trade adversely. Another problem faced by International Trade was volatile exchange rates. Owing to above reasons working of Mumbai Offi ce had a setback. Due to global factors namely melt down of few European economies after effects of sub-prime also affected the international trade adversely. These conditions also led to fl uctuations in commodity prices. To cope with the above developments, our company diversifi ed it’s business by promoting export of other agricultural commodities mainly Cotton, Maize and Rice. Lot of efforts and time were spent in identifying the sources, the logistics devices, export markets, brokers and clients for diversifi cation of our exports. As a result the turnover of company (standalone) during the second and third quarter was very low. It improved in the fourth quarter when export of new commodities as mentioned above started picking up. Later, in the year restrictions on sugar were also removed / relaxed and we undertook export of sugar in smaller quantities whenever viable. Despite all above adversaries the company (standalone) achieved turnover of 618.82 Crores and profi t before tax of 6.06 Crores.

The Future Prospects:

Working of our subsidiaries in Dubai has been encouraging. Our subsidiaries made substantial progress in their business by undertaking local sales and third country exports. The turnover of SAKUMA EXIM DMCC during the fi nancial year 2012- 2013 was AED 584,06,848 . The turnover of G.K.M. General Trading LLC increased from AED 218,77,710 in the preceding year to AED 869,28,024 during the fi nancial year 2013.

As a result of good performance of the subsidiaries, we were able to maintain the bottom-line for the company as a whole with profi t after tax of 6.43 Crores though there was decline in overall sales from Rs. 978.37 Crores to Rs. 812.16 Crores.

Last year’s defi cient rain will have an adverse impact on production of sugar cane during the year 2013-14 as well. We propose to strengthen and diversify the export of the other commodities and for the purpose we also propose to open few more offi ces abroad. During the year, we opened our offi ce by promoting our subsidiary company namely SAKUMA EXPORTS PTE.LTD. in Singapore, which is a commercial hub.

Dividend

The Board of Directors has recommended dividend of 10% on equity shares (i.e. Rs. 1 per equity share) for the fi nancial year ended 31st March, 2013 amounting to Rs.. 164,25,943/-. The dividend tax liability on equity shares to be borne by your Company is Rs..26,64,700/-.

Directors:

Ms. Shipra S. Mediratta, Non-Executive Director retires by rotation and being eligible, offers herself for re-appointment.

Mr. Om Prakash Singal is inducted as an additional director w.e.f 5th November, 2012 and holds offi ce up to ensuing Annual General Meeting of the Company. The Company has received notice from the members pursuant to Section 257 of the Companies Act, 1956, signifying their intention to propose the candidature of Mr. Om Prakash Singal for the offi ce of director.

Item No. 5 of the notice convening Annual General Meeting of the Company contains the resolutions for the re-appointment of respective Directors.

Mr. Satyendra Sonar resigned as Director of the Company w.e.f. 27th September, 2012. The Board of Directors placed on record the valuable contribution made by Mr. Satyendra Sonar during his tenure.

Shri. Chander Mohan and Shri. Saurabh Malhotra, have been re-appointed as Executive Chairman and Managing Director respectively w.e.f. 1st September, 2013. The necessary resolution for their re-appointment is given at item no 6 and 7 of the notice.

Investment in Subsidiary Companies.

During the fi nancial year the Company has incorporated a wholly owned subsidiary in Singapore named as Sakuma Exports Pte Ltd. The company was incorporated on 25th January 2013. During the fi nancial year 2012-13 there is no operation in the company.

Subsidiary Companies

In terms of Section 212(a) of the Companies Act, 1956, the Central Government, Ministry of Corporate Affairs vide its General Circular 2/2011 dated 8th February, 2011 has granted a general exemption to the Company from the requirement of attaching to its annual report, the Balance Sheet, Profi t and Loss Account and the report of the Directors and Auditors thereon of its subsidiary. Accordingly the same is not attached to the Balance Sheet of the Company. Shareholders who wish to obtain a copy of Annual Accounts of subsidiary company may write to the Compliance Offi cer at the registered offi ce of the Company. Members can also email their request at the email address of the Compliance Offi cer, Mrs. Jyoti Deshpande; jyotip@sakumaexportsltd.com.

Statement pursuant to general exemption received under section 212(8) of the Companies Act, 1956 relating to subsidiary companies

(Rs.in Lacs)

Sr. No Particulars GKM General Trading LLC Sakuma Exim DMCC (in Rs.) (Rs.)

Reporting Currency AED AED

Country U.A.E U.A.E

Exchange Rate 14.78 14.78

i) Share Capital 4.31 7.00

ii) Reserves and Surplus 278.37 69.62

iii) Total Assets 7259.97 2070.65

iv) Total Liabilities 6977.29 1994.03

v) Investment other than Investment in subsidiary Nil Nil

vi) Turnover 12796.94 8614.71

vii) Profit before taxation 178.72 69.79

viii) Provision for Taxation Nil Nil

ix) Profi t after taxation 178.72 69.79

x) Proposed Dividend Nil Nil

Public Deposits

The company has neither invited nor accepted any public deposits during the year under review.

Directors’ Responsibility Statement

Pursuant to section 217 (2AA) of the Companies Act, 1956, the Directors to the best of their knowledge and belief confi rm that

(i) In the preparation of the annual accounts for the fi nancial year ended March 31, 2013, all the applicable accounting standards have been followed along with proper explanations relating to material departures.

(ii) Appropriate accounting policies have been selected and applied 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 profi t of the Company for the said period;

(iii) Proper and suffi cient 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; and

(iv) The annual accounts have been prepared on a ‘going concern’ basis.

Auditors

M/s A. R. Sodha & Co. Chartered Accountants, will retire as Auditors of the Company at the conclusion of the Annual General Meeting. M/s. A. R. Sodha & Co., has expressed their inability to act as statutory auditors of the Company.

It is proposed to appoint M/s. S N K & Co., Chartered Accountants, as statutory auditors of the Company in place of M/s. A. R. Sodha & Co. The Company has received a letter from M/s. S N K & Co., Chartered Accountants, to the effect that their appointment if made would be within the prescribed limit under Section 224(1B) of the Companies Act, 1956 and that they are willing to act as statutory auditors of the Company.

Audit Committee of the Board has recommended their appointment

Corporate Governance

A Report on the Corporate Governance Code along with a certifi cate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as also the Management Discussion and Analysis Report, stipulated under Clause 49 of the Listing Agreement are annexed to this Report.

Conservation of Energy, Research & Development, Technology Absorption, Foreign Exchange Earning and Outgo.

In pursuance of the provisions of section 217(2)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of particulars in the Report of Board of Directors) Rules 1988, the particulars relating to conservation of energy, technology absorption and foreign exchange earning and outgo is given below:

A. Conservation of Energy

The operations of the Company are not energy intensive. However, wherever possible the Company strives to curtail the consumption of energy on continued basis.

B. Technology absorption, adaptation and innovation

No expenditure has been incurred by the Company on research and Development activities during the year under review.

C. Foreign Exchange Earning & Outgo:

(Amount in Rs.)

Particulars 2012-13 2011-12

(a) Expenditure in Foreign Currency

- Professional and Consultation Fees 88400

- Travelling Expenses 14,50,175 9,20,976

- Commision Nil 97,671

Import 431,392,054 600,439,150

(b) Earnings in Foreign Currency

- Export of Goods on FOB basis. 516,78,41,786 729,76,83,203

Particulars of Employees

There is no employee in the Company drawing monthly remuneration of ?.5,00,000/- per month Or ?.60,00,000/- per annum. Hence the Company is not required to disclose any information as per Companies (Particulars of Employees) Rules, 1975.

Acknowledgements

The Directors take pleasure in thanking the Company’s business associates / customers, vendors and bankers for their continued support. The Directors also acknowledge the appreciation of the sincere efforts, contribution and cooperation of the employees.

For and on behalf of the Board of Directors

Mumbai (Chander Mohan) (Saurabh Malhotra)

Date: 29th May, 2013 Chairman Managing Director

 
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