Mar 31, 2023
Your Directors have pleasure in presenting the Twenty-Eight (28th) Integrated Annual Report together with the Audited Standalone and
Consolidated Financial Statements for the financial year ended March 31,2023 (âFY 2023â).
FINANCIAL HIGHLIGHTS
A summary of the Company''s financial performance in FY 2023 is as follows:
Particulars |
Standalone |
Consolidated |
||
FY 2023 |
FY 2022* |
FY 2023 |
FY 2022 |
|
Revenue from Operations |
50,959.92 |
43,310.99 |
51,582.47 |
43,961.22 |
Add: Other Income |
497.11 |
406.62 |
504.12 |
413.54 |
Total Income |
51,457.03 |
43,717.61 |
52,086.59 |
44,374.76 |
Profit before Depreciation & Amortisation, Finance |
11,592.05 |
11,045.93 |
11,515.52 |
11,087.76 |
Profit before Depreciation & Amortisation, Finance Cost, |
12,089.16 |
11,452.55 |
12,019.64 |
11,501.30 |
Less: Finance Cost |
1,951.26 |
1,730.13 |
2,012.26 |
1,760.89 |
Less: Depreciation & Amortisation Expense |
4,753.19 |
3,829.74 |
4,858.85 |
3,930.52 |
Profit before share of net profit/ (loss) of associate, |
5,384.71 |
5,892.68 |
5,148.53 |
5,809.89 |
Share of net profit/ (loss) of associate |
(261.22) |
(104.03) |
||
Profit before Exceptional items & Tax Expense |
5,384.71 |
5,892.68 |
4,887.31 |
5,705.86 |
Less: Exceptional items |
466.39 |
73.25 |
73.25 |
|
Profit before Tax Expense |
4,918.32 |
5,819.43 |
4,887.31 |
5,632.61 |
Less: Taxation Expense |
1,356.20 |
1,444.33 |
1,356.97 |
1,451.72 |
Profit for the year |
3,562.12 |
4,375.10 |
3,530.34 |
4,180.89 |
Other Comprehensive Income/ (Loss) |
(2,043.24) |
2,430.02 |
(1,690.99) |
2,112.10 |
Total Comprehensive Income for the year |
1,518.88 |
6,805.12 |
1,839.35 |
6,292.99 |
Retained Earnings |
||||
Balance at the beginning of FY |
16,087.53 |
12,379.13 |
15,321.39 |
11,908.06 |
Add: Profit for the FY |
3,562.12 |
4,375.10 |
3,532.01 |
4,203.92 |
Add: Opening balance of ESOP Trust |
123.89 |
|||
Add: Exercise/ Lapse of share options |
83.41 |
23.14 |
83.41 |
23.14 |
Less: Exercise/ Sale of shares held by ESOP Trust (Net |
(100.05) |
(23.57) |
(100.05) |
(23.57) |
Less: Dividend paid on Equity Shares |
(791.81) |
(791.81) |
(791.81) |
(791.81) |
Less: Acquisition of non controlling interest |
(240.86) |
|||
Add: Dividend on shares held by ESOP Trust |
1.62 |
1.65 |
1.62 |
1.65 |
Balance at the end of FY |
18,842.82 |
16,087.53 |
17,805.71 |
15,321.39 |
RESULTS OF OPERATIONS AND THE STATE OF COMPANY''S AFFAIRS
The Company delivered healthy revenue growth and strong profitability amidst significant inflationary headwinds, while accelerating its
network expansion. During the year, the Company has added 240 stores (net), ending the year with 1,863 stores across all brands in India.
The Company had 1,816 Domino''s, 13 Popeyes, 21 Dunkin'' and 13 Hong''s Kitchen stores as on March 31,2023.
The total income on a standalone basis for FY 2023 reached to H 50,959.92 million which is higher by 17.7% compared to last year. The
EBITDA of H 11,592.05 million increased by 4.9%. The EBITDA margin at 22.7%, decreased by 276 bps and the net profit margin at 7.0%
is lower by 308 bps when compared to last year. During FY 2023, the Company has not transferred any amount to the general reserve
and entire amount of profit for the year forms part of the âRetained
Earnings''.
The operating context and the performance highlights has been
comprehensively discussed in Management Discussion and
Analysis Report forming an integral part of this Integrated Annual
Report.
SHARE CAPITAL
As on March 31, 2023, the paid-up and subscribed share
capital of the Company stood at H 1,319,690,400/- divided into
659.845.200 equity shares of H 2/- each.
Your Board of Directors approved split/sub-division of equity shares
of the Company on February 2, 2022 and the same was approved
by the shareholders by resolution passed by way of postal ballot on
March 27, 2022, such that each equity share having face value of
H 10/- (Rupees Ten only) fully paid-up, was sub-divided into five (5)
equity shares having face value of H 2/- (Rupees Two only) each, fully
paid-up with effect from April 20, 2022 (Record Date).
Accordingly, the authorised share capital of the Company was
altered as H 1,500,000,000/- divided into 750,000,000 equity
shares of H 2/- each and the paid-up and subscribed share capital
of the Company was altered as H 1,319,690,400/- divided into
659.845.200 equity shares of H 2/- each.
DIVIDEND
Based on the Company''s performance and Dividend Distribution
Policy of the Company, your Directors are pleased to recommend
Dividend of H 1.20/- (i.e. 60%) per equity share of H 2/- each fully
paid up for FY 2023 amounting to H 791.81 million. The payment
of dividend is subject to approval of the shareholders at the
forthcoming Annual General Meeting (âAGM'') of the Company and
shall be subject to deduction of tax at source.
EMPLOYEES STOCK OPTION SCHEMES
With a view to attract, reward and retain talented and key employees
in the competitive environment and encourage them to align
individual performance with Company objectives, the Company
grants share based benefits to eligible employees under the
ESOP Schemes. The Company has two Employees Stock Option
Schemes namely, JFL Employees Stock Option Scheme, 2011
(''ESOP 2011'') and JFL Employees Stock Option Scheme, 2016
(''ESOP 2016'') (collectively referred as âESOP Schemes''). Both
the schemes are administered through JFL Employees Welfare
Trust (''ESOP Trust''). Consequent to split/sub-division of equity
shares of the Company with effect from April 20, 2022 (Record
Date), appropriate adjustments were made in the number of stock
options that have been granted under the ESOP Schemes and
yet to be exercised (whether vested or unvested but not lapsed)
such that each such stock options shall be sub-divided into Five
(5) stock options of the same category and the respective exercise
price for each such stock option shall be one fifth (1/5) of the
exercise price fixed at the time of grant of such options. Also, the
ceiling(s) on the maximum number of options/shares that may be
issued pursuant to exercise of options granted to the participants
under the ESOP Schemes shall stand proportionately increased.
The details of both the schemes have also been disclosed in
Note 32 to the Standalone Financial Statements and Note 31 to
the Consolidated Financial Statements forming an integral part of
this Integrated Annual Report.
The Company has Jubilant FoodWorks General Employee
Benefits Scheme, 2020 (âJFGEBS'') which was approved with the
objective of providing healthcare (including preventive measures),
hospital care, or benefits in the event of sickness, accident,
disability, death or scholarship funds, rewards and recognitions,
education, employee engagement, training for skill enhancement/
development and such other welfare activities and benefits
specified by the Company. The JFGEBS would be implemented
and administered by the ESOP Trust. JFGEBS does not involve
issue of shares by the Company for the purposes of JFGEBS and
also does not involve any secondary acquisition by the ESOP Trust.
ESOP Schemes and JFGEBS are in compliance with the SEBI
(Share Based Employee Benefits and Sweat Equity) Regulations,
2021, as amended (the âSEBI ESOP Regulations 2021''). The
details of ESOP Schemes and JFGEBS pursuant to SEBI ESOP
Regulations, 2021 as at March 31,2023 is uploaded on the website
of the Company (web link: https://www.iubilantfoodworks.com/
company-reports/esop-disclosures). In terms of Regulation 13 of
SEBI ESOP Regulations 2021, the Certificate from Chandrasekaran
Associates, Company Secretaries, Secretarial Auditors, would be
placed before the shareholders at the ensuing AGM.
SUBSIDIARIES AND ASSOCIATE COMPANIES
Jubilant FoodWorks Bangladesh Limited (âJubilant
Bangladeshâ):
Jubilant Bangladesh is a subsidiary of the Company in Bangladesh.
Jubilant Bangladesh has exclusive rights to develop and operate
Domino''s stores in Bangladesh.
During the financial year, the Company has completed 100%
acquisition of Jubilant Bangladesh by exercising the call options
for acquiring additional 49% equity stake in Jubilant Bangladesh
from Golden Harvest QSR Limited (âGolden Harvest'') at a
consideration amounting to BDT 389.02 million (equivalent to
H 340.25 million). Consequent to completion of acquisition on May
10, 2022, Jubilant Bangladesh became wholly owned subsidiary
of the Company (with 1 share of Jubilant Bangladesh being held
by a nominee of the Company in order to comply with local law
requirements in Bangladesh).
The name of the company was changed from Jubilant Golden
Harvest Limited to Jubilant FoodWorks Bangladesh Limited with
effect from July 7, 2022.
During the financial year, Jubilant Bangladesh launched ever-
highest number of stores in a financial year. 8 new stores were
launched taking the total count to 17 stores. The performance of
Jubilant Bangladesh continues to remain encouraging. A series
of intervention on menu expansion, packaging innovation and
launch of âLive Pizza Theatreâ - live-streaming of pizza preparation,
helped enhance consumer engagement. The system sales growth
of 46.8% was on the back of Dine-in and Takeaway growth. The
total income of Jubilant Bangladesh grew by 38.30% as on March
31,2023 and is H 347.76 million as compared to H 251.45 million
in the previous year.
Jubilant FoodWorks Lanka (Private) Limited (âJubilant Sri
Lankaâ):
Jubilant Sri Lanka is a wholly owned subsidiary of the Company in
Sri Lanka. Jubilant Sri Lanka has exclusive rights to develop and
operate Domino''s stores in Sri Lanka.
The pace of store expansion increased with the launch of 13 stores
taking the total count to 48. Despite economic challenges during
the financial year, the system sales grew by 35.7% led by growth
in dine-in and takeaway channel. Focused efforts through various
initiatives like rationalizing discounts, reducing wastages, targeted
marketing activities and digital ordering interventions ensured
business continuity. The total income reduced by 17.33% and is H
417.60 million as on March 31,2023 compared to H 505.15 million
in the previous year.
Jubilant Foodworks Netherlands B.V. (âJubilant Netherlandsâ)
and DP Eurasia N.V. (âDPEUâ):
Jubilant Netherlands is a wholly owned subsidiary of the
Company in Netherlands. During the financial year, Jubilant
Netherlands has increased its stake in DPEU through various
on-market purchases. The Company through Jubilant Netherlands
is holding 71,413,939 ordinary shares in DPEU representing
49.04% of its issued share capital as on March 31, 2023.
DPEU is a public company listed with London Stock Exchange
PLC, and is the exclusive master franchisee of the Domino''s
Pizza brand in Turkey, Russia, Azerbaijan and Georgia. The total
income of Jubilant Netherlands is nil as on March 31, 2023
(H 0.54 million in the previous year).
Jubilant FoodWorks International Investments Limited
(âJubilant Internationalâ):
Jubilant FoodWorks International Investments Limited was
incorporated as a wholly owned subsidiary of the Company in
India on August 8, 2022. Jubilant International is an Investment
Company with an objective of making investments in associates/
subsidiaries engaged in food service business. The total income
of Jubilant International is H 1.55 million as on March 31,2023.
Jubilant FoodWorks International Luxembourg (âJubilant
Luxembourgâ):
The Company along with Jubilant FoodWorks International
Investments Limited (wholly owned subsidiary) has incorporated
a subsidiary Company i.e. Jubilant FoodWorks International
Luxembourg on September 21, 2022 in Luxembourg. Jubilant
Luxembourg has been incorporated with an objective of making
investments in associates/subsidiaries engaged in food service
business. The total income of Jubilant Luxembourg is nil as on
March 31,2023.
With an intent of making strategic investments in promising
start-ups and emerging businesses and in line with its stated goal of
building a multi-brand and multi-country food business powered by
technology, the Company has made following acquisition(s):
a) Hashtag Loyalty Private Limited (âHashtagâ):
Hashtag became an associate company on acquisition of
35% stake (on fully diluted basis) w.e.f. March 31, 2022.
Further, Hashtag entered into a Securities Subscription
Agreement dated April 17, 2023 with a new investor pursuant
to which the new investor has acquired 15% stake (on a
fully diluted basis) in Hashtag. Accordingly, the Company''s
stake in Hashtag has reduced from 35% to 29.75% (on a fully
diluted basis).
Hashtag is engaged in the business of providing a platform
which allows brands their own online ordering systems
to accept direct orders from customers and provides an
enterprise-grade omnichannel customer engagement &
marketing automation platform. The total income grew
by 12.69% and is H 25.39 million as on March 31, 2023
compared to H 22.53 million in the previous year.
b) Wellversed Health Private Limited (âWellversedâ):
Wellversed became an associate company on acquisition of
25.02% stake (on fully diluted basis) on May 2, 2022.
Wellversed is a nutrition company offering a variety of food
products tailored for specific nutrition and dietary needs
including keto, gluten-free, vegan, high-protein, diabetic
and immunity. The total income grew by 183.61% and is
H 347.14 million as on March 31, 2023 compared to
H 122.40 million in the previous year.
c) Roadcast Tech Solutions Private Limited (âRoadcastâ):
The Company entered into Share Subscription Agreement,
Shareholders'' Agreement and Share Purchase Agreement
dated July 28, 2022 to invest approx. H 149.8 million for
acquisition of 40% stake (on fully diluted basis) in Roadcast.
The aforesaid acquisition was completed on September 29,
2022 and Roadcast became an associate company.
Roadcast is engaged in the business which offers a logistics
platform for management of last-mile delivery operations.
Roadcast''s delivery automation SaaS platform helps clients
to monitor their fleet and personnel in real-time, providing
a platform which allows brands their own online ordering
systems to accept direct orders from customers and provides
an enterprise-grade omnichannel customer engagement &
marketing automation platform.
The total income grew by 122.94% and is H 257.25 million
as on March 31, 2023 compared to H 115.39 million in the
previous year.
A report on the performance and the Financial position of the
subsidiaries, associate companies and ESOP Trust, as per
Companies Act, 2013 and Rules made thereunder (the ''Act'')
is provided in Form AOC-1 attached to the Consolidated
Financial Statements forming an integral part of this Integrated
Annual Report. Pursuant to the provisions of Section 136 of
the Act, separate audited accounts of the subsidiaries, are
available on the website of the Company (web link: https://
www.jubilantfoodworks.com/companv-reports/financial-
of-subsidiary-companies).
Apart from above, no other company has become or ceased to
be subsidiary, joint venture or associate of the Company during
the financial year.
As per Section 134(3)(a) of the Act, the Annual Return referred
to in Section 92(3) of Act for the financial year ended on
March 31, 2023 is available on the website of the Company (web
link: https://www.iubilantfoodworks.com/companv-reports/
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In terms of Articles of Association of the Company and provisions
of the Act, Mr. Shamit Bhartia (DIN: 00020623) and Ms. Aashti
Bhartia (DIN: 02840983) Directors of the Company, are liable to
retire by rotation at the ensuing AGM and being eligible, offered
themselves for re-appointment. The Board of Directors recommend
their re-appointment for consideration by the shareholders of the
Company at the ensuing AGM.
Mr. Pratik R. Pota resigned as CEO & Wholetime Director
of the Company with effect from close of business hours of
June 15, 2022. The Board placed on record its sincere appreciation
for the outstanding contribution made by Mr. Pota during his
tenure with the Company.
The shareholders of the Company in their 27th AGM held on August
30, 2022 approved:
a) Appointment of Mr. Sameer Khetarpal as Chief Executive
Officer & Managing Director of the Company for a period of five
years with effect from September 05, 2022 upto September
04, 2027;
b) Re-appointment of Mr. Ashwani Windlass
(DIN: 00042686) as an Independent Director of the Company
for a second term of five consecutive years with effect from
July 25, 2023 to July 24, 2028;
c) Re-appointment of Mr. Abhay P. Havaldar
(DIN: 00118280) as Independent Director of the Company for
a second term of five consecutive years with effect from July
25, 2023 to July 24, 2028.
The shareholders of the Company in their 24th AGM appointed
Mr. Vikram S. Mehta (DIN: 00041197) and Ms. Deepa M. Harris
(DIN: 00064912) as Independent Directors of the Company for
a term from February 1, 2019 to January 31, 2024 and from
June 21,2019 to June 20, 2024, respectively.
Considering the vast experience, expertise, acumen, positive
attributes, integrity and significant contribution made by both the
Directors and recommendations of the Nomination, Remuneration
and Compensation Committee, the Board (subject to the approval
of the shareholders) in their meeting held on May 17, 2023
approved:
a) Re-appointment of Mr. Vikram S. Mehta as an Independent
Director of the Company for a second term of five consecutive
years with effect from February 1, 2024 upto January 31 ,
2029;
b) Re-appointment of Ms. Deepa M. Harris as an Independent
Director of the Company for a second term of five consecutive
years with effect from June 21,2024 upto June 20, 2029.
Further, on the recommendations of the Nomination,
Remuneration and Compensation Committee, the Board in
their meeting held on May 17, 2023 approved appointment of
Mr. Amit Jain (DIN: 01770475) as an Additional Director
designated as an Independent Director with effect from
July 1, 2023. The term of his appointment as an Independent
Director will be for a period of five (5) years, subject to the approval
of the shareholders of the Company in the general meeting.
In the opinion of the Board, Mr. Mehta, Ms. Harris and
Mr. Jain fulfils the conditions specified in the Act and under SEBI
(Listing Obligations and Disclosure Requirements) Regulations,
2015 (âListing Regulations''). The Company has received
notices under Section 160 of the Act proposing appointment/
re-appointment of above-mentioned Directors of the Company.
The Board of Directors recommend their appointment/
re-appointment for consideration by the shareholders of the
Company at the ensuing AGM.
Except as stated above, there was no change in the Directors or
Key Managerial Personnel of the Company, during the year under
review.
In terms of Rule 8(5) (iiia) of the Companies (Accounts)
Rules, 2014, in the opinion of the Board, all appointments/
re-appointments of Independent Directors during the financial
year were made after due veracity of their integrity, expertise,
experience and proficiency.
Brief profile, nature of expertise, details of directorship held in other
companies, Chairmanships/ membership of Board Committees
, shareholding in the Company held by the Directors and
relationship with Directors inter-se and other details as stipulated
under Regulation 36(3) of the Listing Regulations, as amended
read with the provisions of the Secretarial Standard on General
Meetings issued by the Institute of Company Secretaries of India
(âSS-2'') relating to the Directors proposed to be appointed/ re¬
appointed at the 28th AGM is annexed to the notice convening
the 28th AGM.
Declaration by Independent Directors
All the Independent Directors of the Company have given their
declarations to the Company under Section 149(7) of the Act
that they meet the criteria of independence as provided under
Section 149(6) of the Act read with Regulation 16(1 )(b) of the
Listing Regulations and are not disqualified from continuing as
Independent Directors and that they have registered themselves
as an Independent Director in the data bank maintained with the
Indian Institute of Corporate Affairs. Based on the disclosures
received, the Board is of the opinion that, all the Independent
Directors fulfill the conditions specified in the Act and Listing
Regulations and are independent of the management.
MEETINGS OF BOARD OF DIRECTORS
Four (4) Meetings of Board of Directors were held during FY 2023.
The details of the meetings of the Board and its Committees are
given in the Corporate Governance Report forming an integral part
of this Board''s Report.
APPOINTMENT & REMUNERATION POLICY
The Company has an âAppointment & Remuneration Policy'' for
Directors, Key Managerial Personnel and Senior Management/
other employees of the Company, specifying criteria for
determining qualifications, positive attributes, independence of a
director and other matters which is disclosed on the website of
the Company (web link: https://www.iubilantfoodworks.com/
investors/governance/policies-codes). The salient features of the
Policy have been disclosed in the Corporate Governance Report
forming an integral part of this Board''s Report.
PERFORMANCE EVALUATION OF THE BOARD
The Board adopted a formal mechanism for evaluating its
performance and as well as of its Committees and individual
Directors, including the Chairperson of the Board. The detailed
process in which annual evaluation of the performance of the
Board, its Chairperson, its Committees and of individual Directors
has been made is disclosed in the Corporate Governance Report
forming an integral part of this Board''s Report.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY
MANAGERIAL PERSONNEL
The details of Employees, Directors & Key Managerial Personnel
as required under Section 197 of the Act read with the Companies
(Appointment and Remuneration) Rules, 2014 is annexed herewith
as Annexure âAâ forming an integral part of this Boardâs Report.
LOANS, GUARANTEES AND INVESTMENTS
Particulars of guarantee and investments made have been
disclosed in Note 31 and 4 to the Standalone Financial Statements,
respectively, forming an integral part of the Integrated Annual
Report. During FY 2023, the Company has not given any loan
pursuant to Section 186 of the Act.
RELATED PARTY TRANSACTIONS
All contracts, arrangements and transactions entered by the
Company during FY 2023 with related parties were in the ordinary
course of business and on arm''s length basis and were approved
by the Audit Committee. The Board of Directors of the Company
had laid down the criteria for granting the omnibus approval by
the Audit Committee for the transactions which are repetitive in
nature, in line with the Company''s Policy on Materiality of and
dealing with Related Party Transactions (âRPT Policy''). During the
year, the Company had not entered into any materially significant
transaction as defined in the RPT Policy with related parties
viz. promoters, directors, their relatives or the management,
subsidiaries etc. that may have potential conflict with the interests
of the Company at large. Accordingly, the disclosure of Related
Party Transactions under Section 188(1) of the Act in Form AOC-2
is not applicable. Related Party disclosures including transactions
with promoter/promoter group which hold(s) more than 10%
shareholding in the Company have been disclosed in Note 33
to the Standalone Financial Statements forming an integral part
of this Integrated Annual Report. The RPT Policy was modified
by the Board with effect from April 1, 2022 to align the same
with the statutory changes. The RPT Policy is disclosed on the
Company''s website (web link: https://www.jubilantfoodworks.
com/investors/governance/policies-codes).
AUDITORS
Statutory Auditor
Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn.
No. 117366W/W-100018) (âDeloitteâ), were re-appointed as
Statutory Auditors of the Company by the Shareholders in their
27th AGM held on August 30, 2022, for a second term of five
consecutive years i.e. from the conclusion of 27th AGM until the
conclusion of 32nd AGM of the Company to be held in the year
2027. The Auditors'' Report read together with Annexures referred
to in the Auditors'' Report for the financial year ended March 31,
2023 does not contain any qualification, reservation, adverse
remark or disclaimer. During the year under review, the Statutory
Auditor has not reported any matter of fraud under Section 143
(12) of the Act, therefore no disclosure is required under Section
134(3)(ca) of the Act.
The Board appointed Chandrasekaran Associates, Company
Secretaries to conduct Secretarial Audit pursuant to the provisions
of Section 204 of the Act for FY 2023. The Secretarial Audit
Report for the financial year ended March 31,2023 received from
Secretarial Auditor is annexed herewith as Annexure âBâ forming
an integral part of this Board''s Report. The Secretarial Audit Report
does not contain any qualification, reservation, adverse remark or
disclaimer. During the year under review, the Secretarial Auditor
has not reported any matter of fraud under Section 143 (12) of
the Act, therefore no disclosure is required under Section 134(3)
(ca) of the Act.
AUDIT COMMITTEE
The Audit Committee comprises of Mr. Ashwani Windlass as
Chairman, Mr. Abhay P. Havaldar, Ms. Deepa M. Harris, Mr. Shamit
Bhartia and Mr. Vikram S. Mehta as members. Brief terms of
reference, meetings and attendance are included in the Corporate
Governance Report forming an integral part of this Board''s Report. All
the recommendations made by the Audit Committee were accepted
by the Board of Directors of the Company.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has in place Whistle Blower Policy and has established
the necessary vigil mechanism for directors and employees in
confirmation with Section 177(9) of the Act and Regulation 22 of
Listing Regulations, to report concerns about unethical behavior
and also provides for direct access to the Chairman of the Audit
Committee in exceptional cases. The details of vigil mechanism
as provided in the Whistle Blower Policy has been disclosed in
the Corporate Governance Report forming an integral part of this
Board''s Report. The Whistle Blower Policy is disclosed on the
Company''s website (web link: https://www.jubilantfoodworks.
com/investors/governance/policies-codes).
RISK MANAGEMENT
Risk Management is an integral and important component of
Corporate Governance. The Board of Directors of the Company
has constituted Risk Management Committee (''RMC'')
which assists the Board in monitoring and reviewing the risk
management plan, implementation of the risk management
framework of the Company and such other functions as Board
may deem fit. The Board updated the Risk Management Policy
with effect from May 17, 2023 to bring more objectivity in risk
classification & prioritization. The Risk Management framework is
in place to identify, prioritize, mitigate, monitor and appropriately
report any significant threat to the organization''s strategic
objectives, its reputation, operational continuity, environment,
compliance, and the health & safety of its employees. A detailed
section on Risk Management is provided in the Management
Discussion and Analysis Report forming an integral part of this
Integrated Annual Report.
INTERNAL FINANCIAL CONTROL
The Company has adequate internal financial controls systems in
place, which facilitates orderly and efficient conduct of its business
including adherence to Companyâs policies, safeguarding of its
assets, prevention and detection of frauds and errors, accuracy and
completeness of the accounting records and timely preparation
of reliable financial information. The Companyâs internal control
framework are commensurate with the size and nature of its
operations. Deloitte Haskins & Sells LLP, Statutory Auditor have
audited the financial statements of the Company included in this
Integrated Annual Report and have also confirmed the adequacy
and operational effectiveness of the Companyâs internal control
over financial reporting (as defined in Section 143 of the Act) as on
March 31,2023. A detailed section on Internal Controls and their
Adequacy is provided in the Management Discussion and Analysis
Report forming an integral part of this Integrated Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the Listing Regulations, Management
Discussion and Analysis Report for the financial year under review
is presented in a separate section, forming an integral part of this
Integrated Annual Report.
CORPORATE SOCIAL RESPONSIBILITY
The Company has in place Corporate Social Responsibility
Policy (âCSR Policyâ) which outlines the Companyâs philosophy
and responsibility and lays down the guidelines and mechanism
for undertaking socially impactful programs towards welfare and
sustainable development of the community around the area of
its operations and other parts of the Country. The CSR Policy is
disclosed on the Companyâs website (web link: https://www.
iubilantfoodworks.com/investors/aovernance/policies-codes).
In terms of Section 135 of the Act read with Rule 8 of the Companies
(Corporate Social Responsibility Policy) Rules, 2014 as amended,
the Annual Report on Corporate Social Responsibility Activities for
FY 2023 is annexed herewith as Annexure âCâ forming an integral
part of this Boardâs Report.
CORPORATE GOVERNANCE
The Corporate Governance philosophy of the Company is driven
by the interest of stakeholders, focus on fairness, transparency
and business needs of the organisation. The Company continues
to be compliant with the requirements of Corporate Governance
as stipulated in Listing Regulations. In terms of Regulation 27 of
Listing Regulations, the Corporate Governance Report including a
certificate from Chandrasekaran Associates, Company Secretaries,
regarding compliance of the conditions of Corporate Governance
is annexed herewith as Annexure âDâ forming an integral part of
this Boardâs Report. The Corporate Governance Report, inter-alia,
contains the following disclosures:
a) Composition of Committees including Audit Committee,
Nomination, Remuneration and Compensation Committee,
Stakeholders Relationship Committee, Sustainability &
Corporate Social Responsibility Committee, Risk Management
Committee, Investment Committee and Regulatory and
Finance Committee;
b) Disclosure relating to affirmation submitted by the Directors
and Senior Management confirming compliance of the Code
of Conduct for Directors and Senior Management;
c) Dividend Distribution Policy;
d) Details of Credit Rating;
e) Details of Unpaid and Unclaimed Dividend Account and
transfer to Investor Education and Protection Fund; and
f) Details of remuneration of Directors including service
contracts, notice period, severance fees, stock options held
by them.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY
REPORT
In terms of Regulation 34 of the Listing Regulations, Business
Responsibility and Sustainability Report for FY 2023 is annexed
herewith as Annexure âEâ forming an integral part of this Boardâs
Report.
PREVENTION OF SEXUAL HARASSMENT
The Company is committed towards promoting the work
environment that ensures every employee is treated with dignity
and respect and afforded equitable treatment irrespective of their
gender, race, social class, caste, creed, religion, place of origin,
sexual orientation, disability or economic status. Pursuant to the
provisions of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 (âPOSH Actâ),
the Company has adopted a Policy on prevention of Sexual
Harassment at Workplace. Periodic sessions were also conducted
to apprise employees and build awareness on the subject matter.
Our key focus is to create a safe, respectful and inclusive workplace
which fosters professional growth for each employee.
As per the requirement of the POSH Act and Rules made
thereunder, the Company constituted an Internal Complaints
Committee (ICC) to redress the complaints received regarding
sexual harassment. The ICC meets periodically to discuss various
scenarios/sample cases and steps that can be taken to ensure
that POSH cases are reported and addressed uniformly across
the organization. The details of the complaints received during the
year under review are as follows. The Company endeavours to
complete the inquiry process within the stipulated period of 90
days.
i. Complaints filed during the financial year : 43
ii. Complaints disposed off during the financial year : 40
iii. Complaints pending as on end of the financial year : 3
CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND
OUTGO
(A) Conservation of Energy
The Company continuously strives to reduce the
environmental impact of its operations and lower its
carbon footprint. It focusses on improving energy
efficiency, increasing the use of renewable energy and
improving waste management to reduce the overall
environment footprint.
i) The steps taken or impact on conservation of energy
a) Energy Management Systems (âEMSâ): EMS are
installed across stores and commissaries to reduce
energy consumption. This year, the Company
upgraded EMS for approximately 747 stores, which
accounts for around 40% of the stores. Due to this
the Company has been able to achieve energy
savings of around 5%.
b) Retrofitting old chiller: The project involved a
detailed audit to identify areas of improvement and
to assess the design versus actual conditions. This
enabled a better understanding of the energy usage
patterns and the identification of areas where energy
could be saved. The project with energy-efficient
chiller has resulted in significant cost savings of
approximately 10 lakh Kwh and avoided, around
790 tCO2e
c) Replacing electric heating with heat pumps:
Traditional electric heaters were replaced with
energy-efficient heat pumps, which are known
for their high energy efficiency and low operating
costs. The implementation of heat pumps at
tray washer areas by replacing electric heaters
has resulted in significant cost savings of around
3 lakh kwh and avoided around 237 tCO2e
d) Other energy efficiency initiatives: Some of the
initiatives at stores includes retrofitting energy
efficient air conditioners, deploying energy efficient
ovens at new stores, and installing IoT devices at
delivery bikes to monitor speed, time, and delivery
efficiency. In addition, converting LPG to PNG at
stores wherever available can lead to significant
savings in emissions, reduced residual gas, and
smoother operations.
ii) The steps taken by the Company for utilising
alternate sources of energy
a) Renewable energy: Solar Power Plants are already
installed at commissaries in Greater Noida, Nagpur,
Mumbai, and Kolkata, accounting for approximately
11% of total electricity consumption. This has also
replaced 1,424 MWh of electricity generated by fossil
fuels and hence avoided 1,125 tCO2e of emissions.
b) E-Bikes: The Company has made significant
progress this year, increasing the number of e-bikes
and e-cycle to 7,594 bringing the percentage of
e-bikes to 33%. This is an important initiative to
reduce our carbon footprint and transition to a
more sustainable future. The company is focused to
implement e-bikes in all of the new stores, taking
into account the local terrain. All of the bikes used in
Popeyes and Hong''s Kitchen are already electric.
As a result of this initiative, approximately 1,313 kl
of petrol is saved and avoided around 3,523 tCO2e
emissions.
iii) The capital investment on energy conservation
equipment
Capital investment on energy conservation equipment
during FY 2023 was H 630.88 million approx.
The Company believes in leveraging technology to transform
every dimension of its business.
The Technology Absorption has been discussed under âData
and Technology Forward'' section in Management Discussion
and Analysis Report forming an integral part of this Integrated
Annual Report.
(C) Foreign Exchange Earnings & Outgo
Particulars |
FY 2023 |
FY 2022 |
Foreign Exchange earned |
129.61 |
55.20 |
Foreign Exchange outgo in |
2,258.31 |
1,679.02 |
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that in the preparation of the Statement of Profit
and Loss Account for the financial year ended March 31,2023 and the
Balance Sheet as at that date, the Directors have:
a) followed the applicable accounting standards along with
proper explanation relating to material departure;
b) selected such accounting policies and applied them
consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of
the state of affairs of the Company at the end of the financial
year and of the profit of the Company for that period;
c) taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
d) prepared the annual accounts on a going concern basis;
e) laid down internal financial controls to be followed by the
Company and that such internal financial controls are
adequate and were operating effectively; and
f) devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were
adequate and operating effectively.
COMPLIANCE OF THE SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial
Standards on Meetings of the Board of Directors and on General
Meetings issued by the Institute of Company Secretaries of India.
OTHER STATUTORY DISCLOSURES
During FY 2023, there were no transaction requiring disclosure or
reporting in respect of matters relating to:
a) Details relating to deposits covered under Chapter V of the
Act. The Company had no outstanding, unpaid or unclaimed
public deposits during the FY 2023;
b) Maintenance of cost records under sub-section (1) of Section
148 of the Act is not applicable to the Company;
c) Issue of equity shares with differential rights as to dividend,
voting or otherwise;
d) Issue of Sweat Equity shares;
e) Any remuneration or commission to the Wholetime Director/
Managing Director of the Company from the subsidiaries of
the Company;
f) No significant and material orders passed by the Regulators/
Courts/Tribunals which impact the going concern status and
Company''s operations in future;
g) No change in the nature of the business of the Company;
h) No application made or any proceeding pending under the
Insolvency and Bankruptcy Code, 2016; and
i) No instance of any one-time settlement with any Banks or
Financial Institutions.
There have been no material changes and commitment, affecting
the financial position of the Company which occurred between the
end of FY 2023 till the date of this Report, other than those already
mentioned in this Report.
ACKNOWLEDGEMENTS
Your Directors take this opportunity to thank and acknowledge
with gratitude, the contribution, co-operation and assistance
received from International Business Partners from Domino''s,
Popeyes, Dunkin'', Government and Regulatory Authorities,
Business Partners, Bankers, Members and other Stakeholders.
Also, the Board places on record its deep appreciation for the
enthusiasm, co-operation, hard work, dedication and commitment
of the employees at all levels.
Your Directors appreciate the continued co-operation and support
received from its customers that has enabled the Company to
make every effort in understanding their unique needs and deliver
maximum customer satisfaction.
Inspired by the Vision, driven by Values and powered by Strength,
your Directors and employees of the Company look forward to the
future with confidence and stand committed to creating an even
brighter future for all stakeholders.
For and on behalf of the Board of DirectorsShyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director
DIN: 00010484 DIN: 00010499
Place: Noida Place: Noida
Date: May 17, 2023 Date: May 17, 2023
(Figures have been rounded off for the purpose of reporting)
Mar 31, 2022
Your Directors have pleasure in presenting the Twenty-Seventh (27th) Annual Report together with the Audited Standalone and Consolidated Financial Statements for the year ended March 31,2022 (âFY 2022â).
FINANCIAL HIGHLIGHTS
A summary of the Companyâs financial performance in FY 2022 is as follows:
('' in lakhs) |
||||
Particulars |
Standalone |
Consolidated |
||
FY 2022 |
FY 2021 |
FY 2022 |
FY 2021 |
|
Revenue from Operations |
433,109.98 |
326,887.27 |
439,612.29 |
331,187.13 |
Add: Other Income |
4,065.97 |
7,037.26 |
4,135.36 |
7,307.77 |
Total Income |
437,175.95 |
333,924.53 |
443,747.65 |
338,494.90 |
Profit before Depreciation & Amortisation, Finance Cost, Exceptional items, Tax Expense & Other Income (EBITDA) |
110,460.81 |
76,655.87 |
110,877.66 |
77,119.24 |
Profit before Depreciation & Amortisation, Finance Cost, Exceptional items & Tax Expense |
114,526.78 |
83,693.13 |
115,013.02 |
84,427.01 |
Less: Finance Cost |
17,301.33 |
16,060.28 |
17,608.94 |
16,269.78 |
Less: Depreciation & Amortisation Expense |
38,297.41 |
36,722.40 |
39,305.19 |
37,539.82 |
Profit before share of net profit/ (loss) of associate, exceptional items and tax |
58,928.04 |
30,910.45 |
58,098.89 |
30,617.41 |
Share of net profit/ (loss) of associate |
- |
- |
(1,040.31) |
- |
Profit before Exceptional items & Tax Expense |
58,928.04 |
30,910.45 |
57,058.58 |
30,617.41 |
Less: Exceptional items |
732.54 |
- |
732.54 |
- |
Profit before Tax Expense |
58,195.50 |
30,910.45 |
56,326.04 |
30,617.41 |
Less: Taxation Expense |
14,443.29 |
7,541.81 |
14,517.21 |
7,565.24 |
Profit for the year |
43,752.21 |
23,368.64 |
41,808.83 |
23,052.17 |
Other Comprehensive Income/ (Loss) |
24,300.15 |
7,805.83 |
21,120.83 |
7,470.07 |
Total Comprehensive Income for the year |
68,052.36 |
31,174.47 |
62,929.66 |
30,522.24 |
Retained Earnings |
- |
- |
(1,040.31) |
- |
Balance at the beginning of FY |
123,791.31 |
100,280.19 |
119,080.81 |
95,807.00 |
Add: Profit for the FY |
43,752.21 |
23,368.64 |
42,039.16 |
23,166.66 |
Add: Exercise/ Lapse of share options |
231.35 |
142.48 |
231.35 |
142.48 |
Add: Exercise/ Sale of shares held by ESOP Trust (Net of Tax) |
- |
- |
(235.63) |
(35.33) |
Less: Dividend paid on Equity Shares |
(7,918.14) |
- |
(7,918.14) |
- |
Add: Dividend on shares held by ESOP Trust |
- |
- |
16.47 |
- |
Balance at the end of FY |
159,856.73 |
123,791.31 |
153,214.02 |
119,080.81 |
RESULTS OF OPERATIONS AND THE STATE OF COMPANYâS AFFAIRS
The highlights of the Companyâs performance on standalone basis are as under:
a) Revenue from operations increased by 32.5% to '' 433,109.98 lakhs
b) EBITDA increased by 44.10% to '' 110,460.81 lakhs
c) Profit before Tax increased by 88.27% to '' 58,195.50 lakhs
d) Net Profit increased by 87.23% to '' 43,752.21 lakhs
The Company delivered healthy revenue growth and strong profitability in the face of COVID induced restrictions and significant inflationary headwinds, while accelerating its network expansion. The revenue increased due to high
number of store days compared to last year (which was impacted due to COVID-19) and increase in store count has resulted into rise in revenue. The total income on a standalone basis for FY 2022 reached to '' 437,175.95 lakhs which is higher by 30.92% compared to last year. The EBITDA of '' 110,460.80 lakhs increased by 44.1%. The EBITDA margin at 25.5%, increased by 205 bps. The net profit margin is higher by 295 bps to 10.10% in FY 2022. The efficiency in operational cost has added to the net profit margin compared to last year. During FY 2022, the Company has not transferred any amount to the general reserve and entire amount of profit for the year forms part of the âRetained Earningsâ.
The Company added 253 new stores across all brands in India. The Company launched its first flagship Popeyes store in January 2022 in Bengaluru. It has received encouraging response from customers. The Company has 1,567 Dominoâs, 28 Dunkinâ, 15 Hongâs Kitchen, 9 Ekdum! and 4 Popeyes stores as on March 31,2022. During the year, the Company continued making investments to strengthen its digital capabilities and continue to improve its digital assets to make the consumer experience even more intuitive and seamless. The business highlights and the operating context has been comprehensively discussed in Management Discussion and Analysis Report forming an integral part of the Annual Report.
As on March 31, 2022, the paid-up share capital of the Company stood at ''1,319,690,400/- divided into 131,969,040 equity shares of '' 10/- each.
During FY 2022, your Board of Directors approved split/ sub-division of equity shares of the Company such that each equity share having face value of '' 10/- (Rupees Ten only) fully paid-up, be sub-divided into five (5) equity shares having face value of '' 2/- (Rupees Two only) each, fully paid-up with effect from April 20, 2022 (Record Date). Further, the shareholders by resolution passed by way of postal ballot on March 27, 2022 approved said split of equity shares and the consequential alteration in Capital Clause of Memorandum of Association of the Company. Accordingly, the authorised share capital of the Company was altered as '' 1,500,000,000 divided into 750,000,000 equity shares of '' 2/- each and the paid- up share capital of the Company was altered as '' 1,319,690,400/- divided into 659,845,200 equity shares of '' 2/- each.
Based on the Companyâs performance and Dividend Distribution Policy of the Company, your Directors are pleased to recommend Dividend of '' 1.20/- (i.e. 60%) per equity share of '' 2/- each fully paid up for FY 2022 amounting to '' 7,918.14 lakhs. The payment of dividend is subject to approval of the shareholders at the forthcoming Annual General Meeting (âAGMâ) of the Company and shall be subject to deduction of tax at source.
EMPLOYEES STOCK OPTION SCHEMES
With a view to attract, reward and retain talented and key employees in the competitive environment and encourage them to align individual performance with
Company objectives, the Company grants share based benefits to eligible employees under the ESOP Schemes. The Company has two Employees Stock Option Schemes namely, JFL Employees Stock Option Scheme, 2011 (âESOP 2011â) and JFL Employees Stock Option Scheme, 2016 (âESOP 2016â) (collectively referred as âESOP Schemesâ). Both the schemes are administered through JFL Employees Welfare Trust (âESOP Trustâ). The Board (on the recommendations of the Nomination Remuneration and Compensation Committee) at its meeting held on February 2, 2022, approved certain amendments in ESOP Schemes to align them with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended (the âSEBI ESOP Regulations 2021â).
Consequent to split/sub-division of equity shares of the Company with effect from April 20, 2022 (Record Date), appropriate adjustments were made in the number of stock options that have been granted under the ESOP Schemes and yet to be exercised (whether vested or unvested but not lapsed) such that each such stock options shall be sub-divided into Five (5) stock options of the same category and the respective exercise price for each such stock option shall be one fifth (1/5) of the exercise price fixed at the time of grant of such options. Also, the ceiling(s) on the maximum number of options/Shares that may be issued pursuant to exercise of options granted to the participants under the ESOP Schemes shall stand proportionately increased. The details of both the schemes have also been disclosed in Note 32 to the Standalone Financial Statements and Note 31 to the Consolidated Financial Statements forming an integral part of the Annual Report.
The Company has Jubilant FoodWorks General Employee Benefit Scheme, 2020 (âJFGEBSâ) which was approved with the objective of providing healthcare (incl. preventive measures), hospital care, or benefits in the event of sickness, accident, disability, death or scholarship funds, rewards and recognitions, education, employee engagement, training for skill enhancement/ development and such other welfare activities and benefits specified by the Company. The JFGEBS would be implemented and administered by the ESOP Trust. JFGEBS does not involve issue of shares by the Company for the purposes of JFGEBS and also does not involve any secondary acquisition by the ESOP Trust. The Board (on the recommendations of the Nomination Remuneration and Compensation Committee) at its meeting held on February 2, 2022, approved certain amendments in JFGEBS to align the same with SEBI ESOP Regulations 2021.
ESOP Schemes and JFGEBS are in compliance with the SEBI ESOP Regulations 2021.The details of ESOP Schemes and JFGEBS pursuant to SEBI ESOP Regulations, 2021 as at March 31, 2022 is uploaded on the website of the Company (web link: https://www.iubilantfoodworks.com/ investors/reports-presentations). In terms of Regulation 13 of SEBI ESOP Regulations 2021, the Certificate from M/s. Chandrasekaran Associates, Company Secretaries, Secretarial Auditors, would be placed before the shareholders at the ensuing AGM.
SUBSIDIARIES, JOINT VENTURE & ASSOCIATE COMPANIESJubilant Foodworks Netherlands B.V. (âJubilant Netherlandsâ) and DP Eurasia N.V. (âDPeUâ):
Jubilant Netherlands is a wholly owned subsidiary of the Company in Netherlands. During the financial year, Jubilant Netherlands acquired 8.51% equity stake in DPEU through Reverse Bookbuild process and direct market purchases. With an intent to consolidate the entire shareholding of DPEU into Jubilant Netherlands and simplification of the corporate structure, Fides Food Systems Cooperatief U.A. (âFidesâ), step down subsidiary of the Company in Netherlands has been merged with its holding company, Jubilant Netherlands effective January 1, 2022. With this, Fides ceases to be step-down subsidiary of the Company. Further, consequent to the merger, the Company through Jubilant Netherlands is holding 60,072,476 ordinary shares in DPEU representing 41.32% of its issued share capital as on March 31,2022. As on March 31,2022, the total income of Jubilant Netherlands is '' 5.38 lakhs as compared to ''184.83 lakhs in FY 2021. DPEU is a public company listed with London Stock Exchange PLC, and is the exclusive master franchisee of the Dominoâs Pizza brand in Turkey, Russia, Azerbaijan and Georgia.
Jubilant Golden Harvest Limited (âJubilant Bangladeshâ):
Jubilant Bangladesh has exclusive rights to develop and operate Dominoâs stores in Bangladesh. The performance of Jubilant Bangladesh was encouraging. Dominoâs in Bangladesh was a dine-in centric business, over the last two years, efforts were made towards growth of delivery business. Jubilant Bangladesh with its continued efforts and potential, saw sustained recovery led by online delivery sales.
During the financial year, the Company exercised call options for acquiring additional 49% equity stake in Jubilant Bangladesh from Golden Harvest QSR Limited (âGolden Harvestâ) at a consideration amounting to BDT 3,890.15 lakhs (equivalent to INR 3,402.46 lakhs). Accordingly, post-completion of acquisition on May 10, 2022, Companyâs stake in Jubilant Bangladesh increased from 51% to 100% (with 1 share of Jubilant Bangladesh being held by a nominee of the Company in order to comply with local law requirements in Bangladesh).
During the year, Jubilant Bangladesh launched 4 stores taking the total count to 9 stores. The total income of Jubilant Bangladesh as on March 31, 2022 is '' 2,514.55 lakhs as compared to '' 1,722.04 lakhs in the previous year.
Jubilant FoodWorks Lanka (Private) Limited (âJubilant Sri Lankaâ):
Jubilant Sri Lanka is a wholly owned subsidiary of the Company in Sri Lanka. Jubilant Sri Lanka has exclusive rights to develop and operate Dominoâs stores in Sri Lanka. During the year, Jubilant Sri Lanka delivered its highest ever system sales growth of 80.9%. The total income grew by 69.49% and is '' 5,051.46 lakhs as on March 31,2022 compared to '' 2,980.31 lakhs in the previous year.
The pace of store expansion increased with the launch of 9 stores taking the total count to 35. The launch of an enhanced mobile app helped in significantly enhancing online order growth. The focus remained on profitable growth managed through various initiatives like rationalizing discounts, reducing wastages and targeted marketing activities.
With an intent of making strategic investments in promising start-ups and emerging businesses and in line with its stated goal of building a multi-brand and multi-country food business powered by technology, the Company made following acquisition(s) during the year:
a) Hashtag Loyalty Private Limited (âHashtagâ): The Company entered into Share Subscription Agreement, Shareholdersâ Agreement and Share Purchase Agreement dated October 27, 2021 to invest approx. '' 24.75 crores for acquisition of 35% stake (on fully diluted basis) in Hashtag. The aforesaid acquisition was completed on March 31, 2022 and Hashtag became associate company.
Hashtag is engaged in the business of providing a platform which allows brands their own online ordering systems to accept direct orders from customers and provides an enterprise-grade omnichannel customer engagement & marketing automation platform. The total income of Hashtag grew by '' 129.31 lakhs in FY 2022 and is '' 225.28 lakhs as compared to '' 95.97 lakhs in FY 2021.
b) Wellversed Health Private Limited (âWellversedâ): The Company entered into Share Subscription Agreement and Shareholdersâ Agreement both dated September 22, 2021 to invest an aggregate amount of ''10 Crores in two tranches for acquisition of 25.02% stake (on fully diluted basis) in Wellversed. The aforesaid acquisition was completed on May 2, 2022 with disbursement of the second tranche of investment. As on March 31,2022, Wellversed was not an associate of the Company.
Wellversed is a Gurgaon-based nutrition company offering a variety of food products tailored for specific nutrition and dietary needs including keto, gluten-free, vegan, high-protein, diabetic and immunity.
A report on the performance and the Financial position of the subsidiaries, associate companies and ESOP Trust, as per Companies Act, 2013 and Rules made thereunder (the âActâ) is provided in Form AOC-1 attached to the Consolidated Financial Statements forming an integral part of the Annual Report. Pursuant to the provisions of Section 136 of the Act, separate audited accounts of the subsidiaries, are available on the website of the Company (web link: https://www.jubilantfoodworks.com/investors/ reports-presentations).
Apart from above, no other company has become or ceased to be subsidiary, joint venture or associate of the Company during the financial year.
As per Section 134(3)(a) of the Act, the Annual Return referred to in Section 92(3) of Act for the financial year ended on March 31,2022 is available on the website of the Company (web link: https://www.jubilantfoodworks.com/ investors/reports-presentations).
MEETINGS OF BOARD OF DIRECTORS
Six (06) Meetings of Board of Directors were held during FY 2022. The details of the meetings of the Board and its Committees are given in the Corporate Governance Report forming an integral part of this Boardâs Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In terms of Articles of Association of the Company and provisions of the Act, Mr. Shyam S. Bhartia (DIN: 00010484) Director of the Company, is liable to retire by rotation at the ensuing AGM and being eligible, offered himself for re-appointment. The Board of Directors recommend his re-appointment for consideration by the shareholders of the Company at the ensuing AGM.
The shareholders of the Company in their 26th AGM held on September 17, 2021 approved:
a) Re-appointment of Mr. Berjis M. Desai (DIN: 00153675) as Independent Director of the Company for a second term of five consecutive years with effect from May 29,
2022 upto May 28, 2027;
b) Re-appointment of Mr. Pratik R. Pota (DIN: 00751178) as Chief Executive Officer & Wholetime Director of the Company for a further period of three years from April 1,2022, upto March 31,2025.
Mr. Pota resigned as CEO & Wholetime Director of the Company with effect from close of business hours of June 15, 2022. The Board placed on record its sincere appreciation for the outstanding contribution made by Mr. Pota during his tenure with the Company.
The shareholders of the Company in their 23rd AGM appointed Mr. Ashwani Windlass (DIN: 00042686) and Mr. Abhay P. Havaldar (DIN: 00118280) as Independent Directors for a term of five consecutive years from July 25, 2018 upto July 24, 2023. Considering the vast experience, expertise, acumen, positive attributes, integrity and significant contribution made by both the Directors and recommendations of the Nomination, Remuneration and Compensation Committee, the Board (subject to the approval of the shareholders) in their meeting held on May 30, 2022 approved:
a) Re-appointment of Mr. Ashwani Windlass as Independent Director of the Company for a second term of five consecutive years with effect from July 25,
2023 upto July 24, 2028;
b) Re-appointment of Mr. Abhay P. Havaldar as Independent Director of the Company for a second term of five consecutive years with effect from July 25, 2023 upto July 24, 2028.
In the opinion of the Board, Mr. Ashwani Windlass and Mr. Abhay P. Havaldar fulfils the conditions specified in the Act and under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ). The Company has received notices under Section 1 60 of the Act proposing appointment of above-mentioned Directors of the Company.
The Board of Directors (on the recommendations of the Nomination, Remuneration and Compensation Committee), in their meeting held on May 30, 2022, approved and recommended the appointment of Mr. Sameer Khetarpal (DIN: 07402011) as Chief Executive Officer & Managing Director of the Company not liable to retire by rotation, w.e.f. September 05, 2022 for a period of five years, to the shareholders for their approval.
During the year under review, except as stated above, there was no change in the Directors or Key Managerial Personnel of the Company.
In terms of Rule 8(5) (iiia) of the Companies (Accounts) Rules, 2014, in the opinion of the Board, all appointments/ re-appointments of Independent Directors during the financial year were made after due veracity of their integrity, expertise and experience (including the proficiency).
Brief profile, nature of expertise, details of directorship held in other companies, Chairmanships/ membership of Board Committees, shareholding in the Company held by the Directors and relationship with Directors inter-se and other details as stipulated under Regulation 36(3) of the Listing Regulations, as amended read with the provisions of the Secretarial Standard on General Meetings issued by the Institute of Company Secretaries of India (âSS-2â) relating to the Directors proposed to be appointed/ re-appointed at the 27th AGM is annexed to the notice convening the 27th AGM.
Declaration by Independent Directors
All the Independent Directors of the Company have given their declarations to the Company under Section 149(7) of the Act that they meet the criteria of independence as provided under Section 149(6) of the Act read with Regulation 16(1)(b) of the Listing Regulations and are not disqualified from continuing as Independent Directors and that they have registered themselves as an Independent Director in the data bank maintained with the Indian Institute of Corporate Affairs. Based on the disclosures received, the Board is of the opinion that, all the Independent Directors fulfill the conditions specified in the Act and Listing Regulations and are independent of the management.
APPOINTMENT & REMUNERATION POLICY
The Company has an âAppointment and Remuneration Policyâ for Directors, Key Managerial Personnel and Senior Management/other employees of the Company, specifying criteria for determining qualifications, positive attributes, independence of a director and other matters which is disclosed on the website of the Company (web link: https://www.jubilantfoodworks.com/investors/ governance/policies-codes). The salient features of the Policy have been disclosed in the Corporate Governance Report forming integral part of this Boardâs Report.
PERFORMANCE EVALUATION OF THE BOARD
The Board adopted a formal mechanism for evaluating its performance and as well as of its Committees and individual Directors, including the Chairperson of the Board. The detailed process in which annual evaluation of the performance of the Board, its Chairperson, its Committees and of individual Directors has been made is disclosed in the Corporate Governance Report forming an integral part of this Boardâs Report.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY MANAGERIAL PERSONNEL
The details of Employees, Directors and Key Managerial Personnel as required under Section 197 of the Act read with the Companies (Appointment and Remuneration) Rules, 2014 is annexed herewith as Annexure âAâ forming an integral part of this Boardâs Report.
LOANS, GUARANTEES AND INVESTMENTS
Particulars of guarantee and investments made have been disclosed in Note 31 and 4 to the Standalone Financial Statements, respectively, forming an integral part of the Annual Report. During FY 2022, the Company has not given any loan pursuant to Section 186 of the Act.
All contracts, arrangements and transactions entered by the Company during FY 2022 with related parties were in the ordinary course of business and on armâs length basis and were approved by the Audit Committee. The Board of Directors of the Company had laid down the criteria for granting the omnibus approval by the Audit Committee for the transactions which are repetitive in nature, in line with the Companyâs Policy on Materiality of and dealing with Related Party Transactions (âRPT Policyâ). During the year, the Company had not entered into any materially significant transaction with related parties as defined in the RPT Policy. Accordingly, the disclosure of Related Party Transactions under Section 1 88(1 ) of the Act in Form AOC-2 is not applicable. Related Party disclosures including transactions with promoter/promoter group which hold(s) more than 10% shareholding in the Company have been disclosed in Note 33 to the Standalone Financial Statements forming an integral part of the Annual Report. The RPT Policy was modified by the Board with effect from April 1, 2022 to align the same with the statutory changes. The RPT Policy is disclosed on the Companyâs website (web link: https://www.jubilantfoodworks.com/investors/ governance/policies-codes).
Shareholders of the Company in their 22nd AGM held on August 28, 2017 appointed Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn. No. 117366W/W-100018) (âDeloitteâ), as Statutory Auditor of the Company to hold office for a period of upto five consecutive years i.e. till the conclusion of 27th AGM of the Company. In terms of the provisions of Section 139 of the Act, Deloitte is eligible for re-appointment as Statutory Auditors for a second term of five (5) consecutive years.
On the recommendation of the Audit Committee, the Board at its meeting held on May 30, 2022, recommended the re-appointment of Deloitte as Statutory Auditor of the Company for a second term of five consecutive years for approval of shareholders. Accordingly, a resolution proposing re-appointment of Deloitte as Statutory Auditor of the Company from conclusion of the 27th AGM till the conclusion of the 32nd AGM of the Company to be held in the year 2027, forms part of the Notice convening the 27th AGM of the Company.
Deloitte has consented to act as Statutory Auditor of the Company and confirmed that their aforesaid appointment, if made, would be within the limits specified under Section 141(3)(g) of the Act. They have also confirmed that they are not disqualified to be appointed as Statutory Auditors in terms of provisions of Sections 139(1) and 141(3) of the Act and the Companies (Audit and Auditors) Rules, 2014.
The Auditorsâ Report read together with Annexure referred to in the Auditorsâ Report for the financial year ended March 31, 2022 does not contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the Statutory Auditor has not reported any matter of fraud under Section 143(12) of the Act, therefore no disclosure is required under Section 134(3)(ca) of the Act.
The Board appointed M/s. Chandrasekaran Associates, Company Secretaries to conduct Secretarial Audit pursuant to the provisions of Section 204 of the Act for FY 2021-22. The Secretarial Audit Report for the financial year ended March 31,2022 received from Secretarial Auditor is annexed herewith as Annexure âBâ forming an integral part of this Boardâs Report. The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimer. During the year under review, the Secretarial Auditor has not reported any matter of frauds under Section 143(12) of the Act, therefore no disclosure is required under Section 134(3)(ca) of the Act.
The Audit Committee comprises of Mr. Ashwani Windlass as Chairman, Mr. Abhay Prabhakar Havaldar, Ms. Deepa Misra Harris, Mr. Shamit Bhartia and Mr. Vikram Singh Mehta as members. Brief terms of reference, meetings and attendance are included in the Corporate Governance
Report forming an integral part of this Boardâs Report. All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has in place Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical behavior and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower Policy was modified by the Board with effect from June 15, 2021 to make it more robust and descriptive. The details of vigil mechanism as provided in the Whistle Blower Policy has been disclosed in the Corporate Governance Report forming an integral part of this Boardâs Report. The Whistle Blower Policy is disclosed on the Companyâs website (web link: https:// www.jubilantfoodworks.com/investors/governance/ policies-codes).
Risk Management is an integral and important component of Corporate Governance. The Board of Directors of the Company has constituted Risk Management Committee (âRMCâ) which assists the Board in monitoring and reviewing the risk management plan, implementation of the risk management framework of the Company and such other functions as Board may deem fit. The Board modified the Risk Management Policy with effect from June 15, 2021 to align the same with the amendments in Listing Regulations. The Risk Management framework is in place to identify, prioritise, mitigate, monitor and appropriately report any significant threat to the organisationâs strategic objectives, its reputation, operational continuity, environment, compliance, and the health & safety of its employees. A detailed section on Risk Management is provided in the Management Discussion and Analysis Report forming an integral part of this Annual Report.
The Company has adequate internal financial controls systems in place, which facilitates orderly and efficient conduct of its business including adherence to Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. The Companyâs internal control framework are commensurate with the size and nature of its operations. M/s. Deloitte Haskins & Sells LLP, Statutory Auditor have audited the financial statements of the Company included in this Annual Report and have also confirmed the adequacy and operational effectiveness of the Companyâs internal control over financial reporting (as defined in Section 143 of the Act) as on March 31,2022. A detailed section on Internal Controls and their Adequacy is provided in the Management Discussion and Analysis Report forming an integral part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the Listing Regulations, Management Discussion and Analysis Report for the year under review is presented in a separate section, forming an integral part of this Annual Report.
BUSINESS RESPONSIBILITY REPORT
The Company believes that it can only be successful in the long term by creating value both for its shareholders and for society. The Company is committed in pursuing responsible growth and recognize its responsibility towards the society and the environment in which it operates. In terms of Regulation 34 of the Listing Regulations, Business Responsibility Report for FY 2022 detailing various initiatives taken by the Company on the environmental, social and governance front is annexed herewith as Annexure âCâ forming an integral part of this Boardâs Report.
CORPORATE SOCIAL RESPONSIBILITY
The Company has in place Corporate Social Responsibility Policy (âCSR Policyâ) which outlines the Companyâs philosophy and responsibility and lays down the guidelines and mechanism for undertaking socially impactful programs towards welfare and sustainable development of the community around the area of its operations and other parts of the Country. The Board modified the CSR Policy with effect from June 15, 2021 to align the same with the amendments in Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014. The CSR Policy is disclosed on the Companyâs website (web link: https://www.jubilantfoodworks.com/investors/ governance/policies-codes). In terms of Section 135 of the Act read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended, the Annual Report on Corporate Social Responsibility Activities for FY 2022 is annexed herewith as Annexure âDâ forming an integral part of this Boardâs Report.
The Corporate Governance philosophy of the Company is driven by the interest of stakeholders, focus on fairness, transparency and business needs of the organisation. The Company continues to be compliant with the requirements of Corporate Governance as stipulated in Listing Regulations. In terms of Regulation 27 of Listing Regulations, the Corporate Governance Report including a certificate from M/s. Chandrasekaran Associates, Company Secretaries, regarding compliance of the conditions of Corporate Governance is annexed herewith as Annexure âEâ forming an integral part of this Boardâs Report.
The Corporate Governance Report, inter-alia, contains the following disclosures:
a) Composition of Committees including Audit Committee, Nomination, Remuneration and Compensation Committee, Stakeholders Relationship Committee, Sustainability & Corporate Social Responsibility Committee, Risk Management Committee, Investment Committee and Regulatory and Finance Committee;
b) Disclosure relating to affirmation submitted by the Directors and Senior Management confirming
(C) Foreign Exchange Earnings & Outgo ('' in lakhs) |
||
Particulars |
FY 2022 |
FY 2021 |
Foreign Exchange earned in terms of actual inflows (FOB Basis) |
552.00 |
346.76 |
Foreign Exchange outgo in terms of actual outflows |
16,790.23 |
8,121.91 |
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that in the preparation of the Statement of Profit and Loss Account for the financial year ended March 31,2022 and the Balance Sheet as at that date, the Directors have:
a) followed the applicable accounting standards along with proper explanation relating to material departures;
b) selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
c) taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) prepared the annual accounts on a going concern basis;
e) laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
COMPLIANCE OF THE SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards on Meetings of the Board of Directors and on General Meetings issued by the Institute of Company Secretaries of India.
OTHER STATUTORY DISCLOSURES
During the year under review, there were no transaction requiring disclosure or reporting in respect of matters relating to:
a) Details relating to deposits covered under Chapter V of the Act. The Company had no outstanding, unpaid or unclaimed public deposits during the FY 2022;
b) Maintenance of cost records under sub-section (1) of Section 148 of the Act is not applicable to the Company;
c) Issue of equity shares with differential rights as to dividend, voting or otherwise;
d) Issue of Sweat Equity shares;
compliance of the Code of Conduct for Directors and Senior Management;
c) Dividend Distribution Policy;
d) Details of Credit Rating;
e) Details of Unpaid and Unclaimed Dividend Account and transfer to Investor Education and Protection Fund; and
f) Details of Remuneration of Directors including service contracts, notice period, severance fees, stock options held by them.
PREVENTION OF SEXUAL HARASSMENT
The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status. Pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (âPOSH Actâ), the Company has adopted a Policy on prevention of Sexual Harassment at Workplace (âPOSH Policyâ). Periodic sessions were also conducted to apprise employees and build awareness on the subject matter. Our key focus is to create a safe, respectful and inclusive workplace which fosters professional growth for each employee.
As per the requirement of the POSH Act and Rules made thereunder, the Company constituted an Internal Complaints Committee (ICC) to redress the complaints received regarding sexual harassment. The ICC meets periodically to discuss various scenarios/sample cases and steps that can be taken to ensure that POSH cases are reported and addressed uniformly across the organization. The details of the complaints received during the year under review are as follows. The Company endeavours to complete the inquiry process within the stipulated period of 90 days.
i. Complaints filed during the financial year : 22
ii. Complaints disposed off during the financial year : 21
iii. Complaints pending as on end of the financial year : 1
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO(A) Conservation of Energy
The Company continuously strives to reduce the environmental impact of its operations and lower its carbon footprint. It focusses on improving energy efficiency, increasing the use of renewable energy and improving waste management to reduce the overall environment footprint.
i) The steps taken or impact on conservation of energy
⢠Energy Management Systems (âEMSâ) are installed across all stores to reduce energy consumption.
⢠Installation of 624 Five Star rated Air Conditioners at the stores to reduce energy consumption.
⢠Installation of energy efficient lighting fixtures and HVAC (Air conditioning systems).
⢠Installation of Automatic Mains Failure (âAMFâ) panels at few stores to reduce energy consumption.
Above initiatives led to saving of ~5% in electricity usage.
⢠Installation of LED lights at all Supply Chain Centres (âSCCâ).
⢠EMS are also installed at all SCCs except Guwahati, for real time remote monitoring of electricity consumption at load level and providing actionable information for optimizing energy usage.
ii) The steps taken by the Company for utilising alternate sources of energy
⢠Solar Power Plants are installed at Greater Noida, Nagpur, Mumbai and Kolkata SCC catering to around 12% of total electricity consumption at the SCCâs (in-house installation of 1,274 KW of solar power) which has resulted in reduction of around 1,185 tCO2. This has also replaced 1,500 MWh of fossil fuel based electricity.
⢠Solar Water Heating Plant were installed at the Nagpur, Mohali and Bengaluru SCC. With this the Company has Solar Heating Plant in all SCCâs to meet the hot water requirements of the facility. Due to Solar Heating Plant, there is a reduction of around 16 tCO2.
The above steps have also resulted in savings of around '' 53 lakhs during the FY 2022.
⢠The Company first introduced electric bikes in its fleet in FY19 with an intent to reduce its carbon footprint. As on March 31, 2022, the Company had 3,822 electric bikes across multiple cities in its fleet used for food delivery.
iii) The capital investment on energy conservation equipment
Capital investment on energy conservation equipment during FY 2022 was '' 4,403.04 lakhs approx.
The Company believes in leveraging technology to transform every dimension of its business. Investments in technology infrastructure is an important element of Companyâs commitment to delivering seamless customer experience. However, there is no other specific information to be furnished in this regard.
e) Any remuneration or commission to the Wholetime Director of the Company from the subsidiaries of the Company;
f) No significant and material orders passed by the Regulators/Courts/Tribunals which impact the going concern status and Companyâs operations in future;
g) No change in the nature of the business of the Company;
h) No application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016; and
i) No instance of any one-time settlement with any Banks or Financial Institutions.
There have been no material changes and commitment, affecting the financial position of the Company which occurred between the end of the financial year 2021-22 till the date of this Report, other than those already mentioned in this Report.
Your Directors take this opportunity to thank and acknowledge with gratitude, the contribution, co-operation and assistance received from International Business Partners from Dominoâs, Dunkinâ, Popeyes, Government and Regulatory Authorities, Business Partners, Bankers, Members and other Stakeholders. Also, the Board places on record its deep appreciation for the enthusiasm, co-operation, hard work, dedication and commitment of the employees at all levels specifically the employees who stood out for service to the nation during the COVID-19 pandemic.
Your Directors also place on record their special gratitude toward the employees who were working in Supply Chain Centres and in stores for their persistence and untiring efforts helped the Company to continue serve the customers unceasingly. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain an industry leader.
Your Directors appreciate the continued co-operation and support received from its customers that has enabled the Company to make every effort in understanding their unique needs and deliver maximum customer satisfaction.
Inspired by the Vision, driven by Values and powered by Strength, your Directors and employees of the Company look forward to the future with confidence and stand committed to creating an even brighter future for all stakeholders.
For and on behalf of Board of Directors
Shyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director DIN: 00010484 DIN: 00010499
Place: Delhi Place: Noida
Date: May 30, 2022 Date: May 30, 2022
(Figures have been rounded off for the purpose of reporting)
Mar 31, 2021
Dear Members,
Your Directors have pleasure in presenting the Twenty-Sixth (26th) Annual Report, together with the Audited Standalone and Consolidated Financial Statements for the financial year ended March 31, 2021 (''FY 2021'').
A summary of the Company''s financial performance in FY 2021 is as follows:
Particulars |
('' in lakhs) Standalone Consolidated |
|||
FY 2021 |
FY 2020 |
FY 2021 |
FY 2020 |
|
Revenue from Operations |
326,887.27 |
388,577.65 |
331,187.13 |
392,727.40 |
Add: Other Income |
7,037.26 |
6,882.44 |
7,307.77 |
6,961.55 |
Total Income |
333,924.53 |
395,460.09 |
338,494.90 |
399,688.95 |
Profit before Depreciation & Amortisation, Finance Cost, Exceptional items, Tax Expense & Other Income (EBITDA) |
76,655.87 |
87,708.31 |
77,119.24 |
87,559.27 |
Profit before Depreciation & Amortisation, Finance Cost, Exceptional items & Tax Expense |
83,693.13 |
94,590.75 |
84,427.01 |
94,520.82 |
Less: Finance Cost |
16,060.28 |
16,345.36 |
16,269.78 |
16,523.50 |
Less: Depreciation & Amortisation Expense |
36,722.40 |
34,414.00 |
37,539.82 |
35,227.72 |
Profit before Exceptional items & Tax Expense |
30,910.45 |
43,831.39 |
30,617.41 |
42,769.60 |
Less: Exceptional items |
- |
4,481.03 |
- |
2,490.98 |
Profit before Tax Expense |
30,910.45 |
39,350.36 |
30,617.41 |
40,278.62 |
Less: Taxation Expense |
7,541.81 |
11,805.17 |
7,565.24 |
12,398.73 |
Profit for the year |
23,368.64 |
27,545.19 |
23,052.17 |
27,879.89 |
Other Comprehensive Income/(Loss) |
7,805.83 |
(282.43) |
7,470.07 |
(270.86) |
Total Comprehensive Income for the year |
31,174.47 |
27,262.76 |
30,522.24 |
27,609.03 |
Retained Earnings |
||||
Balance at the beginning of FY |
100,280.19 |
114,225.92 |
95,807.00 |
109,570.19 |
Add: Profit for the FY |
23,368.64 |
27,545.19 |
23,166.66 |
27,998.25 |
Less: Ind AS 116 Adjustments (net of tax) |
- |
24,066.41 |
- |
24,378.54 |
Add: Exercise/Lapse of share options |
142.48 |
76.01 |
142.48 |
76.01 |
Add: Exercise/Sale of shares held by ESOP Trust (Net of Tax) |
- |
- |
(35.33) |
13.48 |
Less: Dividend paid on Equity Shares |
- |
14,516.59 |
- |
14,516.59 |
Less: Dividend Distribution Tax |
- |
2,983.93 |
- |
2,983.93 |
Add: Dividend on shares held by ESOP Trust |
- |
- |
- |
28.13 |
Balance at the end of FY |
123,791.31 |
100,280.19 |
119,080.81 |
95,807.00 |
RESULTS OF OPERATIONS AND THE STATE OF COMPANY''S AFFAIRS
The highlights of the Company''s performance on standalone basis are as under:
a) Revenue from operations decline by 15.88% to '' 326,887.27 lakhs
b) EBITDA decreased by 12.60% to '' 76,655.87 lakhs
c) Profit before Tax decreased by 21.45% to '' 30,910.45 lakhs
d) Net Profit decreased by 15.16% to '' 23,368.64 lakhs
During FY 2021, the Company has not transferred any amount to the general reserve and entire amount of profit for the year forms part of the ''Retained Earnings''.
The Company has built a strong network of the global franchise partner Domino''s Pizza in India wherein the portfolio is complemented by another internationally renowned brand
Dunkin'' Donuts which has witnessed a transformation in the product offerings and store format. After entering Chinese cuisine segment with its homegrown brand Hong''s Kitchen, the Company further expanded its portfolio by foraying into Biryani Segment with indigenous brand Ekdum!. In addition, given the increased interest in home cooking and experimentation during the pandemic, the Company also forayed into FMCG segment with the launch of ready-to-cook range of sauces, gravies and pastes under the brand name - ChefBoss.
Further, the Company also entered into an exclusive Master Franchise and Development Agreement with PLK APAC Pte. Ltd., a subsidiary of Restaurant Brands International Inc. (RBI), to develop, establish, own and operate Popeyes® restaurants in India, Bangladesh, Nepal and Bhutan in the coming years.
Staying responsive to the winds of change, the Company leveraged its fundamental strengths in delivery, grew its digital
capabilities and adapted such strategies to remain operational throughout the pandemic. The Company has 1,360 Domino''s Pizza Restaurants, 24 Dunkin'' Donuts Restaurants, 8 Hong''s Kitchen and 4 Ekdum! Restaurants as on March 31, 2021.
Bouncing back from COVID-led disruptions
In FY 2021, with rapidly evolving COVID-19 pandemic, the Company committed itself to the nation''s fight against COVID-19 and confronted the uncertainties by focusing on health & safety of employees, business continuity while following strict SOPs of hygiene and sanitisation and maintaining food hygiene. The restaurant and Supply Chain Centre employees rose splendidly to the challenge of the Covid crisis and their persistence and untiring efforts helped the Company to continue serve the customers unceasingly. The Company owe to its employees and their families, a huge debt of gratitude for their unstinting support during the COVID-19 crisis.
Leveraging several strengths including a strong, value-for-money focused brand combined with consumer trust and credibility, execution strength together with a robust and resilient supply chain, the Company has shown tremendous agility in responding to operational needs during the COVID-19 crisis. Despite the disruption and unpredictability of the pandemic, JFL maintained its momentum, thanks to its focus on driving best-in-class operating metrics, its customer-centricity and bold strategic initiatives rolled out to steer the business higher. The evolving pattern of the pandemic notwithstanding the Company could rebound faster given its sharp focus, customer-centricity, and bold structural moves taken. The Company optimised costs across all functions to improve efficiency. The Company''s dedicated supply chain infrastructure across India enabled seamless course correction, in terms of meeting new requirements, towards business continuity and on sanitization and food safety amongst others. The Company developed a playbook to work around this pandemic and restore the business quickly to normalcy in December, 2020 and achieved 100.3% sales recovery in Domino''s.
During the year, the Company continued making investments to strengthen its digital capabilities and introduced host of promotions that enabled the Company to respond faster to new business requirements and drive sales recovery. The Company remained strongly focused on delivery and take away channels to mitigate the pressure on dine-in. As the gears shifted from synergetic combination of revenue recovery and stringent cost control phase to growth phase, despite the spate of challenges, the Company has delivered a strong all-round performance, with improvement in EBITDA margins, year-on-year.
The Business highlights has been comprehensively discussed in Management Discussion and Analysis Report forming an integral part of the Annual Report.
Your Directors have been periodically reviewing with the Management, the impact of COVID-19 on the Company. The Board and the Management will continue to closely monitor the situation as it evolves.
Based on the Company''s performance and Dividend Distribution Policy of the Company, your Directors are pleased to recommend final dividend of '' 6/- (i.e. 60%) per equity share of '' 10/- each fully paid-up for FY 2021 amounting to '' 7,918.14 lakhs, subject to the approval of members at the ensuing Annual General Meeting (AGM'') of the Company. In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the Company shall be taxable in the hands of the members. The Company shall, accordingly, make the payment of the final dividend after deduction of tax at source.
During the year under review, there was no change in the authorised, subscribed and paid-up share capital of the Company. As on March 31, 2021, the paid- up share capital of the Company stood at '' 1,319,690,400/- divided into 131,969,040 equity shares of '' 10/- each.
EMPLOYEES STOCK OPTION SCHEMES
With a view to attract, reward and retain talented and key employees in the competitive environment and encourage them to align individual performance with Company objectives, the Company grants share based benefits to eligible employees under the ESOP Schemes. The Company has two Employees Stock Option Schemes namely JFL Employees Stock Option Scheme, 2011 (''ESOP 2011'') and JFL Employees Stock Option Scheme, 2016 (''ESOP 2016''). Both the schemes are administered through JFL Employees Welfare Trust (''ESOP Trust'').
ESOP 2011: The members on August 20, 2011 approved ESOP 2011 for issuance of Employee Stock Options to the eligible employees of the Company, its holding and subsidiary(ies) in/ outside India. ESOP 2011 was last modified by the members of the Company in its meeting held on September 3, 2015. The options are granted at the exercise price fixed at the time of grant, being the market price as defined under ESOP 2011. As on March 31, 2021, 101,137 options were outstanding under ESOP 2011.
ESOP 2016: The members on November 2, 2016 approved ESOP 2016 for issuance of Employee Stock Options to the eligible employees of the Company, its holding and subsidiary(ies) in/ outside India. The options are granted at the exercise price determined by the Nomination, Remuneration and Compensation Committee and mentioned in the grant letter which shall not be less than face value of the shares
of the Company. As on March 31, 2021, 52,733 options were outstanding under ESOP 2016.
Consequent to Bonus issue in June, 2018, all the then outstanding options granted under ESOP 2011 and ESOP 2016 are entitled to bonus share in the proportion of 1:1. No dilution in paid-up share capital of the Company is expected due to exercise of options as it is envisaged to transfer the equity shares held by ESOP Trust to the employees on exercise of options under both the schemes. The details of both the schemes have also been disclosed in Note 32 to the Standalone Financial Statements and Note 31 to the Consolidated Financial Statements forming an integral part of the Annual Report.
Jubilant FoodWorks General Employee Benefit Scheme, 2020 (âJFGEBSâ) : The members on September 15, 2020 approved JFGEBS with the objective of providing healthcare (incl. preventive measures), hospital care, or benefits in the event of sickness, accident, disability, death or scholarship funds, rewards and recognitions, education, employee engagement, training for skill enhancement/ development and such other welfare activities and benefits specified by the Company. The JFGEBS would be implemented and administered by the ESOP Trust. JFGEBS does not involve issue of shares by the Company for the purposes of JFGEBS and also does not involve any secondary acquisition by the ESOP Trust.
During the year, there was no material change in ESOP 2011, ESOP 2016 and JFGEBS and all the schemes are in compliance with the SEBI (Share Based Employee Benefits) Regulations, 2014 (''ESOP Regulations''). The applicable disclosure under the ESOP Regulations as at March 31, 2021 is uploaded on the website of the Company (web link: https://www.jubilantfoodworks.com/investors/reports-presentations). Certificate from Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors, with respect to the implementation of ESOP 2011, ESOP 2016 and JFGEBS would be placed before the members at the ensuing AGM.
SUBSIDIARIES, JOINT VENTURE & ASSOCIATE COMPANIES
Jubilant Foodworks Netherlands B.V., Fides Food Systems Cooperatief U.A. & DP Eurasia N.V.
During the financial year, Jubilant Foodworks Netherlands B.V. (''JFN'') was incorporated as a wholly-owned subsidiary of the Company in Netherlands. JFN entered into a purchase agreement with Turkish Private Equity Fund II L.P. to fully acquire Fides Food Systems Cooperatief U.A. (''Fides'') which holds 32.81% equity shares in DP Eurasia N.V. DP Eurasia N.V. is a public company listed with London Stock Exchange PLC, and is the exclusive master franchisee of the Domino''s Pizza brand in Turkey, Russia, Azerbaijan and Georgia. JFN completed the acquisition on March 9, 2021. Consequent to the acquisition, Fides became wholly-owned subsidiary of the Company through JFN and DP Eurasia N.V. became associate
Company. As on March 31, 2021, the total income of JFN is '' 184.83 lakhs.
As on April 1, 2021, JFN is a material subsidiary in terms of Policy for determining Material Subsidiaries. Applicable compliances w.r.t. material subsidiary have been complied with.
Jubilant Golden Harvest Limited (âJGHLâ):
JGHL is a subsidiary and joint venture of the Company with Golden Harvest Group of Bangladesh. JGHL has exclusive rights to develop and operate Domino''s Pizza restaurants in Bangladesh. In a short span of time, JGHL has made appreciable progress in the Country and continued to deliver healthy performance in terms of orders served, restaurants added and customer satisfaction scores.
Despite of the COVID-19 crisis, performance of JGHL was encouraging. JGHL with its continued efforts and potential, utilised this opportunity and saw sustained recovery led by online delivery sales. More than two-third Delivery sales were through digital channel.
JGHL also launched two local flavour pizzas - Hariyali Chicken and Keema Dopeyaja. During the year, JGHL launched 2 restaurants taking the total count to 5 Domino''s Pizza Restaurants as on March 31, 2021. The total income of JGHL in FY 2021 is '' 1,722.04 lakhs as compared to '' 1,715.41 lakhs in FY 2020.
Jubilant FoodWorks Lanka (Private) Limited (âJFLPLâ):
JFLPL is a wholly-owned subsidiary of the Company in Sri Lanka. JFLPL has exclusive rights to develop and operate Domino''s Pizza restaurants in Sri Lanka. JFLPL continued its focus on profitable growth managed through various initiatives like rationalising discounts, reducing wastages, launch of an enhanced mobile app and focused marketing activities. As a result, for the first time ever, JFLPL business delivered a positive EBITDA in FY 2021. Despite the COVID-19 crisis, performance of JFLPL was encouraging leading to healthy business recovery.
JFLPL also launched two local flavour pizzas -SL Chicken Curry and SL Spicy Veg, a range of Pasta Pizzas and a new crust called as ''Cheese Float''. During the year, JFLPL launched 4 restaurants and relocated 2 restaurants taking the total count to 26 Domino''s Pizza Restaurants as on March 31, 2021. The total income of JFLPL in FY 2021 is '' 2,980.31 lakhs as compared to '' 3,148.23 lakhs in FY 2020.
Domino''s Pizza Sri Lanka & Bangladesh also took various initiatives during the outbreak of COVID-19 pandemic including Zero Contact Delivery and Takeaway to ensure safety of customers and employees.
A report on the performance and the Financial position of the subsidiaries, associate company and ESOP Trust, as per Companies Act, 2013 and Rules made thereunder (the ''Act'') is provided in Form AOC-1 attached to the Consolidated Financial Statements forming an integral part of the Annual Report. Pursuant to the provisions of Section 136 of the Act, separate audited accounts of the subsidiaries, are available on the website of the Company (web link: https://www. jubilantfoodworks.com/investors/reports-presentations).
Apart from above, no other company have become or ceased to be subsidiary, joint venture or associate of the Company during the financial year.
As per Section 134(3)(a) of the Act, the Annual Return referred to in Section 92(3) of the Act for the financial year ended on March 31, 2021 is available on the website of the Company (web link: https://www.jubilantfoodworks.com/investors/ reports-presentations).
MEETINGS OF BOARD OF DIRECTORS
Nine (09) Meetings of Board of Directors were held during FY 2021. The details of the meetings of the Board and its Committees are given in the Corporate Governance Report forming an integral part of this Report.
DIRECTORS AND KEY MANAGERIAL PERSONNELâS
In terms of Articles of Association of the Company and provisions of the Act, Mr. Hari S. Bhartia, Director of the Company, is liable to retire by rotation at the ensuing AGM and being eligible, offer himself for re-appointment. The Board of Directors recommend his re-appointment for consideration by the members of the Company at the ensuing AGM.
During the year, Mr. Prakash C. Bisht, EVP & Chief Financial Officer and Key Managerial Personnel of the Company resigned from the Company with effect from close of business hours of February 15, 2021 to join another Jubilant group entity as a Chief Financial Officer.
Mr. Ashish Goenka was appointed as EVP & Chief Financial Officer and Key Managerial Personnel of the Company with effect from February 17, 2021. He is a qualified Chartered Accountant, Company Secretary and MBA. He is a seasoned Finance Leader with 18 years of experience in finance & strategy with FMCG & Telecom Industry. His core strengths include driving business strategy and performance, accounting and financial management, financial planning and analysis, corporate governance and risk management.
The shareholders of the Company in their 22nd AGM appointed Mr. Pratik R. Pota as CEO & Wholetime Director for a period of five years from April 1, 2017 up to March 31, 2022. In the
same AGM the shareholders appointed Mr. Berjis Minoo Desai as Non-Executive Independent Director for a period of five years from May 29, 2017, up to May 28, 2022. Considering the vast experience, acumen, positive attributes and significant contribution made by each of the individual director above and recommendations of the Nomination, Remuneration and Compensation Committee, the Board (subject to the approval of the shareholders) in their meeting held on June 15, 2021 approved:
a) Re-appointment of Mr. Pratik R. Pota as Chief Executive Officer & Wholetime Director of the Company for a further period of three years from April 1, 2022, up to March 31, 2025;
b) Re-appointment of Mr. Berjis M. Desai as Non-Executive Independent Director of the Company for a second term of five consecutive years with effect from May 29, 2022 up to May 28, 2027.
In the opinion of the Board, Mr. Pratik R. Pota and Mr. Berjis M. Desai fulfils the conditions specified in the Companies Act, 2013 and the Rules made thereunder and under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''the Listing Regulations''). The Company has received notices under Section 160 of the Act proposing appointment of above-mentioned Directors of the Company.
All the Independent Directors of the Company have given their declarations to the Company under Section 149(7) of the Act that they meet the criteria of independence as provided under Section 149(6) of the Act read with Regulation 16(1 )(b) of the Listing Regulations and are not disqualified from continuing as Independent Directors and that they have registered themselves as an Independent Director in the data bank maintained with the Indian Institute of Corporate Affairs. Based on the disclosures received, the Board is of the opinion that, all the Independent Directors fulfill the conditions specified in the Act and Listing Regulations and are independent of the management.
A brief profile, expertise of Directors and other details as required under the Act, Secretarial Standard-2 and the Listing Regulations relating to the directors proposed to be re-appointed is annexed to the notice convening the AGM.
During the year under review, except as stated above, there were no changes in the Directors or Key Managerial Personnel''s of the Company.
APPOINTMENT & REMUNERATION POLICY
The Company has a Policy on appointment and remuneration of Directors, Key Managerial Personnel and Senior Management/other employees of the Company which is disclosed on the website of the Company (web link: https:// www.jubilantfoodworks.com/investors/policies/). The salient
features of the Policy have been disclosed in the Corporate Governance Report forming an integral part of this Report.
PERFORMANCE EVALUATION OF THE BOARD
The Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual Directors, including the Chairperson of the Board. The evaluation was carried out through a structured questionnaire covering various aspects of the functioning of Board and its Committees. The detailed process in which annual evaluation of the performance of the Board, its Chairperson, its Committees and of individual Directors has been made is disclosed in the Corporate Governance Report forming an integral part of this Report.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY MANAGERIAL PERSONNELâS
The details of Employees, Directors and Key Managerial Personnel as required under Section 197 of the Act read with the Companies (Appointment and Remuneration) Rules, 2014 is annexed herewith as Annexure âA'' forming an integral part of this Board''s Report.
LOANS, GUARANTEES AND INVESTMENTS
Particulars of investments made under the provisions of Section 186 of the Act have been disclosed in Note 4 to the Standalone Financial Statements forming an integral part of the Annual Report. During the year, the Company has not given any loan or provided any guarantees pursuant to Section 186 of the Act.
All contracts, arrangements and transactions entered by the Company during FY 2021 with related parties were in the ordinary course of business and on arm''s length basis and were approved by the Audit Committee. The Board of Directors of the Company had laid down the criteria for granting the omnibus approval by the Audit Committee for the transactions which are repetitive in nature, in line with the Company''s Policy on Materiality of and dealing with Related Party Transactions (''RPT Policy''). During the year, the Company had not entered into any materially significant transaction with related parties as defined in the RPT Policy. Accordingly, the disclosure of Related Party Transactions under Section 188(1) of the Act in Form AOC-2 is not applicable. Related Party disclosures including transactions with promoter/promoter group which hold(s) more than 10% shareholding in the Company have been disclosed in Note 33 to the Standalone Financial Statements forming an integral part of the Annual Report.
AUDITORS AND AUDITORâS REPORT Statutory Auditors
Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn. No. 117366W/W-100018) (''Deloitte''), were appointed as Statutory Auditors of the Company to hold office from the conclusion of 22nd AGM until the conclusion of 27th AGM of
the Company, subject to the ratification by members at every AGM. Further, at the 23rd AGM held on September 27, 2018, members approved ratification of the appointment of Statutory Auditors to hold office from the conclusion of 23rd AGM until the conclusion of 27th AGM of the Company to be held in the year 2022, without any further requirement of ratification at every intervening AGM.
The Auditors'' Report read together with Annexure referred to in the Auditors'' Report for the financial year ended March 31, 2021 do not contain any qualification, reservation, adverse remark or disclaimers. During the year under review, the Statutory Auditors have not reported any matter of frauds under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134 (3)(ca) of the Act.
The Secretarial Audit Report for the financial year ended March 31,2021 received from M/s. Chandrasekaran Associates, Company Secretaries, Secretarial Auditors of the Company is annexed herewith as Annexure âB'' forming an integral part of this Board''s Report. The Report does not contain any qualifications, reservations, adverse remarks or disclaimers. During the year under review, the Secretarial Auditors have not reported any matter of frauds under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
The Audit Committee comprises of Mr. Ashwani Windlass as Chairman, Mr. Abhay Prabhakar Havaldar, Ms. Deepa Misra Harris, Mr. Shamit Bhartia and Mr. Vikram Singh Mehta as members and Mr. Pratik R. Pota is a permanent invitee. Brief terms of reference, meetings and attendance are included in the Corporate Governance Report forming an integral part of this Board''s Report. All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company.
WHISTLE-BLOWER POLICY/VIGIL MECHANISM
The Company has in place Whistle-Blower Policy (''Policy'') and has established the necessary vigil mechanism for Directors and employees in confirmation with Section 177(9) of the Act and Regulation 22 of Listing Regulations, to report concerns about unethical behaviour. The details of vigil mechanism as provided in the Policy have been disclosed in the Corporate Governance Report forming an integral part of this Board''s Report. The Policy was modified by the Board with effect from June 15, 2021 to make it more robust and descriptive. The Policy is disclosed on the Company''s website (web link: https:// www.jubilantfoodworks.com/investors/policies/).
Risk Management is an integral and important component of Corporate Governance. The Board of Directors of the Company
has constituted Risk Management Committee (''RMC'') which assists the Board in monitoring and reviewing the risk management plan, implementation of the risk management framework of the Company and such other functions as Board may deem fit. The Company has in place Risk Management Policy (''Policy'') and the same has been implemented in order to identify elements of risk, if any, which in the opinion of the Board may threaten the existence of the Company. A detailed section on Risk Management is provided in the Management Discussion and Analysis Report forming an integral part of the Annual Report. The Board modified the Policy in its meeting held on June 15, 2021 with immediate effect to align the same with the amendments in Listing Regulations.
The Company has adequate internal financial controls systems in place, which facilitates orderly and efficient conduct of its business including adherence to Company''s policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. The Company''s internal control framework are commensurate with the size and nature of its operations. M/s. Deloitte Haskins & Sells LLP, Statutory Auditors have audited the financial statements of the Company included in this annual report and have also confirmed the adequacy and operational effectiveness of JFL''s internal control over financial reporting (as defined in Section 143 of the Act) as on March 31, 2021. A detailed section on Internal Controls and their Adequacy is provided in the Management Discussion and Analysis Report forming an integral part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the Listing Regulations, Management Discussion and Analysis Report for the year under review is presented in a separate section, forming an integral part of the Annual Report.
BUSINESS RESPONSIBILITY REPORT
The Company believes that it can only be successful in the long term by creating value both for its shareholders and for society. The Company is committed in pursuing responsible growth and recognise its responsibility towards the society and the environment in which it operates. In terms of Regulation 34 of the Listing Regulations, Business Responsibility Report for FY 2021 detailing various initiatives taken by the Company on the environmental, social and governance front is annexed herewith as Annexure âC'' forming an integral part of this Board''s Report.
CORPORATE SOCIAL RESPONSIBILITY
The Company has in place Corporate Social Responsibility Policy (''Policy'') which outlines the Company''s philosophy and responsibility and lays down the guidelines and mechanism for
undertaking socially impactful programs towards welfare and sustainable development of the community around the area of its operations and other parts of the Country. The Board modified the Policy in its meeting held on June 15, 2021 with immediate effect to align the same with the amendments in Section 135 of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 (''CSR Rules''). The Policy is disclosed on the Company''s website (web link: https://www. jubilantfoodworks.com/investors/policies/). In terms of Section 135 of the Act read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended, the Annual Report on Corporate Social Responsibility Activities for FY 2021 is annexed herewith as Annexure âD'' forming an integral part of this Board''s Report.
The Corporate Governance philosophy of the Company is driven by the interest of stakeholders, focus on fairness, transparency and business needs of the organisation. The Company continues to be compliant with the requirements of Corporate Governance as stipulated in Listing Regulations. In terms of Regulation 27 of Listing Regulations, the Corporate Governance Report including a certificate from M/s. Chandrasekaran Associates, Company Secretaries, Secretarial Auditors of the Company regarding compliance of the conditions of Corporate Governance is annexed herewith as Annexure âEâ forming an integral part of this Board''s Report.
The Corporate Governance Report, inter alia, contains the following disclosures:
a) Composition of Committees including Audit Committee, Nomination, Remuneration and Compensation Committee, Stakeholders Relationship Committee, Sustainability & Corporate Social Responsibility Committee, Regulatory and Finance Committee, Investment Committee and Risk Management Committee
b) Disclosure relating to affirmation submitted by the Directors and Senior Management confirming compliance of the Code of Conduct for Directors and Senior Management
c) Dividend Distribution Policy
d) Details of Credit Rating
e) Details of Unpaid and Unclaimed Dividend Account and transfer to Investor Education and Protection Fund
f) Details of Remuneration of Directors including Service Contracts, Notice Period, Severance Fees, Stock Options held by them
PREVENTION OF SEXUAL HARASSMENT
The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status. Pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013 (''POSH Act''), the Company has adopted a Policy on prevention of sexual harassment at workplace (''POSH Policy''). Periodic sessions were also conducted to apprise employees and build awareness on the subject matter. Our key focus is to create a safe, respectful and inclusive workplace which fosters professional growth for each employee.
As per the requirement of the POSH Act and rules made thereunder, the Company constituted an Internal Complaints Committee to redress the complaints received regarding sexual harassment. The Internal Complaints Committee meets periodically to discuss various scenarios/sample cases and steps that can be taken to ensure that POSH cases are reported and addressed uniformly across the organisation. The details of the complaints received during the year under review are as follows. The Company endeavours to complete the inquiry process within the stipulated period of 90 days.
i. Complaints filed during the financial year: 18
ii. Complaints disposed off during the financial year: 18
iii. Complaints pending as on end of the financial year: 0
CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
(A) Conservation of Energy
The Company is committed to take effective measures to conserve energy and drive energy efficiency in its operations and also continuously making efforts on increasing use of renewable energy and enhancing waste management to reduce the carbon footprint. The Company also strives to focus on technologies, processes and improvements that matters for the environment.
During the year, the Company undertook some cost-effective energy-efficiency initiatives across its Restaurants and Supply Chain Centres (''SCC'').
i) The steps taken or impact on conservation of energy
⢠Installation of 786 Five Star rated Air Conditioners at the restaurants to reduce energy consumption.
⢠Installation of Motion Sensors at 1,028 restaurants to reduce energy consumption.
⢠Installation of Automatic Mains Failure (''AMF'') panels at few restaurants to reduce energy consumption.
⢠Energy Monitoring Systems (''EMS'') upgraded across 504 restaurants to reduce energy consumption. EMS are also installed at SCC''s located at Greater Noida, Mumbai, Bengaluru, Mohali, Nagpur, Kolkata and Hyderabad for real time remote monitoring of electricity consumption at load level and providing actionable information for optimising energy usage. This initiative leads to the saving of approx. 1.2% in electricity usage.
⢠Solar Water Heating Plant installed at Mumbai, Kolkata and Greater Noida SCC. With this the Company has Solar Heating Plant in 5 SCC''s and plan to explore the same
in other manufacturing unit. Due to Solar Heating Plant, there is a reduction of approx. 9.9 tonnes of carbon dioxide emission.
⢠Solar Power Plant are installed at Greater Noida, Nagpur, Mumbai and Kolkata SCC catering to 21.7% of total electricity consumption at the SCC which has resulted in reduction of approx. 1,483 tonnes of carbon dioxide emission.
ii) The steps taken by the Company for utilising alternate sources of energy
I ntroduction of 602 E-bikes and 100 E-bicycles for restaurants in FY 2021.
iii) The capital investment on energy conservation equipment
Capital investment on energy conservation equipment during FY 2021 was '' 10.1 crores approx.
(B) Technology Absorption
The Company believes in leveraging technology to transform every dimension of its business. Investments in technology infrastructure is an important element of Company''s commitment to delivering seamless customer experience. Further, steps taken towards Energy Conservation are the result of technology absorption. However, there is no other specific information to be furnished in this regard.
(C) Foreign Exchange Earnings & Outgo
('' in lakhs) |
||
Particulars |
FY 2021 |
FY 2020 |
Foreign Exchange earned in terms of actual inflows (FOB Basis) |
346.76 |
833.25 |
Foreign Exchange outgo in terms of actual outflows |
8,121.91 |
12,784.01 |
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that:
(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) they have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
(c) they have had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) they have prepared the annual accounts on a going concern basis;
(e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
COMPLIANCE OF THE SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards on Meetings of the Board of Directors and on General Meetings issued by the Institute of Company Secretaries of India.
OTHER STATUTORY DISCLOSURES
During the year under review:
(a) No deposits have been accepted by the Company from the public. The Company had no outstanding, unpaid or unclaimed public deposits at the beginning and end of FY 2021.
(b) Maintenance of cost records under sub-section (1) of Section 148 of the Act is not applicable to the Company.
(c) No equity shares were issued with differential rights as to dividend, voting or otherwise.
(d) No Sweat Equity shares were issued.
(e) The Wholetime Director of the Company doesn''t receive any remuneration or commission from the subsidiaries of the Company.
(f) No significant and material orders were passed by the Regulators/ Courts/ Tribunals which impact the going concern status and Company''s operations in future.
(g) There was no change in the nature of the business of the Company.
(h) Details of application or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 is not applicable to the Company.
(i) Details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions is not applicable to the Company.
There has been no material change and commitment, affecting the financial performance of the Company which occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report. However, subsequent to the current financial year end, Assessing Officer (Income Tax) has passed an order and raised demand of '' 13,828.73 lakhs pertaining to FY 2016-17 on account of adjustment of Royalty and Advertisement, Marketing and Promotion (AMP) expense dated April 20, 2021 u/s 143(3) read with Section 144B along with a demand notice order u/s 156 and penalty notices, resulted
into finalization of order instead of issuance of draft order, as envisaged under Sections 144B and 144C of the Income Tax Act. The Company has filed writ petition before Delhi High Court on April 17, 2021 against the impugned order being against the provision of income tax and hence is bad in law, treating it void ab initio. The High Court issued the interim order and stayed operation of the impugned order and accompanying notice of demand as well as notices of penalty. Basis expert opinion and other legal and commercial grounds, the Company is of the view that the demand is not tenable and is remote in nature and thus will not have an impact on the financial statements of the Company.
Your Directors take this opportunity to thank and acknowledge with gratitude, the contribution, co-operation and assistance received from International Business Partners from Domino''s Pizza, Dunkin'' Donuts, Popeyes®, Government and Regulatory Authorities, Business Partners, Bankers, Members and other Stakeholders. Also, the Board places on record its deep appreciation for the enthusiasm, co-operation, hard work, dedication and commitment of the employees at all levels specifically the employees who stood out for service to the nation during the COVID-19 pandemic.
Your Directors also place on record their special gratitude toward the employees who were working in Supply Chain Centres and in restaurants for their persistence and untiring efforts helped the Company to continue serve the customers unceasingly. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain an industry leader.
Your Directors appreciate the continued co-operation and support received from its customers that has enabled the Company to make every effort in understanding their unique needs and deliver maximum customer satisfaction.
Inspired by the Vision, driven by Values and powered by Strength, your Directors and employees of the Company look forward to the future with confidence and stand committed to creating an even brighter future for all stakeholders.
For and on behalf of the Board of Directors
Shyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director
DIN: 00010484 DIN: 00010499
Place: Singapore Place: Dubai
Date: June 15, 2021 Date: June 15, 2021
(Figures have been rounded off for the purpose of reporting)
Mar 31, 2018
Dear Members,
The Directors have pleasure in presenting the Twenty Third (23rd) Annual Report, together with the Audited Standalone and Consolidated Financial Statements for the Financial Year ended March 31, 2018 (âFY 2018â).
Financial Performance
A summary of the Companyâs financial performance in FY 2018 is as follows:
(Rs. in Lakhs)
Particulars |
Standalone |
Consolidated |
||
FY 2018 |
FY 2017 |
FY 2018 |
FY 2017 |
|
Sales & Other Income |
300,316.45 |
256,055.47 |
304,147.67 |
259,813.14 |
Profit before Interest, Depreciation & Tax but after exceptional items |
46,911.59 |
24,890.39 |
46,316.64 |
24,370.37 |
Less: Interest |
- |
- |
- |
- |
Less: Depreciation |
15,587.75 |
15,115.25 |
16,010.58 |
15,543.22 |
Profit / (Loss) before Tax |
31,323.84 |
9,775.14 |
30,306.06 |
8,827.15 |
Less: Provision for Taxation |
10,683.36 |
3,049.69 |
10,683.36 |
3,049.69 |
Profit / (Loss) after Tax |
20,640.48 |
6,725.45 |
19,622.70 |
5,777.46 |
Results of Operations and the State of Companyâs Affairs
The highlights of the Companyâs performance for FY 2018 vis-a-vis FY 2017 are as under:
a) Revenue from operations increased by 17.1% to Rs.298,044 Lakhs
b) EBITDA increased by 81% to Rs.44,639.20 Lakhs
c) Profit before Tax increased by 220.44% to Rs.31,323.84 Lakhs
d) Net Profit increased by 206.9% to Rs.20,640.48 Lakhs
During the year, there are no transfer to the General Reserves.
No material changes and commitments have occurred after the close of the Financial Year till the date of this Report, which affect the financial position of the Company.
The Company with two strong brands in its portfolio addressing different food market segments and is in a sweet spot to leverage on the growth potential of food services segment in India.
During the year, the Company identified key driving the strategic pillars of product and innovation, value for money, customer experience, digital and technology while bringing cost optimization with a clear focus on sustainable growth. Companyâs emphasis on driving the key strategic pillars translated into healthy same store sales growth YoY, while setting the base for consistent growth in line with the potential of the Quick Service Restaurant (QSR) space.
During the year, the implementation of structural reforms mainly Goods and Services Tax (GST) led to positive change for the organized Restaurant industry. The lowering in rate of applicable GST to 5% allowed the Company to demonstrate its commitment to deliver the best value proposition as the Company passed on the benefits of lower tax rate to the customers while taking a small calibrated price increase on few products to partially cover for the input credit loss.
Dominoâs Pizza India (âDPIâ) continuously focused on Innovation for resonating with consumersâ evolving tastes and meeting their expectations. With the launch of âAll New Dominoâsâ, Dominoâs Pizza unveiled its most significant product refresh with an across the board enhancement of its pizzas delighting consumers with the choicest taste and best quality. The 360-degree marketing campaign with the tagline Aapne Kaha, Humne Kiyaâ. The upgrade in core pizzas saw massive acceptance as reflected in new consumer acquisition as well as increase in existing consumerâs frequency. Further diversifying its side product offering, DPI launched three new formats of chicken products with international flavours.
The Company successfully added 24 Restaurants during the year. DPIâs network spanned across 266 cities as on March 31, 2018, as against 264 cities as on March 31, 2017. Seven (7) Restaurants were decommissioned during the year as they failed to deliver on the Companyâs expected ROI parameters. As of March 31, 2018, the DPI network comprised 1,134 Restaurants as against 1,117 Restaurants as on March 31, 2017.
At Dunkinâ Donuts India (âDDIâ), a new focus was brought on beverage and donuts, while food continued to be a strong play. The focused strategy of enhancing core offerings, driving efficiencies along with shutdown of unprofitable stores led to significant reduction in DDI losses. DDI has also experimented with smaller Restaurant size.
As an innovation, DDI launched Value range of donuts and signature donuts including Chocotella, White Choco Cheesecake, Choco Symphony and Coffee Toffee. Shaken Iced Coffee, Caramel Hazelnut Latte and Tiramisu Latte were among the new beverages launched during the year. On the food side, Toasties (Chilli Cheese and Chicken) and Big Joy Mayo Burger were added to the menu. DDI drove Value for Money by introducing a range of donuts at Rs.49 and also introduced a Donut Coffee combo at Rs.89 with the objective of seeding the Donuts Coffee habit.
DDI was cautious in its expansion strategy aligned to the Companyâs overarching strategy of profitable growth. Five (5) new Restaurants were opened in FY 2018 while 31 Restaurants were decommissioned. The total number of DDI Restaurants stood at 37 as on March 31, 2018 as against 63 as on March 31, 2017.
In the fourth quarter of FY 2018, the Company also commissioned its state-of-the-art facility in Greater Noida, a prestigious accomplishment for the Company that will give a better overall efficiency at the commissary level as well. The Commissary will have manufacturing capacity for dough ball and for a couple of other lines as well.
During the year, there was no change in the nature of the business of the Company.
Bonus Issue
The Board of Directors at its meeting held on May 08, 2018, recommended issue of bonus shares, subject to the approval of members, to the holders of equity shares of the Company in the proportion of 1 (One) equity share of Rs.10/- each fully paid up for every 1 (One) equity share of Rs.10/- each fully paid up as on the record date fixed for this purpose. The bonus shares will be issued by capitalisation of a part of the Securities Premium Account.
Dividend
Based on the Companyâs performance, your Directors are pleased to recommend dividend of Rs.5/- (i.e. 50%) per equity share of Rs.10/- each for FY 2018 amounting to Rs.3,299.23 lakhs (excluding Dividend Distribution Tax of Rs.678.17 lakhs), subject to approval of members at the ensuing Annual General Meeting (âAGMâ) of the Company.
The above referred dividend of Rs.5/- per equity share of Rs.10/- each is recommended by the Board of Directors on the basis of the existing paid up share capital of the Company (pre bonus share capital). Upon approval of issuance of Bonus shares, the dividend payout (post bonus issue) will work out to Rs.2.50/- per equity share of Rs.10/- each.
Share Capital
The movement of the share capital during the year is as follows:
(Amount in Rs.)
Particulars |
Equity Share Capital |
At the beginning of the year i.e. as on April 01, 2017 |
659,490,700 |
65,949,070 equity shares of Rs.10/- each |
|
Stock Options allotted during the year under |
|
Dominoâs Employees Stock Option Plan, 2007 |
354,500 |
and JFL Employees Stock Option Scheme, 2011 |
|
35,450 equity shares of Rs.10/- each |
|
At the end of the year i.e. as on March 31, 2018 |
659,845,200 |
65,984,520 equity shares of Rs.10/- each |
To facilitate the issuance of Bonus Shares and for future requirements, the Board of Directors, subject to the approval of the members, approved the increase in Authorized Share Capital of the Company to Rs.1,500,000,000/- (Rupees One Hundred Fifty Crore) divided into 150,000,000 (Fifteen Crore) equity shares of Rs.10/- each by creation of additional 70,000,000 (Seven Crore) equity shares of Rs.10/- each ranking pari passu in all the respect with the existing equity shares of the Company. The increase in Authorised Share Capital would lead to consequential amendment in the existing Capital Clause of the Memorandum of Association of the Company.
Employees Stock Option Schemes
The Company has three (3) Employees Stock Option Schemes namely:
Dominoâs Employees Stock Option Plan, 2007 (âESOP 2007â) JFL Employees Stock Option Scheme, 2011 (âESOP 2011â) JFL Employees Stock Option Scheme, 2016 (âESOP 2016â)
ESOP 2007: During FY 2018, 6,000 options were exercised. Consequently, all options outstanding under the scheme have been exercised and no further grants were made.
ESOP 2011: During FY 2018, 33,932 options were granted under the scheme to the employees of the Company. Further, 179,631 options were exercised during the year.
ESOP 2016: During FY 2018, 20,947 options were granted under the scheme to the employees of the Company.
JFL Employees Welfare Trust (âESOP Trustâ): ESOP Trust acquired 380,670 equity shares from the secondary market for the purpose of implementation of ESOP 2011 and ESOP 2016. Out of this, 151,181 equity shares were transferred to the employees pursuant to exercise of options.
No change in paid up capital is expected due to exercise of options as it is envisaged to transfer the equity shares held by ESOP Trust to the employees on exercise of options.
The applicable disclosure under SEBI (Share Based Employee Benefits) Regulations, 2014 (the âESOP Regulationsâ) as at March 31, 2018 is uploaded on the website of the Company (web link: http://www.jubilantfoodworks.com/investors/ financial-information-2/).
There has been no material change in the ESOP 2007, ESOP 2011 & ESOP 2016 (collectively referred as âESOP Schemesâ) of the Company and the ESOP Schemes are in compliance with the ESOP Regulations.
Certificates from Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors, with respect to the implementation of ESOP Schemes would be placed before the members at the ensuing AGM and a copy of the same shall be available for inspection at the Registered Office & Corporate Office of the Company.
Subsidiary and Joint Venture
Jubilant FoodWorks Lanka (Private) Limited (âJFLPLâ)
During the year, the wholly owned subsidiary Company launched 1 (one) new Dominoâs Pizza Restaurant, taking its total Restaurant count to 24 (twenty four) as on March 31, 2018 (23 Restaurant count as on March 31, 2017). In line with DPI, Every Day Value proposition was also rolled out for Sri Lanka business. New pizzas and sides were introduced in the menu to fuel excitement among the consumers.
A report on the performance and the financial position of JFLPL, as per Companies Act, 2013 and Rules made thereunder (the âActâ) is provided in Form AOC-1 attached to the Consolidated Financial Statements forming integral part of the Annual Report.
Pursuant to the provisions of Section 136 of the Act, separate audited accounts of JFLPL, are available on the website of the Company at www.jubilantfoodworks.com.
Jubilant Golden Harvest Limited
During the year under review, the Company announced joint venture with Golden Harvest QSR Ltd. (Golden Harvest), part of Golden Harvest group of Bangladesh to launch Dominoâs Pizza Restaurants in Bangladesh.
For the purpose of this joint venture, a private limited Company, Jubilant Golden Harvest Limited (âJGHLâ) was incorporated. No investments were made in JGHL by the Company. Subsequent to investment, the Company will be the majority shareholder with 51% of the total shareholding, while Golden Harvest will hold the balance 49%.
Extracts of Annual Return
The extracts of Annual Return as required under the Act in Form MGT - 9 is annexed herewith as Annexure âAâ forming integral part of this Report.
Directors and Key Managerial Personnel
In terms of Articles of Association of the Company and provisions of the Act, Mr. Hari S. Bhartia, Director of the Company, is liable to retire by rotation at the ensuing AGM and being eligible, offer himself for re-appointment. The Board of Directors recommend his re-appointment for the consideration of the members of the Company at the ensuing AGM.
A brief profile and other details as required under the Act, Secretarial Standard-2 and Listing Regulations of the director proposed to be re-appointed is annexed to the Notice convening the AGM.
During the year, Mr. Sachin Sharma, President & Chief Financial Officer and Key Managerial Personnel of the Company resigned from the Company with effect from July 22, 2017.
Mr. Prakash C. Bisht was appointed as EVP & Chief Financial Officer and Key Managerial Personnel of the Company with effect from January 19, 2018. He is a Chartered Accountant with over three decades of experience in the area of Financial Reporting, Financial Planning & Analysis, M&A transactions, Fund raising, Corporate Structuring, IT solution implementation and Commercial Operations.
Particulars of Employees, Directors & Key Managerial Personnel
The details of Employees, Directors and Key Managerial Personnel as required under Section 197 of the Act read with Companies (Appointment and Remuneration) Rules, 2014 is annexed herewith as Annexure âBâ forming integral part of this Report.
Loans, Guarantees and Investments
Particulars of loans, guarantees and investments made under the provisions of Section 186 of the Act have been disclosed in Note 04 to the Standalone Financial Statements forming integral part of the Annual Report.
Related Party Transactions
All contracts, arrangements and transactions entered by the Company during FY 2018 with related parties were in the ordinary course of business and on armâs length basis and were approved by the Audit Committee. During the year, the Company had not entered into any materially significant transaction with related parties as defined in the Companyâs Policy on materiality and dealing with related party transactions (the âpolicyâ). Accordingly the disclosure of Related Party Transactions in Form AOC 2 is not applicable.
Related Party disclosures have been disclosed in Note 33 to the Standalone Financial Statements forming integral part of the Annual Report.
Auditors and Auditorâs Report
Statutory Auditors
Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn. No. 117366W/W-100018) (Deloitte), were appointed as Statutory Auditors of the Company to hold office from the conclusion of 22nd AGM until the conclusion of 27th AGM of the Company, subject to ratification by the members at every intervening AGM.
The Board of Directors has recommended ratification of appointment of Deloitte as Statutory Auditors to the members of the Company.
The Auditorsâ Report read together with Annexure referred to in the Auditorsâ Report do not contain any qualification, reservation, adverse remark or disclaimers. During the year under review, the Statutory Auditors have not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134 (3)(ca) of the Act.
Secretarial Auditors
The Secretarial Audit Report for the Financial Year ended March 31, 2018 received from Chandrasekaran Associates, Secretarial Auditors of the Company is annexed herewith as Annexure âCâ forming integral part of this report. The said report is self-explanatory and does not contain any qualification, reservation, adverse remark or disclaimers.
Risk Management
The detailed Risk Review is provided in the Management Discussion & Analysis section forming integral part of the Annual Report.
Internal Financial Control
The Company has in place adequate internal financial controls with reference to Financial Statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under review, in terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ) is presented in a separate section, forming integral part of the Annual Report.
Business Responsibility Report
Regulation 34 of Listing Regulations mandates inclusion of the Business Responsibility Report (âBRRâ) as part of the Annual Report for top five hundred (500) listed entities based on market capitalization as on March 31 of every Financial Year.
In compliance with Listing Regulations, BRR is annexed as Annexure âDâ forming integral part of this Report.
Corporate Social Responsibility
In terms of Section 135 of the Act read with the Companies (Corporate Social Responsibility) Rules, 2014 as amended (âCSR Rulesâ), the Board of Directors have approved a Corporate Social Responsibility Policy (âCSR Policyâ) that strives towards welfare and sustainable development of the different segments of the community, specifically the deprived and underprivileged segment.
The Annual Report on CSR is annexed as Annexure âEâ forming integral part of this Report.
Corporate Governance
The Corporate Governance philosophy of the Company is driven by the interest of stakeholders and business needs of the organization. The Company continues to be compliant with the requirements of Corporate Governance as enshrined in Listing Regulations. In terms of Regulation 27 of Listing Regulations, the Corporate Governance Report is annexed as Annexure âFâ forming integral part of this Report.
The Corporate Governance Report, inter-alia, contains the following disclosures:
a) Details of Board & Committee Meetings;
b) Composition of Sustainability and Corporate Social Responsibility Committee;
c) Details of Whistle Blower Policy (Vigil Mechanism);
d) Dividend Distribution Policy;
e) Appointment & Remuneration Policy;
f) Performance Evaluation criteria of the Board, its Committees & individual Directors.
Sexual Harassment
Pursuant to the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has adopted a policy on prevention of sexual harassment at workplace.
The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status.
During the Calendar year, the Company received 1 (one) complaint which was suitably addressed.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
A) Conservation of Energy
The Company is committed to take effective measures to conserve energy and drive energy efficiency in its operations and also continuously making efforts on increasing use of renewable energy and enhancing waste management to reduce the carbon footprint. The Company also strives to focus on technologies, processes and improvements that matter for the environment.
Accordingly, the Company undertook some cost-effective energy-efficiency initiatives across its Restaurants and Supply Chain Centres (âSCCâ).
i) The steps taken or impact on conservation of energy
Installation of energy efficient LED Lights in all Restaurants and SCC.
Installation of Energy Management System in 425 (approx.) Restaurants.
Installation of Energy Saving Sensors in the AC System of 388 (approx.) Restaurants. Solar Power plant at Nagpur, Kolkata, and Mumbai SCCs. Efforts are on to install plants at Greater Noida SCC.
Onsite Sewage Treatment Plant at Greater Noida SCC to treat 100% of the waste water generated.
ii) The steps taken by the Company for utilizing alternate sources of energy in few Restaurants
Conversion of Liquefied Petroleum Gas Fuel into Piped Natural Gas for Ovens installed.
iii) The capital investment on energy conservation equipment:
(B) Technology Absorption
All steps taken towards Energy Conservation are the result of technology absorption, however, there is no specific information to be furnished in this regard.
(C) Foreign Exchange Earnings & Outgo
Information pertaining to Foreign Exchange Earnings & Outgo is as under:-
Directors Responsibility Statement
Your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit of the Company for that period;
c) they have had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and Based on the framework of internal financial controls including the financial reporting and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and the reviews performed by the management, the Board is of the opinion that the Companyâs internal financial controls are adequate and effective during the FY 2018.
f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Other Statutory Disclosures
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
a) No deposits have been accepted by the Company during the year from the public. The Company had no outstanding, unpaid or unclaimed public deposits at the begining and end of financial year 2017-18.
b) No equity shares were issued with differential rights as to dividend, voting or otherwise.
c) Issue of shares (including sweat equity shares) to employees of the Company under any Scheme save and except ESOP Schemes referred to in this Report.
d) The Wholetime Director of the Company doesnât receive any remuneration or commission from its subsidiary Company.
e) No significant or material orders were passed by the Regulators/Courts/Tribunals which impact the going concern status and Companyâs operations in future.
The Company has complied with the applicable Secretarial Standards on Meetings of the Board of Directors and on General Meetings issued by the Institute of Company Secretaries of India.
Acknowledgements
Your Directors take this opportunity to thank and acknowledge with gratitude the cooperation and assistance received from Dominoâs International, Dunkinâ Donuts International, Government and Regulatory Authorities, Business Partners, Bankers, Members and other Stakeholders. Also, the Board places on record its appreciation for the enthusiastic, co-operation, hard work, dedication and commitment of the employees at all levels.
Your Directors would also like to appreciate the confidence and loyalty displayed by the guests, whom the Company always strive to serve better.
For and on behalf of the Board of Directors
Sd/- Sd/-
Shyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director
DIN No. 00010484 DIN No. 00010499
Place: Noida
Date: May 08, 2018
(Figures have been rounded off for the purpose of reporting)
Mar 31, 2017
Dear Members,
The Directors have pleasure in presenting the Twenty Second (22nd) Annual Report, together with the Audited Financial Statements of the Company for the Financial Year ended March 31, 2017 ("FY 2017").
Financial Performance
Pursuant to the notification dated February 16, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards ("Ind AS") with effect from April 1, 2016 (transition date being April 1, 2015). Accordingly, financial statements for the year ended March 31, 2016 and March 31, 2017 have been prepared in accordance with the recognition and measurement principles laid down in the Ind AS 34 "Interim Financial Reporting" prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules issued there under and the other accounting standards generally accepted in India.
(Rs, in Lakhs)
Particulars |
Standalone |
Consolidated |
||
FY 2017 |
FY 2016 |
FY 2017 |
FY 2016 |
|
Sales & Other Income |
256,055.47 |
242,153.78 |
259,813.14 |
244,954.70 |
Profit before Interest, Depreciation & Tax but after exceptional items |
24,890.39 |
28,310.02 |
24,370.37 |
27,526.02 |
Less: Interest |
0 |
0 |
0 |
0 |
Less: Depreciation |
15,115.25 |
12,426.89 |
15,543.22 |
12,824.46 |
Profit / (Loss) before Tax |
9,775.14 |
15,883.13 |
8,827.15 |
14,701.56 |
Less: Provision for Taxation |
3,049.69 |
5,220.79 |
3,049.69 |
5,012.56 |
Profit / (Loss) after Tax |
6,725.45 |
10,662.34 |
5,777.46 |
9,689.00 |
Results of Operations and the State of Company''s Affairs
The highlights of the Company''s performance for FY 2017 are as under:
a) Revenue from operations increased by 5.6% to Rs, 254,607 lakhs
b) EBITDA decreased by 9.3% to Rs, 24,659 lakhs
c) Profit before Tax decreased by 38.5% to Rs, 9,775 lakhs
d) Net Profit decreased by 36.9% to Rs, 6,725 lakhs
During the year, there are no transfer to the General Reserves.
No material changes and commitments have occurred after the close of the financial year till the date of this Report, which affect the financial position of the Company.
FY 2017 was a year of designing and implementing strategy for driving the Company''s evolution to the next phase of profitable growth. During FY 2017, the Company continued to focus on optimum network expansion and driving technology platform to enhance the customer experience and improving operational efficiency. The Company invested and implemented initiatives to deliver long-term growth for its business, while closely managing the short-term events which influence performance.
While the economic growth momentum was temporarily impacted with demonetization during the year, the Company sustained its focus on the cost rationalization and improving efficiencies.
Domino''s Pizza and Dunkin'' Donuts Restaurant network expansion was focused on alignment with the Return on Investment norms of the Company and the external operating environment. The Company increased its reach amongst relevant consumers by entry of Domino''s Pizza in the State of Nagaland. During FY 2017, Domino''s Pizza India entered 29 new cities which takes the spread to a total of 1,117 Restaurants in 264 cities. The total number of Dunkin'' Donuts Restaurant stands at 63 in 16 cities as on March 31, 2017.
With the focus on improving profitability, few existing restaurants that failed to deliver the Company''s expected ROI parameters were decommissioned during the year.
With the launch of Burger Pizza, the Company aimed to grow its share in the ''all day, individual consumption'' occasion and further grow its share in the chained Indian Food Service Industry. Burger Pizza and Pizza Mania Extremes were among the two most innovative products launched targeted to delight consumers, met with good response and achieved the internal launch objectives.
Dunkin'' Donuts India ("DDI") on the other hand, continued its efforts to strengthen its position in the sweet spot between the QSR and the Cafe markets.
Continuous and renewed efforts were made to improve beverage and donut sales and bringing value offerings to food range. A number of product launches were made to cater rapidly evolving consumer taste and preferences such as Big Joy Burger, Munchkins, Eggless Donuts Cakes and Dunky Doos
- a new range of donuts for the young guests. The range of Big Joy Burger was extremely popular with the consumers.
During the year, there was no change in the nature of the business of the Company.
Dividend
Based on the Company''s performance, your Directors are pleased to recommend dividend of Rs, 2.50/- (i.e. 25%) per equity share of Rs, 10/- each fully paid up for FY 2017 amounting to Rs, 1,648.73 lakhs (excluding Dividend Distribution Tax of Rs, 335.64 lakhs), subject to approval of members at the ensuing Annual General Meeting ("AGM") of the Company.
Share Capital
The movement of the share capital during the year is as follows:
Particulars |
Equity Share Capital (in Rs,) |
At the beginning of the year i.e. as on |
657,951,060 |
April 1, 2016 |
|
Stock Options allotted during the year : |
|
- Domino''s Employees Stock Option Plan, |
876,640 |
2007 (87,664 equity shares of Rs, 10 each) |
|
- JFL Employees Stock Option Scheme, |
663,000 |
2011 (66,300 equity shares of Rs, 10 each) |
|
At the end of the year i.e. as on |
659,490,700 |
March 31, 2017 |
Employees Stock Option Schemes
In order to motivate, incentivize and reward employees, the Company instituted various Employees Stock Option Schemes from time to time. The Company has three (3) Employees Stock Option Schemes namely:
- Domino''s Employees Stock Option Plan, 2007 ("ESOP 2007")
- JFL Employees Stock Option Scheme, 2011 ("ESOP 2011")
- JFL Employees Stock Option Scheme, 2016 ("ESOP 2016")
The Company implemented ESOP 2016, which was approved by the members through Postal Ballot dated November 02, 2016. The total number of options granted under ESOP 2016 shall not exceed 350,000 (Three Lakh Fifty Thousand). Each option when exercised shall be converted into 1 (one) fully paid up equity share of the Company.
During FY 2017, 10,272 options were granted under ESOP 2011 and 14,528 options were granted under ESOP 2016. The applicable disclosure under SEBI (Share Based Employee Benefits) Regulations, 2014 (the "ESOP Regulations") as at March 31, 2017 is uploaded on the website of the Company (Web link: http://www.jubilantfoodworks.com/investors/ financial-information-2/)
Further, ESOP 2007, ESOP 2011 & ESOP 2016 (collectively referred as "ESOP Schemes") of the Company are in compliance with the ESOP Regulations.
Certificates from S. R. Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors, with respect to the implementation of ESOP Schemes would be placed before the members at the ensuing AGM and a copy of the same shall be available for inspection at the Registered Office & Corporate Office of the Company.
Operations of Subsidiary
Jubilant Food Works Lanka (Private) Limited ("JFLPL")
During the year, the subsidiary Company launched 3 (three) new Domino''s Pizza Restaurant, taking its total Restaurant count to 23 (Twenty Three) as on March 31, 2017 (20
Restaurant count as on March 31, 2016). Through steady expansion of the restaurant network, new restaurants were launched in Kalutara, Kotahena and Boralesgamuwa, marking Domino''s Pizza foray in these cities.
In addition to providing consumers with differentiated and innovative choices, the menu was revamped during the year and now it is catering completely to the Sri Lankan taste. Through ongoing aggressive marketing communication and promotion strategy together with enhancement of operational service level, JFLPL aimed to reach out to more consumers and generate brand loyalty.
A report on the performance and the financial position of JFLPL, as per Companies Act, 2013 and rules made there under (the "Act") is provided in Form AOC 1 attached to the Consolidated Financial Statements forming integral part of the Annual Report.
Pursuant to the provisions of Section 136 of the Act, separate audited accounts of JFLPL, are available on the website of the Company at www.jubilantfoodworks.com.
During FY 2017, there were no companies which became/ ceased to exist as Subsidiary, Joint Venture or Associate of the Company.
Extracts of Annual Return
The extracts of Annual Return as required under the Act in Form MGT - 9 is annexed herewith as Annexure "A" forming integral part of this Report.
Directors and Key Managerial Personnel
In terms of Articles of Association of the Company and provisions of the Act, Mr. Shyam S. Bhartia, Director of the Company, is liable to retire by rotation at the ensuing AGM and being eligible, offer himself for re-appointment. The Board of Directors recommend his re-appointment for the consideration of the members of the Company at the ensuing AGM.
During the year, Mr. Sachin Sharma was appointed as President & Chief Financial Officer and Key Managerial Personnel of the Company with effect from September 3, 2016.
Mr. Ajay Kaul, CEO cum Whole time Director and Key Managerial Personnel of the Company resigned from the services of the Company with effect from close of the business hours of March 31, 2017. The Board placed on record their deep sense of appreciation for the significant contribution made by him during his tenure towards the stupendous growth of the Company.
Based on the recommendations of the Nomination, Remuneration and Compensation Committee ("NRC"), Board''s approval and subject to members approval in ensuing AGM:-
1) Mr. Pratik Pota was appointed as CEO and Whole time Director of the Company with effect from April 1, 2017;
2) Mr. Berjis Desai was appointed as an Additional Director (Independent) of the Company with effect from May 29, 2017; and
3) Mr. Shamit Bhartia and Ms. Aashti Bhartia were appointed as Additional Directors (Non-Executive) of the Company with effect from May 29, 2017.
The Company has received notices under Section 160 of the Act together with requisite deposit from members proposing appointment of above mentioned Directors of the Company.
The Company has received necessary declaration from each Independent Director under Section 149(7) of the Act that he/ she meets the criteria of independence laid down in the Act and SEBI (Listing Obligations and Disclosures Requirements), Regulations 2015 ("Listing Regulations").
A brief profile and other details as required under the Act, Secretarial Standard-2 and Listing Regulations, of Directors proposed to be appointed/re-appointed are annexed to the notice convening AGM.
Particulars of Employees, Directors & Key Managerial Personnel
The details of Employees, Directors and Key Managerial Personnel as required under Section 197 of the Act read with Companies (Appointment and Remuneration) Rules, 2014 is annexed herewith as Annexure "B" forming integral part of this Report.
Loans, Guarantees and Investments
Particulars of loans, guarantees and investments made under the provisions of Section 186 of the Act have been disclosed in Note 4 of the notes to the Standalone Financial Statements forming integral part of the Annual Report.
Related Party Transactions
All contracts, arrangements and transactions entered by the Company during FY 2017 were in the ordinary course of business and on arm''s length basis. During the year, the Company had not entered into any contract, arrangement and transaction with related parties which could be considered material in accordance with the Company''s Policy on materiality and dealing with related party transactions (the "policy") and accordingly the disclosure of Related Party Transactions in Form AOC 2 is not applicable. The Policy as approved by the Board is uploaded on the website of the Company (Web link: http://www.jubilantfoodworks.com/ investors/policies/).
Related Party disclosures have been disclosed in Note 32 of the notes to the Standalone Financial Statements forming integral part of Annual Report.
Auditors and Auditor''s Report Statutory Auditors
As per Section 139 of the Act read with the Companies (Audit and Auditors) Rules, 2014, the term of S. R. Batliboi & Co. LLP (ICAI Regn. No. 301003E/E300005), Chartered Accountants, as the Statutory Auditors of the Company expires at the conclusion of the ensuing AGM of the Company. The Board place on record its appreciation for the ethical standards and quality maintained by S. R. Batliboi & Co. LLP as the Statutory Auditors of the Company.
On the recommendation of the Audit Committee, the Board recommended the appointment of M/s Deloitte Haskins & Sells LLP, Chartered Accountants (ICAI Regn. No. 117366W/ W-100018), as the Statutory Auditors of the Company for an initial term of five (5) years. Accordingly, a resolution, proposing appointment of M/s Deloitte Haskins & Sells
LLP, Chartered Accountants, as the Statutory Auditors of the Company from the conclusion of 22nd AGM till the conclusion of 27th AGM of the Company, forms part of the Notice of the 22nd AGM of the Company.
The Company has received the consent & eligibility certificate from M/s Deloitte Haskins & Sells LLP, Chartered Accountants under Section 139(1) and 141 of the Act and that the appointment, if made, shall be in accordance with the applicable provisions of the Act and rules framed there under.
The Auditors'' Report read together with Annexure referred to in the Auditors'' Report does not contain any qualification, reservation, adverse remark or disclaimers. During the year under review, the Statutory Auditors have not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134 (3)(ca) of the Act.
Secretarial Auditors
The Board appointed M/s Chandrasekaran Associates, Practicing Company Secretaries to conduct Secretarial Audit for FY 2017. The Secretarial Audit Report for the Financial Year ended March 31, 2017 is annexed herewith as Annexure "C" forming integral part of this report. The said report is self-explanatory and does not contain any qualification, reservation, adverse remark or disclaimers.
Risk Management
The detailed Risk Review is provided in the Management Discussion & Analysis section forming integral part of the Annual Report.
Internal Financial Control
The Company has in place adequate internal financial controls with reference to Financial Statements. During the year, such controls were tested and no reportable material weakness in the design or operations were observed.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the year under review, in terms of Regulation 34 of the Listing Regulations is presented in a separate section, forming integral part of the Annual Report.
Dividend Distribution Policy
Pursuant to Regulation 43A of Listing Regulations, the Board of Directors of the Company approved the Dividend Distribution Policy of the Company ("the Policy") which provides the guidance for declaration of dividend and its payout by the Company. The Policy is uploaded on the website of the Company (Web link: http://www.jubilantfoodworks. com/investors/policies/) and is provided in the Corporate Governance Report forming integral part of the Annual Report.
Business Responsibility Report
Regulation 34 of Listing Regulations mandates inclusion of the Business Responsibility Report ("BRR") as part of the Annual Report for top five hundred (500) listed entities based on market capitalization as on March 31 of every financial year.
In compliance with Listing Regulations, BRR is annexed as Annexure "D" forming integral part of this Report.
Corporate Social Responsibility
In terms of Section 135 of the Act read with the Companies (Corporate Social Responsibility) Rules, 2014 as amended ("CSR Rules"), the Board of Directors have approved a Corporate Social Responsibility Policy (CSR Policy) that strives towards welfare and sustainable development of the different segments of the community, specifically the deprived and underprivileged segment.
Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. The Company endeavor''s to continuously make focused efforts to evolve and ramp up the CSR activities in both social and environmental spheres improving the quality of life of the people in the society through its CSR endeavors.
The Annual Report on CSR is annexed as Annexure "E" forming integral part of this Report.
Corporate Governance
The Corporate Governance philosophy of the Company is driven by the interest of stakeholders and business needs of the organization. The Company continues to be compliant with the requirements of Corporate Governance as enshrined in Listing Regulations. In terms of Regulation 27 of Listing Regulations, the Corporate Governance Report along with certificate received from M/s Chandrasekaran Associates, Practicing Company Secretaries certifying compliance with the conditions of Corporate Governance is annexed as Annexure "F" forming integral part of this Report.
The Corporate Governance Report, inter-alia, contains the following disclosures:
a) Details of Board & Committee Meetings
b) Composition of Sustainability and Corporate Social Responsibility Committee
c) Whistle Blower Policy (Vigil Mechanism)
d) Appointment & Remuneration Policy
e) Performance Evaluation criteria of the Board, its Committees & individual Directors
Transfer to Investor Education and Protection Fund (IEPF)
Pursuant to applicable provisions of the Act read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules
2016, the Company has transferred unclaimed and unpaid share application money received at the time of initial public offer of the Company in 2010 to the IEPF established by the Central Government.
Sexual Harassment
Pursuant to the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has adopted a policy on prevention of sexual harassment at workplace.
The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status.
During the Calendar year, the Company has not received any complaint.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
A) Conservation of Energy
The Company is committed to take the effective measures to conserve energy and drive energy efficiency in its operations. Accordingly, the Company undertook some cost-effective energy-efficiency initiatives across all its Restaurants and Supply Chain Centres ("SCC").
i) The steps taken or impact on conservation of energy
Installation of energy efficient LED Lights in all restaurants and SCC.
Installation of Energy Management System in 434 (approx.) restaurants.
Installation of Energy Saving Sensors in the AC System of 394 (approx.) restaurants.
ii) The steps taken by the Company for utilizing alternate sources of energy in few restaurants
Conversion of Liquefied Petroleum Gas Fuel into Piped Natural Gas for Ovens installed. Introduction of cycles for delivery on trial basis. Introduction of Compressed Natural Gas Scooters on trial basis.
- Evaluation of lithium battery operated E-bikes on trial basis.
iii) The capital investment on energy conservation equipment
(Rs, in Lakhs)
Particulars |
Amount |
Installation of Energy Management System |
17.37 |
Installation of AC Energy Saver System |
25.93 |
Investment in power efficient LED Lights in certain restaurants & SCC |
126.79 |
B) Technology Absorption
All steps taken towards Energy Conservation are the result of technology absorption, however, there is no specific information to be furnished in this regard.
C) Foreign Exchange Earnings & Outgo
Information pertaining to Foreign Exchange Earnings & Outgo is as under:__(Rs, in Lakhs)
Particulars |
FY 2017 |
FY 2016 |
Foreign Exchange Earnings |
- |
- |
Export of Goods (FOB value basis) |
- |
- |
Total Inflow |
- |
- |
CIF Value of Imports (Accrual basis) |
||
Raw Materials & Components |
151.74 |
198.21 |
Store & Spares |
4.08 |
- |
Capital Goods |
227.29 |
106.92 |
Expenditure in Foreign Currency (Accrual Basis) |
||
Foreign Travel |
3.67 |
17.56 |
Franchisee Fees |
7,717.78 |
7,299.14 |
Store Opening Fees |
388.78 |
551.38 |
Total Outflow |
8,171.23 |
7,868.08 |
Directors Responsibility Statement
Your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
c) they have had 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) t hey have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
Based on the framework of internal financial controls including the financial reporting and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and the reviews performed by the management, the Board is of the opinion that the Companyâs internal financial controls are adequate and effective during the FY 2017.
f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Other Statutory Disclosures
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
a) Details relating to deposits covered under Chapter V of the Act.
b) Issue of equity shares with differential rights as to dividend, voting or otherwise.
c) Issue of shares (including sweat equity shares) to employees of the Company under any Scheme save and except ESOP Schemes referred to in this Report.
d) The Whole time Director of the Company doesn''t receive any remuneration or commission from its subsidiary Company.
e) No significant or material orders were passed by the Regulators/Courts/Tribunals which impact the going concern status and Company''s operations in future.
Acknowledgements
Your Directors take this opportunity to thank and acknowledge with gratitude the cooperation and assistance received from Domino''s International, Dunkin'' Donuts International, Government and Regulatory Authorities, Business Partners, Bankers, Members and other Stakeholders. Also, the Board places on record its appreciation for the enthusiastic, cooperation, hard work, dedication and commitment of the employees at all levels.
Your Directors would also like to appreciate the confidence and loyalty displayed by the guests, whom the Company always strive to serve better.
For and on behalf of the Board of Directors
Sd/- Sd/-
Shyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director
DIN No. 00010484 DIN No. 00010499
Place: Noida
Date: May 29, 2017
Mar 31, 2016
Dear Members,
The Directors have pleasure in presenting the Twenty First (21st)
Annual Report, together with the Audited Financial Statements of the
Company for the Financial Year ended March 31, 2016 ("FY 2016").
FINANCIAL PERFORMANCE
(Rs. In Lakhs)
Particulars Standalone Consolidated
FY 2016 FY 2015 FY 2016 FY 2015
Sales & Other Income 241,629 208,188 244,422 210,029
Profit before Interest,
Depreciation & Tax 29,123 27,021 28,336 26,260
Less: Interest - - - -
Less: Depreciation 12,427 9,815 12,824 10,112
Profit / (Loss) before Tax 16,696 17,206 15,512 16,148
Less: Provision for
Taxation 5,240 4,878 5,032 5,040
Profit / (Loss) after Tax 11,456 12,328 10,481 11,108
RESULTS OF OPERATIONS AND THE STATE OF COMPANY''S AFFAIRS
The highlights of the Company''s performance for the FY 2016 are as
under:
a) Revenue from operations increased by 13.93% to Rs. 241,021 Lakhs
b) EBITDA increased by 7.84% to Rs. 28,515 Lakhs
c) Profit before Tax decreased by 3.05% to Rs. 16,696 Lakhs
d) Net Profit decreased by 7.61% to Rs. 11,456 Lakhs
During the year, there are no transfer to the General Reserves.
No material changes and commitments have occurred after the close of
the year till the date of this Report, which affect the financial
position of the Company.
As the fiscal ended, the Company delivered yet another year of
consistent and profitable growth aided by well-defined strategies that
optimize multiple strengths of the Company and its iconic brands
Domino''s Pizza and Dunkin'' Donuts.
During the year, the Company continued to elevate its initiatives with
a twin goal of growing business and delighting the consumers by
creating innovative offerings. While economic factors posed as
headwinds for growth, the Company successfully leveraged its business
model, brand strength, national footprint and well established connect
with consumers to deliver growth.
The Company sustained its strong focus on strengthening its brands by
deep understanding of consumer insights, investing in new product
innovation, bolstering the technology infrastructure, supply chain
systems, growing retail presence, driving strong execution and
ultimately enhancing the consumer experience.
Along with growth, the Company also maintains focus areas such as food
safety and quality assurance have always remained a priority.
Initiatives like training programs, implementation of various
guidelines, regular food quality and safety assessments, strict
parameters for business partners and other stringent internal norms,
are embedded in everyday operations of the Company.
Domino''s Pizza India ("DPI") continued on its strong growth path marked
by the accomplishment of reaching 1000th restaurant.
With the 1000th restaurant, India joins the USA, where the brand has
been operating since 1960, to become the only other country with over
1000 restaurants. Continuing with its systematic approach to expansion,
DPI achieved the target of opening 150 new restaurants. DPI entered 39
new cities which takes the spread to a total of 1,026 restaurants in
235 cities as on March 31, 2016.
The success of Chef''s range of exotic Italian pizzas and double crunch
pizzas launched during the year are corroboration of proactively
addressing evolving consumer patterns.
Dunkin'' Donuts India ("DDI") on the other hand, continued to expand
gradually across existing and new cities in India. It''s all day part
offerings are resonating well with customers making rapid strides to
gain their affection.
During the year, the Company has taken a strategic move and
decommissioned 3 restaurants and revised the restaurant opening target
downwards. The total number of DDI Restaurants stands at 71 in 23
cities as on March 31, 2016.
In Dunkin'' Donuts, focus was on innovation across all day part food
items that resulted in latest innovation and menu addition which are
Donut cakes marking the Company''s entry into the packaged food segment.
With a view to attract new consumers, reinvigorate interest and drive
repeat orders, menu innovation were done with the launch of Too Much
Burgers, Voodoo Wraps, Coolattas along with the fresh range of Coffees
which received an outstanding consumer response.
During the year, there was no change in the nature of the business of
the Company.
DIVIDEND
Based on the Company''s performance, your Director''s are pleased to
recommend dividend of Rs. 2.50/- (i.e. 25%) per equity share of Rs.
10/- each fully paid up for the FY 2016 amounting to Rs. 1,644.88 Lakhs
(excluding Tax of Rs. 334.86 Lakhs), subject to approval of members at
the ensuing Annual General Meeting ("AGM") of the Company.
SHARE CAPITAL
During FY 2016, the Company issued 167,303 equity shares of Rs. 10/-
each on the exercise of stock options under Domino''s Employees Stock
Option Plan, 2007 and 58,013 equity shares of Rs.10/- each on the
exercise of stock options under JFL Employees Stock Option Scheme,
2011. Consequently, the issued, subscribed and paid-up equity share
capital of the Company has increased from Rs. 655,697,900/- consisting
of 65,569,790 equity shares of Rs. 10/- each as at March 31, 2015 to
Rs. 657,951,060/- consisting of 65,795,106 equity shares of Rs. 10/-
each as at March 31, 2016.
EMPLOYEES STOCK OPTION SCHEMES
The Company has two (2) Employees Stock Option Schemes at present:
- Domino''s Employees Stock Option Plan, 2007 ("ESOP 2007")
- JFL Employees Stock Option Scheme, 2011 ("ESOP 2011")
During the FY 2016, no options were granted under any of the schemes.
The applicable disclosures under SEBI (Share Based Employee Benefits)
Regulations, 2014 (the "ESOP Regulations") as at March 31, 2016 is
uploaded on the website of the Company (Web link: http://www.
jubilantfoodworks.com/investors/ financial-information-2/)
During the year, ESOP 2011 was modified vide shareholder''s approval
dated September 3, 2015 to align the provisions of the Scheme with ESOP
Regulations including but not limited to facilitating Secondary
Acquisition of shares by JFL Employees Welfare Trust or acquisition by
way of gift in accordance with applicable laws. Further, the ESOP
Schemes of the Company are in compliance with ESOP Regulations.
Certificate from S. R. Batliboi & Co. LLP, Chartered Accountants,
Statutory Auditors, with respect to the implementation of ESOP 2007 &
ESOP 2011 would be placed before the members at the ensuing AGM and a
copy of the same shall be available for inspection at the Registered
Office of the Company.
REGISTERED AND CORPORATE OFFICE OF THE COMPANY
The Registered Office of the Company was shifted to Plot 1A, Sector
16A, Noida - 201301, U.P., India effective April 01, 2016.
During the year, the Corporate Office was also shifted to 5th Floor,
Tower D, Plot No. 5, Logix Techno Park, Sector 127, Noida - 201304,
U.P., India. New Corporate Office brings both the brands under one
roof. The office is designed with the vibrant theme based walls
reflecting the young, fun loving employees, technologically advanced
meeting rooms that allows them to thrive by co-working in the
organizational community.
Earlier, the Registered and Corporate Office of the Company was
situated at B-214, Phase-II, Dist. Gautam Budh Nagar, Noida - 201305,
U.P., India.
OPERATIONS OF SUBSIDIARY
Jubilant FoodWorks Lanka (Pvt.) Ltd.("JFLPL")
The Company''s wholly owned subsidiary, JFLPL continued to expand
steadily Domino''s Pizza brand in Sri Lanka. During the year, the
subsidiary Company launched five (5) new Domino''s Pizza Restaurant,
taking its total Restaurant count to twenty (20) as on March 31, 2016.
(15 Restaurant count as on March 31, 2015)
In order to reach a broader universe of consumers and simultaneously
strengthening the brand equity various initiatives were taken during
the year. To bolster technology, JFLPL successfully launched its Online
Ordering ("OLO") and the mobile app for Mobile ordering.
A report on the performance and the financial position of JFLPL, as per
Companies Act, 2013 and rules made thereunder (the "Act") is provided
in Form-AOC 1 attached to the Consolidated Financial Statements forming
integral part of Annual Report.
Pursuant to the provisions of Section 136 of the Act, separate audited
accounts of JFLPL, are available on the website of the Company at
www.jubilantfoodworks.com.
During FY 2016, there were no companies which become/ ceased to exist
as Subsidiaries, Joint Venture or Associate of the Company.
EXTRACTS OF ANNUAL RETURN
The extracts of Annual Return as required under the Act in Form MGT-9
is annexed herewith as Annexure "A" forming integral part of this
Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In terms of Articles of Association of the Company and provisions of
the Act, Mr. Hari S. Bhartia, Director of the Company, is liable to
retire by rotation at the ensuing AGM and being eligible, offer himself
for re-appointment. The Board of Directors recommend his re-appointment
for the consideration of the members of the Company at the ensuing AGM.
Mr. Ravi Shanker Gupta, President & Chief Financial Officer and Key
Managerial Personnel of the Company resigned from the services of the
Company with effect from the close of the business hours of July 11,
2016. The Board placed on record their sincere appreciation for the
valuable contribution made by him during his tenure.
The Company received necessary declaration from each Independent
Director under Section 149 (7) of the Act that he/ she meets the
criteria of independence laid down in the Act and Listing Regulations.
During the year, there was no change in the constitution of the Board
of Directors of the Company.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY MANAGERIAL PERSONNEL
The details of Employees, Directors and Key Managerial Personnel as
required under Section 197 of the Act read with Companies (Appointment
and Remuneration) Rules, 2014 is annexed herewith as Annexure "B"
forming integral part of this Report.
LOANS, GUARANTEES AND INVESTMENTS
Particulars of loans, guarantees and investments made under the
provisions of Section 186 of the Act have been disclosed in note no. 12
of the notes to the Standalone Financial Statements forming integral
part of Annual Report.
RELATED PARTY TRANSACTIONS
All contracts, arrangements and transactions entered by the Company
during FY 2016 were in the ordinary course of business and on arm''s
length basis. During the year, the Company had not entered into any
contract, arrangement and transaction with related parties which could
be considered material in accordance with the Company''s Policy on
materiality of and dealing with related party transactions (the
"Policy") and accordingly the disclosure of Related Party Transactions
in Form AOC-2 is not applicable. The Policy as approved by the Board is
uploaded on the website of the Company (Web link:
http://www.jubilantfoodworks.com/investors/policies/)
Related Party disclosures have been disclosed in note no. 29 of the
notes to the Standalone Financial Statements forming integral part of
Annual Report.
AUDITORS AND AUDITOR''S REPORT Statutory Auditors
S. R. Batliboi & Co. LLP (ICAI Regn. No. 301003E/E300005), Chartered
Accountants, Statutory Auditors of the Company will retire at the
conclusion of 21st AGM of the Company and being eligible, have offered
themselves for re-appointment as Statutory Auditors. The Company
received the consent & eligibility certificate from S. R. Batliboi &
Co. LLP under Section 139(1) and 141 of the Act. The Board of Directors
recommend their re-appointment from the conclusion of 21st AGM till the
conclusion of 22nd AGM of the Company.
Auditors'' Report read together with Annexure referred to in the
Auditors'' Report does not contain any qualification, reservation,
adverse remark or disclaimers.
Secretarial Auditors
The Board appointed Chandrasekaran Associates, Practising Company
Secretaries to conduct Secretarial Audit for FY 2016. The Secretarial
Audit Report for the Financial Year ended March 31, 2016 is annexed
herewith as Annexure "C" forming integral part of this report. The said
report is self-explanatory and does not contain any qualification,
reservation, adverse remark or disclaimers.
RISK MANAGEMENT
Risk Management is a holistic, integrated, structured and disciplined
approach to manage risks. It involves identifying potential events that
may affect the Company and formulating strategy to manage these events
while ensuring that the risk exposure remains at the defined
appropriate levels.
The Company has developed and implemented comprehensive risk assessment
and mitigation procedures as laid down in the Company''s Risk Management
Policy duly approved by the Board. There are no risks identified by
the Board which may threaten the existence of the Company.
The detailed Risk Review is provided in the Management Discussion &
Analysis section forming integral part of Annual Report.
INTERNAL FINANCIAL CONTROL
The Company has in place adequate internal financial controls with
reference to Financial Statements. During the year, such controls were
tested and no reportable material weakness in the design or operations
were observed.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility ("CSR") in the Company is based on the
vision of nation building, values and sustainability. The Company
believes in actively assisting in the improvement of the quality of
life of the people in the society through its CSR endeavors. The
Company has adopted a Corporate Social Responsibility Policy ("CSR
Policy") as approved by the Board that strives towards welfare and
sustainable development of the different segment of the society at
large, specifically the deprived and underprivileged.
The CSR Policy laid down by the Company ensures that the:
- CSR agenda is integrated with the business
- Focused efforts are made in the identified community development
areas to achieve the expected outcomes
- Support in nation-building through CSR activities
In terms of CSR Policy, the Company shall endeavor to focus in the
areas of:
1. Skill Development
2. Nutrition
3. Education
4. Swachh Bharat Abhiyan
5. Road Safety
6. Disaster response Program
The Annual Report on CSR is annexed as Annexure "D" forming integral
part of this Report.
CORPORATE GOVERNANCE
Being a value-driven organization, the Company is committed towards
being ethical, transparent and building trust of its shareholders,
employees, business partners and other stakeholders which is based on
the principles of good corporate governance.
The Corporate Governance philosophy of the Company is driven by the
interest of stakeholders and business needs of the organization.
Corporate governance is essential for the growth, profitability and
stability of any business. Aligning itself to this philosophy, the
Company has placed Corporate Governance on a high priority.
In terms of Regulation 27 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (the "Listing Regulations"), the
Corporate Governance Report along with certificate received from M/s
Chandrasekaran Associates, Practising Company Secretaries certifying
compliance with the conditions of Corporate Governance is annexed as
Annexure "E" forming integral part of this Report. The Corporate
Governance Report, inter-alia, contains the following disclosures:
a) Details of Board & Committee Meetings
b) Composition of Sustainability & Corporate Social Responsibility
Committee
c) Whistle Blower Policy (Vigil Mechanism)
d) Appointment & Remuneration Policy (for Directors, Key Managerial
Personnel, Senior Management and other Employees of the Company)
pursuant to the provision of Section 178 of the Act read with Clause 49
of erstwhile Listing Agreement (corresponding to Regulation 19 of the
Listing Regulations)
e) Performance Evaluation criteria of the Board, its Committees &
individual Directors
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report for the year under
review, in terms of Regulation 34 of the Listing Regulations is
presented in a separate section, forming integral part of the Annual
Report.
SEXUAL HARRASMENT
Pursuant to the provisions of The Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013, the
Company has adopted a policy on prevention of sexual harassment at
workplace.
The Company is committed towards promoting the work environment that
ensures every employee is treated with dignity and respect and afforded
equitable treatment irrespective of their gender, race, social class,
caste, creed, religion, place of origin, sexual orientation, disability
or economic status.
During the Calendar year, the Company has not received any complaint.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
A) Conservation of Energy
The Company values the significance of conservation of energy and
remain conscious about the environmental impact of its business
operations and continuously strives to improve energy efficiency
through various initiatives. During the year, the Company undertook a
variety of energy conservation measures across all its Restaurants and
Commissaries/ Supply Chain Centres ("SCC"), making continuous efforts
for judicious use of energy at all levels of operations by utilizing
energy efficient system and processes.
i) The steps taken or impact on conservation of energy
- Installation of energy efficient LED Lights in all restaurants and
SCC.
- Installation of Energy Management System in 400 (approx.) restaurants
- Due to Company''s innovative approach in Oven Technology, LPG
Consumption in all restaurants reduced
- Installation of Energy Saving Sensors in the AC System of 300
(approx.) restaurants.
- Procurement of E-bikes for some restaurants on trial basis.
ii) The steps taken by the Company for utilizing alternate sources of
energy
Apart from Mumbai SCC, the Company has installed 200 KW Solar Power
plant at Nagpur SCC and is in the process of installing 200 KW Solar
Power Plant at Kolkata SCC. Efforts are on to install plants at other
locations also.
iii) The capital investment on energy conservation equipment
(Rs. In Lakhs)
Particulars of Investment Amount
Installation of Energy Management System 271.14
Installation of AC Energy Saver System 200.37
Procurement of E-bikes 4.96
Investment in power efficient LED Lights in 171.21
certain restaurants & SCC
(B) Technology Absorption
All steps taken towards Energy Conservation are the result of
technology absorption, however, there is no specific information to be
furnished in this regard.
(C) Foreign Exchange Earnings & Outgo
Information pertaining to Foreign Exchange Earnings & Outgo is given in
note no. 32 of the notes forming part of the Standalone Financial
Statements.
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that:
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures;
b) they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit of the
Company for that period;
c) they have had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls to be followed by
the Company and that such internal financial controls are adequate and
were operating effectively; and
Based on the framework of internal financial controls including the
financial reporting and compliance systems established and maintained
by the Company, work performed by the internal, statutory and
secretarial auditors and the reviews performed by the management, the
Board is of the opinion that the Company''s internal financial controls
are adequate and effective during the Financial Year 2015-16.
f) they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
OTHER STATUTORY DISCLOSURES
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these
items during the year under review:
a) Details relating to deposits covered under Chapter V of the Act.
b) Issue of equity shares with differential rights as to dividend,
voting or otherwise.
c) Issue of shares (including sweat equity shares) to employees of the
Company under any scheme save and except ESOP Schemes referred to in
this Report.
d) The Whole time Director of the Company doesn''t receive any
remuneration or commission from it''s subsidiary Company.
e) No significant or material orders were passed by the
Regulators/Courts/Tribunals which impact the going concern status and
Company''s operations in future.
ACKNOWLEDGEMENTS
Your Directors acknowledge with gratitude the co-operation and
assistance received from Domino''s International, Dunkin'' Donuts
International, Government and Regulatory Authorities, business
partners, bankers, members and other stakeholders. Also, the Board
places on record its appreciation for the enthusiastic, co-operation,
hard work, dedication and commitment of the employees at all levels,
without which it would not have been possible to achieve all round
progress and growth of the Company
Your Directors would also like to appreciate the confidence and loyalty
displayed by the guests, whom the Company always strive to serve
better.
For and on behalf of the Board of Directors
Sd/- Sd/-
Shyam S. Bhartia Hari S. Bhartia
Chairman & Director Co-Chairman & Director
DIN No. 00010484 DIN No. 00010499
Date: May 28, 2016
Place: Noida
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting the Twentieth (20th) Annual
Report, together with the Audited Financials of the Company for the
Financial Year ended March 31, 2015 ("FY 2015").
FINANCIAL PERFORMANCE
Standalone Financial Summary
(Rs. inMillion)
Particulars FY 2015 FY 2014
Sales & Other Income 20,819 17,328
Profit before Interest, Depreciation & Tax 2,702 2,644
Less: Interest - -
Less: Depreciation 982 767
Profit / (Loss) before Tax 1,721 1,877
Less: Provision for Taxation 488 619
Profit / (Loss) after Tax 1,233 1,258
Consolidated Financial Summary
(Rs. inMillion)
Particulars FY 2015 FY 2014
Sales & Other Income 21,003 17,457
Profit before Interest, Depreciation & Tax 2,626 2,590
Less: Interest - -
Less: Depreciation 1,011 787
Profit / (Loss) before Tax 1,615 1,803
Less: Provision for Taxation 504 620
Profit / (Loss) after Tax 1,111 1,182
RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S
AFFAIRS
The highlights of the Company's performance are as under:
1. Revenue from operations increased by 20.36% to
Rs. 20,745 million
2. EBITDA increased by 3.00% to Rs. 2,628 million
3. Profit before Tax decreased by 8.00% to Rs. 1,721 million
4. Net Profit decreased by 2.00% to Rs. 1,233 million
There are no transfer to the General Reserves.
No material changes and commitments have occurred after the close of
the year till the date of this Report, which affect the financial
position of the Company.
As the fiscal ended, the Company remained on track to deliver its goal
of driving profitable growth while investing in initiative that can
fuel Company's momentum over the long term. In FY 2015, the Company
took successful strides to make its brands Domino's Pizza and Dunkin'
Donuts more capable, efficient and highly relevant for its consumers.
The Company focused on enhancing operations, tightening efficiencies
and on creating more synergies for cementing the path for sustainable &
profitable growth. During the year the Company not only stood tall
through a moderating consumption environment but also successfully
implemented strategic initiatives which included restaurant rollouts,
exciting menu additions, novel offers and thrust on Online Ordering
(ÂOLO"). The Company's sustained expansion on all these fronts and
infrastructure in a tough market, was driven by its faith in the
potential of the Food Service Industry.
During the year Domino's India crossed the UK restaurant count and
became the largest market for Domino's Pizza worldwide, outside USA.
During the year the Company achieved its target of opening 150 new
Domino's Pizza restaurants set at the start of the year The Company has
taken its total tally to 876 Domino's Pizza restaurants across 196
cities as on March 31, 2015.
During the year Dunkin Donuts expansion remained well on track.
Enthused by the consumer's response, the Company set up 28 new
restaurants in FY 2015, taking Dunkin Donuts tally to 54 restaurants in
19 cities as on March 31, 2015.
During the year, there was no change in the nature of the business of
the Company.
DIVIDEND
Your Directors have recommended maiden dividend of Rs. 2.50 (i.e. 25%)
per equity share amounting to Rs. 163.93 million (inclusive of taxes)
for FY 2015. The dividend payout is subject to approval of members at
the ensuing Annual General Meeting.
The dividend will be paid to members whose names appear in the Register
of Members as on August 27, 2015 and in respect of shares held in
dematerialized form, it will be paid to members whose names are
furnished by National Securities Depository Limited and Central
Depository Services (India) Limited, as beneficial owners as on that
date.
OPERATIONS OF SUBSIDIARY
Jubilant FoodWorks Lanka (Pvt.) Ltd.(ÂJFLPL")
The Company's wholly owned subsidiary, JFLPL continued with its steady
efforts to strengthen Domino's Pizza brand in Sri Lanka. During the
year, JFLPL launched 4 new Domino's Pizza Restaurants, taking its total
restaurant count to 15 as on March 31, 2015.
A report on the performance and the financial position of JFLPL, as per
Companies Act, 2013 is provided in Form-AOC 1 attached to the
consolidated financial statements forming part of this Annual Report.
During FY 2015, there were no companies which ceased to exist as
subsidiaries, joint venture or associate of the Company.
SHARE CAPITAL
During the year, the Company issued 1,14,580 Equity Shares of Rs. 10/-
each on the exercise of stock options under Dominos Employees Stock
Option Plan, 2007 and 16,180 Equity Shares of Rs. 10/- each on the
exercise of stock options under JFL Employees Stock Option Scheme,
2011. As a result, the issued, subscribed and paid-up equity share
capital increased from 65,439,030 Equity Shares as on March 31, 2014 to
65,569,790 Equity Shares as at March 31, 2015.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return as required under the Companies Act, 2013
in Form MGT-9 is annexed herewith as Annexure 'A' forming integral part
of this Report.
AUDITORS AND AUDITORS REPORT
Statutory Auditors
S. R. Batliboi & Co. LLP (ICAI Regn. No. 301003E), Chartered
Accountants, Statutory Auditors of the Company retire at the conclusion
of the ensuing Annual General Meeting of the Company and being
eligible, have offered themselves for re- appointment as Statutory
Auditors. Further, the Company has received the consent & eligibility
certificate from S. R. Batliboi & Co. LLP under Section 139(1) and
Section 141 of the Companies Act, 2013 & rules made thereunder The
Board of Directors recommend their re-appointment for further period of
one year from the conclusion of the ensuing Annual General Meeting till
the conclusion of the next Annual General Meeting.
Auditors' Report read together with Annexure referred to in the
Auditors' Report does not contain any qualification, reservation,
adverse remark or disclaimers. Members' attention is drawn towards
Clause (xii) of the Annexure referred to in the Auditors' Report and
the Directors wish to clarify that the Company has taken all the
necessary steps, including taking legal action against the employees
involved and has fully provided for the same in the financial
statements. Further, effective steps have been taken to
reduce/eliminate such cases.
Secretarial Auditors
The Board appointed Chandrasekaran Associates, Company Secretaries to
conduct Secretarial Audit for FY 2015. The Secretarial Audit Report
for the financial year ended March 31, 2015 is annexed herewith as
Annexure 'B' forming integral part of this report. The said report is
self explanatory and does not call for any comments.
LOANS, GUARANTEES OR INVESTMENTS
The particulars of investments made under Section 186 of the Companies
Act, 2013 are as follows:
As on March
S. No. Name of the Body Transaction Type
Corporate
1. Jubilant FoodWorks Subscription
Lanka (Pvt.) Ltd. to Equity
(Wholly Owned Shares
Subsidiary)
S. No. Name of the Body Amount Purpose of
Corporate (Rs. in Million) Investment
As on March
31, 2015
1. Jubilant FoodWorks 557.14 Business
Lanka (Pvt.) Ltd. Purposes
(Wholly Owned
Subsidiary)
Note 12 of Standalone Financial Statement sets out details of
investment.
RELATED PARTY TRANSACTIONS
All contracts, arrangements and transactions entered by the Company
during FY 2015 were in the ordinary course of business and on an arm's
length basis. During the year, the Company had not entered into any
contract, arrangement and transaction with related parties which could
be considered material in accordance with the policy of the Company on
materiality of related party transactions. The policy on materiality of
related party transactions and dealing with related party transactions
as approved by the Board is disclosed on the website of the Company
www.jubilantfoodworks.com
Note 29 to the Standalone Financial Statements sets out related party
disclosures.
RISK MANAGEMENT
The Company has a Risk Management Policy which has been approved by the
Board. The aim of the Company's risk management policy is to create
awareness of applicable risks and consequently limit, control and
manage them, while safeguarding business opportunities and
strengthening profitability. Through its well formulated strategy, the
Company ensures that the risk exposure remains at the defined
appropriate levels, while the overall management of the risks is
integrated and embedded in the everyday business operations and
activities. There are no risks identified by the Board which may
threaten the existence of the Company.
The detailed Risk Review is provided in the Management Discussion &
Analysis section forming part of the Annual Report.
INTERNAL FINANCIAL CONTROL
The Company has in place adequate internal financial controls with
reference to financial statements. During the year, such controls were
tested and no reportable material weakness in the design or operations
were observed.
CORPORATE SOCIAL RESPONSIBILITY
The Sustainability and Corporate Social Responsibility Committee
(ÂSCSR Committee") has formulated and recommended to the Board, a
Corporate Social Responsibility Policy (CSR Policy), which has been
approved by the Board. The CSR Policy laid down by the Company ensures
that the:
* CSR agenda is integrated with the business
* Focused efforts are made in the identified community development
areas to achieve the expected outcomes
* Support in nation-building through CSR activities
In terms of CSR Policy the Company shall endeavor to focus in the areas
of:
1. Skill Development
2. Nutrition
3. Education
4. Swachh Bharat Abhiyan
5. Road Safety
The Annual Report on CSR is annexed as Annexure 'C' forming integral
part of this Report.
DIRECTORS & KEY MANAGERIAL PERSONNEL
In terms of Articles of Association of the Company and provisions of
Companies Act, 2013, Mr Shyam S. Bhartia, Director of the Company, is
liable to retire by rotation at the ensuing Annual General Meeting and
being eligible, offer himself for re-appointment. The Board of
Directors recommend his re-appointment.
Mr Ajay Kaul, CEO cum Whole time Director of the Company was
re-appointed as the Whole time Director w.e.f. March 14, 2015 by the
Board of Directors, subject to the approval of the shareholders in the
forthcoming Annual General Meeting.
The Company has received necessary declaration from each Independent
Director under Section 149 (7) of Companies Act, 2013 that he/she meets
the criteria of independence laid down in Section 149 (6) of Companies
Act, 2013 and Clause 49 of Listing Agreement.
During the year there was no change in the constitution of the Board
and in the position of Key Managerial Personnel of the Company.
PARTICULARS OF EMPLOYEES, DIRECTORS & KEY MANAGERIAL PERSONNEL
The details of Employees, Directors and Key Managerial Personnel as
required under Section 197 of the Companies Act, 2013 read with
Companies (Appointment and Remuneration) Rules, 2014 is annexed
herewith as Annexure 'D' forming integral part of this Report.
EMPLOYEES STOCK OPTION SCHEMES
The Company has two (2) Employees Stock Option Schemes in operation at
present:
* Dominos Employees Stock Option Plan, 2007
* JFL Employees Stock Option Scheme, 2011
During the year, the employees were allotted equity shares upon
exercise of stock options under both the schemes. The applicable
disclosures under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
1999, as at March 31, 2015 is annexed as Annexure 'E' forming integral
part of this Report.
Certificate from S. R. Batliboi & Co. LLP, Chartered Accountants,
Statutory Auditors, with respect to the implementation of the JFL
Employees Stock Option Scheme, 2011 and Domino's Employees Stock Option
Plan, 2007 would be placed before the members at the ensuing Annual
General Meeting and a copy of the same shall be available for
inspection at the Registered Office of the Company.
SEXUAL HARRASMENT
Employees at all levels are assured of a work place free of harassment
irrespective of their gender, race, social class, caste, creed,
religion, place of origin, sexual orientation, disability or economic
status. The employees have the right to work in an environment free
from any form of discrimination and conduct which can be considered
harassing, coercive, or disruptive particularly behaviors that
tantamount to sexual harassment.
In view of above, the Company has adopted a policy on the prevention of
sexual harassment at workplace. The Company received two (2) complaints
during the calendar year 2014 under this policy which were suitably
addressed.
CORPORATE GOVERNANCE
The corporate governance philosophy of the Company is driven by the
interest of stakeholders and business needs of the organization.
Aligning itself to this philosophy, and in order to sustain the
stakeholder's trust, the Company has placed corporate governance on a
high priority. In terms of clause 49 of the Listing Agreement with the
Stock Exchanges, the Corporate Governance Report along with certificate
from M/s Chandrasekaran Associates, Company Secretaries certifying the
compliance with the conditions of Corporate Governance is annexed as
Annexure 'F' forming an integral part of this Report. The Corporate
Governance Report, inter-alia, contains the following disclosures:
a) Number of Board Meetings
b) Composition of Audit Committee
c) Composition of Sustainability & Corporate Social Responsibility
Committee
d) Whistle Blower Policy (vigil mechanism)
e) Appointment & Remuneration Policy (for Directors, Key Managerial
Personnel, Senior Management and other Employees of the Company)
f) Performance Evaluation criteria of the Board, its Committees &
individual Directors
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
A) Conservation of energy
The Company values the significance of conservation of energy and
therefore endeavors to operate in an eco-friendly manner so as to
protect and improve the environment. The Company is making continuous
efforts for judicious use of energy at all levels of operations by
utilizing energy efficient system and processes.
i) The steps taken or impact on conservation of energy
Installation of energy efficient LED Lights in certain restaurants and
Commissaries
Installation of Energy Management System in certain restaurants.
Due to Company's innovative approach in Oven Technology, LPG
Consumption in certain restaurants reduced.
Installation of Energy Saving Sensors in the AC System of certain
restuarants.
Procurement of E-bikes for some restaurants on trial basis.
ii) The steps taken by the Company for utilizing alternate sources of
energy
The Company has installed 200 KW Solar Power plant at Mumbai Commissary
and is in the process of installing 120KW Solar Power Plant at Nagpur
Commissary. Efforts are on to install plants at other locations also.
iii) The capital investment on energy conservation equipment
Particulars of Investments Amount (` In Million)
Energy Management System in certain 28
Restaurants
AC Energy Saver System in certain Restaurants 7
Procurement of E-bikes 2
Investment in power efficient LED Lights in 19
certain restaurants & Commissaries.
(B) Technology Absorption
All steps taken towards Energy Conservation are the result of
technology absorption, however, there is no specific information to be
furnished in this regard.
(C) Foreign Exchange Earnings & Outgo
Information pertaining to Foreign Exchange Earnings & Outgo is given in
Note No. 32 of the Notes forming part of the Standalone Financial
Statements.
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors state that:
(a) in the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) The directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of the profit and loss
of the Company for that period;
(c) The directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 ("Act") for safeguarding the
assets of the Company and for preventing and detecting fraud and other
irregularities;
(d) The directors had prepared the annual accounts on a going concern
basis;
(e) The directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively; Based on the framework of
internal financial controls including the financial reporting and
compliance systems established and maintained by the Company, work
performed by the internal, statutory and secretarial auditors and the
reviews performed by the management, the Board is of the opinion that
the Company's internal financial controls are adequate and effective
during the Financial Year 2014-15.
(f) The directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
GENERAL
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions related to
these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the
Company under any scheme save and except the ESOP Schemes referred to
in this Report.
4. Neither the Managing Director nor the Whole time Directors of the
Company receive any remuneration or commission from any of Company's
subsidiaries.
5. No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company's
operations in future.
ACKNOWLEDGEMENTS
Your Directors wish to extend their deep sense of appreciation to
employees at all levels for their continuing support and unstinting
efforts. Your Directors also acknowledge the continued support from
Domino's International, Dunkin Donuts' International, government and
regulatory authorities, business partners, bankers, members and other
stakeholders.
Your Directors would also like to appreciate the confidence and loyalty
displayed by the guests, whom the Company always strive to serve
better.
For and on behalf of the Board of Directors
Sd/- Sd/-
(Shyam S. Bhartia) (Hari S. Bhartia)
Chairman & Director Co-Chairman & Director
DIN No. 00010484 DIN No. 00010499
Date: May 14, 2015
Place: Noida
(Figures have been rounded off for the purpose of reporting)
Mar 31, 2014
Dear Members,
The Directors have pleasure in presenting the Nineteenth Annual
Report, together with the Audited Financials of the Company for the
Financial Year ended March 31, 2014 ("FY2014").
FINANCIAL PERFORMANCE
Standalone Financial Summary
(Rs. in Million)
Particulars FY2014 FY2013
Sales & Other Income 17,328 14,153
Profit before Interest, 2,644 2,522
Depreciation & Tax
Less: Interest - 1
Less: Depreciation 767 547
Profit / (Loss) before Tax 1,877 1,974
Less: Tax Expense 619 623
Profit / (Loss) after Tax 1,258 1,351
Consolidated Financial Summary
(Rs. in Million)
Particulars FY2014 FY2013
Sales & Other Income 17,457 14,222
Profit before Interest, 2,590 2,496
Depreciation & Tax
Less: Interest - 1
Less: Depreciation 787 556
Profit / (Loss) before Tax 1,803 1,939
Less: Tax Expense 620 628
Profit / (Loss) after Tax 1,182 1,311
BUSINESS PERFORMANCE
The Company''s growth plan continued during FY2014 despite difficult
economic conditions coupled with growing competition and high
inflationary market conditions. During the year, the Company continued
its focus on product innovation, cost consciousness, technology,
employee development, consumer connect and loyalty. The Company
leveraged its strengths to achieve the operational excellence for both
the brands i.e. Domino''s Pizza India and Dunkin'' Donuts India.
Domino''s Pizza - India
Aligning itself to the Company''s principles and values, and steered by
its deep-rooted strengths, Domino''s Pizza India continued to make rapid
strides in transforming the Indian FSI landscape. Domino''s Pizza has
taken its tally to 726 restaurants in 150 cities as of March 31, 2014
(749 restaurants in 152 cities as of May 19, 2014). During the year,
150 new Domino''s Pizza restaurants were successfully launched as
against 111 restaurants in the previous year. Product innovations
remained high on the Company''s agenda, as showcased by the new
offerings and launches. During the year, the Company captured the
consumers'' interest and market by launching the new indulgent Fresh Pan
Pizzas, Spicy Baked Chicken, Lebanese rolls and Calzone Pockets. The
Company continued to work towards rejuvenating its brand with
innovative initiatives like launch of Pizza Theatre and strengthened
its consumer connect.
Domino''s Pizza - Sri Lanka
The Company''s Sri Lankan subsidiary, Jubilant FoodWorks Lanka (Pvt.)
Ltd. (subsidiary) expanded its base by opening 5 (five) restaurants
during FY2014, taking its total restaurant count to 11 as on March 31,
2014. The year was a challenging one for Sri Lanka market with
increased competition and entry of new food brands. Consumer preference
and acceptance for the brand increased with strategic marketing
communication. During FY2014, 3 (three) new products, Pepper Chicken
Drumsticks, Rice and Fresh Pan Pizza, were also launched which received
encouraging response from the consumers. Operationally, the subsidiary
continued delivering efficiency on the back of several cost management
initiatives. Though the overall sales grew, the subsidiary continued to
incur losses. Raw material cost continued to be high due to inflation
and increased duty on cheese. Decisions and strategic choices continued
to be guided by the principle of systematic expansion backed by strong
infrastructure.
Sri Lankan subsidiary shall continue to be one of the focus markets for
the Company.
Dunkin'' Donuts - India
Dunkin'' Donuts'' restaurants offering a wide variety western, all day
part food menu including donuts, coffee, burgers, sandwiches, snacks
and more, continued its expansion plans. The Company successfully
launched 16 new Dunkin'' Donuts restaurants during the year, taking the
total number to 26 restaurants as on March 31, 2014. Mumbai marked
another important milestone in the geographical expansion of Dunkin''
Donuts, thereby taking the total restaurant count to 29 as on May 19,
2014.
The Company is continuously reinvigorating its menu by offering various
new products. During the year, the Company launched "Get Your Mojo
Back" positioning, aimed to get Dunkin'' Donuts better placed in the
sweet spot between the QSR and the Café markets.
With its focus on innovation and strong consumer insight and
understanding, Jubilant FoodWorks continues to chart its growth story
for the future across both its brands. A detailed analysis and insight
into the operations & business performance of the Company for the year
is appearing in the Management Discussion & Analysis which forms part
of Annual Report.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financials, in terms of Clause 32 of the Listing
Agreement and prepared in accordance with AS - 21 as specified in
Companies (Accounting Standards) Rules, 2006 form part of the Annual
Report. In terms of the general exemption granted by the Government of
India vide its General Circular No. 2/2011 dated February 8, 2011, from
attaching the Directors'' Reports, Balance Sheets, Statement of Profit &
Loss and other particulars of the subsidiary Companies subject to
fulfillment of certain conditions mentioned therein, the same have not
been attached to this Report.
The audited annual financial statements and other related information
of the subsidiary Company, wherever applicable, will be made available
to shareholders of the Company on request. Further, these documents
will also be available for inspection during business hours at the
Registered Office of the Company and the subsidiary Company.
HUMAN RESOURCE DEVELOPMENT
Our employees are custodians of both our brands  Domino''s Pizza &
Dunkin'' Donuts. The Company aims at constantly upgrading the strength
of its employees through focused skill building, ongoing Learning and
Professional Development programmes for employees at all levels and
across functions. The Company invests in various programs like
Executive Coaching for next level leaders, strategic thinking
workshops, management development programs & seminars for senior and
middle level management, performance management workshops, business
communication workshops for people managers which is a step in the
direction to build talent pipeline and creating future leaders.
At the restaurant level, the focus is to map job specific competencies
and provide them functional training for enhanced consumer service and
experience.
Further, a dedicated operations training team extends a systematic
product/systems/processes training across all levels of operations. The
training team uses multiple modes of training like Learning Management
System (LMS), Class Room Training and On the Job Training to ensure
requisite information and integrated career progression to the
employees at restaurant.
The Company encourages a culture which combines work with fun. The all
India event "Dance Dominos Dance" was re-launched as "Dance Domino''s
Dunkin'' Dance"-(DDD-Season II), where more than 500 employees
participated.
All the above factors have made the Company a great place to work by
being recognised and ranked 9th in the Great Places to Work India
survey in retail sector (a survey conducted by GPWI and RAI).
As on March 31, 2014, the total numbers of employees on the records of
the Company were 24,969. A detailed note on human resources is
appearing in the Management Discussion & Analysis which forms part of
Annual Report.
Employees at all levels are assured a work place free of harassment
irrespective of their gender, race, social class, caste, creed,
religion, place of origin, sexual orientation, disability or economic
status. The employees have the right to work in an environment free
from any form of discrimination and conduct which can be considered
harassing, coercive, or disruptive particularly behaviors that
tantamount to sexual harassment.
In view of above, the Company has adopted a policy on prevention of
sexual harassment at workplace. The Company has not received any
complaint for the calendar year 2013.
DIVIDEND
Keeping in view, the Company''s requirement of capital for its expansion
plans, the Board has not recommended any dividend.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Management Discussion & Analysis Report including Risk
Review is presented in a separate section forming part of the Annual
Report.
SHARE CAPITAL
During the year, the Company issued 148,100 Equity Shares of Rs. 10/-
each on the exercise of stock options under Employees Stock Option
Plan, 2007 and 7,540 Equity Shares of Rs. 10/- each on the exercise of
stock options under JFL Employees Stock Option Scheme, 2011. As a
result, the issued, subscribed and paid-up equity share capital
increased from 65,283,390 Equity Shares as at March 31, 2013 to
65,439,030 Equity shares as at March 31, 2014.
EMPLOYEES STOCK OPTION SCHEMES
The Company has two Employees Stock Option Schemes in operation at
present:
- Employees Stock Option Plan, 2007
- JFL Employees Stock Option Scheme, 2011
Compensation Committee of the Company administers and monitors both
ESOP Schemes. Compensation Committee was merged with Remuneration
Committee and re-constituted as Nomination, Remuneration and
Compensation Committee w.e.f. May 19, 2014. During the year, the
employees were allotted equity shares upon exercise of stock options
under both the schemes. The applicable disclosures under the Securities
and Exchange Board of India (Employee Stock Option Scheme and Employee
Stock Purchase Scheme) Guidelines, 1999, as at March 31, 2014 are given
in Annexure A.
Certificate from S. R. Batliboi & Co. LLP, Chartered Accountants,
Statutory Auditors, with respect to the implementation of the JFL
Employees Stock Option Scheme, 2011 and Employees Stock Option Plan,
2007 would be placed before the shareholders at the ensuing Annual
General Meeting and a copy of the same shall be available for
inspection at the Registered Office of the Company.
CORPORATE GOVERNANCE REPORT
The corporate governance philosophy of the Company is driven by the
interest of stakeholders and business needs of the organisation.
Aligning itself to this philosophy, and in order to sustain the
stakeholder''s trust, the Company has placed corporate governance on a
high priority.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Corporate Governance Report alongwith Certificate from
M/s. Chandrasekaran Associates, Company Secretaries confirming
compliance with the conditions of Corporate Governance forms part of
the Annual Report.
DEPOSITS
The Company has not accepted any public deposits and as such, no amount
on account of principal or interest was outstanding as at March 31,
2014.
DIRECTORS
In terms of Articles of Association of the Company, Mr. Hari S.
Bhartia, Director of the Company, is liable to retire by rotation at
the ensuing Annual General Meeting and being eligible, offer himself
for re-appointment. The Board of Directors recommend his
re-appointment.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Company had appointed Ms. Ramni Nirula, Mr. Arun Seth,
Mr. Vishal Kirti Keshav Marwaha, and Mr. Phiroz Adi Vandrevala as
Independent Directors of the Company, liable to retire by rotation.
Now, in terms of Section 149, 150, 152, Schedule IV and other
applicable provisions, if any, of the Companies Act, 2013 read
alongwith rules made thereunder, the Independent Directors can hold
office for a term of upto 5 (five) consecutive years on the Board of
the Company and are not liable to retire by rotation. Accordingly, it
is proposed to appoint Ms. Ramni Nirula, Mr. Arun Seth, Mr. Vishal
Kirti Keshav Marwaha and Mr. Phiroz Adi Vandrevala as Independent
Directors of the Company, not liable to retire by rotation, from the
date of ensuing Annual General Meeting till March 31, 2019.
A brief resume of the aforesaid Directors and other information have
been detailed in the Notice of ensuing Annual General Meeting.
AUDITORS AND THEIR REPORT
S. R. Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors of
the Company (bearing ICAI Regn. No. 301003E), retire at the conclusion
of the ensuing Annual General Meeting of the Company and being
eligible, have offered themselves for re-appointment as Statutory
Auditors. Further, the Company has received the consent & eligibility
certificate from S. R. Batliboi & Co. LLP, vide their letter dated May
9, 2014 under Section 139(1) of the Companies Act, 2013 & rules made
thereunder.
The Board of Directors recommend their re-appointment for further
period of one year from the conclusion of the ensuing Annual General
Meeting till the conclusion of the next Annual General Meeting.
Auditors'' Report read together with Annexure referred to in the
Auditors'' Report does not contain any qualification. Members'' attention
is drawn towards the comment made by the Auditors in Clause (xxi) of
the Annexure referred to in the Auditors'' Report and the Directors wish
to clarify that the Company has taken all necessary steps, including
taking criminal action against the said employee and has fully provided
for the same in the financial statements. Further, effective steps have
been taken to reduce/eliminate such cases.
COST AUDITORS
The Company had appointed M/s. Jitender, Navneet and Co., Cost
Accountants (Firm Regn. No. 000119), as Cost Auditors of the Company
for FY2014 to conduct the audit of the cost records of the Company.
The Cost Audit Report for FY2013 was filed within the due date on
September 19, 2013. The due date for submission of the Cost Audit
Report for FY2014 is within 180 days from March 31, 2014.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the Annexure B forming part of this Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The Company values the significance of conservation of energy and hence
continuous efforts are made for judicious use of energy at all levels
of operations by utilising energy efficient systems and processes.
Towards achievement of this objective, steps have been initiated
including use of energy efficient LED lights and energy management
systems at our restaurants. Further, certain initiatives are being
implemented for optimisation of electricity and LPG usage.
The information as required to be furnished in Form A pursuant to
Section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988, for Energy Conservation is considered to be not applicable to the
Company and hence have not been provided. Further, the Company has no
information to furnish in Form B regarding technology absorption.
Information pertaining to Foreign Exchange Earnings and Outgo is given
in Note No. 33 of the Notes forming part of the Standalone Financial
Statements.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Statement of Profit and Loss for the year
ended March 31, 2014 and the Balance Sheet as at that date, your
Directors confirm that they have:
- Followed the applicable accounting standards and no material
departures have been made from the same;
- Selected such accounting policies and applied them consistently and
made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the
end of the financial year and of the profit of the Company for that
year;
- 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
- Prepared the annual accounts on a ''going concern'' basis.
ACKNOWLEDGEMENT
Your Directors wish to extend their deep appreciation to employees at
all levels for their continuing support and unstinting efforts. Your
Directors also acknowledge the continued support from Domino''s
International, Dunkin Donuts'' International, Government and Regulatory
Authorities, bankers and other stakeholders.
Your Directors would also like to appreciate the confidence and loyalty
displayed by the consumers, whom the Company always strive to serve
better.
For and on behalf of the Board of Directors
(Shyam S. Bhartia)
Chairman & Director
Noida, June 2, 2014
Mar 31, 2013
Dear Members,
The Directors have pleasure in presenting the Eighteenth Annual Report,
together with the Audited Financials of the Company for the Financial
Year ended March 31, 2013 ("FY 2013").
FINANCIAL PERFORMANCE SUMMARY
Standalone Financials
The Company has been growing in numbers, year on year, manifesting the
trust and confidence of the consumers and stakeholders. The financial
performance summary of the Company on standalone basis for FY 2013 is
enumerated below:
(Rs. in Million)
Particulars FY 2013 FY 2012
Sales & Other Income 14,153 10,233
Profit before Interest, 2,522 1,922
Depreciation & Tax
Less: Interest 1 -
Less: Depreciation 547 376
Profit / (Loss) before Tax 1,974 1,546
Less: Provision for Taxation/ 623 490
FBT
Profit / (Loss) after Tax 1,351 1,056
The Company''s total income stood at Rs.14,153 Million in FY 2013,
yielding a growth of 38%. The Profit before Interest, Depreciation and
Tax in FY 2013 increased to Rs.2,522 Million as against Rs. 1,922
Million in FY 2012, registering a growth of 31%. Net Profit increased
to Rs. 1,351 Million in FY 2013 from Rs. 1,056 Million in FY 2012,
registering a growth of 28%.
Consolidated Financials
A synopsis of the consolidated financials of the Company (alongwith its
subsidiaries), is reproduced below:
(Rs. in Million)
Particulars FY 2013 FY 2012
Sales & Other Income 14,222 10,249
Profit before Interest, 2,496 1,898
Depreciation & Tax
Less: Interest 1 -
Less: Depreciation 556 377
Profit / (Loss) before Tax 1,939 1,521
Less: Provision for Taxation/ 628 488
FBT
Profit / (Loss) after Tax 1,311 1,033
The Consolidated Financials, in terms of Clause 32 of the Listing
Agreement and prepared in accordance with AS-21 as specified in
Companies (Accounting Standards) Rules, 2006 form part of the Annual
Report.
Particulars required as per Section 212 of the Companies Act, 1956
In terms of the general exemption granted by the Government of India
vide its General Circular No. 2/2011 dated February 8, 2011, the
Company has enclosed the consolidated financial statements, duly
audited by Statutory Auditors of the Company.
The audited annual financial statements and other related information
of the subsidiary companies, wherever applicable, will be made
available to shareholders of the Company on request. Further, these
documents will also be available for inspection during business hours
at the Registered Office of the Company and the subsidiary companies.
DIVIDEND
Keeping in view, the Company''s requirement of capital for its expansion
plans, the Board has not recommended any dividend.
OPERATIONAL PERFORMANCE
During FY 2013, the growth story continued, hallmarked by customer
focussed innovation, value offerings combined with both the powerful
brands. Domino''s Pizza and Dunkin'' Donuts both have made it a priority
to understand their consumers, which is really the cornerstone of the
pace of growth that the Company is seeing.
DOMINO''S PIZZA
In FY 2013, Domino''s Pizza added 111 new stores to the network and
entered into 18 new cities. The 500th store was opened in New Delhi,
highlighting a significant milestone for continued growth in the
market. At year end, Domino''s Pizza store count stood at 576 stores
across 123 cities. The Company delivered a Same Store Sales (SSS)
growth of 16.2%, during FY 2013. While the SSS growth was at 22.3% in
the first quarter of FY 2013, it reduced to 7.7% for the fourth quarter
due to weak consumer sentiments arising out of declining economic
growth.
Consumers are at the heart of the business. The Company aims at
enhancing its presence for wider consumers in India simultaneously with
innovation and new product offerings. Strong promotions around new
product offerings as well as enhancement of digital platforms - meant
new and existing consumers had more reasons to choose Domino''s. The
Company is now reaching out with more Domino''s Pizza stores, better
stores and better standards of service.
During FY 2013, new product offerings included Cheesy Boloroni Pizza,
Taco Indiana, Spicy Twistyz and Potato Smackers. After spending four
years with the emotional proposition of Happiness Home delivered -
''Khushiyon ki Home Delivery'' and in its endeavour to deepen the
engagement with consumers, Domino''s Pizza launched new brand
positioning " Yeh HaiRishton Ka Time!''. This new brand positioning
focusses on relationships and bonding.
During the year, Sri Lankan subsidiary of the Company opened 4 new
Domino''s Pizza Stores, thereby taking the total to 6 Domino''s Pizza
Stores as on March 31, 2013. The response from the consumers has been
encouraging, which has enabled the Company to take up the expansion
plans for Sri Lanka progressively. Over the long term, the Company
wishes to extend its experience in India to Sri Lanka and expects to
expand its base to 25-30 stores in next 3 years.
DUNKIN'' DONUTS
At the end of FY 2013, total Dunkin'' Donuts restaurant count stood at
10. Out of this, 9 restaurants are across Delhi NCR region and one at
Chandigarh. The journey of Dunkin'' Donuts so far has been exciting and
full of learnings. The consumer response for the brand has been
extremely encouraging and insights from the first year of operations
has helped the Company in preparing a roll out strategy to more
territories as well as in fine-tuning the brands offerings and the
overall consumer experience.
The Company offered several reasons for its consumers to celebrate and
enjoy Dunkin'' Donuts, like Dunkin'' Donuts Diwali gift packs and Dunkin''
Donuts winter blast wherein new varieties of donuts were offered to
consumers.
Dunkin'' Donuts is gaining traction in a highly methodical manner. Your
Directors believe that the all-day part food and beverage opportunity
is largely untapped and with the Company''s unique innovations, there is
tremendous potential for growth in the future.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Management Discussion & Analysis Report including Risk
Review is presented in a separate section forming part of the Annual
Report.
SHARE CAPITAL
During the year, the Company issued 198,560 Equity Shares of Rs.10/-
each on the exercise of stock options under Employees Stock Option
Plan, 2007 and 6,890 Equity Shares of Rs.10/- each on the exercise of
stock options under JFL Employees Stock Option Scheme, 2011. As a
result, the issued, subscribed and paid-up equity share capital
increased from 65,077,940 Equity Shares as at March 31, 2012 to
65,283,390 Equity shares as at March 31, 2013.
HUMAN RESOURCE DEVELOPMENT
To run a successful organisation, an effective leader needs to create
high performing teams which exhibit accountability, purpose,
cohesiveness and collaboration. Various training programmes like one on
one personalised coaching session and two days Coaching skills workshop
for the top management, "Coaching Skills", "Finance for Non Finance"
and "Leadership Skills" for senior and middle management and
"Performance Management" for People Managers have ensured creation of
future leaders of the organisation.
The Company aims at helping employees in performing their best and
achieve their full potential through ongoing training and development.
Hence initiatives have been taken like implementation of Touch Screen
Training PCs over 250 Domino''s Pizza Stores and launch of online
"Learning Management System" which facilitates training, collaborative
learning and consolidation of training initiatives on a scalable web
based platform.
The Company believes in a culture which combines work with fun and in
this direction, the Company held events like "Dance Domino''s Dance" in
which more than 300 employees participated.
The Company''s key focus is also the exemplary customer services
extended by the employees of JFL family to its consumers. The evidence
of this fact is that 4 employees of the Company were recognised with
the prestigious TRRAIN Awards. These awards are given by the Trust for
Retailers and Retail Associates of India, recognising excellence and
endearing consumer service extended by the retail associates in the
country. These employees were recognised for going beyond the call of
duty to create magic moments for their consumers.
All the above factors have made the Company an employer of choice and
made it recognised for 3rd year in a row, amongst the top 50 companies
in "India''s Best Companies To Work For, 2012", a study conducted by the
Great Place to Work Institute in India in partnership with Economic
Times.
EMPLOYEES STOCK OPTION SCHEMES
The Company has two Employees Stock Option Schemes in operation at
present:
- Employees Stock Option Plan, 2007
- JFL Employees Stock Option Scheme, 2011
The Compensation Committee of the Company administers and monitors both
ESOP Schemes. During the year, the employees were allotted equity
shares upon exercise of stock options under both the schemes. The
applicable disclosures under the Securities and Exchange Board of India
(Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999, as at March 31, 2013 are given in Annexure A.
Certificate from S. R. Batliboi & Co. LLFJ Chartered Accountants,
Statutory Auditors, with respect to the implementation of the JFL
Employees Stock Option Scheme, 2011 and Employees Stock Option Plan,
2007 would be placed before the shareholders at the ensuing Annual
General Meeting and a copy of the same shall be available for
inspection at the Registered Office of the Company.
CORPORATE GOVERNANCE REPORT
The Company consistently endeavors to focus on good corporate
governance practices and is committed to fulfilment of its social
responsibilities. These practices have resulted in securing the trust
of the stakeholders and society at large in the Company and its
management.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Corporate Governance Report alongwith Certificate from
M/s. Chandrasekaran Associates, Company Secretaries confirming
compliance with the conditions of Corporate Governance forms part of
the Annual Report.
DEPOSITS
The Company has not accepted any public deposits and as such, no amount
on account of principal or interest was outstanding as at March 31,
2013.
DIRECTORS
In accordance with the provisions of the Companies Act, 1 956 and the
Articles of Association of the Company, Mr. Shyam S. Bhartia & Mr.
Phiroz Vandrevala, Directors of the Company, are liable to retire by
rotation in the forthcoming Annual General Meeting and being eligible,
offer themselves for re-appointment.
A brief resume containing nature of expertise, details of directorships
held in other public limited companies and other information of the
Directors proposing re-appointment pursuant to Clause 49 of the Listing
Agreement with the Stock Exchanges is appended as an annexure to the
Notice of ensuing Annual General Meeting.
Your Directors recommend their re-appointment.
AUDITORS AND THEIR REPORT
S. R. Batliboi & Co. LLP, Chartered Accountants, Statutory Auditors of
the Company (bearing ICAI Regn. No. 301003E), retire at the conclusion
of the ensuing Annual General Meeting of the Company and being
eligible, have offered themselves for re-appointment as Statutory
Auditors for a further period of one year.
Further, members may note that the Statutory Auditors have converted
their partnership firm into a Limited Liability Partnership effective
April 1, 2013 under the name S.R. Batliboi & Co LLP, pursuant to The
Limited Liability Partnership Act, 2008.
Your Directors recommend their re-appointment.
Auditors'' Report read together with Annexure referred to in the
Auditors'' Report does not contain any qualification.
Members'' attention is drawn towards the comment made by the Auditors in
Clause (ix)(a) of the Annexure referred to in the Auditor''s Report and
the Directors of your Company wish to clarify that your Company is
committed for timely deposit of all statutory dues and effective steps
have been taken to reduce / eliminate slight delays which are due to
spread of your Company''s operations pan India.
COST AUDITORS
Pursuant to Section 233B of the Companies Act, 1956, the Central
Government has prescribed audit of cost records for certain products of
the Company vide Cost Audit Order No F. No. 52/26/CAB-2010 dated
January 24, 2012 & November 6, 2012.
Based on the recommendations of the Audit Committee and with the
approval of the Central Government, the Board of Directors had
appointed M/s. Jitender, Navneet and Co., Cost Accountants (Firm
Registration No. 000119), as Cost Auditors of the Company for FY 2013.
Since the filing of the Cost Audit Reports for FY 2012 was not
applicable to the Company, the Company had filed Cost Compliance Report
in terms of the Companies (Cost Accounting Records) Rules, 2011.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the Annexure B forming part of this Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
Although the operations of the Company are not energy intensive, the
Company values the criticality of conservation of energy and efforts
are made in this direction on continuous basis. The Company ensures
that measures are taken for judicious use of energy at all levels of
operations by utilising energy efficient systems and processes.
The information as required to be given under Section 217(1) (e) of the
Companies Act, 1956 read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988, for Energy
Conservation and Technology Absorption is considered to be not
applicable to the Company and hence have not been provided.
Information pertaining to Foreign Exchange Earnings and Outgo is given
in the Note No. 33 of the Notes forming part of the Standalone
Financial Statements.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Statement of Profit and Loss for the year
ended March 31, 2013 and the Balance Sheet as at that date, your
Directors confirm that they have:
- Followed the applicable accounting standards and no material
departures have been made from the same;
- Selected such accounting policies and applied them consistently and
made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the
end of the financial year and of the profit of the Company for that
year;
- 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
- Prepared the annual accounts on a ''going concern'' basis.
ACKNOWLEDGEMENT
Your Directors wish to thank all the employees and the management team,
who with their passion are constantly working together with
determination and perseverance, to create new levels of success each
day. Your Directors would like to express their sincere gratitude to
the Company''s loyal customers and stakeholders who continue to put
their trust in the Company and its future. Your Directors also
gratefully acknowledge the continued support from various government
agencies, media and academic institutions and look forward to nurture
this relationship further in the future.
As we look ahead, your Directors are confident about the progress of
both the brands - Domino''s Pizza and Dunkin'' Donuts and believe the key
would be to execute the strategy systematically as we have been doing
in the past.
For and on behalf of the Board of Directors
Shyam S. Bhartia
Chairman & Director
Date : May 9, 2013
Mar 31, 2012
The Board of Directors is pleased to deliver the 17th Annual Report,
together with the Audited Financials of your Company for the Financial
Year ended March 31, 2012 ("FY 2012"). In line with its commitment to
constantly endeavour to "deliver more" to all the stakeholders of the
Company, this year has been no exception. The focus on delivering more,
continued across every aspect of your Company's business operations,
with the business model aligned to this philosophy.
FINANCIAL PERFORMANCE SUMMARY
The growing numbers, in terms of turnover and profitability, stood
testimony to your Company's focus on delivering more to its consumers
and stakeholders, on whose trust and confidence the Company's edifice
of growth is built. The financial performance summary of your Company
on standalone basis for FY 2012 is enumerated below:
(Rs in Million)
Particulars Year Ended Year Ended
March 31, 2012 March 31, 2011
Sales & Other Income 10,233 6,803
Profit before Interest, 1,922 1,220
Depreciation & Tax
Less: Interest - 3
Less: Depreciation 376 293
Profit / (Loss) before Tax 1,546 924
Less: Provision for Taxation/FBT 490 204
Profit / (Loss) after Tax 1,056 720
FINANCIAL PERFORMANCE
Your Company's total income stood at Rs10,233 million in FY 2012,
yielding a growth of 50%. The Profit before Interest, Depreciation and
Tax in FY 2012 increased to Rs 1,922 million as against Rs 1,220 million
in FY 2011, registering a growth of 58%. Net Profit increased to Rs1,056
million in FY 2012 from Rs720 million in FY 2011, registering a growth
of 47%.
Consolidated Financials
Your Company has a wholly owned subsidiary, Jubilant FoodWorks Lanka
(Pvt.) Limited ("JF Lanka"), in Sri Lanka. A synopsis of the
consolidated financials of your Company and its subsidiary, is
reproduced below:
(Rs in Million)
Particulars Year Ended Period Ended
March 31, 2012 March 31, 2011
Sales & Other Income 10,249 6,803
Profit before Interest,
Depreciation & Tax 1,898 1,217
Less: Interest - 3
Less: Depreciation 377 293
Profit / (Loss) before Tax 1,521 921
Less: Provision for Taxation/FBT 488 204
Profit / (Loss) after Tax 1,033 717
In compliance with the directions issued by the Ministry of Corporate
Affairs vide its Circular No. 2/2011 dated February 8, 2011, your
Company has enclosed the consolidated financial statements of your
Company and its subsidiary, duly audited by statutory auditors of your
Company.
The audited annual accounts and other related information of the
subsidiary, wherever applicable, will be made available to shareholders
of the Company on request. Further, these documents will also be
available for inspection during business hours at the Registered Office
of your Company, as well as that of JF Lanka, and are also being
uploaded on the website of your Company viz. www.jubilantfoodworks.com.
DIVIDEND
Keeping in view, your Company's requirement of capital for its growth
plans for Domino's Pizza and Dunkin' Donuts, the Board has not
recommended any dividend.
OPERATIONAL PERFORMANCE
Domino's Pizza
Your Company has been able to maintain healthy levels of profitability
by countering the negative effects, if any, of the slowdown in economy
due to euro zone crisis, through greater operational and cost
efficiencies. During FY 2012, your Company delivered a System Sales
growth of 50% (revenue growth at an overall level) and Same Store Sales
growth of 30%.
With more than 70% market share, your Company remains the market leader
in pizza home delivery segment and more than 55% share in organised
pizza segment in India.
Your Company believes in exploring new cities even as it continues to
penetrate deeper into the cities where it is already present. Your
Company had 465 Domino's Pizza stores in 105 cities across India as on
March 31, 2012 as against 378 Domino's Pizza stores in 90 cities as on
March 31, 2011, an addition of 87 new Domino's Pizza stores and 15 new
cities during the year.
A holistic and highly evolved business model has successfully propelled
this growth through continuous investment in training, processes,
marketing and technology by your Company.
For your Company, delivering more extends beyond numbers to more
consumer satisfaction through continuous expansion and innovation of
its product portfolio. During the year, your Company launched several
new products like Butterscotch Mousse Cake, Nutty Choco Lava Cake, etc.
to delight its consumers. The emotional connect of "Khushiyon ki Home
delivery"and the promise of 30 minutes delivery continues to create a
strong bond between the consumer and your Company.
A more exciting and comfortable consumer experience also remained a key
thrust area for your Company, which, in addition to the launch of
Single National Number 68886888 and Online ordering service for
Domino's Pizza, also entered into the field of digital marketing,
thereby creating more and more ways to reach its consumers. The
popularity of your Company in the society is well depicted by a fan
base of over 1 million people on Domino's Pizza Fan Page on Facebook as
on March 31, 2012.
During the year, your Company also opened its first two Domino's Pizza
stores in Sri Lanka through its subsidiary. Since the launch, the
consumer response has been overwhelming, indicating the brand's
wholehearted acceptance in Sri Lanka.
Dunkin' Donuts
Your Company announced launch of Dunkin' Donuts by opening two
restaurants in New Delhi in May 2012, thereby adding more flavour to
its palate. With the launch of Dunkin' Donuts, your Company marks the
beginning of another exciting journey and hopes to exceed consumer
expectations.
INCORPORATION OF SUBSIDIARY
Your Company incorporated a wholly owned subsidiary in Mauritius, viz.
JFW Holdings Mauritius Private Limited in March 2012.
RISK MANAGEMENT
Your Company has a strong risk monitoring system at various levels for
timely identification and mitigation of the risks faced by your
Company. With an effective risk management framework in place, your
Company looks at these risks as challenges and opportunities to create
more value for its stakeholders.
A detailed note on Risk Management is given as part of "Management
Discussion & Analysis"
SHARE CAPITAL
During the year, your Company issued 545,720 Equity Shares on the
exercise of stock options under Employees Stock Option Plan, 2007. As
a result, the issued, subscribed and paid-up equity share capital
increased from 64,532,220 Equity Shares as at March 31, 2011 to
65,077,940 Equity Shares as at March 31, 2012.
HUMAN RESOURCE DEVELOPMENT
Your Company considers its employees resources as the engine which
drives the Company's growth and helps it rise to greater levels of
success. Your Company believes in the philosophy of continuous
investment in its people by undertaking several employee development
initiatives and best-in-class employee friendly policies. During the
year, various programmes were conducted across teams for the overall
skill enhancement of the employees. Further, varied employee engagement
programmes were initiated to sustain the energised and cohesive team
culture in the organisation. Your Company successfully implemented a
Succession Planning initiative for the key leadership roles and created
customised development programmes for the incumbents.
As a testimony to this, your Company continues to enjoy a strong
reputation as an employer of choice. Your Company has been ranked
amongst the top 25 employers in India in Hewitt's Best Employers Survey
in the past 3 years. Your Company is amongst 6 companies who have
retained their status over the past 3 surveys. Your Company has also
consistently been ranked amongst the top 50 employers in India by the
Great Place to Work Institute in the last 3 surveys. Your Company was
also recognised with "Strong Commitment to HR Excellence" by CII in its
HR Excellence Survey 2011 -12.
"Happy faces delivering boxes of joy, confidence in their strides,
pride in their voice and a feeling of comradeship with their fellow
colleagues - all this makes your Company a great place to work."
Your Company also implemented JFL Employees Stock Option Scheme, 2011
during the year to reward its employees. In addition, the Employees
Stock Option Plan, 2007 is still in force. The Compensation Committee
of your Company administers and monitors both ESOP Schemes. During the
year, the employees were allotted equity shares upon exercise of stock
options under the Employees Stock Option Plan, 2007. The applicable
disclosures under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
1999, as at March 31, 2012 are given in Annexure A.
Certificate from M/s. S. R. Batliboi & Co., Chartered Accountants,
Statutory Auditors, with respect to the implementation of the JFL
Employees Stock Option Scheme, 2011 and Employees Stock Option Plan,
2007 would be placed before the shareholders at the ensuing Annual
General Meeting and a copy of the same shall be available for
inspection at the Registered Office of your Company.
CORPORATE SOCIAL RESPONSIBILITY (CSR) - CARING FOR THE COMMUNITY
Your Company is committed to contribute as much more to the society as
to its employees, consumers and stakeholders in its pursuit of growth.
It is a privilege for your Company to extend a supporting hand to those
in need. Road safety, health awareness, green plant and civic and
social awareness are some of the key areas your Company actively
pursued as part of its CSR thrust. This focus is evident from the fact
that 481 CSR activities were undertaken in FY 2012 as against 366 in FY
2011.
CORPORATE GOVERNANCE REPORT
Your Company consistently endeavours to focus on good corporate
governance practices to match global standards. These practices have
resulted in securing the trust of the stakeholders and society at large
in your Company and its management.
The Corporate Governance Report pursuant to Clause 49 of the Listing
Agreement with the Stock Exchanges forms part of the Annual Report. A
certificate from M/s. Chandrasekaran Associates, Company Secretaries
confirming compliance with the conditions of Corporate Governance as
stipulated under Clause 49 is attached to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the Management Discussion & Analysis Report is presented in
a separate section forming part of the Annual Report.
DEPOSITS
Your Company has not accepted any public deposits and, as such, no
amount on account of principal or interest was outstanding as at March
31, 2012.
DIRECTORS
In accordance with the Articles of Association of your Company, Mr.
Vishal Marwaha and Mr. Arun Seth are liable to retire by rotation in
the forthcoming Annual General Meeting and being eligible, offer
themselves for re-appointment.
A brief resume containing nature of expertise, details of directorships
held in other public limited companies and other information of the
Directors proposing re-appointment pursuant to Clause 49 of the Listing
Agreement with the Stock Exchanges is appended as an annexure to the
Notice of ensuing Annual General Meeting.
Your Directors recommend their re-appointment at the ensuing Annual
General Meeting.
AUDITORS AND THEIR REPORT
S. R. Batliboi & Co., Chartered Accountants, Statutory Auditors of
your Company, retire at the conclusion of the ensuing Annual General
Meeting of your Company and being eligible, have offered themselves for
re-appointment as Statutory Auditors for a further period of one year.
Your Directors recommend their re-appointment.
Members' attention is drawn towards the observation made by the
Auditors in Clause (ix)(a) of the Auditor's Report and the Directors of
your Company wish to clarify that your Company is committed for timely
deposit of all statutory dues and steps have been taken to eliminate
the slight delays due to spread of your Company's operations pan India.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the Annexure 'B' forming part of the Directors' Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO UNDER SECTION 217(1) (e) OF THE COMPANIES ACT, 1956
READ WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF
BOARD OF DIRECTORS) RULES, 1988
Energy conservation demands a strong thrust on conserving energy to the
maximum extent possible. Energy Audits are carried out for Domino's
Pizza stores and commissaries of your Company to identify the areas of
energy efficiency. These are implemented after due observations, thus
ensuring more environment friendly and energy-efficient systems and
processes.
In view of the nature of business of your Company, the information as
prescribed in the prescribed form for Technology Absorption is
considered to be not applicable to your Company.
Information pertaining to Foreign Exchange Earnings and Outgo is given
in the Note No. 33 of the Notes forming part of the standalone
financial statements.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that in the preparation of Statement of Profit and
Loss for the year ended March 31, 2012 and the Balance Sheet as at that
date, your Directors have:
- Followed the applicable accounting standards and no material
departures have been made from the same;
- 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 your Company at
the end of the financial year and of the profit of your Company for
that year;
- 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 your Company and for
preventing and detecting fraud and other irregularities; and
- Prepared the annual accounts on a 'going concern' basis.
ACKNOWLEDGEMENT
Your Directors wish to convey their sincere appreciation to all the
employees for their enormous dedication as well as contribution to the
Company's performance. The progress which the Company has made would
never have been possible without the tremendous support of the
Management and the dedicated commitment of the workforce of the
Company. Your Directors are also thankful to the investors of the
Company for their continued trust and support in the Company. Your
Directors also gratefully acknowledge the continued support from the
business associates, various government agencies, financial
institutions, bankers, media and academic institutions received
throughout the year and look forward to nurture this relationship
further in the future. Your Directors also appreciate the confidence
and loyalty displayed by the consumers, whom your Company will always
strive to serve better by delivering more happiness.
Your Directors would need this continued support to achieve the goals
they have set for Jubilant FoodWorks in the years ahead.
For and on behalf of the Board of Directors
sd/-
Shyam S. Bhartia
Chairman
Date : May 10, 2012
Mar 31, 2011
Dear Members,
The Directors of your Company feel delighted to present the 16th Annual
Report together with the Audited Financials of your Company for the
year ended March 31, 2011. Financial Year 2010-11 (FY 2011), your
Company's first full year as a listed company, was simply an
exceptional year.
FINANCIAL REVIEW
Your Company is encouraged by the high growth rate and positive
response of consumers. Your Company's results show a well executed plan
translating into a robust performance. Key highlights of your Company's
standalone financial performance for FY 2011 are as enumerated below:
(Rs in Million)
Particulars Year Ended Year Ended
March 31,2011 March 31, 2010
Sales & Other Income 6,803 4,243
Profit before Interest,
Depreciation & Tax 1,220 657
Less: Interest 3 83
Less: Depreciation 293 243
Profit/ (Loss) before Tax 924 331
Provision for Taxation/FBT 204 1
Profit/ (Loss) after Tax 720 330
Your Company's total income stood at Rs6,803 million in FY 2011 yielding
a growth of 60%. The Profit before Interest, Depreciation and Tax in FY
2011 increased to Rs1,220 million as against XQ57 million in FY 2010
registering a growth of 86%. Net Profit increased to Rs720 million from
Rs330 million in FY2010 registering a growth of 118%.
Consolidated Financials
(Rs in Million)
Particulars Year Ended
March 31, 2011
Sales & Other Income 6,803
Profit/ (Loss) before Tax 921
Provision for Taxation/FBT 204
Profit/ (Loss) After Tax 717
Jubilant Food Works Lanka (Pvt.) Ltd., wholly owned subsidiary of your
Company was incorporated in Sri Lanka on September 14,2010, hence
figures have been consolidated in these financial statements from that
date onwards and previous year figures of the subsidiary are not
applicable.
DIVIDEND
Keeping in view your Company's requirement of capital for its growth
plans and the intent to finance such plans through internal accruals to
the maximum, the Board has not proposed any dividend.
OPERATIONAL PERFORMANCE
"We know that our shareholders deserve nothing less than our very best
effort. So we put together a solid business plan and set challenging
growth goals each year."
Your Company marched towards its goal of gaining market share with
robust performance which again proved the ability of your Company to
deliver consistent profitable growth. As a result, your Company remains
the market leader in the organised pizza home delivery segment in India
with over 70% market share. Your Company has enormous talent,
capabilities and skills, in addition to an impressive product
development program and process technologies. These have enabled your
Company to achieve a more prominent position in the marketplace.
The momentum in the business growth was largely driven by excellent
same store sales growth. This translated into deeper penetration of
stores and higher frequency of consumption ultimately leading to higher
volumes and a continued increase in the number of new stores opened.
As on March 31, 2011, your Company had 378 stores across India as a
result of addition of 72 new stores during the year. As on March
31,2011, your Company had presence in 90 cities out of which the
Company entered into 21 new cities during FY2011.
During FY 2011, your Company achieved a robust System Sales growth of
60% (revenue growth at an overall level). Your Company has continued
with its tremendous performance this year with same store sales growth
of 37% which again proves the trust consumers have in your Company's
products.
The phenomenal growth has been possible due to strong consumer focused
approach, commitment to deliver the tastiest products in 30 minutes,
constant endeavor to bond with consumers through "Khushiyon ki Home
delivery" positioning, best in class training infrastructure and highly
motivated and passionate team. Your Company's National marketing
program which involves launching new products and building the brand,
Precision marketing program which develops store specific marketing
activations and CRM programs wherein your Company connects with all its
valuable consumers one-on-one, have been extremely successful in
driving the growth.
Further, one of the important factors in the growth of your Company has
been the expertise to penetrate in the tier II and tier III cities
resulting in opportunity to explore the vast gamut of the food services
market. Your Company has received phenomenal success in every city it
has entered.
The technology is touching the lives of the people and your Company
became the first Food Service Company in India to take live online
orders through its online ordering initiative. Your Company has also
launched Single National Same Number 68886888 to facilitate consumers
ordering Domino's. Further, your Company also connected with the
consumers through social platforms like Facebook where it currently has
a fan base of more than 4.5 lakhs.
TAMING INDIAN TASTE BUDS
Innovation, out of box thinking and exploring new opportunities within
the pizza business was the challenge your Company set for itself for FY
2011. Your Company continuously assesses consumer needs to develop new
and innovative products and promotional ideas which deliver better
value to its consumers. This year your Company launched several new
products such as Wheat Thin Crust Pizza, the new Pasta Italiano range,
the all new Mexican Wrap range and Double Burst Pizza. Your Company
also made exciting offers to its valued consumers in new cities as a
welcome note for the consumers in the city where your Company placed
its first step.
BRINGING GREAT TASTE TO INDIA - ALLIANCE WITH DUNKIN'DONUTS
Your Company entered into an alliance with Dunkin' Donuts Franchising
LLC to bring Dunkin' Donuts restaurants to India. With the beginning
of this new relationship with Dunkin' Donuts, your Company has now
significantly strengthened its portfolio.
Founded in 1950, Dunkin' Donuts is America's favourite coffee and
donuts. It is a market leader in the hot regular/ decaf/flavoured
coffee, iced coffee, donut, bagel and muffin categories.
Your Company is well poised to address two distinct non-competing
segments of the Food Service Industry in India, namely the home
delivery of Pizza's market and the all day part dine-in restaurant,
food and beverage market. This alliance will provide flexibility to
your Company in localising recipes and leveraging its strengths in food
service industry.
EXPANDING HORIZONS - INCORPORATION OF FOREIGN SUBSIDIARY
During the year, your Company incorporated a Wholly Owned Subsidiary,
Jubilant Food Works Lanka (Pvt.) Limited (JF Lanka) in Sri Lanka to
extend its operation in the territory of Sri Lanka. Your Company had
invested Rs11.5 million in JF Lanka during FY2011.
In compliance with the directions issued by the Ministry of Corporate
Affairs vide its Circular No. 2/2011 dated February 8, 2011, your
Company has enclosed its consolidated financial statements duly audited
by statutory auditors of the Company.
The audited annual accounts and other related information of JF Lanka,
wherever applicable, will be made available to shareholder of the
Company on request. Further, these documents will also be available for
inspection during business hours at the Registered Office of your
Company as well as that of JF Lanka and are also being uploaded on the
website of your Company viz. www.dominos.co.in.
RISK MANAGEMENT
Your Company has several risk factors which could potentially impact its
business objectives, if not perceived and mitigated in a timely manner.
With an effective risk management framework in place, your Company
looks at these risks as challenges and opportunities to create value
for its stakeholders. With its established processes and guidelines in
place, combined with a strong oversight and monitoring system at the
Board and Senior Management levels, your Company believes that it has a
robust risk management strategy in place.
The Senior Management team of your Company sets the overall tone and
risk culture of the organisation through defined and communicated
corporate values, clearly assigned risk responsibilities, appropriately
delegated authority and a set of processes and guidelines. Your Company
has laid down procedures to inform Board members about the risk
assessment and risk minimization procedures. As an organisation, your
Company promotes strong ethical values and high levels of integrity in
all its activities, which in itself is a significant risk mitigator.
With the growth strategy in place, risk management holds a key to the
success of your Company's journey of continued competitive
sustainability in attaining its desired business objective.
A detailed note on Risk Management is given as part of "Management
Discussion & Analysis".
SHIFTING OF REGISTERED OFFICE
During the year, your Company shifted its registered office from Delhi
to Noida, Uttar Pradesh with effect from January 10, 2011 and now it is
co-located with its Corporate Office.
SHARE CAPITAL
During the year, your Company issued 910,474 Equity Shares on the
exercise of stock options under Domino's Employee Stock Option Plan,
2007. Due to this, the issued, subscribed and paid-up equity share
capital increased from 63,621,746 Equity Shares to 64,532,220 Equity
Shares as at March 31,2011.
HUMAN RESOURCE DEVELOPMENT
Your Company acknowledges the fact that it is the human assets which
make or break an organisation. It is a belief of your Company that
investing in its employees yields not only prosperity for your Company
but also committed relationship from employees. Your Company seeks to
achieve its goals through alignment of employees' goals with your
Company's vision and appreciating employees' efforts through rewards
and recognition. Your company believes in promoting a fun@work culture
in your organisation so as to free the working environment from
continuous burden of work and provide employees a friendly working
environment.
During the year, several initiatives were undertaken for employee
development and to raise the level of satisfaction of employees in the
organisation. Some of the initiatives undertaken are as follows:
Various training programs like "Happiness Delivered" and "Winning Edge"
were conducted in which more than 11,000 man hours of training was
imparted.
BBAin Retail Management was launched in collaboration with IGNOU for
employees, wherein your Company will sponsor 75 % of total course fees
of the program.
P. G. Diploma in Materials and Supply Chain Management was launched in
collaboration with IMT Ghaziabad wherein your Company will sponsor 50%
of total course fees of the program.
Facilitated medical facilities through vaccination camp for employees
to prevent them from Cervical Cancer and Hepatitis B.
The above initiatives were well appreciated and recognised as a result
of which the following awards were received:
Adjudged as one of the Top 25 employers in the country, 3 times in a
row by Aon Hewitt Best Employers Survey 2011.
Mr. Ajay Kaul, CEO cum Whole Time Director won "CEO with HR
Orientation" in Asia's Best Employer Brand Awards-2010 by World HRD
Congress.
Mr. Basab Bordoloi, Vice President - Human Resources won "HR leadership
award" and "Most powerful HR professional of India" in Asia's Best
Employer Brand Awards - 2010 by World HRD Congress.
Further, your Company had also implemented Domino's Employees Stock
Option Plan, 2007 which is still in force. The Compensation Committee,
constituted by your Company administers and monitors the plan. During
the year, the employees were allotted new equity shares upon exercise
of stock options under the Domino's Employees Stock Option Plan, 2007.
The applicable disclosures under the Securities and Exchange Board of
India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999, as at March 31,2011 are given in Annexure A.
A certificate from M/s S. R. Batliboi & Co., Chartered Accountants,
Statutory Auditors, with respect to the implementation of the Domino's
Employees Stock Option Plan, 2007 would be placed before the
shareholders at the ensuing Annual General Meeting and a copy of the
same shall be available for inspection at the Registered Office of your
Company.
CORPORATE SOCIAL RESPONSIBILITY - CARING FOR THE COMMUNITY
As your Company continues to serve its consumers, it does not overlook
its responsibility towards society. It has been your Company's
privilege to extend a supporting hand to those in need. Each store
endeavors to contribute its bit to the betterment of the society. The
CSR activities in your Company encompass four categories -
Employability & Education, Green Planet, Health & Safety, Social
Activities and Social Awareness. The thrust on CSR is evident from the
fact that 366 CSR Activities were undertaken this year as against 142
in the last financial year.
Being a responsible corporate citizen, your Company carried out several
social programs in different parts of the country, some of which it
feels proud to enumerate herein -
A road safety program was conducted at Gwalior and Noida.
The Company reinforced the greenery awareness by "GO GREEN" program
conducted at Karnal, Punjab and various other parts of the country.
An awareness program on pollution due to crackers was conducted at
Bengaluru.
World Environment day was celebrated to spread awareness on global
warming.
Exercise to clean Juhu beach was carried out at Mumbai.
An education awareness programme held in Jaipur slum area.
These are just some of the CSR activities that your Company
accomplished, there are many more which were executed flawlessly and a
lot more are on the cards. Your Company endeavors to raise the bar
every year on the CSR front.
CORPORATE GOVERNANCE REPORT
The corporate governance philosophy of your Company is driven by the
interest of stakeholders and business needs of your Company. Therefore,
enhancing corporate governance is on highest priority of your Company
in order to keep the trust of the shareholders and to fulfill its
social responsibilities as a Company.
Further, your Company has also put in place a Whistle Blower Policy to
provide opportunity to its employees to raise concern about
irregularities within the Company and to provide the necessary
safeguards to these employees from unlawful victimisation, retaliation
or discrimination for their having disclosed or reported fraud,
unethical behavior, violation of Code of Conduct, questionable
accounting practices, grave misconduct etc.
A detailed Corporate Governance Report pursuant to the requirements of
Clause 49 of the Listing Agreement forms part of the Annual Report. A
certificate from M/s Naresh Verma & Associates, Company Secretaries
confirming compliance with the conditions of Corporate Governance as
stipulated under Clause 49 is attached to this Report.
MANAGEMENT DISCUSSION &ANALYSIS REPORT
In accordance with the Listing Agreement requirements, the Management
Discussion & Analysis Report is presented in a separate section forming
part of the Annual Report.
DEPOSITS
Your Company has not accepted any public deposits and, as such, no
amount on account of principal or interest was outstanding as on the
Balance Sheet date.
DIRECTORS
In accordance with the Articles of Association of your Company, Mr.
Hari S. Bhartia and Ms. Ramni Nirula are liable to retire by rotation
in the forthcoming Annual General Meeting and being eligible offer
themselves for re-appointment.
A brief resume containing nature of expertise, details of directorships
held in other public limited companies and other information of the
Directors proposing re-appointment as stipulated under Clause 49 of the
Listing Agreement with the Stock Exchanges is appended as an annexure
to the Notice of ensuing Annual General Meeting.
AUDITORS AND AUDITOR'S REPORT
S. R. Batliboi & Co., Chartered Accountants, Statutory Auditors of your
Company, retire at the conclusion of the ensuing Annual General Meeting
of your Company. They have offered themselves for appointment as
Statutory Auditors for a further period of one year and have confirmed
that their appointment, if made, would be within the prescribed limits
under section 224 (1B) of the Companies Act, 1956. Your Board of
Directors recommend their appointment.
Members' attention is drawn towards the observation made by the
Auditors in Clause (ix)(a) of the Auditor's Report and the Directors of
your Company wish to clarify that your Company is committed for timely
deposit of all statutory dues and steps have been taken to eliminate
the minor delays due to spread of your Company's operations pan India.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the Annexure 'B'forming part of the Directors' Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO UNDER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956
READ WITH THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF
BOARD OF DIRECTORS) RULES, 1988
Energy conservation demands the thrust on conserving energy to the
maximum extent possible. Energy Audits are carried out for the stores
and commissaries of your Company to identify the areas of energy
efficiency. These are implemented after due observations.
In view of the nature of business of your Company, the information as
prescribed in the prescribed form for Technology Absorption are
considered to be not applicable to your Company.
Information pertaining to Foreign Exchange Earnings and Outgo is given
in the Note No. 13 of the Notes to the Accounts.
DIRECTORS'RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that in the preparation of the Profit & Loss Account
for the year ended March 31, 2011 and the Balance Sheet as at that
date, your Directors have:
a. Followed the applicable accounting standards with proper explanation
relating to material departure.
b. 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 your Company at
the end of the financial year and of the profit of your Company for
that year.
c. Taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies
Act, 1956 for safeguaRiding the assets of your Company and for
preventing and detecting fraud and other irregularities; and
d. Prepared the annual accounts on a 'going concern' basis.
ACKNOWLEDGEMENT
Your Directors wish to convey their sincere appreciation towards all of
the employees for their enormous dedication as well as contribution to
the Company's performance. The progress which the Company has made
would never have been possible without the tremendous support of the
management and workforce of the Company. Your Directors are also
thankful to the investors of the Company for their continued trust and
support in the Company. Your Directors also gratefully acknowledge the
continued support from the business associates, various government
agencies, financial institutions, bankers, media and academic
institutions received throughout the year and look forward to nurture
this relationship in future also. Your Directors also appreciate the
confidence and loyalty displayed by the consumers, whom your Company
will always strive to serve better.
Your Directors would need this continued support to achieve the goals
they have set for Jubilant Food Works in the years ahead.
For and on behalf of the Board of Directors
sd/-
(Shyam S. Bhartia)
Date: May 12,2011 Chairman
Mar 31, 2010
The Directors have pleasure in presenting the 15th Annual Report
together with the Audited Balance Sheet and Profit and Loss Account of
your Company for the year ended March 31, 2010.
OPERATING AND FINANCIAL REVIEW
Building on the strong performance in 2008-09, your Company has had
another year of robust growth and excellent results. Key highlights of
your Companys financial performance for the year 2009-10 are as
enumerated below:
Particulars year ended
march 31 ,2010 Year ended March 31 ,2009
(Rupees in millions) (Rupees in millions)
Sales & Other
Income 4,243 2,810
Profit before
Interest, Depre-
ciation & Tax 665 339
Less: Interest 91 89
Less: Depreciation 243 169
Profit (Loss)
before tax 331 81
Provision for
Taxation/FBT 1 8
Profit (Loss)
after tax 330 73
Your Companys growth continues to be driven by unfaltering focus and
passion for the delivery of your Companys three key priorities namely,
great tasting and great quality pizzas and other products, best in
class customer service and innovative consumer marketing. As a result
of your Companys efforts in these three areas and other initiatives,
the net sales of the Company increased to Rs.4,239 millions in FY2010
from Rs.2,806 millions in the FY2009 yielding a growth of 51%. The
operating profit for the year FY2010 increased to Rs.665 millions as
against Rs.339 millions in FY2009 registering a growth of 96%.
The net profit increased to Rs.330 millions from Rs.73 millions
in the FY2009 registering a growth of 351%.
OVERVIEW OF OPERATIONS
Your Company is one of the largest and fastest growing international
food brands in South Asia and the market leader in the organized pizza
home delivery segment in India with over 65% market share in the year
2009.
As on March 31, 2010, your Company had 306 stores across India, having
added 65 new stores and through a sub- franchisee, D. P. Lanka, five
stores in Sri Lanka. Your Company achieved a major landmark by opening
its 300th store in New Delhi, in this financial year. This store also
happens to be Dominos Pizza Inc.s 9000th store worldwide.
Your Company had excellent System Sales growth of 51 % (revenue growth
at an overall level). Your Company evaluates its performace across
three category of stores namely a) Same Stores, (Stores that were in
Operations for full twelve months in the previous financial Year) b)
Stores that were opened in the last financial year and c) New stores
that were opened this financial year. Your Company is happy to report
that there has been excellent performance in all the three
categories of stores leading to the growth that we have witnessed last
year.
The Company had excellent same store sales growth of 22%. The same
store growth of your Company is representative of the organic growth
and does not take into account the sales increase due to new stores and
this is testimony to the growing appeal of the Dominos brand in India.
Additionally, acceptance of new products and campaigns that your
Company launched last year, relevance in customers lives due to the 30
minutes service delivery commitment and your Companys focus on
building customer relationships, have played a key role.
The cornerstone of operational success of your Company is based on
employee training programs which cover every aspect of a stores
operations, your company knows, the they are likely to reorder. This
has enabled your companys operations to be ranked no. 1 in the
Dominos global operations among the countries with 100 or more stores
Your company also places great emphasis on general hygiene and safety,
as well as branding of its stores. Your Company has focused upon
significant improvements in the store expansion process, more stringent
Quality controls to maintain high standards for the products and added
new processes to ensure responsible and profitable growth.
In the current economic climate, we are pleased to inform that we aim
to continue aggressive expansion plans as we have done in the past
years. As of March 31, 2010, your Company grew its store count across I
the country to 306, having added 65 new stores during the year. Your
Company | plans to expand its presence by entering into new cities and
towns, in order to exploit the large untapped potential that exists in
these tier 2 and tier 3 cities. This has been a major factor in the
strong revenue growths that your Company has been able to deliver in
the recent years.
One of the key elements of your Companys business operation is
marketing strategy and consumer understanding. Your Companys
marketing strategy is focused on understanding key aspects of consumer
behaviour and identifying opportunities. The core of marketing strategy
is to deliver product and service solutions to address these
opportunities and to associate Dominos brand with key consumer
requirements.
Recognizing the continued excellence of the innovative marketing of
your Company, your Company was honoured with the "Indias top 25
Marketers Award of 2009", by the exchange4media group. Your Company
shared the dias with Indias top 25 brands including most of the elite
consumer product brands of the country. Your Company was also
recognized as a Game Changer of the Decade by the Pitch magazine.
This recognition was given to those brands which created significant
explosion in demand by changing rules of the game over the last decade.
In sync with the strategy of providing a variety of great tasting
products on the menu and offering a wider choice to consumers, your
Company launched "Dominos Pasta" and "Choco-Lava Cake". Both these
products have received tremendous positive response and have been
runaway successes.
Your Company continued its focus of building strong emotional
differentiators and further strengthened the Brand Positioning of
"Khushiyon ki Home Delivery".
Your Directors take pleasure in informing that your Company saw a
revenue growth of 51% as a result of aggressive actions both in store
expansion as well as by aggressive marketing.
HELPING COMMUNITIES - CORPORATE SOCIAL RESPONSIBILITY
While serving consumers is our passion, becoming a part of
the communities in which we operate and building relationships
with the society is one of our duties. Also, helping the needy
in difficult times or time when they just need our support is
something that gives us immense joy and satisfaction. Asa
responsible corporate citizen, your Company carried out many
activities in various parts of the country. Some of them are listed
below -
- In association with India National Polio Plus committee of Rotary
International, your Company is supporting Rotary Internationals
information, education and communication programme to promote polio
immunisation activities throughout India
- At Delhi, Dominos in association with a NGO named "Family of
Disabled (FOD)" identified 16 disabled people who "want to stand on
their legs" under a scheme named "APNA ROZGAR YOGNA" exclusively
designed for self employment of physically challenged people and who
are determined not to be dependent on anybody for their livelihood.
Employees with the help of FOD provided small business setups to them
- A special outing for the children of SOS Childrens village Rajpura
was organized. They were shown the entire outlet and served with
pizzas, cold drinks and sweets
- At Bangalore, "DRIVE SAFE, AVOID ACCIDENT AND SAVE LIFE" messages
were propagated during the road safety awareness programme. Apart from
sharing statistics and figures, the employees came out on streets to
convey road safety messages to the public through placards and banners
- At Ahmedabad, Childrens day was celebrated with more than 50 orphans
in collaboration with three local civil society organizations
- At Mumbai, Christmas was celebrated with 30 visually impaired
children sheltered at National Association for Blind (NAB), Mumbai.
Employees spent time with the children, organized recreational
activities and shared cakes, garlic breads and Pizzas
- 180 blind girls were treated to pizzas, wafers, chocolates and coke.
Employees also played games, shared jokes and tried to make their day a
memorable one
- Employees of northern zone participated in Vastradaan programme of
Goonj (a reputed NGO) to provide clothings to needy in rural areas
- Save Environment programme was coordinated in southern zone to
create awareness in the society about Bio- Degradable and Recyclable
wastes
- No Tobacco Day was observed on May 31, 2009 to create awareness about
the importance of "QUIT SMOKING"
AWARDS & RECOGNITIONS
- Your Companys operations have been ranked No. 1 in Dominos
International in 2009
- Won the "Top 25 Marketers of 2009" award presented by exchange4media
group for a strong performance in tough economic environment
- Was adjudged the 9th best employer in HEWITT Best Employer Survey,
2009
- Recognized as "Game changer of the Decade" for being one of the 10
brands that have changed the consumer behavior and set new trends over
the last decade, presented by Pitch magazine
- Won the Coca Cola Golden Spoon Award for the Most Admired Food &
Beverage Retailer of the year - QSR foreign brand by Images Retail
- Received the Best Employer Brand Award (Hospitality) from the
Employee Branding Institute in 2009
- Award for Excellence (Customer Service) in Franchising and Business
Development by The Franchising World in 2009
- Won three Dominos Pizza International Awards for 2009, namely -
International Trainer of the Year in the entire Dominos International
Regional Manager of the Year in Asia Pacific Regional Supervisor of the
Year in Asia Pacific
- Won 94 Rolex Awards from Dominos Pizza International for calendar
year 2009 which is the highest ever Rolexes won by any Master
Franchisee
- Won MOST ADMIRED QSR Brand in 2009, given by India Food Forum
- Our CEO, Shri Ajay Kaul, won MOST ADMIRED FOOD PROFESSIONAL in
2009, given by the India Food Forum
CHANGE OF NAME
In order to align the name of the Company with the group name
"JUBILANT", the name of your Company was changed from Dominos Pizza
India Limited to Jubilant FoodWorks Limited effective September 24,
2009.
INITIAL PUBLIC OFFER OF EQUITY SHARES OF THE COMPANY
During the year under review, your Company successfully made an Initial
Public Offering of 22,670,452 equity shares of Rs. 10/- each
constituting 35.63% of the post issue share capital of the Company at a
price of Rs. 145/- per equity share aggregating Rs. 3,287,214,815/-. It
comprised of a fresh issue of 4,000,005 equity shares and an offer for
sale of 18,670,447 equity shares by The India Private Equity Fund
(Mauritius) and Indocean Pizza Holding Limited. The issue was opened
for subscription to public on January 18, 2010 and closed on January
20, 2010. Your Companys issue received a tremendous response from the
investors. The issue was oversubscribed by 31 times on overall basis.
The Equity Shares of the Company got listed on National Stock Exchange
and Bombay Stock Exchange. The trading in the fully paid shares of the
Company commenced on February 08, 2010 at BSE and NSE.
Your Directors welcome all the new Shareholders of the company.
SHARE CAPITAL
During the year, the Authorised Share Capital of your Company increased
from Rs.600,000,000 to Rs. 800,000,000 divided into 80,000,000 equity
shares of Rs. 10/- each.
During the year under review the Company has issued and allotted shares
as detailed below:
- 11,76,835 equity shares of Rs.10/- each to ex-managing Director under
the Options Agreement on September 29, 2009
- 171,919 equity Shares of Rs.10/- each for a cash consideration at a
premium of Rs.25/- per equity Share under the Dominos Employee Stock
Option Plan, 2007 on September 29, 2009
- 1,600 equity Shares of Rs.10/- each for a cash consideration at a
premium of Rs.41/-per equity Share under the Dominos Employee Stock
Option Plan, 2007 on September 29, 2009
- 103,200 equity Shares of Rs.10/- each for a cash consideration at a
premium of Rs.25/- per equity Share under the Dominos Employee Stock
Option Plan, 2007 on November 27, 2009
- 3,200 equity Shares of Rs.10/- each for a cash consideration at a
premium of Rs.41/- per equity Share under the Dominos Employee Stock
Option Plan, 2007 on November 27, 2009
- 4,000,005 equity shares of Rs.10/- each for a cash consideration at a
premium of Rs.135/- per equity share in the Initial Public Offer of the
Company on February 01, 2010
DIVIDEND
In view of the accumulated losses of your Company and the plan to
reinvest the internal accruals back into your Company, the Board has
not proposed any dividend.
EMPLOYEES STOCK OPTION PLAN
The Compensation Committee, constituted by the Company administers and
monitors the plan. The applicable disclosures as stipulated under the
SEBI Guidelines as at March 31, 2010 are given in Annexure A.
Your Company has received a certificate from the Auditors of the
company that the Scheme has been implemented in accordance with the
SEBI guidelines and the resolution passed at the Annual General Meeting
held on August 6, 2007. This Certificate would be placed at the Annual
General Meeting for inspection by members.
HUMAN RESOURCE DEVELOPMENT
Your Company strongly believes that employees are one of the key
factors leading to the companys growth. Your Company values the
individuality of its employees and customers, which your Company
believes results in a management, operations and training philosophy
distinct from that of its competitors. Your Companys employees act as
the most critical link to your Companys customers, and your Company
seeks to develop employee skills that will enhance their work
experience by providing continuous training, as well as providing
appropriate rewards and recognition to them. Your Company has put in
place a comprehensive training program, which is structured to provide
a growth path for all its employees, from trainees to store managers.
There is a dedicated training ace for each store along with regional
trainers and a dedicated training facility in each major city in which
your Company operates. A number of employees, who joined your Company
as trainees, have been subsequently promoted to management ranks based
on their performance which is a motivating factor towards continued
employee engagement. Your Companys efforts are geared towards aligning
employees goals with your Companys vision in a bid to strengthen
employee engagement.
Your Company also launched Dominos University scheme, which provides
employees the ability to enroll into selected universities for which
your Company will bear a portion of the fee. Your Company also provides
to the middle management the option to undertake executive management
programs at the Institute of Management Technology, Ghaziabad.
Under the Employee Stock Option Plan, 2007, your Company granted
4,74,960 options during 2009-10. The total cumulative options granted
under the Plan (net of options lapsed) are 2,496,380.
A recognition of our employee friendly culture from the external world
was evident from our V.P. - Human Resource, Shri Basab Bordoloi
receiving the HR Leadership Award (Hospitality) from the Employee
Branding Institute.
CORPORATE GOVERNANCE REPORT
The corporate governance philosophy of your Company is driven by the
interest of stakeholders and business needs of the Company. Therefore,
enhancing corporate governance is on our highest priority in order to
keep the trust of the shareholders and to fulfill our social
responsibilities as a Company. The Directors adhere to the Corporate
Governance requirements set out by the Securities and Exchange Board of
India and your Company has implemented all the stipulations prescribed
by SEBI.
The Board of Directors of the Company had also evolved and adopted a
Code of Conduct based on the principles of Good Corporate Governance
and best management practices being followed globally. The Code is
available on the website of the Company at WWW. dominos. co. in.
The Report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
The requisite Certificate from M/s Naresh Verma & Associates, Company
Secretaries, confirming compliance with the conditions of Corporate
Governance as stipulated under Clause 49 is attached to this report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Managements Discussion and Analysis Report for the year under review,
as stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges in India is presented in a separate section forming part of
the Annual Report.
DEPOSITS
Your Company has not accepted any public deposits and, as such, no
amount on account of principal or interest on public deposits was
outstanding as on the date of the Balance Sheet.
DIRECTORS
Your Company is delighted to welcome Shri Arun Seth. Shri Vishal
Marwaha, Ms. Ramni Nirula and Shri Phiroz Vandrevala as Additional
Directors to the Board. They were appointed in accordance with Article
106 of Articles of Association and Section 260 of the Companies Act,
1956. These Directors bring along a wealth of experience to the Board.
All these Directors in their capacity as Additional Directors, will
cease to hold office at the forthcoming Annual General Meeting and are
eligible for appointment. Notices alongwith requisite deposit under
Section 257 of the Companies Act, 1956 have been received from Members
signifying their intention to propose the candidature of aforesaid
persons for appointment as Directors.
The details of their re-appointment together with nature of their
expertise in specific functional areas and names of the companies in
which they hold office as a Director and/or the Chairman/Membership of
committees of the Board, are provided elsewhere in this Report.
Further, in terms of the provisions of the Companies Act, 1956, Shri
Shyam S. Bhartia is liable to retire by rotation at the ensuing Annual
General Meeting and being eligible has offered himself for
re-appointment.
Also, the term of Shri Ajay Kaul as Whole Time Director has expired by
efflux of time on March 13, 2010. Accordingly, it is proposed to
re-appoint him as Whole Time Director of the Company w.e.f. March 14,
2010 for a period of five years i.e. upto March 13, 2015 at the
remuneration as approve by the Members in their Annual General Meeting
held on September 26, 2008.
Your Board recommends their appointment/re-appointment.
AUDITORS AND AUDITORS REPORT
S. R. Batliboi & Co., Chartered Accountants, Statutory Auditors of the
Company, retire at the conclusion of the ensuing Annual General Meeting
of the Company. They have offered themselves for reappointment as
Statutory Auditors and have confirmed that their appointment, if made,
would be within the prescribed limits under section 224 (1B) of the
Companies Act, 1956. Your Board of Directors recommend their
re-appointment.
Accounts alongwith notes and Auditors Report are self explanatory and
do not require any further explanation or clarification.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
as amended, the names and other particulars of the employees are set
out in the Annexure B forming part of the Directors Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO UNDER SECTION 217(1)(E) OF THE COMPANIES ACT, 1956
READ WITH THE COMPANIES (DISCLOSURE OF
PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988
The thrust on energy conservation continues to achieve the objective of
energy conservation. The Company carried out energy audits of few of
its stores and commissaries to identify the areas of energy efficiency
which were implemented.
In view of the nature of business of the Company, the required
information in the prescribed form for Technology Absorption are
considered to be not applicable to the Company.
Information pertaining to Foreign Exchange Earnings and Outgo is given
in the Notes No. 16(B), (C), (D) & (F) of the Notes to the Accounts.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Directors Responsibility Statement, it is
hereby confirmed that in the preparation of the Profit and Loss Account
for the year ended March 31, 2010 and the Balance Sheet as on date,
your Directors have:
- Followed the applicable accounting standards with proper explanation
relating to material departure.
- 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 your Company at
the end of the financial year and of the profit of your Company for
that year.
- 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 your Company and for
preventing and detecting fraud and other irregularities; and
- Prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENT
The Directors wish to convey their appreciation to all of the Companys
employees for their enormous personal efforts as well as their
collective contribution to the Companys performance. The Directors are
also thankful to the investors of the Company for their confidence in
the Company. They also gratefully acknowledge the continued support
received from the customers, business associates, various government
agencies, financial institutions and the bankers and academic
institutions.
For and on behalf of the Board of Directors
sd/-
Date : May 10,2010 (Shyam S. Bhartia)
Place : Noida Chairman
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