Directors Report of McNally Bharat Engineering Company Ltd.
Mar 31, 2018
The Directors have pleasure in presenting the Fifty Fifth Annual Report together with audited statement of accounts for the year ended March 31, 2018.
HIGHLIGHTS
The key highlights of the operations for the financial year 2017-18 over the previous year (based on standalone only in all cases) are as follow:
Total Income decreased from Rs. 2,24,063.64 lakh to Rs. 1,59,218.63 lakh and earnings before Finance Cost, Depreciation & Amortization and Tax increased from Rs. (13,213) lakh to Rs. (4,240) lakh.
FINANCIAL RESULTS
The Financial performance of the Company for the year ended March 31, 2018 is summarized below:
(Rs. in Lakhs)
|
Particulars |
Standalone for the year ended March 31st 2018 2017 |
|
|
Revenue from operations and other income |
159,219 |
224,064 |
|
Profit before Finance Cost, Depreciation & Amortisation and Tax |
(4,240) |
(13,213) |
|
Less: Finance Cost |
50,236 |
39,207 |
|
Earnings before Depreciation & Amortisation and Tax |
(54,476) |
(52,420) |
|
Less: Depreciation & Amortisation |
1,462 |
2,533 |
|
Profit Before Tax |
(55,938) |
(54,953) |
|
Total Tax Expenses |
(13,393) |
(49,126) |
|
Profit for the year |
(42,545) |
(5,827) |
|
Other Comprehensive Income |
(101) |
(48) |
|
Total Comprehensive Income of the year |
(42,646) |
(5,875) |
|
Retained earnings amount brought forward from previous year |
(80,821) |
(74,945) |
|
Transfer to / from General Reserve |
Nil |
Nil |
|
Balance of Total Retained Earnings at the end of the year |
(123,467) |
(80,821) |
STATE OF COMPANY''S AFFAIRS AND REVIEW OF OPERATIONS
Your Company''s overall performance has been improving since the time Mr. Srinivash Singh took over as the Managing Director of the Company in December 2016. With his business acumen and precision to identify and pick up right talent for the right job, he has formed different teams consisting of senior officers and executives to support him. The new teams are working harmoniously under the able guidance of Mr. Singh to bring about a turnaround in the economic fate of the Company. The efficiency of the teams and their effort is visible in terms of increased fresh order inflow. The fresh order inflow, during the year ended March 31, 2018 stood at 1,094 Crore which is more than double in comparison to that of the previous financial year.
Further, certain measures had been taken, during the year under review, to improve the financial viability of your Company. To recapitalize the Company and restoring erosion of net worth due to losses, Compulsorily Convertible Preference Shares for an amount of Rs. 39.42 Crore (approx.), Equity Shares for an amount of Rs. 35.27 Crore (approx.) and Warrants for an amount of Rs. 2.5 Crore (approx.) were issued. In addition, the bankers of the Company have already provided project specific working capital line to complete the ongoing projects. Effective steps have been taken to complete the old and held up projects and to bring back retention money and stuck up receivables within the current financial year.
Your Board has received confirmation from its senior managerial staffs that they had no personal interest in any material, financial and commercial transactions of the Company.
CHANGES, IF ANY, IN THE NATURE OF BUSINESS
No change has taken place in the nature of business of the Company during the year under review.
MAJOR PROJECTS UNDER EXECUTION
The following major projects are under execution of your Company:
- 100MW Solar Power Plant at Annantapuramu, AP for APGENCO
- BOP Package for 2 x 600 MW STPP of M/s. SCCL
- 132 KV GIS Substation at Domkol & Nazirpur of M/s. WBSETCL
- 132 KV GIS Substation at Panagarh of M/s. WBSETCL
- Coal Handling Plant for 1x500 MW TPS at Vindyachal of NTPC
- Coal Handling Plant for 3x250 MW TPS at Bongaigaon of NTPC
- Coal Handling Plant for 2x500 MW at Sagardighi of WBPDCL
- Ash Handling Plant for 2x660 MW at Mouda (Stage II) of NTPC
- Ash Handling Plant for 3x800 MW at Kudgi of NTPC
- Ash Handling Plant for 2x250 MW at Bhavnagar of M/s. BECL
- Limestone Milling and Conveying System for 2x250 MW at Bhavnagar of M/s. BECL
- Dry Fly Ash conveying system at Farakka of NTPC
- CW & Make up Water Package for 2x600 MW at Nabinagar of NPGC
- PT Plant for 2x660 MW at Mouda (Stage II) of NTPC
- By-Product Plant at Bhilai for BSP, SAIL
- 8MTPA capacity CHP at Manoharpur, Odisha for OCPL
- Coke Handling Plant at Chennai for CPCL
- De-bottlenecking of Plant at Zawar of HZL
- 2MTPA Lead-Zinc beneficiation Plant at Zawar for HZL
- Balaria-Mochia Surface Crushing Plant at Zawar of HZL
- 2MTPA Paste Fill Plant at RA Mines for HZL
- 2MTPA Paste Fill Plant at SK Mines for HZL
- Coal Handling Plant at Gevra for SECL
- Residential Accommodations for DGMAP at Jammu and Udaipur
- R&R Colony for NBCC at Pakri, Hazaribagh
MAJOR ORDERS RECEIVED DURING THE YEAR
- Delhi Metro Rail Corporation
- Construction of Entry Exit Structures & Other Civil Work at Kochi
- Odisha Coal & Power Limited
- 8MTPA capacity CHP with allied infrastructural facilities
- Hindustan Zinc Limited
- 2MTPA Lead Zinc Beneficiation Plant, Zawar Mines
- Balaria-Mochia Surface Crushing Portal Package at Zawar Mines
- 2.5MTPA Paste Fill Plant at Ra Mines
- 2.5MTPA Paste Fill Plant at S. K. Mines
- Slurry Pump, Flotation and Thickener
DIVIDEND
In absence of profit for the current financial year (2017-18), the Board of Directors of your Company considered it prudent not to recommend any dividend on Equity Shares for the year. Further, in view of the accumulated losses, no dividend will be rewarded to the Non-Convertible Preference shareholders, though they are entitled to receive dividend at a fixed rate of 11.50% on the Non-Convertible Redeemable Preference Shares of Rs. 100/- each.
The register of members and share transfer books will remain closed from September 20, 2018 to September 26, 2018 (both days inclusive).
SHARE CAPITAL
With a view to enhance the Company''s net worth, improve its debt-equity ratio and to meet its working capital requirement it became necessary to bring in more investment in the Company in the form of equity capital. Hence, during the year ended 31st March, 2018, the authorized share capital of the Company had been increased to Rs. 500,00,00,000/- (five hundred crore) divided into 24,00,00,000 (twenty-four crore) equity shares of Rs. 10/- each, 1,20,00,000 (one crore twenty lakh) Non-convertible Redeemable Preference Shares of Rs. 100/- each and 14,00,00,000 (fourteen crore) Convertible Preference Shares of Rs. 10/- each.
During the year ended 31st March, 2018, the Subscribed and Paid-up Equity Share Capital of the Company has been increased to 15,80,44,606 equity shares having a face value of Rs. 10/- each upon allotment of further 10,44,50,788 number of equity shares. During the year under review, the Company from time to time allotted 3,52,70,000 equity shares to different investors belonging to public category on preferential basis to infuse fresh capital in the business. In addition to that, as per the terms of Compulsorily Convertible Preference Shares (CCPS), allotted earlier, 3,21,51,515 and 3,70,29,273 equity shares were allotted (on conversion of same number of CCPS) to holders belonging to Promoter and Public category respectively.
Further, during the Year ended 31st March, 2018, your Company has issued 1,20,00,000 and 2,74,19,000 number of CCPS having a face value of Rs. 10/- each at a premium amount of Rs. 52/- per share to investors belonging to promoter and public category respectively to improve the Company''s net worth. Your Company has also issued 25,00,000 warrants of Rs. 10/- each at a premium of Rs. 52/- per warrant to one investor belonging to public category.
CHANGES IN THE BOARD OF DIRECTORS
The following changes have occurred in the Board of Directors during the year:
Resignation / Cessation:
- Mr. P. H. Ravikumar, (DIN - 00280010) who was an Independent Director of the Company, resigned, due to his personal commitments, from the Board of Directors of the Company w.e.f. June 25, 2017.
- Mr. Prabir Kumar Ghosh (DIN - 01912656), Whole Time Director of the Company resigned from the Board of Directors w.e.f. August 31, 2017.
- Mr. Prasanta Kumar Chandra, (DIN - 01919454), Whole Time Director and Chief Operating Officer of the Company, resigned from the Board of the Directors of the Company w.e.f. August 31, 2017 due to personal reasons.
- Mr. Manish Agarwal, (DIN - 00485089), who was appointed as an Additional Director of the Company on October 1, 2016, resigned from the directorship of the Company w.e.f. September 07, 2017, due to other engagements.
Your Directors take this opportunity to place on record their appreciation and gratitude for the valuable contributions made by the above-mentioned directors during their association with the Company.
Appointment / Reappointment:
In accordance with the provisions of the Articles of Association of the Company read with Section 152 of the Act, Mr. Aditya Khaitan (DIN - 00023788) will retire by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment.
In compliance with Regulation 36(3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 (''Listing Regulations'') read with the Secretarial Standard on General Meetings (SS-2) issued by the Institute of Company Secretaries of India, the particulars of Mr. Aditya Khaitan (DIN - 00023788) form part of the Notice convening the 55th Annual General Meeting of the Company.
CHANGES IN THE KEY MANAGERIAL PERSONNEL
The following changes have occurred in the Key Managerial Personnel during the year:
Appointment and Resignation/Cessation:
- Mr. Dibakar Chatterjee, the erstwhile Company Secretary and Compliance Officer of the Company, resigned from the Company with effect from April 24, 2017.
- Mr. Indranil Mitra, Company Secretary, was appointed by the Board of Directors as the Company Secretary and Compliance Officer of the Company w.e.f. April 24, 2017.
- Mr. Lalit Khetan, who was appointed as the Chief Financial Officer (CFO) of the Company w.e.f. April 01, 2017, resigned from the position of CFO of the Company w.e.f. March 31, 2018.
The Board of Directors wishes to place on record their appreciation for the valuable contributions made by the erstwhile Company Secretary and the CFO.
As on March 31, 2018, the Company had three Key Managerial Personnel, being Mr. Srinivash Singh, Managing Director, Mr. Lalit Khetan, Chief Financial Officer and Mr. Indranil Mitra, Company Secretary and Compliance Officer of the Company.
The Board of Directors later appointed Mr. Manoj Kumar Digga, as the CFO of the Company w.e.f. July 14, 2018. Mr. Digga holds, by qualification, memberships of the Institute of Chartered Accountants of India, the Institute of Company Secretaries of India and the Institute of Cost Accountants of India. He possesses more than 26 years of experience in the fields of Accounts, Finance and Secretarial functions. Immediately before joining the Company, he was associated with Visa Steel Limited as CFO and leading the finance and accounts of the group for 23 years.
NUMBER OF BOARD MEETINGS
The Board met five times during the year on April 24, 2017, May 30, 2017, August 11, 2017, November 14, 2017 and February 13, 2018. The intervening gap between any two Board Meetings was within the period prescribed by the Companies Act, 2013 (''the Act'') read with the Listing Regulations.
BOARD EVALUATION
The evaluation of the Board, its Committees and of individual Directors for the financial year 2017-18 was undertaken in compliance with the provisions of Section 134(3)(p) and Schedule IV of the Act.
The Board was of the view that the performance of the Board of Directors as a whole was adequate and it fulfilled the parameters stipulated in the Evaluation Framework in its pro-growth activity and facing challenging operational and economic adversities during the year. The Board also ensured that the Committees functioned adequately and independently in terms of the requirements of the Act and the Listing Regulations, and at the same time supported as well as coordinated with the Board to help in its decision making. The individual Director''s performance was also evaluated and the Board was of the view that the Directors fulfilled their applicable responsibilities and duties as laid down by the Act and the Listing Regulations and at the same time contributed with their valuable knowledge, experience and expertise for the functioning of the Company and counter at the adverse challenges faced by the Company during the year.
Evaluation was also carried out by the Independent Directors of the non-independent Directors and the Board as a whole and the Chairman of the Company, considering the views of executive and non-executive Directors. The performance of all the Directors and Chairman was found to be extremely satisfactory in the present scenario.
DECLARATION REGARDING FULFILLMENT OF CRITERIA OF INDEPENDENCE
The Independent Directors have submitted their disclosures to the Board that they meet the criteria of independence as stipulated in Section 149(6) of the Act.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Board acknowledges the responsibility for ensuring compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Act for the year ended 31st March, 2018, and states that:
1) in the preparation of annual accounts, the applicable accounting standards have been followed. There are no material departures from prescribed accounting standards;
2) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2017-18 and of profit/loss of the Company for that period;
3) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
4) the Directors have prepared the annual accounts on a going concern basis;
5) 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; and
6) 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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of loans, guarantee or investment made under Section 186 of the Act are furnished in the Notes to the Financial Statements for the year ended March 31, 2018.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
Related Party Transactions entered into, during the year under review, were on arm''s length basis and in the ordinary course of business for the operational and administrative benefits of the Company. There were no contracts/arrangements/ transactions, with related parties which could be considered as material and which may have a potential conflict with the interest of the Company at large. Accordingly, no Contracts/arrangements/transactions are being reported in Form AOC-2.
The Company has formulated a Related Party Transaction Policy and the same is disclosed on the website of the Company and can be accessed at: http://www.mcnallybharat.com/assets/pdf/investor/policy/related-party-transaction-policy.pdf.
DEPOSIT
During the financial year ended March 31, 2018, your Company has not accepted any deposits from the public.
GOING CONCERN STATUS
No significant and material orders have been passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operation in the future.
MATERIAL CHANGES AND COMMITMENTS
No material changes and commitments affecting the financial position of the Company occurred between the financial year-end i.e. March 31, 2018 and the date of this report.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
Financial statements (i.e. Balance Sheet, Profit & Loss Statement and Cash-Flow Statement, together with notes) are prepared through the process which has automated as well as manual controls to ensure accuracy of recording all transactions which have taken place during any accounting period, and the resultant financial position at period end. All data pertaining to payroll, purchases, manufacturing, project cost and other financial activities are recorded through ERP systems operating in various sites as well as head office. All data/ transactions entered in systems are checked by various functional personnel on the basis of supporting documents & records, then the accounting entries are checked by accounts personnel, and finally those are validated by managerial personnel.
At periodic intervals, the accounting data are compiled and financial statements are prepared. While preparing the financial statements, it is ensured that all transactions pertaining to the accounting period are recorded. Fixed assets, all significant items of stores and monetary assets are physically verified. Balance confirmations are obtained for all significant items of trade receivables and advances.
After preparation of the financial statements, all items appearing in the statements are analyzed in order to ensure overall reasonableness.
The Company has adopted policies and procedures including Internal Audit system for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies, safeguarding of its assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures.
However, the Statutory Auditors of the Company has held the Company''s internal financial control, relating to compliance with laws and regulations, responsible for checking payment of excess managerial remuneration without complying with the requirements of Section 197(3) read with Schedule V to the Companies Act, 2013 and has identified this as ''material weakness'' in Company''s internal financial control system. The Company is in the process of obtaining necessary approval from the Central Government for payment of excess managerial remuneration.
RISK MANAGEMENT POLICY
The Company has adopted and implemented a Risk Management Policy after identifying various risks which the Company encounters with during the course of its business none of which in the opinion of the Board of Directors may threaten the very existence of the Company itself. The Audit Committee and the Board of Directors of your Company regularly monitor the Risk Management process including risk identification, impact assessment, effective implementation of the mitigation plans and risk reporting.
AUDIT COMMITTEE
The Audit Committee of the Board as on 31st March, 2018 consisted of Mr. V. K. Verma, Mr. A. K. Barman and Ms. Arundhuti Dhar. Mr. V. K. Verma, a Non-Executive Independent Director, is the Chairman of the Audit Committee.
DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM
Pursuant to the provisions of Section 178(10) of the Act, the Company has established a vigil mechanism/whistle blower policy and oversees through the Audit Committee, the genuine concerns expressed by the employees and other Directors. The Company has also made provisions for adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of the employees and the Company. The vigil mechanism/whistle blower policy of the Company has been uploaded on the website of the Company and can be accessed at: http://www.mcnallybharat.com/assets/pdf/investor/policy/vigil-policy.pdf.
PARTICULARS OF SUBSIDIARIES AND CONSOLIDATION OF ACCOUNTS
Your Company has the following subsidiaries as on March 31, 2018:
- McNally Sayaji Engineering Limited (MSEL)
- McNally Bharat Equipments Limited (MBEL)
- MBE Mineral Technologies Pte Limited
- MBE Minerals Zambia Limited
- Vedica Sanjeevani Projects Private Limited
- McNally Bharat Engineering (SA) Proprietary Ltd (deregistered w.e.f. June 30, 2017)
During the year under review, the Board of Directors of your Company reviewed the affairs of material subsidiaries. In accordance with Section 129(3) of the Act, your Company has prepared, in addition to the Standalone Financial Statements of the Company, consolidated financial statements of the Company and all its subsidiaries, which form part of the Annual Report. Further, the report on the performance and financial position of each of the subsidiary, associate and joint venture and salient features of the financial statements in the prescribed Form AOC-1 is annexed to the financial statements of the Company.
Information pursuant to Rule 8(1) of the Companies (Accounts) Rules, 2014 regarding financial highlights of performance of subsidiary companies and their contribution to the overall performance of the Company during the period under report is given herein-below: -
(Rs. in lakh)
|
Sl. No. |
Subsidiary Companies |
Business Activities |
Turnover (Rs.) |
Income (Rs.) |
|
1. |
McNally Sayaji Engineering Limited |
Manufacturer of crushing, screening, grinding, material handling and mineral processing equipment. |
21,942 |
(3,422) |
|
2. |
McNally Bharat Equipments Limited |
- |
- |
(0.29) |
|
3. |
MBE Mineral Technologies Pte Limitedt |
Investment holding and provision of management and related support services. |
1851219# |
(2840330)# |
|
4. |
MBE Minerals Zambia Limited |
- |
- |
(1241)* |
|
5. |
Vedica Sanjeevani Projects Private Limitedt |
Construction business. |
2.75 |
(43.78) |
# Figures in US $ not in INR lakhs.
* Figures in ZMK not in INR lakhs.
The actual turnover being nil, turnover column is showing only other income.
Further, in accordance with Section 136 of the Act, the audited financial statements, including the consolidated financial statements and related information of the Company and audited financial statements of each of the subsidiary will be available on the website of the Company i.e. www.mcnallybharat.com, in a downloadable format. These documents will also be available for inspection during business hours at the registered office of the Company. Shareholders desirous of obtaining the report and accounts of your Company''s subsidiaries may obtain the same upon request.
STATUTORY AUDITORS
M/s. Lovelock and Lewes, Chartered Accountants (FRN: 301056E), the erstwhile Statutory Auditors of the Company, retired from the conclusion of the Fifty Fourth Annual General Meeting held on September 20, 2017 upon completion of their term and could not be proposed for reappointment by operation of the provisions of Section 139 of the Companies Act, 2013. In the said Annual General Meeting, M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, (Firm Registration No. 117366W/W-100018), was appointed as the Statutory Auditors of your Company for a period of five consecutive years from the conclusion of the 54th Annual General Meeting (AGM) until the conclusion of the 59th AGM.
Further, with a view to expedite and ensure completion of audit process in an efficient and time-bound manner, your directors in consultation with the Audit Committee of the Board of Directors felt the need of appointing Joint Statutory Auditors in addition to the existing Statutory Auditors i.e. M/s. Deloitte Haskins & Sells LLP (Firm Registration No. 117366W/ W-100018). Hence, your directors obtained your consent in the Extra-ordinary General Meeting of the Company held on March 15, 2018, for appointment of M/s. V. Singhi & Associates, Chartered Accountants, Kolkata, (ICAI Firm Registration No. 311017E), as Joint Statutory Auditors of the Company to hold office till the conclusion of the ensuing AGM.
STATUTORY AUDITORS'' REPORT
The Board has duly examined the Statutory Auditors'' Report to the accounts and the Board''s clarifications regarding the qualified opinions of the Statutory Auditors on the Standalone Financial Statements of the Company are as under:
Qualification 1:
The matter of payment of excess managerial remuneration amounting to Rs. 40.82 lacs to one of the erstwhile Whole Time Directors for the financial year ended March 31, 2018 shall be placed before the members of the Company in the ensuing AGM for their approval and thereafter necessary application shall be made to the Central Government.
Qualification 2:
The Company has already applied to the Central Government for obtaining its approval for waiver of excess managerial remuneration paid / payable to the Managing Director of the Company for the financial year 2017-18 and the two erstwhile Whole Time Directors of the Company for the financial year 2016-17. Both the matters are pending with the Central Government for its approval.
COST AUDITORS
M/s A. Bhattacharya & Associates, Cost Auditors had been appointed as Cost Auditors for conducting the audit of cost records of the Company for the Financial Year 2017-18.
INSURANCE
Adequate insurance has been taken for the assets of the Company including various ongoing projects, plant and machineries deployed by contractors or the Company, motor vehicles etc. Insurance policies have also been taken by the Company to safeguard various project sites from loss on account of burglary. Further, insurance for Directors and Officers Liability has also been taken by the Company.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
The information required pursuant to the provisions of Rule 8(3) of the Companies (Accounts) Rules, 2014, in relation to Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo is given in Annexure - A to this report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34(2)(e) of the Listing Regulations, a Management Discussion and Analysis Report is attached as Annexure - B forming part of this Report.
REPORT ON CORPORATE GOVERNANCE
In terms of requirements of Regulation 34(3) of the Listing Regulations read with Schedule V to the Regulations, a Report on Corporate Governance together with the Auditors'' Certificate regarding compliances of conditions of Corporate Governance are attached as Annexure - C, forming part of this Report.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
In compliance with Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has established a Corporate Social Responsibility (CSR) Committee.
A CSR Policy has been formulated by the CSR Committee and the same is available on the website of the Company at: http:// www.mcnallybharat.com/assets/pdf/investor/policy/corporate-social-responsibility-policy.pdf. The policy encompasses the Company''s philosophy for delineating its responsibility as a corporate citizen and lays down the guidelines and mechanism for undertaking socially useful programmes for welfare & sustainable development of the community at large.
The Annual Report on CSR activities containing inter alia, the brief outline of the CSR policy, the CSR initiatives taken, the expenditure on CSR activities, as well as the composition of the CSR Committee forms a part of this Report as Annexure - D.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Board of Directors of the Company as on March 31, 2018 comprised of Mr. Asim Kr. Barman, a Non-Executive Independent Director as its Chairman and Mr. V. K. Verma and Ms. Arundhuti Dhar, Non-Executive Independent Directors as its Members.
The Company''s Policy relating to appointment of Directors, payment of managerial remuneration, Directors'' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Act read with Clause 19 of the Listing Regulations is attached to this report as Annexure - E.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return pursuant to the provisions of Section 92 of the Act, read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is attached to this Report as Annexure - F.
COMPLIANCE WITH THE SECRETARIAL STANDARDS
The Company has in place proper systems to ensure compliance with the provisions of the applicable Secretarial Standards, issued by The Institute of Company Secretaries of India. The Company is constantly upgrading its compliance management and monitoring system to adhere to all the necessary Secretarial Standards on a continuous basis.
SECRETARIAL AUDITORS
In terms of the requirements of Section 204 of the Act, the Secretarial Audit of the Company for the year ended March 31, 2018, was conducted by M/s. A. K. Labh & Co., Company Secretaries. The Secretarial Auditors'' Report is attached to this Report as Annexure - G and forms part of the Directors'' Report. Clarifications regarding the matter of emphasis of the Report of the Secretarial Auditor are as under:
1. The Company has already applied to the Central Government for obtaining its approval for waiver of managerial remuneration paid / payable to the Managing Director of the Company for the financial year 2017-18 and the same is pending with the Central Government for it approval.
2. The matter of payment of excess managerial remuneration amounting to Rs. 40.82 lacs to one of the erstwhile Whole Time Directors for the financial year 2017-18 shall be placed before the members of the Company in the ensuing Annual General Meeting (AGM) for their approval and thereafter necessary application shall be made to the Central Government.
3. Having obtained the approval of the members of the Company for waiver of excess managerial remuneration paid / payable to the two Whole Time Directors of the Company for the financial year 2016-17, the Company made an application to the Central Government seeking its approval for the same. The matter is still pending with the Central Government for its approval.
4. There were a few technical issues in filing certain forms in the MCA system for which certain forms were filed belatedly. Further, the Company is taking necessary steps to file with the Registrar of Companies (RoC) all the forms that are required to be filed with the RoC.
5. Due to severe cash crunch, there were some lapses in depositing the contributions towards Employees State Insurance, Cess and Value Added Tax with the prescribed authorities. However, the Company is taking best possible measures to regularize the same.
6. The Company is constantly upgrading its compliance management and monitoring system to adhere to all the necessary Secretarial Standards on a continuous basis.
PARTICULARS OF EMPLOYEES
Pursuant to Section 197(12) of the Act, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,
- the ratio of the remuneration of each Director to the median employee''s remuneration and other particulars and
- details of employees of the Company who were in receipt of remuneration of Rs.120 Lakhs or more if employed throughout the financial year or a monthly remuneration of Rs. 8.5 Lakhs or more if employed for part of the financial year are attached to this Report as Annexure - H.
OCCUPATIONAL HEALTH & SAFETY:
In line with your Company''s objectives, Occupational Health & Safety (OH&S) Management System has been integrated & tuned up with the project management, design, manufacturing, supply, construction and infrastructural projects on turnkey basis with an eye on continual improvement. Your Company has revised the OH&S Policy in July 2017 and laid down a norm to establish OH&S Management System, which has subsequently been re-certified as per BS OHSAS 18001:2007 standard. The OH&S system and norms have been accorded national and international recognition and are compatible with national as well as international standards.
As a part of the OH&S Management System there are periodic audits, training and inspections to ensure health & safety compliance at all our sites. We have a system of ''Daily OH&S Message'' for all the email users the Company, which give them, update about recent OH&S requirements. There is intranet webpage (MBE-Bridge) for OH&S, which contains ''Procedure'', ''Formats'', copy of ''Certificates'' received and ''Training'' model, etc.
Since the beginning, your Company achieved low incident records including ''No Fatality'' records, which shows a sustainable improvement in Occupational Health & Safety compared to other EPC firms in India. Apart from that, there are many satisfied customers, who issued ''Merit Certificate'' for our excellent safety performance in their project sites (such as BPCL-Kochi Refinery, NTPC-Mauda, WBPDCL Sagardighi Thermal Power-CHP#2, Tata Projects- Kalinganagar etc.). In addition to that, your Company has maintained LTI (Loss Time Injury) free records in many prestigious projects, few of them are DBN-Zawar mines-Udaipur, DMRC Station Building-Kochi, CPCL-Chennai, APGENCO-Solar, DGMAP-Jammu & Udhampur and Sub-station jobs etc.
Your Company has received -
(a) Royal Society for the Prevention of Accident (RoSPA) International Awards for best safety performance in many project sites (like Silver Award for RSP - Stock House, New CHP & Interplant, IISCO - RMHS, By Product & Water Package, 2x500MW CHP#2 - Sagardighi Thermal Power Plant, and BOP Satpura Thermal Power Station.),
(b) Certificate of Appreciation from National Safety Council of India (NSCI) for NTPC - Bongaigaon TPP, 3x67.5MW Gas Based Thermal Power Plant - Kalinganagar and ACC Jamul Expansion Project (Cement Works) project sites, and
(c) National Safety Award for outstanding performance in industrial safety based on lowest average frequency at Kanyapur Febrication Shop (West Bengal) and S. K. Mines (Rajasthan).
OTHER DISCLOSURES
The Company has in place a policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. During the year under review, no complaint has been received regarding sexual harassment of women at workplace.
CAUTIONARY STATEMENT
Certain statements in the Directors'' Report describing the Company''s operations, objectives, projections and expectations regarding future performance may constitute ''forward looking statements'' with the meaning of applicable laws and regulations. Actual results may differ materially from those either expressed or implied, depending on the economic conditions, Government policies and other incidental factors and developments.
ACKNOWLEDGEMENT
The Directors place on record their sincere appreciation for significant contribution made by the employees through their dedication, hard work, active involvement and devoted services rendered. The Directors would also like to thank all the stakeholders, investors including Bankers and other business associates, who have extended their valuable support and encouragement.
This has, understandably, been critical for the Company''s success. The Directors look forward to their continued support and understanding in the years to come.
For and on behalf of the Board of Directors
Aditya Khaitan
Kolkata, August 14, 2018 Chairman
Mar 31, 2016
Directorsâ Report
The Directors have pleasure in presenting the Fifty Third Annual Report together with audited statement of accounts for the year ended March 31, 2016.
Highlights
The key highlights of the operations for the financial year 2015-16 over the previous year are (based on standalone only in all cases):
Total Income increased by Rs. 26,433.41 lacs and earnings before Finance Cost, Depreciation & Amortization and Tax decreased by Rs. 5,689.14 lacs.
Financial Results
The Financial performance of the Company for the year ended March 31, 2016, is summarized below:
Rs. in Lacs
|
Particulars |
Standalone year ending March 31, 2016 |
Standalone year ending March 31,2015 |
|
Sales (net of excise) and other income |
244,633 |
218,200 |
|
Profit before Finance Cost, Depreciation & Amortization and Tax |
2,220 |
7,909 |
|
Less: Finance cost |
31,747 |
22,519 |
|
Earnings before Depreciation & Amortization and Tax |
(29,527) |
(14,610) |
|
Less: Depreciation & Amortization |
2,249 |
2,912 |
|
Profit before Tax and before provision for onerous contract |
(31,776) |
(17,522) |
|
Provision for onerous contracts |
(1,400) |
(6,100) |
|
Profit before Tax but after provision for onerous contract |
(30,376) |
(11,422) |
|
Less: Provision for Taxation (including Deferred Tax) |
0 |
0 |
|
Profit after tax and after provision for onerous contract |
(30,376) |
(11,422) |
|
Profit after Tax |
(30,376) |
(11,422) |
|
Amount brought forward from previous year |
4,159 |
15,712 |
|
Profit available for Appropriations |
(26,217) |
4,290 |
|
Proposed for Dividend on equity shares for the year |
0 |
0 |
|
Dividend Distribution Tax on Proposed Dividend on Equity shares |
0 |
0 |
|
Transfer from/to General Reserve |
138 |
0 |
|
Proposed for Dividend on preference shares for the year |
112 |
112 |
|
Dividend Distribution Tax on Proposed Dividend on preference shares |
25 |
19 |
|
Balance at the end of the year |
26,218 |
4,159 |
Business Performance/ Review of Operations
The financial year 2015-16 has been the most challenging year in the recent past for the entire infrastructure Sector. Complete policy paralysis at the Government level and resulting deferment and delay on all new projects in the infra sector reduced the overall opportunities for all the players. This has resulted in significant fall in order booking during the financial year by all the players. MBE is no exception and during the year the fresh order inflow was substantially lower at Rs. 1443 Cr. Those include one order for Bitumen Refinery in Sohar area of Oman, which your company has received in a joint venture with the new promoter Group in your company, EMC Ltd. The Company during the year faced severe working capital crunch due to non payment of dues by certain Private and Public sector customers and delayed execution on part of some customers. This has affected the execution and the billing in spite of reasonably healthy opening order book at the beginning of the financial year. The borrowing level during the year increased substantially which also created pressure on cash flow and profitability due to high interest burden. Though the top line during the year was maintained at the same level of previous year, the pressure on high interest payout and higher provision of depreciation due to change in accounting policy resulted in loss of Rs303 Cr during the financial year.
Some of the significant orders bagged during the year are mentioned below, which are currently under execution:
- GIS Substation Order from WBSETCL for Rs. 32.95 crores.
- De-Bottlenecking of Zawar Plant from Hindustan Zinc Ltd. for Rs. 160.00 crores.
- Operation and Maintenance Work at 4 x 135 MW Coal based Power Plant of Sai Wardha Power Plant from KSK
- SWPL for Rs. 57.02 crores.
- Operation and Maintenance for Coal Based Thermal Power Plant from Adani Power Maharashtra Ltd. for Rs. 125.00 crores.
- Civil and Structural Works for CDU - 4 Project at Mahul
- Mumbai for Bharat Petroleum Corporation Limited.
- Civil and Structural Works of Sindhri Cement Plant for ACC
- Development of Modern Station Building and allied works of Hijli Station for South Eastern Railways
- Construction Work for Buildings at Rajarhat - Kolkata for Bengal Unitech Universal Infrastructure Pvt. Ltd.
Major Projects Under Execution
- 9,000 TPD Cement Plant project at Jamul for ACC
- BOP Package for 2 x 600 MW STPP of M/S SCCL
- 400 KV Substation Extension Package (Package S1) of M/S PGCIL
- 132 KV GIS Substation at Domkol & Nazirpur of M/S WBSETCL
- 132 KV GIS Substation at Panagarh of M/S WBSETCL
- Coal Handling Plant for 1x500 MW TPS at Vindyachal of NTPC
- Coal Handling Plant for 3x250 MW TPS at Bongaigaon of NTPC
- Coal Handling Plant for 2x500 MW at Sagardighi of WBPDCL
- Ash Handling Plant for 2x660 MW at Mouda (Stage II) of NTPC
- Ash Handling Plant for 3x800 MW at Kudgi of NTPC
- Ash Handling Plant for 3x250 MW TPS at Bongaigaon of NTPC
- Ash Handling Plant for 2x250 MW at Bhavnagar of M/S BECL
- Limestone Milling and Conveying System for 2x250 MW at Bhavnagar of M/S BECL
- Dry Fly Ash Conveying system at Farakka of NTPC
- CW & Make up Water Package for 2x600 MW at Nabinagar of NPGC
- PT Plant for 2x600 MW at Nabinagar of NPGC
- PT Plant including Intake for 1x500 MW at Bokaro of DVC
- PT Plant for 2x660 MW at Mouda (Stage II ) of NTPC
- Booster Pumping Station at Entally in Kolkata of KMC
- Sinter Plant at Vizag for RINL
- Paradip- Haldia Gas Pipeline Project of IOCL
- Coke Handling Plant at Chennai for CPCL
- De-bottlenecking of Plant at Zawar of HZL
SUBSIDIARIES
- McNally Sayaji Engineering Ltd. (MSEL)
Major Order Received
- Larson &Tubro - Rod Mill & Screening Feeder - Rs 1051 Lacs
- Famur India Mining Solutions Pvt. Ltd - Wagon Tippler -Rs 1863 Lacs
- Bengal Tools Ltd - Screening Feeder & Ring Granulator - Rs 366 Lacs
- Jindal Steel & Power Ltd - Idler & Pulley - Rs 492 Lacs
- Lanco Infratech Limited -Apron Feeder - Rs 900 Lacs
- Hamtek Technologies Pvt Ltd - Screening Feeder & Ring Granulator - Rs 493 Lacs
- S.K. Samanta - Paddle Feeder -Rs 360 Lacs
- L&T Ltd., - Thickener -Rs 158 Lacs
- Chendayad Granites Pvt. Ltd., - Sand Plant - Rs 139 Lacs
- Essar Projects (India) Limited - Crusher Double rolled -Rs 278 Lacs
- Yash Raj Black Stone Works - Stationary & Screening Plant -Rs 240 Lacs
- Singhasani Stone Crusher - Crushing & Screening - Rs 185 Lacs
- ISGEC Heavy Engineering Limited - Crushing & Screening - Rs 239 Lacs
- Macmet India Limited - Hammer Ball -Rs160 Lacs
- Bajrang Stones - jaw Crusher - Rs 159Lacs
- JSW Bellary - PGC 2set- Rs 500 Lacs
- Rungta Projects - 400 TPH skid plant -Rs131 Lacs
- Victor Transport BCCL - 400 tph skid plantâ1 - Rs 130 Lacs
- Super Smelters Limited -Rs1183 lacs
Major Despatches
- Larson & Tubro - Design Engineering Supply - Rs 1260 Lacs
- Rungta Sons Pvt Ltd - Ball Mill & Rotary Scrubber - 414 Lacs
- Shri Jagannnath Steel & Power Ltd - Ball Mill - Rs 390 Lacs
- TRF Limited - Rod Mill -Rs179 Lacs
- Scorpio Engineering Pvt Ltd - Vibrating Grizzly Feeder -157 Lacs
- BGR Energy System Ltd -Ring Granulator -Rs128 Lacs
- Rungta Sons Pvt. Ltd., - Projects - 2296 Lakhs
- Pacific Iron Manufaturing Co. Ltd., - Thickener- 179 Lakhs
- ACB India Ltd., - Thickener & Flotation - 175 Lakhs
- Chendayad Granites Pvt. Ltd., - Sand Plant - 129 Lakhs
- Thermax Limited - Crushers , Screens , HPA , Spares -Rs311 Lacs
- ISGEC Heavy Engineering Limited- Crushers , Screens - Rs 306 Lacs
- Macmet India Limited- Crushers, HPA Spares - Rs 281 Lacs
- Jindal Steel & Power Ltd- Crushers - Rs 247 Lacs
- Bajrang Stores - Two Stage Crusing, Hammmer Mil - Rs 159 Lacs
- Parque Cientifico YTecnologico De Gijon - Roll Crushers -155 Lacs
- BLA Project - Rs 336 Lacs
- United Coal carriers - Rs 266 Lacs
- JSW Steel Ltd -Rs170 Lacs
- A.K.Transport -Rs143 Lacs
- Coal Mines Associated Traders. - Rs 141 Lacs
- Victor Transport Co. -Rs130 Lacs
- Nuclear Power Corporation of India. -Rs122 Lacs
- Super Smelters Limited -Rs1183 lacs
MBE Coal & Mineral Technology India Pvt Ltd
Major orders received
- ACB India Ltd.- Supply of Deshaling Jig Package with Screen Discharge System
- Rungta Project - Supply of Coarse and Fine Jigs.
- Central Coalfields Ltd.- Renovation of Thickener at Swang Washery
- Mahavir Coal Resources Pvt Ltd.- Design and Engineering
- Various Customers - Supply of various Single Equipment, Spares and Service Jobs
Some of the major projects / orders completed :
- Supply of 250 TPH Batac Jigs and other Equipment for Iron Ore for Rungta Project.
- Renovation of Thickener work for Central Coalfields Ltd., Sawang washer.
- Design, Engineering & Civil work for 250 TPH Silica Removal PlantforVedanta Ltd.
- 400 TPH Coal Washery at Hirmi in Chattisgarh for Ultratech Cement Limited has been commissioned.
- operation and maintenance of the Bina Deshaling Plant on behalfof Northern Coalfields Limited.
- Mechanical completion of the project in the Alumina segment for Vedanta Limited at Lanjigarh, Orissa in connection with design, supply, erection & commissioning for debottlenecking the Washer Package Project
- 660 TPH Coal washery with Batac Jigs for Bhushan Steel Limited (Under Execution)
- Chrome Ore Beneficiation Plant for Orissa Mining Corporation Ltd is under execution.
- Screening & Crushing system for 400 TPH Coal washery of Bhushan Power & Steel Limited is under execution.
- 200 TPH Charcoal Washing Plant for Bhushan Power & Steel Limited is under execution.
- The Company continues to do good business in supply of Centrifuge machines and in the current financial year 59 machines were supplied.
In accordance with general circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies. A Statement containing brief financial details of the subsidiary companies is included in the Annual Report in the Chapter containing Consolidated Financial Statements.
Dividend
In absence of profit for the current Financial year (2015-16), the Board of Directors of your Company considered it prudent not to recommend any dividend on Equity Shares for the year under review.
The Non Convertible Redeemable Preference Shares of Rs. 100/- each issued by the Company is entitled to a fixed Dividend of 11.5% per annum as per the terms of issuance of such Non Convertible Redeemable Preference Shares. Accordingly, the Board of Directors of your Company has recommended a dividend of Rs.11.50 (11.5%) per share on 975,000 Non Convertible Redeemable Preference Shares of Rs.100/- each. In absence of profit for the current year, the same will be adjusted out of the previous yearâs profit.
The dividend will be tax free in the hands of the Non Convertible Redeemable Preference shareholders. The register of members and share transfer books will remain closed from September 23, 2016 to September 29, 2016 (both days inclusive).
Share Capital
During the Year ended 31st March, 2016, the Equity Share Capital of the Company has increased to 5,10,93,818 shares having a face value of Rs. 10/- each. The 11.5% Non Convertible Redeemable Preference Capital of the Company remains unchanged at 975,000 having face value of Rs. 100/- each.
The proceeds of issue of the fresh equity capital of Rs. 100 crores has been utilized for the purpose it was issued for i.e to enhance the Companyâs net worth, improve its debt equity ratio and to meet its working capital and other requirements.
Scheme of Amalgamation
On March 31, 2016, your Board of Directors have approved a draft Scheme of Amalgamation of your Company for it to amalgamate, along with its subsidiary company McNally Sayaji Engineering Limited and EMC Limited, into Kilburn Engineering Limited. The core objective of the merged entity will be to emerge as a total engineering solution provider with comprehensive Construction and Resource Management capability, which will not only improve its marketability but will also lead to multiple opportunity creation.
Each constituent of the merged entity will bring in to the common pool their list of unique clientele. Thus the common pool will be able to compile a combined list of niche customers who can now be approached with huge expanse of service range.
The scheme will facilitate debt consolidation which will improve the debt servicing abilities through improved cash flows. Superior asset backing coupled with healthier liquidity will lead to improved gearing which will be encouraging for banks and institutions.
The draft scheme of amalgamation has received approval from the Competition Commission of India and is currently awaiting approvals from other regulatory bodies.
Energy Conservation, Technology Absorption and Foreign Exchange Earning and Outgo
The information required pursuant to the provisions of Rule 8(3) of the Companies (Accounts) Rules, 2014, is given as Annexure A to this report.
Management Discussion and Analysis Report
In terms of Regulation 34(2)(e) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), a Management Discussion and Analysis Report is attached as Annexure B forming part of this Report.
Report on Corporate Governance
In terms of requirements of Regulation34(3) of Listing Regulations, a Report on Corporate Governance together with the Auditorsâ Certificate regarding compliances of conditions of Corporate Governance are attached as Annexure C forming part of this Report.
The disclosure in terms of item (iv) of sub clause(iv) of second proviso of clause (B) of Section II of Part II of Schedule V of the Companies Act 2013 has been provided in the Report on Corporate Governance attached to this Report.
Corporate Social Responsibility
In compliance with Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, your Company has established a Corporate Social Responsibility (CSR) Committee.
A CSR Policy has been formulated and is available on the website of the Company at http://www.mcnallybharat.com/ investors/pdf/corporate-social-responsibility-policy.pdf The policy encompasses the Companyâs philosophy for delineating its responsibility as a corporate citizen and lays down the guidelines and mechanism for undertaking socially useful programmes for welfare & sustainable development of the community at large.
The Annual Report on CSR activities containing inter alia, the brief outline of the CSR policy, the CSR initiatives taken, the expenditure on CSR activities, as well as the composition of the CSR Committee forms a part of this Report as Annexure D.
Directorsâ Responsibility Statement
The Board acknowledges the responsibility for ensuring compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 for the year ended 31st March, 2016, and state that:
1) in the preparation of annual accounts, the applicable accounting standards have been followed. There are no material departures from prescribed accounting standards;
2) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year 2015-16 and of profit/loss of the Company for that period;
3) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
4) the Directors have prepared the annual accounts on a going concern basis;
5) 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; and
6) 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
Directors and Key Managerial Personnel
Mr. Utsav Pasrekh, who was an Independent Director, submitted his resignation on 28th September, 2015 due to his personal and professional commitments. The Board noted his resignation with regret and recorded its appreciation for the contributions made by Mr. Parekh during his association with the Company.
Miss. Nandini Khaitan, who was an Independent Director, submitted her resignation on May 19, 2016, due to her personal and professional commitments. The Board noted her resignation with regret and recorded its appreciation for the contributions made by Miss. Khaitan during her association with the Company.
Mr. Sukanta Chattopadhyay, who was the Sr. VP - Commercial & Company Secretary, submitted his resignation on August 13, 2015, due to his personal reasons and family obligations. The Board noted his resignation with regret and recorded its appreciation for the contributions made by him during his association with the Company.
Mr. Dibakar Chatterjee was appointed as the Company Secretary of the Company by the Board of Directors on November 23, 2015.
In accordance with the provisions of the Articles of Association of the Company read with Section 152 of the Act, Mr. Aditya Khaitan and Mr. Amritanshu Khaitan will retire by rotation at the forthcoming Annual General Meeting and being eligible, offer themselves for re appointment.
In view of the expiry of the terms of appointment of Mr. P. K. Chandra and Mr. Prabir Ghosh, as whole-time directors of the Company on February 14, 2016, and June 26, 2016, respectively, the Board of Directors re-appointed Mr. P. K. Chandra and Mr. Prabir Ghosh as the whole-time directors of the Company fora period of three years commencing from February 15, 2016, and July4, 2016, respectively. Approval of the members for the said re-appointment, along with the remuneration payable to them, will be sought in the ensuing Annual General Meeting.
During the year, the Company had three Key Managerial Personnel, being Mr. Prabir Ghosh, Whole Time Director & CFO, Mr. P.K. Chandra, Whole Time Director & COO and Mr. Dibakar Chatterjee, Company Secretary.
The Independent Directors have submitted their disclosures to the Board that they meet the criteria as stipulated in Section 149(6) of the Companies Act, 2013.
The Board met ten times during the year on May 29, 2015, June 30, 2015, August 13, 2015, September 28, 2015, October 23, 2015, November 13, 2015, November 23, 2015, February 12, 2016, March 22, 2016 and March 31, 2016. The intervening gap between any two Board Meetings was within the period prescribed by the Companies Act, 2013.
During the year under review the Company has a Familiarization Programme for Independent Directors and the same is disclosed on the website of the Company and can be accessed at http://www.mcnallybharat.com/ investors/pdf/familarisation-programme-for-IDs.pdf.
Board Evaluation
Pursuant to the said Evaluation Framework, the Board evaluated the performance of the Board, its Committees and the Individual Directors for the financial year 2015-16.
The Board was of the view that the performance of the Board as a whole was adequate and fulfilled the parameters stipulated in the evaluation framework in its pro growth activity and facing challenging operational and economic adversities during the year. The Board also ensured that the Committees functioned adequately and independently in terms of the requirements of the Companies Act, 2013, the Listing Agreement and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and at the same time supported as well as coordinated with the Board to help in its decision making. The individual Directorâs performance was also evaluated and the Board was of the view that the Directors fulfilled their applicable responsibilities and duties as laid down by the listing agreement and the Companies Act, 2013 and at the same time contributed with their valuable knowledge, experience and expertise to grab the opportunity and counter the adverse challenges faced by the Company during the year.
Audit Committee
The Audit Committee of the Board as on 31st March 2016 consisted of Mr. V.K. Verma, Mr. A.K. Barman and Mr. S.R Dasgupta. Mr. V.K Verma, a Non-Executive Independent Director, is the Chairman of the Audit Committee.
The Company has established a vigil mechanism / whistle blower policy and oversees through the Audit Committee, the genuine concerns expressed by the employees and other Directors. The Company has also made provisions for adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of the employees and the Company. The vigil mechanism / whistle blower policy of the Company has been uploaded on the website of the Company and can be accessed at http://www.mcnallybharat.com/ investors/pdf/vigil-policy.pdf.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee of the Board as on 31st March 2016 is comprised of Mr. Asim. Kr. Barman, a Non Executive Independent Director as its Chairman and Mr. V.K. Verma and Mr. S.R Dasgupta, Non Executive Independent Directors as its Members.
The Companyâs Policy relating to appointment of Directors, payment of managerial remuneration, Directorsâ qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 and clause 49 of the Listing Agreement is attached to this report as Annexure E.
Particulars of Loans, Guarantees or Investments made under Section 186 of the Companies Act, 2013
The particulars of loans, guarantee or investment made under Section 186 of the Companies Act, 2013 are furnished in the Notes to the Financial Statements for the year ended March 31,2016.
Particulars of contracts or arrangements made with related parties
Related Party Transactions entered into, during the year under review, were on armâs length basis and in the ordinary course of business for the operational and administrative benefits of the Company. There were no contracts/ arrangements/transactions, with related parties which could be considered as material and which may have a potential conflict with the interest of the Company at large. Accordingly, no Contracts/arrangements/transactions are being reported in Form AOC-2.
The Company has formulated a Related Party Transaction Policy and the same is disclosed on the website of the Company and can be accessed at http://www.mcnallybharat .com/investors/pdf/related-party-transaction-policy.pdf.
Deposit
During the financial year ended March 31, 2016, your Company has not accepted any deposits from the public.
Going Concern Status
No significant and material orders have been passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operation in the future.
Details in respect of adequacy of Internal Financial Controls with reference to the Financial Statements
Financial statements (i.e. Balance Sheet, Profit & Loss Statement and Cash-Flow Statement, together with notes) are prepared through the process which has automated as well as manual controls to ensure accuracy of recording all transactions which have taken place during any accounting period, and the resultant financial position at period end. All data pertaining to payroll, purchases, manufacturing, project cost and other financial activities are recorded through ERP systems operating in various sites as well as head office. All data/ transactions entered in systems are checked by various functional personnel on the basis of supporting documents & records, then the accounting entries are checked by accounts personnel, and finally those are validated by managerial personnel.
At periodic intervals, the accounting data are compiled and financial statements are prepared. While preparing the financial statements, it is ensured that all transactions pertaining to the accounting period are recorded. Fixed assets, all significant items of stores and monetary assets are physically verified. Balance confirmations are obtained for all significant items of trade receivables and advances.
After preparation of the financial statements, all items appearing in the statements are analyzed in order to ensure overall reasonableness.
The Company has adopted policies and procedures including Internal Audit system for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures.
Annual Return
The extract of Annual Return pursuant to the provisions of Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is attached to this Report as Annexure F.
Statutory Auditors
M/s Lovelock and Lewes, Chartered Accountants (FRN: 301056E), the Statutory Auditors of the Company hold office till the conclusion of the Annual General Meeting for the year ended March 31, 2017, under the provisions of Section 139(2) of the Companies Act, 2013, subject to the ratification of the Members of the Company. Accordingly, the ratification of their appointment as the Statutory Auditors of the Company is being placed before the Members at the Annual General Meeting.
The Company has received a letter from them to the effect that their re-appointment, if made, would be within the prescribed limits under the Companies Act, 2013 and that they are not disqualified for re-appointment.
Secretarial Audit
In terms of the requirements of Section 204 of the Companies Act, 2013 the Secretarial Audit of the Company for the year ended March 31, 2016, was conducted by M/S A.K Labh & Co, Company Secretaries. The Secretarial Auditorsâ Report is attached to this Report as Annexure G and forms part of the Directorsâ Report. Clarifications regarding the matter of emphasis of the Report of the Secretarial Auditor are as under:
1. The requisite forms have been filed and the Company is, as on date, in compliance with the requirements of Section 203 of the Companies Act, 2013
2. The Company has approached the estate of Late Mr. Deepak Khaitan for the recovery of excess remuneration and the same is in process.
3. Due to severe cash crunch, there were some lapses in depositing the contributions towards Provident Fund and the Employee State Insurance with the prescribed authorities. However, the Company is taking best possible measures to regularize the same.
4. There were few technical issues in filing certain forms in the MCA system for which certain forms were filed belatedly. However, the Company is in compliance with such filings and the Ministry of Corporate Affairs has approved all such returns filed.
5. Miss. Nandini Khaitan served as an Independent Director in the Board of Directors of the Company during the entire financial year ended March 31, 2016. She resigned from her post on May 19, 2016, and the Company is in the process of selecting and appointing a woman director.
6. As on date, the Company has taken all the measures to be fully compliant with the requirements of the Secretarial Standards 1 and 2.
7. There was a delay in the reconciliation of bank statements with the books of accounts of the Company. The unclaimed and unpaid dividend for the financial year 2007-08 were transferred to the Investor Education and Protection Fund and the requisite information has been disclosed to the Ministry of Corporate Affairs.
Cost Auditor
M/s A Bhattacharya & Associates, Cost Auditors has been appointed as Cost Auditors for conducting the audit of cost records of the Company for the Financial Year 2015-16.
Statutory Auditorsâ Report
The Board has duly examined the Statutory Auditorsâ Report to the accounts and clarifications regarding the qualified opinions of the Statutory Auditors on the Consolidated Financial Statements of the Company are as under:
Consolidated Financial Statement
Qualification 1:
The auditor has expressed qualified opinion with regard to the sale transaction of one investment for Euro 14 mio. In terms of the Agreement with the buyer, notarized in Germany, the contract has been extended from time to time. The Directors firmly believe since the extension is in line with the agreement, the transaction is valid and the amount is fully recoverable.
Qualification 2:
The trade receivables of USD 803,972 are from its own subsidiary and associates. Directors feel they are fully collectible since part of the receivable has been collected (USD 120,000) during the year and the balance would also be collected in the current year 2016-17. The other receivable of USD 15,190,184 (Euro 14 mio) included in USD 19,980,800 has already been explained as fully recoverable against Qualification 1. Another receivable of USD 4.49 mio from an erstwhile subsidiary, accepted as due by the company is legally claimable as per the agreement.
Risk Management Policy
Your Company has a Risk Management Policy. The Management of your Company regularly monitors the Risk Management process including risk identification, impact assessment, effective implementation of the mitigation plans and risk reporting. The Company is taking adequate measures to mitigate various risks encountered by the Company.
Insurance
The assets of the Company including building, shed, plant & machinery, etc. are adequately insured.
Occupational Health & Safety
In line with your Company objectives, the Occupational Health & Safety (Oh&S) Management System has been integrated & tuned up with the production/construction process with an eye on continual improvement. Your Company has revised the OH&S Policy in July 2013 and laid down a norm to establish the OH&S Management System, which has subsequently been certified as per BS OHSAS 18001:2007 standard in October 2013. The OH&S system and norms have been accorded international recognition and are compatible with international standards.
As a part of the OH&S Management System there are periodic audits, training and inspections to ensure health & safety compliance at all the sites. The Company has a system of âDaily OH&S Messageâ for all the email users of the Company, which gives update about recent OH&S requirement. There is an intranet webpage (MBE-Bridge) for OH&S, which contains âProcedureâ, âFormatsâ, copy of âCertificatesâ and âTrainingâ model etc.
Since 2013 MBECL as a whole, achieved low incident records, which shows a sustainable improvement in Occupational
Health & Safety compare to other EPC firm in India. Apart from that there are many satisfied customers, who issued âMerit Certificateâ for excellent safety performance in their project sites this year (such as BPCL-Kochi Refinery, NTPC Mauda, ACC Expansion Project Jamul, WBPDCL for Sagardighi Thermal Power-CHP#2 and Tata Projects -Kalinganagaretc.). This year the Company achieved National Safety Council Award for âACC Expansionâ Project, Jamul site and in recent past the Company was awarded international recognitions like RoSPA Award etc.
Particulars of Employees
The ratio of the remuneration of each Director to the median employeeâs remuneration and other particulars or details of employees pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached to this Report as Annexure I.
Information, pursuant to Rule 5(2) of the Company (Appointment & Remuneration of Managerial Personnel) Rules, 2014, of the top ten employees of the Company in terms of remuneration drawn and the names of every employee who were in receipt of remuneration of Rs. 1.02 Crores or more throughout the financial year and in receipt of a monthly remuneration of Rs. 8.5 Lakhs or more during part of the financial year is also disclosed in Annexure H.
Cautionary Statement
Certain statements in the Directorsâ Report describing the Companyâs operations, objectives, projections and expectations regarding future performance may constitute âforward looking statementsâ with the meaning of applicable laws and regulations. Actual results may differ materially from those either expressed or implied, depending on the economic conditions, Government policies and other incidental factors and developments.
Acknowledgement
The Directors place on record their sincere appreciation for significant contribution made by the employees through their dedication, hard work, active involvement and devoted services rendered. The Directors would also like to thank all the stakeholders, investors including Bankers and other business associates, who have extended their valuable support and encouragement.
This has, understandably, been critical for the Companyâs success. The Directors look forward to their continued support and understanding in the years to come.
For and On behalf of the Board of Directors
Prasanta Kumar Chandra Prabir Ghosh
Kolkata, August 12, 2016 Whole Time Director & COO Whole Time Director & CFO
Mar 31, 2015
The Directors have pleasure in presenting the Fifty Second Annual
Report together with audited statement of accounts for the year ended
March 31, 2015.
Highlights
The key highlights of the operations for the financial year 2014-15
over the previous year are (based on standalone only in all cases):
Total Income increased by Rs. 2683.48 lacs and earnings before Finance
Cost, Depreciation & Amortization and Tax increased by Rs. 4,224.24
lacs.
Financial Results
The Financial performance of the Company for the year ended March 31,
2015 is summarized below:
Rs. in Lacs
Particulars Standalone Standalone
year ending year ending
March 31, 2015 March 31,
2014
Sales (net of excise) and other income 218,200 215,551
Profit before Finance Cost, Depreciation
& Amortisation and Tax 7,909 17,797
Less: Finance cost 22,519 15,124
Earnings before Depreciation & Amortisation
and Tax -14,610 2,673
Less: Depreciations Amortisation 2,912 1,910
Profit before Tax and before provision for
onerous contract (17,522) 763
Provision for onerous contracts (6,100) 7,500
Profit before Tax but after provision for
onerous contract (11,422) (6,737)
Less: Provision for Taxation (including D
eferred Tax) 0 512
Profit after tax and after provision for
onerous contract (11,422) (7,249)
Profit after Tax (11,422) (7,249)
Amount brought forward from previous year 15,712 23,088
Profit available for Appropriations 4,290 15,839
Proposed for Dividend on equity shares for
the year 0 0
Dividend Distribution Tax on Proposed Dividend
on Equity shares 0 0
Transfer to General Reserve 0 0
Proposed for Dividend on preference shares for
the year 112 109
Dividend Distribution Tax on Proposed Dividend
on preference shares 19 18
Balance at the end of the year 4,159 15,712
Business Performance/ Review of Operations
The financial year 2014-15 have been the most challenging year in the
recent past for the entire infrastructure Sector. Complete policy
paralysis at the Government level and resulting deferment and delay on
all new projects in the infra sector reduced the overall opportunities
for all the players. This has resulted in significant fall in order
booking during the financial year by all the players. MBE is no
exception and during the year the fresh order inflow was substantially
lower at Rs. 1226 Cr. The Company during the year faced severe working
capital crunch due to nonpayment of dues by certain Private and Public
sector customers and delayed execution on part of some customers. This
has affected the execution and the billing in spite of high opening
order book at the beginning of the financial year. The borrowing level
during the year increased substantially which also created pressure on
cash flow and profitability due to high interest burden. Though the top
line during the year was maintained at the same level of previous year,
the pressure on high interest payout and higher provision of
depreciation due to change in accounting policy resulted in loss of Rs.
114.22 Cr during the financial year.
Some of the significant orders bagged during the year are mentioned
below, which are currently under execution:
- Substation Order from PGCIL for Rs 118 crores
- GIS Subsation Order from WBSETCL for Rs.21.10 crores.
- Land Mark work for Nabinagar CW and make up water package for Rs. 350
crores
- Petcoke handling plant for Chennai Petroleum Corporation Ltd for Rs.
228.46 Crores
- Construction of Residential Accommodation at BD Bari, Jammu, Janglot,
Ratnachuk for DGMAP at a contract value of Rs. 144.19cr
- Construction of Muttom Depot for Kochi Metro of DMRC at a contract
value of Rs. 69.91 cr
- Design, Engg, Manufacture, Supply of 1 set of Rotary WT & Beetle
charger of Paradeep Port Trust at a contract value of 12.0 Crores
- Design, Engg, Manufacture, Supply of 1 No. 80 Ton Electric Level
Luffing Crane of DGNP, Vizag at a contract value of 24.0 Crores
Project Completed
- Construction of Civil Foundation & Structural Steel Work for 6X150MW
Captive Power Plant at Mahan Aluminum Project of Hindalco
PROJECT EXECUTION
During the year a number of projects were at various stages of
execution. Some of the major projects which were completed during the
year:
- 9,000 TPD Cement Plant project at Jamul for ACC
- BOP Package for 2 x 600 MW STPP of M/S SCCL
- 400 KV Substation Extension Package (Package S1) of M/S PGCIL
- 132 KV GIS Substation at Domkol & Nazirpur of M/S WBSETCL
- Coal Handling Plant for 1x500 MW TPS at Vindyachal of NTPC
- Coal Handling Plant for 3x250 MW TPS at Bongaigaon of NTPC
- Coal Handling Plant for 2x500 MW at Sagardighi of WBPDCL
- Ash Handling Plant for 2x660 MW at Mouda (Stage II) of NTPC
- Ash Handling Plant for 3x800 MW at Kudgi of NTPC
- Ash Handling Plant for 3x250 MW TPS at Bongaigaon of NTPC
- Ash Handling Plant for 2x250 MW at Bhavnagar of M/S BECL
- Limestone Milling and Conveying System for 2x250 MW at Bhavnagar of
M/S BECL
- CW & Make up Water Package for 2x600 MW at Nabinagar ofNPGC
- PT Plant for 2x600 MW at Nabinagar of NPGC
- PT Plant including Intake for 1x500 MW at Bokaro of DVC
- PT Plant for 2x660 MW at Mouda (Stage II ) of NTPC
- Booster Pumping Station at Entally in Kolkata of KMC
- Sinter Plant at Vizag for RINL
- Blast Furnace (BF-5) Stock House for TPL, RSP
- 35 TPH GAP for Mahan Aluminium Project, Hindalco
- 52 TPH GAP for Aditya Aluminium Project, Hindalco
- HDPS GAP for Mahan Aluminium Project, Hindalco
- HDPS for Aditya Aluminium Project, Hindalco
- Clubbed Water System Package, CCPP: OTPC
ACTIVITY HIGHLIGHTS
During the year, a number of significant, complex and large value
projects were commissioned including Bellary CHP, HCSD Disposal System
of Crescent Power, NLC BWE, Paste Fill Plant of HZL etc.
Inspite of the tough economic scenario your Company has been able to
book fresh orders of Rs. 1,226 Cr. (approx) in various sectors this
year.
Your Company has been consistently putting efforts towards improvement
in Quality and Occupational Health and Safety Standards. MBECL already
has ISO 9001-2008 and ISO 14001-2004 Certifications. Our Laboratory is
certified by NABL for non-destructive testing. We are also pleased to
inform that our OH&S Management System (OHSMS) has been certified this
year by BS OHSAS 18001:2007. Our quality and safety standards
maintained by us during execution of under HOLCIM Standard and BPCL
Refinery at Mahul have been highly appreciated.
SUBSIDIARIES AND CONSOLIDATED FINANCIAL STATEMENTS
- McNally Sayaji Engineering Ltd. (MSEL)
Major Orders received
- JINDAL SAW - Ball Mill & Rod Mill Rs. 890 lacs
- BGR, Chennai - Ring Granulator for 1500 TPH - Rs. 255 lacs
- BGR, Chennai, Pulley for OPGCL - Rs. 105 lacs
- TRF, Rod Mill for NMDC-Rs. 753 lacs
- UCIL, Grinding system - Rs. 648 lacs
- Navadaya, Rotary scrubber for export to S.A. - Rs. 107 lacs
- Scorpio Engineering, Ring Granulator & Screening feeder for IPCL-Rs.
218 lacs
- L & T , Double Roll Crusher for Aditya & Mahan Project - Rs. 94 lacs
- L&T, Pulley for NCL-Rs.238 lacs
- L & T , Screening Feeder for Chhabra CHP - Rs.165 lacs
- JSPL, Double Roll Crusher - Rs. 107 lacs
- Maihar Cement, Ring Granulator & Apron feeder - Rs. 50 lacs
- HZL, Vibrating Screen - Rs. 30 lacs
- JSW for Rs. 527 lacs
- Danieli for Rs. 352 lacs
- Kilburn for Rs. 284 lacs
- Druk for Gypsum crushing plant for Rs. 89 lacs
Major Billing in 2014-15 - Kumardhubi
- Shree Mahavir Ferro Alloys, Ball Mill for Rs. 250 lacs
- Super Smelter, Ball mill and scrubber for Rs. 490 lacs
- HZL, Screen for Rs. 30 lacs
- JSPL, Double roll crusher for Rs. 107 lacs
- HDO, Ball mill for Rs. 93 lacs
- JINDAL SAW - Ball Mill & Rod Mill for Rs. 890 lacs
- TRF, Rod mill for NMDCRs. 550 lacs
- Maihar Cement, Ring granulator & Apron feeder - Rs. 50 lacs
- Dalmia Cement, Rotor assembly - Rs. 92 lacs
- Humboldt Wedag, Slide shoe and other items for Rotary Kiln-Rs. 135
lacs
- HZL for Screen & Reciprocating feeder - Rs. 50 lacs
- BGR, Chennai for Pulley of OPGCL - Rs. 105 lacs
- ACC, Jamul for Roller Screen, Pulley & Stacker - Rs. 460 lacs
- SECL, Ring Granulator, Screen & Stacker - Rs. 360 lacs
- NMDCforldlerAssembly-Rs.56lacs
- NTPCMouda for Silo - Rs 325 lacs
MBE Coal & Mineral Technology India Ltd. Major orders received:
- Renovation of existing Coarse Coal BATAC® Jig from
CCLSawangwasheryatJharkhand.
- Renovation of Coarse Coal and Fine Coal BATAC® Jigs from CCL Kedla
Washery at Jharknand.
- Supply of two(2) nos. 400 tph Deshaling BATAC® Jig and fixed &
dewatering screens for coal washery from Monnet Ispat
- Supply of 150 tph Batac Jig, Screens and Hydrocyclone from Mahavir
Coal Resources at Katni.
- Supply of equipment Centrifuges, De-Grit Cyclones & dense Media
Cyclones, Screens & Sieve Bends to ACB India for 1.6 mtpa Coking Coal
washery.
- Several orders of dewatering screens from clients, BCCL, CCL Kathara
and Utkal Energy.
- Supply of dewatering screens to end user at Bosnia.
- Design engineering, supply and erection & commissioning for dry
gravity separation pilot equipment, AKAFLOW, along with M/s. AKW of
Germany from National Metallurgical Laboratory, Ranchi.
- Design Engineering, Supply and Erection Commissioning for 250 tph
throughput capacity Silica Removal Plant from bauxite ore from Sesa
Sterlite Ltd. at Lanjigrah.
- Supply of 90 nos. of Solid Bowl Centrifuge for different
environmental projects.
Some of the major projects / orders completed during the year 2014-15:
- Commissioning, PG test & handover of 2.5 MTPA non coking coal washery
for S. V. Power Limited at Korba.
- Completed renovation work of existing Coarse Coal BATAC® Jig from CCL
Sawang washery at Jharkhand.
- Completed renovation of Coarse Coal and Fine Coal BATAC® Jigs from
CCL Kedla washery at Jharknand.
- Completed supply of several Screen equipments to various clients like
CCL, BCCL & Mahavir Coal Washery.
- Completed supply of Screen equipments to end user at Bosnia.
- Commissioning, Performance Guarantee Tests & handover for 0.6 MTPA
Iron ore Beneficiation Plant for MSPL, Hospet, Kamataka.
- Supplied 66 nos. Decanter Centrifuges for different Environmental
Projects.
MBE Mineral Technologies, Singapore:
During the year, the Company sold 70% and 90% of its investment in Coal
and Mineral Technology GmbH and Cologne Engineering GmbH respectively,
both of which were held through its wholly owned subsidiary in
Singapore.
While the disinvestment in Coal and Mineral Technology GmbH resulted in
substantial profits for the Company reported in its consolidated
financials, the decision to dispose of holding in Cologne Engineering
GmbH was prompted by lack of visibility in its turnaround from the
present financial position.
In terms of the agreement with the buyer of Coal and Mineral Technology
GmbH, the proceeds are due within end September 2015 or any other
extended date as may be agreed by both the parties.
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet, Profit and loss
Account and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company The Company will make
available the Annual Accounts of the subsidiary companies and the
related detailed information to any member of the Company who may be
interested in obtaining the same. The annual accounts of the subsidiary
companies will also be kept for inspection at the Registered Office of
the Company and that of the respective subsidiary companies. The
Consolidated Financial Statements presented by the Company include the
financial results of its subsidiary companies. A Statement containing
brief financial details of the subsidiary companies is included in the
Annual Report in the Chapter containing Consolidated Financial
Statements.
Dividend
In absence of profit for the current Financial year (2014-15), the
Board of Directors of your Company considered it prudent not to
recommend any dividend on Equity Shares for the year under review as a
measure of conservation.
The Non Convertible Redeemable Preference Shares of Rs.1007- each
issued by the Company is entitled to a fixed Dividend of 11.5% per
annum as per the terms of issuance of such Non Convertible Redeemable
Preference Shares. Accordingly, the Board of Directors of your Company
has recommended a dividend of Rs.11.50 (11.5%) per share on 975,000 Non
Convertible Redeemable Preference Shares of Rs.1007- each. In absence
of profit for the current year, the same will be adjusted out of the
previous year's profit.
The dividend will be tax free in the hands of the shareholders. The
register of members and share transfer books will remain closed from
September 21, 2015 to September 27, 2015 (both days inclusive).
Share Capital
During the Year ended 31st March, 2015, the Equity Share Capital of the
Company has increased to 40593818 shares having a face value of Rs.
10/- each. The 11.5% Non Convertible Redeemable Preference Capital of
the Company remains unchanged at 9,75,000 having face value of Rs.
100/-each.
The proceeds of issue of the fresh equity capital of 95,00,000 has been
utilised for the purpose it was issued for i.e to enhance the Company's
net worth, improve its debt equity ratio and to meet its working
capital and other requirements.
Strategic Investment
Your Company has entered into an agreement with EMC Limited ("EMC") and
Williamson Magor Group ("Existing Promoters") to enable an additional
equity investment of upto Rs. 100 Crores as primary equity capital
infusion into your Company. Established in 1953, EMC Limited is a
leading service provider in the Indian Power Transmission and
Distribution sector. Earlier, MKN Investments, a group company of EMC,
had made an equity investment of Rs. 50 crore in March 2015 in the
Company and it holds 12.5% stake in the Company.
This above mentioned capital raising of Rs 100 crore by your Company
would be done through a preferential allotment of 10 million equity
shares to EMC at a price of Rs. 100 per share. After this preferential
issue, EMC group (along with MKN Investments) will hold 29.64% of your
Company's expanded equity share capital. In addition, as per SEBI
guidelines, there will also be an open offer by EMC and Williamson
Magor Group for up to 26% of equity share capital of your Company.
Energy Conservation, Technology Absorption and Foreign Exchange Earning
and Outgo
The information required pursuant to the provisions of Section
134(3)(m) of the Companies Act, 2013 and Rule 8(3) of the Companies
(Accounts) Rules, 2014, is given as Annexure A to this report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of requirements of Clause 49 of the Listing Agreement(s) with
the Stock Exchange(s), a Management Discussion and Analysis Report is
attached as Annexure B forming part of this Report.
Report on Corporate Governance
The Company has adopted the best corporate governance norms and it has
been our endeavour to comply and upgrade to the changing norms.
In terms of requirements of Clause 49 of the Listing Agreement(s) with
the Stock Exchange(s), a Report on Corporate Governance together with
the Auditors' Certificate regarding compliances of conditions of
Corporate Governance are attached as Annexure C forming part of this
Report.
Corporate Social Responsibility:
In compliance with Section 135 of the Companies Act, 2013 read with the
Companies (Corporate Social Responsibility Policy) Rules, 2014, your
Company has established a Corporate Social Responsibility (CSR)
Committee.
A CSR Policy has been formulated and is available on the website of the
Company at http://www.mcnallybharat.com/
investors/pdf/corporate-social-responsibility-policy.pdf. The policy
encompasses the Company's philosophy for delineating its responsibility
as a corporate citizen and lays down the guidelines and mechanism for
undertaking socially useful programmes for welfare & sustainable
development of the community at large.
The Annual Report on CSR activities containing inter alia, the brief
outline of the CSR policy, the CSR initiatives taken, the expenditure
on CSR activities, as well as the composition of the CSR Committee
forms a part of this Report as Annexure D.
Directors' Responsibility Statement
The Board acknowledges the responsibility for ensuring compliance with
the provisions of Section 134(3)(c) read with Section 134(5) of the
Companies Act, 2013 and Clause 49(III)(D)(4)(a) of the Listing
Agreement with the Stock Exchanges for the year ended 31st March, 2015
and state that:
1) in the preparation of annual accounts, the applicable accounting
standards have been followed. There are no material departures from
prescribed accounting standards;
2) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year 2014-15 and of
profit/Loss of the Company for that period;
3) the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
4) the Directors have prepared the annual accounts on a going concern
basis;
5) 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; and
6) 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
Directors and Key Managerial Personnel:
The Board with profound grief regret to inform you of the sad and
premature demise of Late Mr. Deepak Khaitan, who passed away for his
heavenly abode on 9th March 2015.
Late Mr. Deepak Khaitan served the Company as its Executive Chairman
since 2011. The Board acknowledges the significant contributions made
by Mr. Khaitan for the growth of the Company during his long
association with the Company.
Mr. Sudipto Sarkar, who was an Independent Director, submitted his
resignation on 6th April, 2015 due to his personal and professional
commitments. The Board noted his resignation with regret and recorded
its appreciation for the contributions made by Mr. Sarkar during his
association with the Company.
During the year, Miss. Nandini Khaitan was appointed as an Additional
Director and also as an Independent Woman Director. The Company has
received requisite Notice from a Member of the Company along with the
deposits in terms of Section 160 of the Companies Act, 2013 proposing
the candidature of Miss. Nandini Khaitan for appointment as Director at
the forthcoming Annual General Meeting of the Company.
Mr. Aditya Khaitan has been re-designated by the Board as the Chairman
of the Company.
The Company being a listed Company is required to have at least one
third of the total number of Directors as Independent Directors
according to Section 149(4) of the Companies Act, 2013. In the opinion
of the Board Mr. A. K. Barman, Mr. V.K. Verma, Mr. S.R Dasgupta, Mr.
P.H. Ravikumar are Independent directors in terms of the Listing
Agreements and meet the criteria of independence in terms of Section
149 (6) of the Act, should be considered for appointment as Independent
Directors of the Company under Section 149, 150 and 152 read with
Schedule IV of the Act. Accordingly resolutions will be placed at the
ensuing Annual General Meeting (AGM) for their appointment as
Independent Directors from the date of the ensuing AGM upto the expiry
of five consecutive years or date of the 57th AGM whichever is earlier.
After such appointment the said Directors will no longer be liable to
retire by rotation during their tenure as Independent Directors.
In accordance with the provisions of the Articles of Association of the
Company read with Section 152 of the Act, Mr. Aditya Khaitan and Mr.
Amritanshu Khaitan will retire by rotation at the forthcoming Annual
General Meeting and being eligible, offer themselves for re
appointment.
During the year, the Company had four Key Managerial Personnel, being
Late Mr. Deepak Khaitan (Mr. Khaitan passed away on 9th March, 2015 and
had acted as the Executive Chairman till such date), Mr. Prabir Ghosh,
Whole Time Director & Group CFO, Mr. P. K. Chandra, Whole Time Director
& COO and Mr. Sukanta Chattopadhyay, Sr. V.P Commercial & Company
Secretary.
Mr. Sukanta Chattopadhyay, Sr. V.P. Commercial & Company Secretary
submitted his resignation on 15h June, 2015 due to his personal
commitments. The Board noted his resignation with regret and recorded
its appreciation for the contributions made by Mr. Chattopadhyay during
his association with the Company.
The Independent Directors have submitted their disclosures to the Board
that they meet the criteria as stipulated in Section 149(6) of the
Companies Act, 2013.
The Board met six times during the year on May 30, 2014, August 14,
2014, November 14, 2014, February 02, 2015, February 14, 2015 and March
30, 2015. The intervening gap between any two Board Meetings was within
the period prescribed by the Companies Act, 2013.
During the year under review the Company has formulated a
Familiarisation Programme for Independent Directors and the same is
disclosed on the website of the Company and can be accessed at
http://www.mcnallybharat.com/
investors/pdf/familarisation-programme-for-IDs.pdf.
Board Evaluation
During the year, the Board formulated and adopted a Board Evaluation
Framework for evaluating the performance of the Board as a whole,
Committees of the Board and the Individual Directors on the Board.
Pursuant to the said Evaluation Framework, the Board evaluated the
performance of the Board, its Committees and the Individual Directors
for the financial year 2014-15.
The Board was of the view that the performance of the Board as a whole
was adequate and fulfilled the parameters stipulated in the evaluation
framework in its pro growth activity and facing challenging operational
and economic adversities during the year. The Board also ensured that
the Committees functioned adequately and independently in terms of the
requirements of the Companies Act, 2013 and the Listing Agreement and
at the same time supported as well as coordinated with the Board to
help in its decision making. The individual Directors' performance was
also evaluated and the Board was of the view that the Directors
fulfilled their applicable responsibilities and duties as laid down by
the listing agreement and the Companies Act, 2013 and at the same time
contributed with their valuable knowledge, experience and expertise to
grab the opportunity and counter the adverse challenges faced by the
Company during the year.
Audit Committee
The Audit Committee of the Board as on 31st March 2015 consisted of Mr.
V.K. Verma, Mr. A.K Barman, Mr. U. Parekh and Mr. S.R Dasgupta. Mr. V.K
Verma, a Non-Executive Independent Director, is the Chairman of the
Audit Committee.
The Company has established a vigil mechanism / whistle blower policy
and oversees through the Audit Committee, the genuine concerns
expressed by the employees and other Directors. The Company has also
made provisions for adequate safeguards against victimisation of
employees and Directors who express their concerns. The Company has
also provided direct access to the chairman of the Audit Committee on
reporting issues concerning the interests of the employees and the
Company. The vigil mechanism / whistle blower policy of the Company has
been uploaded on the website of the Company and can be accessed at
http://www.mcnallybharat.com/investors/pdf/vigil-policy.pdf.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee of the Board as on 31st March
2015 is comprised of Mr. Asim. Kr. Barman, a Non Executive Independent
Director as its Chairman and Mr. V.K. Verma , Mr. S.R Dasgupta and Mr.
Utsav Parekh, Non Executive Independent Directors as its Members.
The Company's Policy relating to appointment of Directors, payment of
managerial remuneration, Directors' qualifications, positive
attributes, independence of Directors and other related matters as
provided under Section 178(3) of the Companies Act, 2013 and clause 49
of the Listing Agreement is attached to this report as Annexure E.
Particulars of Loans, Guarantees or Investments made under Section 186
of the Companies Act, 2013
The particulars of loans, guarantee or investment made under Section
186 of the Companies Act, 2013 are furnished in the Notes to the
Financial Statements for the year ended March 31,2015.
Particulars of contracts or arrangements made with related parties and
related party policy
The particulars of contracts or arrangements made with related parties
pursuant to Section 188(1) of the Companies Act, 2013, furnished in
Form AOC -2, is attached to this report as Annexure F.
During the year under review the Company has formulated a Related Party
Transaction Policy and the same is disclosed on the website of the
Company and can be accessed at
http://www.mcnallybharat.com/investors/pdf/related-party-
transaction-policy.pdf.
Deposit
During the financial year ended March 31, 2015, your Company has not
accepted any deposits from the public.
Going Concern Status
No significant and material orders have been passed by the Regulators
or Courts or Tribunals impacting the going concern status of the
Company and its operation in the future.
Details in respect of adequacy of Internal Financial Controls with
reference to the Financial Statements
Financial statements (i.e. Balance Sheet, Profit & Loss Statement and
Cash-Flow Statement, together with notes) are prepared through the
process which has automated as well as manual controls to ensure
accuracy of recording all transactions which have taken place during
any accounting period, and the resultant financial position at period
end. All data pertaining to payroll, purchases, manufacturing, project
cost and other financial activities are recorded through ERP systems
operating in various sites as well as head office. All data/
transactions entered in systems are checked by various functional
personnel on the basis of supporting documents & records, then the
accounting entries are checked by accounts personnel, and finally those
are validated by managerial personnel.
At periodic intervals, the accounting data are compiled and financial
statements are prepared. While preparing the financial statements, it
is ensured that all transactions pertaining to the accounting period
are recorded. Fixed assets, all significant items of stores and
monetary assets are physically verified. Balance confirmations are
obtained for all significant items of trade receivables and advances.
After preparation of the financial statements, all items appearing in
the statements are analyzed in order to ensure overall reasonableness.
The Company has adopted policies and procedures including Internal
Audit system for ensuring the orderly and efficient conduct of its
business, including adherence to the Company's policies, safeguarding
of its assets, prevention and detection of fraud and errors, accuracy
and completeness of the accounting records, and timely preparation of
reliable financial disclosures.
Annual Return
The extract of Annual Return pursuant to the provisions of Section 92
of the Companies Act, 2013 read with Rule 12 of the Companies
(Management and Administration) Rules, 2014 is attached to this Report
as Annexure G.
Statutory Auditors
M/s Lovelock and Lewes, Chartered Accountants (FRN: 301056E), the
Statutory Auditors of the Company hold office till the conclusion of
the Annual General Meeting for the year ended March 31,2017, under the
provisions of Section 139(2) of the Companies Act, 2013, subject to the
ratification of the Members of the Company. Accordingly, the
ratification of their appointment as the Statutory Auditors of the
Company is being placed before the Members at the Annual General
Meeting.
The Company has received a letter from them to the effect that their
re-appointment, if made, would be within the prescribed limits under
the Companies Act, 2013 and that they are not disqualified for
re-appointment.
Secretarial Audit
In terms of the requirements of Section 204 of the Companies Act, 2013
the Secretarial Audit of the Company for the year ended March 31, 2015,
was conducted by M/S A. K. Labh & Co., Company Secretaries. The
Secretarial Auditors' Report is attached to this Report as Annexure H
and forms part of the Directors' Report. Clarifications regarding the
matter of emphasis of the report of the Secretarial Auditor are as
under:
1. Due to severe cash crunch there were some lapses in depositing the
contributions towards Provident Fund and the Employee State Insurance
with the prescribed authorities. However, the Company is taking best
possible measures to regularise the same.
2. The Company has taken the requisite approval from its shareholders
through a special resolution at the Extra Ordinary General Meeting of
the members of the Company held on July 30, 2015 and has applied to the
Ministry of Corporate Affairs for waiver of the excess payment of
remuneration to its managerial personnel during the financial year
2014-15.
3. The Company has Chief Financial Officer (CFO) in terms of Section
203 of the Companies Act, 2013 and the Company is in the process of
filing the requisite form (DIR- 12) with the Office of the Registrar of
Companies for such appointment.
Cost Auditor
M/s A Bhattacharya & Associates, Cost Auditors has been appointed as
Cost Auditors for conducting the audit of cost records of the Company
for the Financial Year 2014-15.
Auditors' Report
The Board has duly examined the Statutory Auditors' Report to the
accounts and clarifications regarding the qualified opinion of the
Statutory Auditors are as under and the same have also been included in
the Notes to the Accounts section of the Annual Report:
Standalone Financial Statement
During the previous financial year, the Company paid a sum of Rs. 5.60
Crores towards managerial remuneration to its Executive Chairman and
two Whole Time Directors, out of which a sum of Rs. 3.79 crores was in
excess of the maximum permissible limit under The Companies Act, 2013
read with Schedule V of the said Act. However, the Company has taken
necessary approval from its shareholder through a special resolution at
the Extra Ordinary General Meeting held on July 30, 2015 and has
applied to the Central Government waiver of such excess payment of
remuneration to its managerial personnel.
Consolidated Financial Statement
The Company on 24th March 2015 disposed 70% of its investment in one of
its step-down subsidiaries in Germany for EURO 14 mio. As per the
amended agreement with the buyer, the sales consideration is to be
received on or before 30th September 2015 or any other extended date as
may be agreed by both the parties.
Management feels the sales consideration will be received within the
due date in relation to which the Auditor has expressed qualified
opinion/ reservation in their Report.
Risk Management Policy
Your Company has a robust Risk Management Policy. The Management of
your Company regularly monitors the Risk Management process including
risk identification, impact assessment, effective implementation of the
mitigation plans and risk reporting. However, none of the identified
risks, in the opinion of the Board, are threatening to the existence of
the Company.
Insurance
The assets of the Company including building, shed, plant & machinery,
etc. are adequately insured.
Occupational Health & Safety
In line with your Company objectives, the Occupational Health & Safety
(OH&S) Management System has been integrated & tuned up with the
production/construction process with an eye on continual improvement.
Your Company has revised the OH&S Policy in July 2013 and laid down a
norm to establish the OH&S MANAGEMENT SYSTEM, which has subsequently
been certified as per BS OHSAS 18001:2007 standard in October 2013. The
OH&S system and norms have been accorded international recognition and
are compatible with international standards.
As a part of the OH&S Management System, there are periodic audits,
training and inspections to ensure health & safety compliance at all
the sites. The Company has a system of 'Daily OH&S Message' for all the
email users of the Company, which gives update about recent OH&S
requirement. There is an intranet webpage (MBE-Bridge) for OH&S, which
contains 'Procedure', 'Formats', copy of 'Certificates' and 'Training'
model etc.
In 2014 MBECL as a whole achieved 'No Fatality' records, which shows a
sustainable improvement in Occupational Health & Safety. Apart from
that there are many satisfied customers, who issued 'Merit Certificate'
for excellent safety performance in their project sites this year (such
as BPCL- Kochi Refinery, NTPC Mauda, ACC Expansion Project Jamul,
WBPDCL for Sagardighi Thermal Power-CHP#2 and Tata Projects -
Kalinganagar etc.). This year the Company achieved National Safety
Council Award for TPL-Kalinganagar site and in recent past the Company
was awarded international recognitions like RoSPA Awards etc.
Particulars Of Employees
The ratio of the remuneration of each Director to the median employee's
remuneration and other particulars or details of employees pursuant to
Section 197(12) of the Companies Act, 2013 read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 are attached to this Report as Annexure I.
Cautionary Statement
Certain statements in the Directors' Report describing the Company's
operations, objectives, projections and expectations regarding future
performance may constitute 'forward looking statements 'with the meaning
of applicable laws and regulations. Actual results may differ
materially from those either expressed or implied, depending on the
economic conditions, Government policies and other incidental factors
and developments.
Acknowledgement
The Directors place on record their sincere appreciation for
significant contribution made by the employees through their
dedication, hard work, active involvement and devoted services
rendered. The Directors would also like to thank all the stakeholders,
investors including Bankers and other business associates, who have
extended their valuable support and encouragement.
This has, understandably, been critical for the Company's success. The
Directors look forward to their continued support and understanding in
the years to come.
For and On behalf of the Board of Directors
Prasanta Kumar Chandra Prabir Ghosh
Kolkata, August
13, 2015 Whole Time Director & COO Whole Time
Director
& Group CFO
Mar 31, 2014
Dear Members,
The Directors take great pleasure in presenting the Fifty First Annual
Report together with audited statement of accounts for the year ended
March 31, 2014.
Highlights
The key highlights of the operations for the financial year 2013-14
over the previous year are (based on standalone only in all cases):
Total Income reduced marginally by 1.7%, but, earnings before Finance
Cost, Depreciation & Amortization and Tax increased by 4.5%.
Financial Results
The Financial performance of the Company for the year ended March 31,
2014 is summarized below:
Rs. in Lacs
Particulars Standalone Standalone
year ending year ending
March 31, 2014 March 31, 2013
Sales (net of excise) and
other income 215,551 219,056
Profit before Finance Cost,
Depreciation & Amortisation and Tax 17,797 17,023
Less: Finance cost 15,124 10,003
Earnings before Depreciation &
Amortisation and Tax 2,673 7,020
Less: Depreciation & Amortisation 1,910 1,358
Profit before Tax and before provision
for onerous contract 763 5,662
Provision for onerous contracts 7,500 --
Profit before Tax but after provision
for onerous contract (6,737) 5,662
Less: Provision for Taxation
(including Deferred Tax) 512 1,799
Profit after tax and after provision
for onerous contract (7,249) 3,863
Profit after Tax (7,249) 3,863
Amount brought forward from previous
year 23,088 19,693
Profit available for Appropriations 15,839 23,556
Proposed for Dividend on equity shares
for the year - 311
Dividend Distribution Tax on Proposed
Dividend on Equity shares - 53
Transfer to General Reserve - 97
Proposed for Dividend on preference
shares for the year 109 6
Dividend Distribution Tax on
Proposed Dividend on preference
shares 18 1
Balance at the end of the year 15,712 23,088
Business Performance
Your Directors are pleased to report that inspite of being the most
challenging year in the last decade, 2013-14 has turned out to be yet
another satisfactory year with respect to the order intake, when your
Company could book fresh order of Rs. 3,980 Cr. However, the turnover
reduced marginally to Rs. 2,155 Cr. compared to last year''s turnover of
Rs. 2,190 Cr. This has been primarily due to the working capital
shortage and credit crunch faced by many of our Clients resulting in
further increase in our borrowings and higher interest charges.
Order Book
Your Company has an order book of around Rs. 6,537 crores as on March
31, 2014.
Some of the significant orders bagged during the year are mentioned
below, which are currently under execution:
- BOP (2*600 MW) package for Singareni Thermal Power Project.
- Main plant civil works and chimney & chimney elevator package for DVC
Ragunathpur.
- Inpit conveying system for SECL-Gevra.
- Construction of R & R colony for NTPC Pakri Barwadih
atBarkagaon,HazaribaghforNBCC
- Supply, installation, commissioning & testing under CHP package for
NTPC Vindhyachal super power thermal project stage v.
- Civil works & underground piping works for DHDT & VGO- HDT Unit for
IREP of BPCL Kochi Refinery.
- Civil works & underground piping works of existing refinery area for
IREP of BPCL Kochi Refinery.
- Civil, Structural & underground piping works of Sulphur Recovery
units (SRU) for IREP of BPCL Kochi Refinery.
- Operation & maintenance of coal handling plant with all the sub
system/auxilliaries of 6*600MW KSK Mahanadi Power Company Ltd.,
- Design, Engineering, Supply, Testing & Commissioning of Ash Water
Recirculation Package for NTPC, Kudgi.
- Dry fly ash conveying & transportation system package for NTPC
Farrakka stage-l(3*200 MW) & stage-ll (2*500 MW)
- Construction of 3 super speciality hospitals under BRGF at Debra and
Salboni in Paschim Medinipur and at Nandigram in Purba Medinipur.
- Construction of residential accommodation at Udhampur, DGMAP
Project Execution
During the year a number of projects were at various stages of
execution. Some of the major projects which were completed during the
year:
- Balance of Plant for MPPGCL, Satpura Unit 11 (250 MW)
- Sinter Plant at Vizag for RINL
- Coke Oven By-Product Plant of IISCO
- New Coal Handling Plant Package 091 of RSP
- Inter Plant Package 092 of RSP
- Blast Furnace (BF-5) Stock House for TPL, RSP
- 35 TPH GAP for Mahan Aluminium Project, Hindalco
- 52 TPH GAP for Aditya Aluminium Project, Hindalco
- HDPS GAP for Mahan Aluminium Project, Hindalco
- HDPS for Aditya Aluminium Project, Hindalco
- Clubbed Water System Package, CCPP: OTPC
- Coal Handling Plant for 1X500MW BELLARY TPS.
- Evaporation Plant Package for Aluminium Refinery, UAIL
Activity Highlights
During the year, a number of significant, complex and large value
projects were commissioned including Balance of Plant (BOP) projects
viz.,Vizag Sinter Plant (SP-III), IISCO Coke Oven By-product plant,
Coke Handling and Inter-plant packages for SAIL, Rourkela etc.
The new initiative taken by your Company in the last year in marketing
activities have started yielding results and your Company has been able
to book fresh orders of approx. Rs. 4,000 Cr. in various sectors this
year, which is a record in the Company''s history. Your Company made an
inroad into Petrochemical refineries last year and have further been
able to enter into this sector by booking three prestigious projects
from Bharat Petroleum for their Kochi Refinery.
Your Company has been consistently putting efforts towards improvement
in Quality and Occupational Health and Safety Standards. MBECL already
has ISO 9001-2008 and ISO 14001-2004 Certifications. Our Laboratory is
certified by NABL for non-destructive testing. We are also pleased to
inform that our OH&S Management System (OHSMS) has been certified this
year by BS OHSAS 18001:2007. Our quality and safety standards
maintained by us during execution of 9,000 TPD Cement Plant project at
Jamul for ACC under HOLCIM Standard and BPCL Refinery at Mahul have
been highly appreciated.
For the second successive year, we have received prestigious Safety
Awards from the Royal Society for Prevention of Accidents (RoSPA), UK.
The awards are RoSPA International Silver awards for our BOP Satpura
Project and Sagardighi Thermal Power Plant CHP for best safety
performance on Occupational Health & Safety 2014. Furthermore, we have
received a number of Domestic Customer Safety Awards for Bongaigaon CHP
& AHP from NTPC, TPL Kalinganagar from TATA Power Ltd., GAP Lapanga
from HINDALCO, Mauda Water from NTPC, BPCL Mahul from BPCL/EIL, O&M -
Adani Power from Adani etc. for our excellent safety performances.
Subsidiaries
- McNally Sayaji Engineering Ltd. (MSEL)
Orders received
- Nava Bharat Projects Ltd - Roll Crusher, Vibrating Screen for Zambia
Project-Rs 53.00 lacs
- Protech Associates - Vibrating Grizzly feeder, Roll crusher & Screen
for Lusaka, Zambia Project - Rs 48.00 lacs
- Protech Associates - 2 Stage Mobile Plant for Lusaka, Zambia
Project-Rs 230.00 Lacs
- Ashoka Gears - Reciprocating Feeder and Impactor (for Cosmos Nepal
project)-Rs 50.00 lacs
- Hyquip systems - HPA and Impactors - Rs 115.00 lacs
- Saifco cements - Smooth double Roll crusher, Impactor & Reciprocating
Feeder- Rs 70.50 lacs
- Triveni Real Estate - Vibrating Screens, reciprocating Feeder, Jaw
Crusher & Smooth double roll crusher- Rs 73.00 lacs
- Bhushan Power & Steel Ltd - Hammer Mills, Toothed double roll
crushers, Smooth double roll crushers - Rs 940.00 lacs
- Nova Iron & Steel Ltd - Vibrating Screens & Toothed Double Roll
Crushers-Rs 90.00 lacs
- Ramco cements - Vibrating Screens - Rs 89.00 lacs
- Sri Girija Alloys - Impactor, Vibrating Screen & HPA - Rs 52.50 lacs
- Isgec Heavy Engg - Vibrating Screen, Impactor, hammer Mill for
Honduras Project - Rs 117.00 lacs
- Bhushan Power & Steel - Smooth Double Roll crusher - Rs 57.00 lacs
- Ashoka Gears -Apron feeder & Impactor - Rs 93.00 lacs
- Direct orders from Metso Power ( Presently known as Valmet) for the
first time, of Basic Value Rs 500 lakhs for Evaporators .
- Metso Power,approved us as their Global Supplier.
- Direct orders from Danieli for the first time, of Basic Value Rs 400
lakhs for Steel Plant Equipment.
Major Billing in 2013-14
- Nava Bharat Projects Ltd - Roll Crusher, Vibrating Screen for Zambia
Project-Rs 53.00 lacs
- EPIL Ltd ( BSP Project)- Hammer Mills, Smooth & Toothed Double Roll
Crushers-Rs 889 lacs
- Protech Associates - Vibrating Grizzly feeder, Roll crusher & Screen
for Lusaka, Zambia Project - Rs 48.00 lacs
- Protech Associates - 2 Stage Mobile Plant for Lusaka, Zambia
Project-Rs 230.00 lacs
- Ashoka Gears - Reciprocating Feeder and Impactor for Cosmos Nepal
project-Rs 50.00 lacs
- Hyquip systems - HPAand Impactors - Rs 115.00 lacs
- Saifco cements - Smooth double Roll crusher, Impactor & Reciprocating
Feeder- Rs 70.50 lacs
- Triveni Real Estate - Vibrating Screens, reciprocating Feeder, Jaw
Crusher & Smooth double roll crusher- Rs 73.00 lacs
- Bhushan Power & Steel Ltd - Hammer Mills, Toothed double roll
crushers, - Rs 325.00 lacs
- Nova Iron & Steel Ltd - Vibrating Screens & Toothed Double Roll
Crushers-Rs 90.00 lacs.
- Ramco cements - Vibrating Screens - Rs 89.00 lacs
- Sri Girija Alloys - Impactor, Vibrating Screen - Rs 37.00 lacs
- Ball Mills from SHRI JAGANNATH STEEL & POWER LTD., SHRI MAHAVIR FERRO
ALLOY, SUPER SMELTER LTD. & NAVODAYA - DHARNI, SALGAOCAR
- Rod Mills from L & T - TSL Kalinganagar.
- Chain Mills from IFFCO.
- Hammer Mill & Screens from BCCL, B.C. MOHANTY, HINDUSTAN ZINC
LIMITED, MONNET ISPAT ENERGY
LTD.
- Scrubbers from NAVODYA- DHARNI & SUPER SMELTER LTD.
- Hammer Mills, Double Roll crushers (toothed ) from BHUSHAN POWER &
STEEL LTD.
- Feeder from HINDUSTAN ZINC LIMTED
- Vibrating Screen from L & T - CHHABRA project
- Roller Screen from EPIL.
- HPA Screen (Flip Flow) from MBE - CMT
- Slide Shoe as a Job Work From HWIL
- Rotor Assy From Dalmia Cement.
- Major Over Hauling Jobs: HP/LP Feeder, From HPCL
- Coal Crushers & Screens From Singrani TPP,A/C:MBE
- Clinker Grinder, Paddle Mixtures & Silo From NTPC- Mouda,A/C:MBE
- Stacker Reclaimers for SINGRANI,A/C:MBE.
MBE Coal & Mineral Technology India Ltd.
Some of the major orders received during the year 2013 - 14:
- Design, Engineering, Supply, Supervision of Erection & Commissioning
of 3.0 MTPA Screening & Crushing Plant for Bhushan Power & Steel at
Jharsuguda Orissa.
- Design, Engineering, Supply, Supervision of Erection & Commissioning
of 2.4 MTPA Non coking Coal Washery for Bhushan Power & Steel at
Jharsuguda Orissa.
- Design, Engineering, Supply, Supervision of Erection & Commissioning
of 1.2 MTPA Char Beneficiation Plant for Bhushan Power & Steel at
Jharsuguda Orissa.
- Design, Engineering & Project Management of 1.6 MTPA Coking Coal
Beneficiation Plant from Aryan Coal Beneficiation for BCCL at Dahibari,
Jharkhand.
- Received orders for 83 Nos of Decanter Centrifuges for different
Environmental Projects
- Some of the major projects / orders completed during the year2013-14:
- Design, Engineering & Supply for all equipment to Trade Serve
International Pvt. Ltd. for its 1.0 MTPA Coal Washery in Pakistan.
- Design, Engineering, Supply, Supervision of Erection & commissioning
for 1.2 MTPA Iron ore Beneficiation Plant for Janki Corporation Ltd.
Bellary, Karnataka
- Renovated both Coarse & Fine Coal Batac Jigs at Rajrappa Coal
washery, Ramgarh for CCL
- Performance Guarantee Tests under progress for 0.6 MTPA Iron ore
Beneficiation Plant for MSPL, Hospet, Karnataka
- Supplied 86 Nos Decanter Centrifuges for different Environmental
Projects.
Overseas Companies under MBE''s 100% subsidiary, MBE Mineral
Technologies Pte Limited (MBEMT) have performed satisfactorily during
the year in spite of prevailing slow down in the international metal
market and economic crisis in Europe. The Coal & Mineral Technology
business has good order backlog and looking for a major growth in
2014-15. As part of Corporate consolidation, in Jan''14 MBEMT has sold
its entire shareholding of 41.66% in Hayward Tyler Group Pic, U.K. in a
bidding process at AIM counter of London Stock Exchange at a total
value of GBP 12.3 million. The inflow from the transaction reduced
borrowing at the consolidated level by approximately Rs. 140 crores and
has reduced the contingent liability for Corporate Guarantee given for
the loans being paid back to the extent of Rs. 130 crores.
In April 2014, MBE Mineral Technology Pte Ltd has sold 90% of its
holding in its manufacturing subsidiary, MBE Cologne Engineering GmbH
at a consideration of Euro 1.5 million. The entire investment has been
reinstated at Euro 1 as part of an impairment exercise done in the last
Financial year 2012-13 by MBE Mineral Technology Pte Ltd . This shall
also reduce the overseas borrowing of EURO 4 Million at considerate
level in the financial year 2014-15.
McNally Bharat (SA) Proprietary Limited, a 100% subsidiary of MBE is in
operation and has already secured an order of 367 Mio Rand ( Equivalent
INR 205 Crores approx) in South Africa and also in negotiation for some
more order in African region. Your Directors are expecting a good
margin out of this order.
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet, Profit and loss
Account and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company. The Company will make
available the Annual Accounts of the subsidiary companies and the
related detailed information to any member of the Company who may be
interested in obtaining the same. The annual accounts of the subsidiary
companies will also be kept for inspection at the Registered Office of
the Company and that of the respective subsidiary companies. The
Consolidated Financial Statements presented by the Company include the
financial results of its subsidiary companies. A Statement containing
brief financial details of the subsidiary companies is included in the
Annual Report in the Chapter containing Consolidated Financial
Statements.
Dividend
In absence of profit for the current Financial year (2013-14), the
Board of Directors of your Company considered it prudent not to
recommend any dividend on Equity Shares for the year under review as a
measure of conservation.
The Non convertible Redeemable Preference Shares of Rs.1007- each
issued by the Company is entitled to a fixed Dividend of 11.5% per
annum as per the terms of issuance of such Non convertible Redeemable
Preference Shares. Accordingly, the Board of Directors of your Company
has recommended a dividend of Rs.11.50 (11.50%) per share on 975,000
Non convertible Redeemable Preference Shares of Rs.1007- each. In
absence of profit for the current year, the same will be adjusted out
of the previous year''s profit.
The dividend will be tax free in the hands of the shareholders. The
register of members and share transfer books will remain closed from
July 21, 2014 to July 29, 2014 (both days inclusive).
Insurance
The assets of the Company including building, shed, plant & machinery,
etc. are adequately insured.
Occupational Health & Safety
In line with our Company objectives, our Occupational Health & Safety
(OH&S) Management System has been integrated & tuned up with the
production/constructionprocess with an eye on continual improvement..
We have revised the OH&S Policy in July 2013 and laid down a norm to
establish our OH&S Management System, which has subsequently been
certified as per BS OHSAS 18001:2007 standard in October 2013. Our OH&S
system and norms have been accorded international recognition and are
compatible with international standards..
As a part of the OH&S Management System there are periodic audits,
training and inspections to ensure health & safety compliance at all
our sites. We have a system of ''Daily OH&S Message'' for all companies
email users, which gives them update about recent OH&S requirement.
There is intranet webpage (MBE-Bridge) for OH&S, which contains
''Procedure'', ''Formats'', copy of ''Certificates'' and ''Training'' model
etc.
In 2013 more than 55 sites achieved LTI free records which shows the
improvement in OH&S. Apart from that there are many satisfied
customers, who issued ''Merit Certificate'' for our excellent safety
performance in their project sites. In recent past we got many national
and international recognitions for our excellent performance on health
& safety.
Directors
Mr. Virendra Kumar Verma, Mr. Subir Ranjan Dasgupta and Mr. Asim Kumar
Barman retire by rotation and, being eligible, offer themselves for
reappointment.
Auditors
The Statutory Auditors of the Company M/s. Lovelock & Lewes, Chartered
Accountants, will retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office of
Auditors, if reappointed. The Audit Committee and the Board of
Directors recommended M/s. Lovelock & Lewes, as Statutory Auditors of
the Company to hold office from the conclusion of the Annual General
Meeting of the Members'' of the Company for the year ended March 31,
2014, until the conclusion of the Annual General meeting of the
Members'' of the Company to be held for the year ended March 31,2017,
for shareholders approval.
As required under the provisions of Section 139(1) of the Companies
Act, 2013, the Company has obtained a written Certificate from the
above Auditors proposed to be re- appointed to the effect that their
re-appointment, if made, would be in conformity with the limits
specified in the said section.
The Ministry of Corporate Affairs, Government of India, by an order
directed the audit of the Cost Accounts of the Company under section
209(1 )(d) of the Companies Act, 1956, in respect of Construction of
industrial and non-industrial plants, structures and facilities. In
terms of the said order, a compliance report, pursuant to Sections
209(1 )(d), 600(3)(b) of the Companies Act, 1956, and the relevant Cost
Accounting Records Rules, 2011, has been filed.
Auditors''Report
The Board has duly examined the Statutory Auditors'' Report to the
accounts and clarifications, wherever necessary, have been included in
the Notes to the Accounts section of the Annual Report.
Fixed Deposit
The Company hasn''t accepted any deposit from the public during the
year, and as such, there are no outstanding deposits in terms of the
Companies (Acceptance of Deposits) Rules, 1975.
Share Capital
During the year, the paid-up share capital of the Company has increased
to Rs. 408,438,180 by issue of 150,000 nos. of 11.50% Non-convertible
Redeemable Preference Shares of Rs. 100/- each. The paid-up Equity
share capital of the company remains unchanged at 31,093,818 shares
having a face value of Rs. 10/-each.
The proceeds of the issue of the said 11.50% Non-convertible Redeemable
Preference Shares has been utilized to enhance the Company''s net worth,
improve its debt-equity ratio and to meet its working capital and other
requirements.
Corporate Governance
The Company has adopted the best corporate governance norms and it has
been our endeavour to comply and upgrade to the changing norms.
A separate section on Corporate Governance and a certificate from the
Statutory Auditors of the Company regarding compliances of conditions
of Corporate Governance as stipulated under Clause 49 of the Listing
Agreement(s) with the Stock Exchange(s) form part of the annual report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the CEO/CFO, inter alia, confirming the correctness of
the financial statements, adequacy of the internal control measures and
reporting of matters to the Audit Committee in terms of the said
Clause, is also enclosed as a part of this Report.
Corporate Social Responsibility - "PRAYASH" 2013-14
A new face of MBE CSR is Prayash. The Company, over the past one year,
has been closely working with Child In Need Institute to support the
education of the under privileged children in a slum area is situated
in a very backward region of Tiljala -Topsia in Kolkata under Ward-66
of KMC. In this MBE supported centre, learning & various
extracurricular activities for the school children (7 years - 12 years)
are conducted on a day to day basis by CINI appointed teachers & ground
level volunteers.
Currently there are twenty-five children in the coaching centre.
Beside the learning activities of the children, the counselling of the
parents is also initiated, so as to make them realize that the need for
education for their children is much greater than the meagre income
that those young children get working in tanneries and other sweat
shops in the neighbouring area
Our approach is focused to support education for the Under Privileged
Children. In this project MBE & CINI are working together to ensure
that the students continue with their formal education process. Beside
the formal classes,the young students are also made to involve and
engage themselves in celebrations of various festival days of national
importance. They are also taken out for education-cum recreational
visits so that there is a holistic development of their young mind.
A young motivated and committed group of employees of MBE from MBE -
PRAYASH team have been enthusiastically partnering with CINI during
2013-14 in achieving the following activities:
Activities done in last 1 year (2013-2014)
- The community based volunteers who reach the children directly
received trainings on academic issues as well as on record keeping,
community mobilization and classroom management
- Training of all the girl children in the centre were held on 24th and
25th July''13. The issues were life skill education, early marriage,
child trafficking, stress management, decision making, menstrual health
- myth and misconception, ICDS service- Kishori Shakti Yojana (KSY) and
referral services available in the area by the resource persons from
various fields like education, health and protection.
- The children of this centre observed the World Environment Week from
5th June to 12th June 2013. They took the initiative of cleaning their
centre premises as well as its surroundings with the help of the
coaching volunteer and also decorated their centre with low cost and no
cost materials. They participated in the drawing competition in the
coaching centre and planted many saplings in the earthen pots. The
supervisor and volunteer gave the inputs on the importance world
environment day throughout the week. The best pictures from the
children have been put up on the wall for display.
- On 8th of June, 2013 the CSR team of McNally visited the coaching
centre. They interacted with the children regarding their studies,
hobbies and about the centre. The children were very much inspired by
their words. On 24th August 2013 the CSR team again visited the
coaching centre. The children initially greeted them and performed some
role plays, recited poems, told stories etc.
- On 21st December, 2013 the children of this centre participated in
the programme "Right to Play" where the children participated in many
forgotten and obsolete games from our city. The main focus of the
programme was to revive those games in our city and to inculcate a
sense of team work among them. The children enjoyed it very much.
- Apart from education, the children also had karate and dance classes
in the centre.
- Awareness cum cultural programme was taken place in the community
with 25 children of MBE Coaching centre along with other children from
the community.
- Exposure visit to Science City has been organized for the children of
this coaching centre on 15th January 2014.
- Health Check up camp was organized on 28th February, 2014 for the
children of this coaching centre along with other children of Tarun
Tirtho Primary School where the MBE supported centre runs.
- The volunteers of this coaching centre received the training on Child
Entitlement Card (basic entitlements of children on Education,
Protection, Health and Nutrition) by our organizational staff on 12th
and 13th March.
- Creativity workshop was organized with 25 children of this centre on
24th March where the children made some handicraft items like jute
bags, flower vase and key rings with assistance of an efficient outside
resource person.
Beside this, MBE team participated to support the city''s spirit of
caring, the biggest MARATHON CAMPAIGN organized by TATA MEDICAL CENTRE.
Particulars of Employees
Information pursuant to Section 217(2A) of the Companies Act, 1956 read
with Companies (Particulars of Employees) Rules, 1975, forms part of
this Report. Any Member interested may obtain a copy of the statement
from the Company.
Energy Conservation, Technology Absorption And Foreign Exchange Earning
And Outgo
The details as prescribed under Sub-section (1 )(e) of Section 217 of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988, are given
in Annexure A to the Directors'' Report.
Directors'' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors confirm as under:
1) In the preparation of annual accounts, the applicable accounting
standards have been followed. There are no material departures from
prescribed accounting standards;
2) We 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 2013-14 and of profit of
the Company for that period;
3) We have 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; and
4) We have prepared the annual accounts on a going concern basis.
Cautionary Statement
Certain statements in the Directors'' Report describing the Company''s
operations, objectives, projections and expectations regarding future
performance may constitute ''forward looking statements''with the meaning
of applicable laws and regulations. Actual results may differ
materially from those either expressed or implied, depending on the
economic conditions, Government policies and other incidental factors
and developments.
Acknowledgement
The Directors place on record their sincere appreciation for
significant contribution made by the employees through their
dedication, hard work, active involvement and devoted services
rendered. The Directors would also like to thank all the stakeholders,
investors including Bankers and other business associates, who have
extended their valuable support and encouragement.
This has, understandably, been critical for the Company''s success. The
Directors look forward to their continued support and understanding in
the years to come.
On behalf of the Board of Directors
Prasanta Kumar Chandra Prabir Ghosh
Kolkata,
May 30, 2014 Whole Time Director & COO Whole Time Director
& Group CFO
Mar 31, 2013
The Directors take great pleasure in presenting the Fiftieth Annual
Report together with audited statement of accounts for the year ended
March 31, 2013.
Highlights
The key highlights of the operations for the financial year 2012-13
over the previous year are (based on standalone accounts only in all
cases):
Total Income Increased by 4.75%
Earnings before Finance Cost, Depreciation & Amortization and Tax
increased by 12.09%
Financial Results
The Financial performance of the Company for the year ended March 31,
2013 is summarized below:
Rs. in Lakhs
PARTICULARS Standalone year
ending Standalone year
ending
March 31, 2013 March 31, 2012
Sales (Net of Excise) and other
income 219,056 209,126
Profit before Finance Cost,
Depreciation & 17,023 15,187
Amortization and Tax
Less: Finance Cost 10,003 6,281
Earnings before Depreciation
& Amortization and Tax 7,020 8,906
Less: Depreciations Amortization 1,358 1,053
Profit before Tax 5,662 7,853
Less: Provision for
Taxation (including Deferred Tax) 1,799 1,289
Profit after Tax 3,863 6,564
Amount brought forward from
previous year 19,693 13,635
Profit available for
Appropriations 23,556 20,199
Proposed for Dividend on
equity shares for the year 311 311
Dividend Distribution Tax on
Proposed Dividend 53 30
on Equity Shares
Transfer to General Reserve 97 165
Proposed Dividend on preference
shares for the year 6 --
Dividend Distribution Tax
on Proposed Dividend 1 --
on Preference Shares
Balance at the end of the year 23,088 19,693
Business Performance
Your Directors are pleased to report that 2012-13 turned out to be yet
another satisfactory year during which your company achieved its
highest ever turnover of Rs 2,190 crores as against Rs 2,091 crores
during the previous year.
However, due to credit crunch faced by our clients across all sectors,
collections and working capital management was a challenge, resulting
in increased borrowings and higher interest charges.
Order Book
Your Company has an order backlog of around Rs. 4,707 crores as on
March 31, 2013.
Some of the significant orders bagged during the year are mentioned
below, which are currently under execution:
- Construction of a 9000 TPD Integrated Cement Plant in technical
collaboration with KHD Humboldt Wedag for Holcim Group at their ACC
Jamul plant.
- Fluorspar Concentrator plant for Sephaku Fluoride Ltd, South Africa
(LOI received)
- Coal Handling Plant for Sagardighi TPP units 3 & 4 (2 X 500 MW) for
West Bengal Power Development Corporation Ltd.
- Ash Handling & Ash water recirculation system for NTPC
atMoudaSTPP(2X660MW)
- Civil & Structural works for BPCL refinery
- Paste Fill Plant for Hindustan Zinc Ltd
- External water system for Mills & Fire Water Pump houses in Bhilai
Steel Plant
- Civil works for 3 X 67.5 MW gas based thermal power plant for IEL,
Kalinganagar. Client Tata Power
- Civil works for Barauni TPP. Client BHEL
- Construction of 3 metro stations at Behala Bazar, Taratala & Majerhat
for Kolkata Metro. Client Gammon.
- Coal handling & Ash handling plant for 2 X 250 MW Barauni TPP. Client
BHEL
- Water supply package for Barauni TPP Ph I (2 X 110
MW)&PhaseM(2X250MW)
- Construction of schools, hostels & quarters in Bankura & Purulia
districts. Client HRBC
Project Execution
During the year a number of projects were at various stages of
execution. Some of the major projects which were commissioned during
the year:
- Balance of Plant for Ideal Energy (1X 270 MW)
- Balance of Plant for MPPGCL, Satpura Unit 10 (250 MW)
- Coal handling Plant for Ukai TPP (500 MW). Client Gujarat State
Electricity Corpn
- Ash Handling Plant for Essar Power Gujarat Ltd, Salaya (2X660 MW)
- Tailing Hydro Fill plant for SK Mines, Hindusthan Zinc Ltd.
- 300 Ton Goliath crane for Mazagaon Docks Ltd, Mumbai
- 250 Ton Goliath crane for Garden Reach Shipbuilders & Engineers Ltd,
Kolkata
- 3 Nos Level Luffing cranes for Goa Shipyard
- 2 Nos Stacker cum Reclaimers for ESSAR, Salaya Power
- 2 Nos Wagon Tippler with side arm charger for Sterlite Industry,
Jharsuguda
- 1 No Stacker & 1 No Reclaimer for Essar Steel, Paradip and 1 No
Stacker cum Reclaimerfor Essar Power, Mahan
Activity Highlights
During the year a number of significant projects were commissioned,
which vindicates MBE''s capability to execute large value projects. Two
Balance of Plant (BOP) projects were completed for Ideal Energy, Nagpur
& MPPGCL, Satpura. The 300 ton Goliath crane for Mazagaon Docks & the
250 ton Goliath crane for GRSE were commissioned. MBE is the only
company who have supplied all the Shipyard cranes in India.
Your company has been consolidating its presence in key markets by
setting up offices in India & abroad. With these steps we expect a
greater thrust on our marketing activities in new markets &
territories, which will reflect in higher sales growth in the future.
Simultaneously, your company has been reorganising the Project
Divisions to focus on new business areas. Two new Strategic Business
Units were formed : Cement and Chemicals & Fertilisers. Senior
professionals have been hired from Industry to strengthen Marketing &
Business Units.
Quality in project delivery is of utmost priority for your company. MBE
has ISO 9001-2008 & ISO 14001-2004 certification. Our laboratory is
certified by NABL for non- destructive testing.
Your company is committed to implement the highest standards of
Occupational Health & Safety standards at all Project sites.
We have received this year two prestigious safety awards from the Royal
Society for prevention of accidents, based in UK.
- Silver Award for Occupational Health & Safety for IISCO project site
(Raw Material Handling, By Products Recovery and Water packages)
- Silver Award for Occupational Health & Safety for Rourkela Steel
Plant Project site (Stock House, New CHP and Inter plant Transportation
packages)
Apart from this, your company has received a number of Safety awards at
various project sites like GAP Lapanga, NALCOetc.
Subsidiaries
McNally Sayaji Engineering Ltd. (MSEL)
Some of the major orders received, which were executed during the year:
- Ball Mills from STEMCOR, Janaki Corpn., Rashi Strips, Furance
Fabrica, HDO, Bhavnagar.
- Rod Mills from EPIL, TECPRO
- Chain Mills from IFFCO
- Hammer Mill & Screens from BCCL
- Scrubbers from Usha Martin & Jaiswal NECO
- Hammer Mills, Double Roll crushers (toothed & smooth) from EPIL
- Hammer Mill, Impactor, Jaw Crusher for ACC Jamul project
- 3 stage mobile crushing & screening plant from MBE
- 2 stage mobile crushing plant from Suryodaya Infra Projects
- 2 stage mobile crushing plant from Essel Mining
- Double Roll Crushers, Vibrating Feeders, Chutes & Hoppers from
Archean Chemicals
- Bucket wheel excavator for Neyveli Lignite
- Stacker Reclaimers for NMDC, Sagardighi & BGR Energy
- Steel Plant equipment for SMS Meer a/c Bhilai Steel Plant
- Steel Plant equipment for Siemens a/c Bhilai Steel plant
- Equipment for By Products recovery plant from MBE a/c Bhilai Steel
plant
- Skid mounted crusher plant from HINDALCO
- Thickners from W Minerals, Usha Martin, Bhushan Steel, Godavari Power
& Ispat
Production at the new plant at Savli in Vadodara is now in full swing.
The manufacturing units have ISO 9001-2008 certification. In addition,
the Asansol factory has IBR certification for manufacture of boilers &
heat exchangers. The laboratory at Kumardhubi is certified by NABL for
mechanical testing. The Kumardhubi unit has also obtained ISO 14001 -
2004 certification
During the year, the R&D department had successfully developed several
models of the slurry pump upto 10 inch inlet diameter.
MBE Coal & Mineral Technology India Ltd.
Some of the major orders received and projects commissioned during the
year:
- Renovation of coarse & fine coal Batac Jigs from CCL for Rajrappa
Coal washery, Ramgarh .
- O&M for 3 years for a 425 TPH Heavy Media Coal washery at Meramandali
for Bhushan Steel Ltd.
- Orders received for 90 Nos Decanter Centrifuges for Environmental
projects
- Commissioned the 425 TPH Heavy Media coal washery at Meramandali for
Bhushan Steel Ltd
- 100 TPH Iron ore jigging plant is under commissioning forMSPLinHospet
- Last consignment of equipment under despatch for 150 TPH Coal washery
at Karachi.
Overseas Subsidiaries
All the overseas subsidiary companies under MBE Mineral Technologies
Pte Ltd, Singapore, excepting the manufacturing unit in Cologne, have
performed reasonably well in spite of global slowdown, currency
fluctuations and crisis in Europe. The manufacturing subsidiary in
Cologne, has recorded loss due to low business volume from its main
customer, for whom it works as outsourcing partner. During the year
the company also implemented major downsizing exercise and reduced
about 40 workmen. The cost of such reduction also impacted the Profit &
Loss. As a result the company had major erosion in its net worth. As
per prudent accounting principle, impairment loss of Rs. 34.5 crore
have been recognized in its parent company, MBE Mineral Technologies
Pte Ltd, Singapore, which is our 100% subsidiary. This has resulted in
a negative impact of equivalent amount in the consolidated Profit and
Loss Account of your Company.
Subsidiaries
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India/the Balance Sheet, Profit and Loss Account
and other documents of the subsidiary companies are not being attached
with the Balance Sheet of the Company. The Company will make available
the Annual Accounts of the subsidiary companies and the related
detailed information to any member of the Company who may be interested
in obtaining the same. The annual accounts of the subsidiary companies
will also be kept for inspection at the Registered Office of the
Company and that of the respective subsidiary companies. The
Consolidated Financial Statements presented by the Company include the
financial results of its subsidiary companies. A Statement containing
brief financial details of the subsidiary companies is included in the
Annual Report in the Chapter containing Consolidated Financial
Statements.
Dividend
In view of the Company''s performance, the Board of Directors of your
Company is pleased to recommend a dividend of Re. 1.00 (10 %) per
equity share of Rs.10/- each (compared to 2011-12 Re. 1.00 per equity
share of Rs. 10/- each).
The dividend will be tax free in the hands of the shareholders. The
register of members and share transfer books will remain closed from
September 20, 2013 to September 27, 2013 (both days inclusive).
The Non-convertible Redeemable Preference Shares allotted during the
financial year are entitled to a fixed dividend of 115% per annum
Accordingly, the Directors have recommended, for approval of the
members, a dividend of Rs. 11.50 (11.50%) per Share on 825,000
Non-convertible Redeemable Preference Shares of Rs. 100 each for the
financial year 2012-13.
Insurance
The assets of the Company including building, shed, plant & machinery,
etc. are adequately insured.
Health And Safety
Your company gives utmost importance to health and safety of the
employees. Various measures are being taken at our site locations, such
as:
Daily safety inspection at site by qualified Safety Engineers &
Officers of each Project site.
To identify unsafe acts & conditions and accordingly safety measures
are taken on a daily basis.
Regular safety training programs are conducted at sites for workmen.
Safety promotion activities are carried out on an ongoing basis.
Posters, slogans, No Smoking signs, safety barricades are displayed
prominently.
Competition & contests on Safety are conducted for workmen and prizes
distributed.
Directors
Mr. Amritanshu Khaitan, Mr. P H Ravikumar and Mr. Aditya Khaitan retire
by rotation and being eligible, offer themselves for reappointment.
Auditors
The Statutory Auditors of the Company M/s. Lovelock & Lewes, Chartered
Accountants, retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office of
Auditors, if reappointed. The Audit Committee and the Board of
Directors recommended M/s. Lovelock & Lewes, as Statutory Auditors of
the Company for the financial year 2013-14 for shareholders approval.
As required under the provisions of Section 224(1 B) of the Companies
Act, 1956, the Company has obtained a written Certificate from the
above Auditors proposed to be re-appointed to the effect that their
re-appointment, if made, would be in conformity with the limits
specified in the said section.
The Ministry of Corporate Affairs, Government of India, by an order
directed the audit of the Cost Accounts of the Company under section
209(1 )(d) of the Companies Act, 1956, in respect of Construction of
industrial and non- industrial plants, structures and facilities. In
terms of the said order, a compliance report, pursuant to Section 209
(1)(d), 600(3)(b) of the Companies Act, 1956, and the relevant Cost
Accounting Records Rules, 2011, has been filed.
Auditors'' Report
The Board has duly examined the Statutory Auditors'' Report to the
accounts and clarifications, wherever necessary, have been included in
the Notes to the Accounts section of the Annual Report.
Fixed Deposit
The Company hasn''t accepted any deposit from the public during the
year, and as such, there are no outstanding deposits in terms of the
Companies (Acceptance of Deposits) Rules, 1975.
Share Capital
During the year, the authorized share capital of the Company has been
increased to Rs. 1,600,000,000 divided into 40,000,000 Equity Shares
having a face value of Rs. 10/- each and 12,000,000 Non-convertible
Redeemable Preference Shares having a face value of Rs. 100/- each.
Subsequently, the paid-up share capital of the Company has increased to
Rs. 393,438,180 by issue of 825,000 nos. of 11.50% Non-convertible
Redeemable Preference Shares of Rs. 100/- each. The paid-up Equity
share capital of the company remains unchanged at 31,093,818 shares
having a face value of Rs. 10/-each.
The proceeds of the issue of the said 11.50% Non-convertible Redeemable
Preference Shares has been utilized to enhance the Company''s net worth,
improve its debt-equity ratio and to meet its working capital and other
requirements.
Corporate Governance
The Company has adopted the best corporate governance norms and it has
been our endeavour to comply and upgrade to the changing norms.
Aseparate section on Corporate Governance and a certificate from the
Statutory Auditors of the Company regarding compliances of conditions
of Corporate Governance as stipulated under Clause 49 of the Listing
Agreement(s) with the Stock Exchange(s) form part of the annual report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the CEO/CFO, inter alia confirming the correctness of
the financial statements, adequacy of the internal control measures and
reporting of matters to the Audit Committee in terms of the said
Clause, is also enclosed as a part of this Report.
Corporate Social Responsibility
A new face of MBE CSR is Prayash. The Company, over the past few months
has been working with an institute called Child In Need Institute
(CINI), to support the under privileged children in a slum area. It is
situated is in a very backward region of Tiljala- Topsia under Ward-66
of KMC In this coaching centre learning & various activities for the
school children (7 years -12 years) are conducted on a day to day basis
by CINI appointed teachers & ground level volunteers. Currently there
are twenty-five children in the coaching centre. Here the community is
very poor and so additional creative and exposure inputs have to be
given to the children to draw them towards education. Apart from that
there are activities done with the parents so as to make them realize
that the need for education for their children is much greater than the
meager income that they get working in tanneries and other sweat shops.
Our approach is focused to support, education for the Under Privileged
Children. In this project MBE & CINI are working together to ensure
that the students continue with their formal education process. Beside
this, counseling, workshops on motivation, stress management,
refreshment and education tour is also conducted for the children.
Particulars Of Employees
Information pursuant to Section 217(2A) of the Companies Act, 1956 read
with Companies (Particulars of Employees) Rules, 1975, forms part of
this Report. Any Member interested may obtain a copy of the statement
from the Company.
Energy Conservation, Technology Absorption And Foreign Exchange Earning
And Outgo
The details as prescribed under Sub-section (1 )(e) of Section 217 of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988, are given
in Annexure A to the Directors'' Report.
Directors'' Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors confirm as under:
1)ln the preparation of annual accounts, the applicable accounting
standards have been followed. There are no material departures from
prescribed accounting standards;
2)We 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 2012-13 and of profit of
the Company for that period;
3)We have 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; and
4)We have prepared the annual accounts on a going concern basis.
Cautionary Statement
Certain statements in the Directors'' Report describing the Company''s
operations, objectives, projections and expectations regarding future
performance may constitute ''forward looking statements'' with the
meaning of applicable laws and regulations. Actual results may differ
materially from those either expressed or implied, depending on the
economic conditions, Government policies and other incidental factors
and developments.
Acknowledgement
The Directors place on record their sincere appreciation for
significant contribution made by the employees through their
dedication, hard work, active involvement and devoted services
rendered. The Directors would also like to thank all the stakeholders,
investors including Bankers and other business associates, who have
extended their valuable support and encouragement.
This has, understandably, been critical for the Company''s success. The
Directors look forward to their continued support and understanding in
the years to come.
On behalf of the Board of Directors
Subir Ranjan Dasgupta Asim Kumar Barman
Director Director
Kolkata, August 14, 2013
Mar 31, 2012
The Directors take great pleasure in presenting the Forty ninth Annual
Report together with audited statement of accounts for the year ended
March 31, 2012.
HIGHLIGHTS
The key highlights of the operations for the financial year 201 1-1 2
over the previous year are (based on standalone only in all cases):
Total Income increased by 1 8%
Earnings before Interest, Depreciation and Taxes increased by 26.6%
Profit before Tax increased by 6.6%
Earnings per Share increased by 37%
FINANCIAL RESULTS
The Financial performance of the Company for the year ended March 31,
2012 is summarized below:
Rs. In Lacs
PARTICULARS Standalone
year ending Standalone
year ending
March 31, 2012 March 31, 2011
Sales (net of excise)
and other income 209126 177226
Profit before Interest,
Depreciation
& Amortisation and Tax (EBIDTA) 14772 11669
Less: Interest cost 5865 3470
Earnings before Depreciation
& Amortisation and Tax (EBDTA) 8907 8199
Less: Depreciation & Amortisation 1053 832
Profit before Tax 7854 7367
Less: Provision for Taxation
(including Deferred Tax) 1289 2575
Profit after Tax 6565 4792
Amount brought forward from
previous year 13635 9905
Profit available for Appropriations 20199 14697
Proposed for Dividend on
equity shares for the year 311 622
Dividend Distribution Tax on
Proposed Dividend on Equity shares 30 80
Transfer to General Reserve 165 360
Balance at the end of the year 19693 13635
BUSINESS PERFORMANCE
Your Directors are pleased to report that 2011-12 turned out to be yet
another excellent year during which your company achieved its highest
ever turnover & profits. The total income for the year was Rs. 2091 crore
as against Rs. 1775 crores during the previous year.
However, due to credit crunch faced by our clients across all sectors,
collections and working capital management was a challenge, resulting
in increased borrowings and higher interest charges.
ORDER BOOK )
Your Company has an order backlog of around Rs. 3417 crores as on March
31, 2012.
Some of the significant orders bagged during the year are mentioned
below, which are currently under execution:
- By-Product plant complex for New Coke Oven Battery in SAIL Bhilai
- Supply of 10 Nos. Stacker Reclaimers, Barrel Reclaimers & Stackers to
BHEL a/c NMDC steel plant, Chattisgarh
- Supply of Ball Mill to Kenya Fluorspar
- High Concentration Ash Slurry Disposal (HCSD) system for Crescent
Power
- Ash handling Plant & Limestone Milling/Conveying for 2x250MW
Lignite based Thermal Power Project of Bhavnagar Energy Co. Ltd.
- Ash Handling Plant for 2x600MW Power Plant of Essar Projects at TORI
- Coal Handling System of Surana Power Ltd.
- Two to Four Laning of NH33 for Madhucon Projects Ltd.
- Mechanical Work Package at Lepetkata for BCPL
- Ash Handling Package for 660 MW Power Plant of Jabua Plant Ltd.
PROJECT EXECUTION
During the year a large number of projects were at various stages of
execution. Some of the major projects which were completed are:
- 800 TPH Coal Handling Plant for DVC, Chandrapura Thermal Power
Station
- 750 TPH East Mill Copper Concentrator Plant for VEDANTA, Konkona
Copper Mines, Zambia B Ball Mill for Kenya Fluorspar B Ash Handling
Plant for DVC - Mejia Phase "B"-1x500 MW B Ash Handling for 2x660 MW
Power project for Essar Power Gujarat in Salaya
- Lead Zinc Concentrator at SK Mines for Vedanta.
Your company has ambitious plans to expand in Infrastructure projects
and has been bidding for road, Metro, High rise buildings & other
industrial construction projects and we expect to receive good order
booking in this sector in 2012-1 3. The Infrastructure Projects &
Construction Division has been strengthened by inducting senior
professionals from the Industry.
Your company, through its 100% subsidiary in Singapore, MBE Mineral
Technologies Pte Ltd. has acquired a 42% stake in Specialist Energy
Group pic in UK (SEG). SEG owns Hayward Tyler Ltd UK and Hayward Tyler
Inc. USA. Hayward Tyler manufactures specialized pumps for Power,
Nuclear and Oil & Gas Industry.
Your company has received the following prestigious awards during the
year.
In October 2011, the Deptt. Of Scientific & Industrial Research (DSIR),
Ministry of Science & Technology, GOI accorded recognition of our
In-house R&D activities.
Reputed International Consultants, KPMG had been engaged to develop the
Operating Processes for the Infrastructure Projects & Construction
Division to enable rapid scaling up of operations.
The Center of Engineering Excellence (COEE) has been established to
develop software based solutions for achieving automation in execution
of day to day engineering of projects. Since inception, work has been
completed for automation of Engineering and Drawing for various
Material Handling system & equipment, Mills etc. This has resulted in
significant saving in man-hours, material cost and project execution
time.
Your company has received numerous Safety awards at project sites from
clients such as SOLIOS, BHEL & Tata Projects Ltd. More than 1 Million
hours accident free operations were achieved at the following
construction sites: Bellary Thermal Power Station & HINDALCO, Mahan.
SUBSIDIARIES
McNally Sayaji Engineering Ltd. (MSEL)
Some of the major orders received during the year:
- Rashi Steel & Power for various equipment including Ball Mills for
Iron Ore Beneficiation plant
- Hindustan Dorr Oliver (client NMDC) for Grinding Mills
- HINDALCO, Renusagar power project for 2 Nos 400TPH skid mounted coal
crushing plants
- Stemcor India Pvt. Ltd. for Ball Mills
- Sesa Goa for Thickners, crushers, screens & feeders
- Thermax Ltd for single roll crusher, Hammer mill, Screen
- Bengal Tools for Apron Feeders & screens
- SK Samanta (client - BCCL) for Single Roll crusher
- Furnace Fabrica India Ltd. for Ball Mill_
- IFFCO for chain mill
- Nava Bharat Energy Ltd. for single roll crusher
- Hamtek Technologies for single roll crusher
Construction of the new plant at Savli in Vadodara is completed.
The Department of Scientific & Industrial Research (DSIR), Mininstry of
Science & Technology, GOI has accorded recognition to the In - house
R&D activities of MSEL. During the year, the R&D department has
successfully developed a 3 inch centrifugal slurry pump & a skid
mounted coal crushing plant.
MBE Coal & Mineral Technology India Ltd.
Some of the major orders received during the period:
- Trade Serve International Pvt. Ltd. for 150 TPH Coal Washery at
Karachi with Batac Jig.
- NRE Metcoke Ltd. for 150 TPH Heavy Media Cyclone Washery with 80 TPH
Fines Washing in Pneumatic Flotation Machine at Bachau.
- MSPL, Hospet for 100 TPH Iron Ore Jigging Plant.
- Janki Corporation, Bellary for 200 TPH Iron Ore Beneficiation Plant
(WHIMS).
- For the first time export order received from South America for
Design and Engineering works of Flotation Plant for VALE (Brazil)
through MBE-CMT, Cologne, Germany.
- Order received from MBE-CMT, Cologne for Design & Engineering Works
for Naryn Sukhai Coal Handling & Preparation Project at Mongolia.
- Order received for Design & Engineering for Pasir Coal Washery,
Kideco in Indonesia from MBE-CMT, Cologne.
- Renewed contract for Operation and Maintenance of 1200 TPH Deshaling
Plant at Bina Project of Northern Coalfields Limited for a period of 5
years.
Some of the major orders executed & commissioned during the period:
- Successfully commissioned 500 TPH Coal Washery Plant at Korba for S.
V. Power Pvt. Ltd.
- Successfully commissioned the Coarse Seed Filtration package for
Vedanta Aluminum Ltd., Lanjigarh, Orissa.
- Sales of centrifuges reached record high of 113 numbers surpassing
the earlier high of 107 in 2010-1 1.
MBE Mineral Technologies Pte Ltd., Singapore
A 100% owned subsidiary of MBE has a number of companies under its
fold.
The MBE CMT Group comprising MBE Coal & Minerals Technology GmbH
Cologne, MBE Minerals SA Pty Ltd. South Africa and operations in China,
Russia, Indonesia & Brazil. The performance of the MBE CMT Group was
satisfactory inspite of the European crisis & global slowdown Cologne
Engineering & EWB Techologial
kit Budapest, have also performed satisfactorily under adverse
conditions.
Specialist Engineering Group (SEG) MBE Mineral Technologies Pte Ltd.,
has acquired controlling stake (42%) in Specialist Energy Group pic in
UK (SEG). SEG owns Hayward Tyler Ltd. UK (HTL) and Hayward Tyler Inc.
USA (HTI). HTL is one of the three global manufacturers of Boiler
Circulating Pumps. Other products included pumps for special
application, canned pumps used in Nuclear Power Plant, submersible
motors, process pumps, pumps used in oil & gas sector, subsea pumps and
pumps used in Submarine. HTI is a major player in Nuclear Power
sector, specialising in service, overhauling of Nuclear Power Plants in
USA. HTI has strong presence in special range of pumps used in Coal
Power Generation, Nuclear Power, Syngas Power and speciality Chemical
and Hydrogen processing.
SUBSIDIARIES
In accordance with general circular issued by the Ministry of Corporate
Affairs, Government of India, the Balance Sheet, Profit and loss
Account and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company. The Company will make
available the Annual Accounts of the subsidiary companies and the
related detailed information to any member of the Company who may be
interested in obtaining the same. The annual accounts of the subsidiary
companies will also be kept for inspection at the Registered Office of
the Company and that of the respectve subsidiary companies. The
Consolidated Financial Statements presented by the Company include the
financial results of its subsidiary companies. A Statement containing
brief financial details of the subsidiary companies is included in the
Annual Report in the Chapter containing Consolidated Financial
Statements.
DIVIDEND
In view of the Company's performance, the Board of Directors of your
Company is pleased to recommend a dividend of Rs. 1.00 (10%) per equity
share of Rs. 10/- each (compared to 2010-1 1 Rs.2.00 per equity share of Rs.
10/- each).
The dividend will be tax free in the hands of the shareholders. The
register of members and share transfer books will remain closed from
September 17, 2012 to September 28, 2012 (both days inclusive).
INSURANCE
The assets of the Company including building, shed, plant & machinery,
etc. are adequately insured.
HEALTH AND SAFETY
Your company gives utmost importance to health and safety of the
employees. Various measures are being taken at our site locations,
such as:
Daily safety inspection at site by qualified Safety Engineers &
Officers of each Project site.
To identify unsafe acts & conditions and accordingly safety measures
are taken on a daily basis.
Regular safety training programs are conducted at sites for workmen.
Safety promotion activities are carried out on an ongoing basis.
Posters, slogans, No Smoking signs, safety barricades displayed
prominently.
Competition & contests on Safety are conducted for workmen and prizes
distributed.
DIRECTORS
Mr. Asim Kumar Barman, Mr. Subir Ranjan Dasgupta, Mr. Utsav Parekh and
Mr. Sudipto Sarkar retire by rotation and being eligible, offer
themselves for reappointment.
AUDITORS
The Statutory Auditors of the Company M/s. Lovelock & Lewes, Chartered
Accountants, retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office of
Auditors, if reappointed. The Audit Committee and the Board of
Directors recommended M/s. Lovelock & Lewes, as Statutory Auditors of
the Company for the financial year 2012-1 3 for shareholders approval.
As required under the provisions of Section 224(1 B) of the Companies
Act, 1956, the Company has obtained a written Certificate from the
above Auditors proposed to be re-appointed to the effect that their
re-appointment, if made, would be in conformity with the limits
specified in the said section.
AUDITORS' REPORT
The Board has duly examined the Statutory Auditors' Report to the
accounts and clarifications, wherever necessary, have been included in
the Notes to the Accounts section of the Annual Report.
FIXED DEPOSIT
The Company hasn't accepted any deposit from the public during the
year, and as such, there are no outstanding deposits in terms of the
Companies (Acceptance of Deposits) Rules, 1975.
SHARE CAPITAL
During the year, authorized and paid-up share capital of the Company
remain unchanged in comparison to the previous year.
CORPORATE GOVERNANCE
The Company has adopted the best corporate governance norms and it has
been our endeavour to comply and upgrade to the changing norms.
A separate section on Corporate Governance and a certificate from the
Statutory Auditors of the Company regarding compliances of conditions
of Corporate Governance as stipulated under Clause 49 of the Listing
Agreement(s) with the Stock Exchange(s) form part of the annual report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the CEO/CFO, inter alia, confirming the correctness of
the financial statements, adequacy of the internal control measures and
reporting of matters to the Audit Committee in terms of the said
Clause, is also enclosed as a part of this Report.
PARTICULARS OF EMPLOYEES
Information pursuant to Section 217(2A) of the Companies Act, 1956 read
with Companies (Particulars of Employees) Rules, 1975, forms part of
this Report. Any Member interested may obtain a copy of the statement
from the Company.
PERSONS CONSTITUTING GROUP
Statement of Persons constituting group within the definition of
'Group' for the purpose of Regulation 3(l)(e)(i) of the Securities and
Exchange Board of India (Substantial Acquisition of Shares and
Takeover) Regulation, 1977 form a part of the Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING
AND OUTGO
The details as prescribed under Sub-section (l)(e) of Section 217 of
the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988, are given
in Annexure A to the Directors' Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors confirm as under:
1) In the preparation of annual accounts, the applicable accounting
standards have been followed. There are no material departures from
prescribed accounting standards;
2) We 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 201 1-12 and of profit of
the Company for that period;
3) We have 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; and
4) We have prepared the annual accounts on a going concern basis.
CAUTIONARY STATEMENT
Certain statements in the Directors' Report describing the Company's
operations, objectives, projections and expectations regarding future
performance may constitute 'forward looking statements' with the
meaning of applicable laws and regulations. Actual results may differ
materially from those either expressed or implied, depending on the
economic conditions, Government policies and other incidental factors
and developments.
ACKNOWLEDGEMENT
The Directors place on record their sincere appreciation for
significant contribution made by the employees through their
dedication, hard work, active involvement and devoted services
rendered. The Directors would also like to thank all the stakeholders,
investors including Bankers and other business associates, who have
extended their valuable support and encouragement.
This has, understandably, been critical for the Company's success. The
Directors look forward to their continued support and understanding in
the years to come.
On behalf of the Board of Directors
Subir Ranjan Asim Kumar
Dasgupta Barman
Director Director
Kolkata, August 10, 2012
Mar 31, 2011
Dear Members,
The Directors have great pleasure In presenting the Forty-eighth
Annual Report together with audited statement of accounts For the year
ended on March 31. 2011.
Highlights
The key highlights of the operations of McNally Bharat Engineering
Company Limited for the financial year 2010-11 over the previous year
are:
- Total income increased by 19%
- Earnings before interest, depreciation and taxes increased by 31%
- Profit before tax increased by 38%
- Earnings per share increased by 38%
Financial Results
Rs. in Lakh
PARTICULARS Standalone Consolidated
year ending year ending
March 31, 2011 March 31,2011
Bales (net or excise) and other
income 177.462 227,075
Earnings before Interest, Tax.
Depreciation & Ammortrisation
(EBITDA) 11,609 17,850
Less; interest & Finance Charges 3,410 4,864
Earnings before Depreciation, Tax &
Ammortisation (EBDTA) 8,199 12,986
Less; Depreciation & Ammortlsatlon 832 2,285
Profit before Tax 7,367 10,701
Less; Provision for Taxation
(including Deferred Tax} 2.575 3,976
Profit after Tax and before Minority
Interest 4.792 6,727
Less; Minority interest & proportionate
share of pre-acquisition profit adjusted
with goodwill - 390
Profit after Tax and Minority Interest 4,792 6,337
Amount brought forward from previous year 9,905 12,863
Profit available for Appropriations 14.697 19,225
Proposed for Dividend 622 622
Provision for Dividend Tax 80 109
Transfer to General Reserve 360 360
Balance carried forward to Balance Sheet 13,635 10,134
Operations & Business Performance
Your Directors are pleased to report that 2010-11 turned out to be yet
another excellent year during which your company achieved highest ever
turnover and profits. The total income for the year was Rs 1.775 crore
as against Rs 1A87 crore during the previous year,
Order Book
Your company has an order backlog of over Rs 3,500 croreas on 31 March
2011. During the year your company bagged several significant orders as
mentioned below, which are currently under execution.
- Balance of Plant from Madhya Pradesh Pqwe r G en e rat io n Com pany
Limited (MPPGCL). far their Satpura Thermal Power Plant (2 X 250 MW).
- mterplant transportation facility for ores, coal, sinter and iron
fines from SAIL, Rourkela Steel.
- 700 litre capacity Bucket Wheel Excavator For Neyveli Lignite
Corporation.
- West Mill Copper Concentrator plant VEDANTA, Konkola Copper Mines,
Zambia.
- East Mill Copper Concentrator plant & related floatation package for
VEDANTA, Konkola Copper Mines. Zambia.
- Coal Handling Terminal for Marg Limited. Karaikal Port.
- Coal Handling Plant for Coke Oven Battery for SAIL, Rourkela Steel.
- HCSD Ash Handling system for VEDANTA, Talwandi Saba Power plant.
- Ash Water circulation & treatment system. NTPC, Singrauli.
- 2 nos Electric Level Luffing crane for Goa Shipyard.
- Technological structures for SMS
Meer for Universal Rail Mill project in Bhilai Steel Plant
- Coal Grinding Plant structures for Tata Projects Limited for SAIL,
Rourkela.
- Inside Battery Limit package from Essar Projects foriOCL refinery,
Paradeep.
Project Execution
During the year a large numberof projects including 2 BOP projects were
at various stages of execution. Some of the major projects which were
completed in 2010-11:
- The Raw Material Handling Plant for IISCO, Burnpur.
- The Lead-Zinc Benefication Plant for SK Mines of HZL
- The Uranium Beneficiation Plant for UCIL at Tumala pally.
- The Green Anode Plants 3 & 4 for Ved a n ta at J ha rsu guda.
- Coal Handling Plant for Vcdanta, Jharsuguda.
- Ash Handling, NTPC, Rihand.
- Ash Handling Plant for MSPGCL, Parli.
- Ash Handling Plant for MSPGCL. Paras.
- Ash Handling Plant for 8HEL, Mejia.
Activity Highlights
During the year we received a Rs 827 crore order for executing a
Balance of Plant From MP Power Generating Company Limited. We also won
two export project orders from Vedanta for their konkola Copper Mines
in Zambia. Your company also has made a breakthrough in the Oil & Gas
sector by procuring an EPC order for IOCL refinery coming up in
Paradeep. Your company has ambitious plans to be a global player in
Mineral Processing & Material
Handling and have opened an office in South Africa. This year your
company has plans to open more offices in Indonesia and South America.
who are having huge deposits of mineral resources.
Your company has entered into a co-operation & license agreement with
Beijing Guodian Science & Technology Development Company Limited, China
for Dry Bottom Ash Handling Systems.
Your company had appointed KPMG for valuable Advisory assistance in
Business Process and Operations improvement for EPC business. Their
scope of engagement covered Project Resource Planning & Deployment,
Review of Project Manager Empowerment & Accountability, Re-designing
Project Review & Control Processes and Develop i n g t h e Ri sk Ass e
ss m ent Framework. Implementation of their recommendations is being
carried out.
During the year your company obtained ISO 1*001 2004 certification and
NABL accreditation for the NDT (IMon Destructive Testing) laboratory
located in its premises.
In Human Resource Development we have implemented a robust Performance
Management Process based on KRAs (Key Result Areas) and competencies.
Subsidiaries
McNally Sayaji Engineering Limited (MSEL)
During the year MSEL perform Ed reasonably well in the backdrop of slow
downturn, still affecting capital Investment. During the year the
company was able to maintain its activity level. However, the profit
was impacted by increase in employee costs.
Some of the major orders received during the year:
- First order for 2 Skid Mounted Coal Crushing Plant, order value Rs
2.5 crone.
- First order For 2 stage Mobile Crushing & Screening Plant for
aggregates, order value Rs 2,5 crore.
- Order from L&T (a/c Bhushan Steel) for 3 Rod Mills, order value Rs
10.5 crore.
- Order from BMM Ispat for 4 Bait Mills, order value Rs 9-5 crore.
- Order from Nuclear Corporation of India [NPCIL] for Main Airlock
doors, auxiliary airlock doors & reactor building doors for RAPP 7.
valued Rs 3,5 crore.
The new plant at Savli near Vadodara is under construction and is
expected to be on stream in the current financial year. The new plant
would significantly increase the manufacturing capacity of MSEL The
in-house R&D department have successfully developed wheel mounted
mobile crushing & screening plants and skid mounted coal sizers, These
equipment have a huge market in Mining & Construction industry and MSEL
can expect a good number of orders for these equipment in the c urrent
yea r a nd s u bs e q u en t years.
MBE Coal & Minerals Technology Business Segment
McNally Humboldt Wedag Minerals India Private Limited
The Indian arm of the CMT business had achieved in 2010-11 a turnover
of Rs 91.26 crore and PBTofRs6.6 crore. Some of the major orders
received during this period were:
- Coal Washery for SV Power Private Limited valued at Rs ~i.2 crore.
- Modification jobs at Orissa Mining
Corporation valued at Rs 2.5 crore. A number of projects were under
execution during the year, Some of the projects completed during the
year:
- 600 TPH coal washery and 80 TPH coat crushing & screening plant for
Bhushan Powers Steel, Bengali.
- Global Coal & Mining Private Limited. 300 TPH washery at Belpahar,
Orissa and 400 TPH washery at Manguru, AP.
- ACC, 100 TPH washery at Bargarh,
- Ultratech. 300 TPH washery at Awarpur, Maharashtra and 400 TPH
washery at Hirmi, Chattisgarh.
- Washer package and disc filter package forVedanta.
- 79 centrifuges supplied compared to 55 In last year.
The industrial Centrifuge business continues to grow and this trend is
expected to continue in the coming years.
MBE Coal & Minerals Technology GmbH, Cologne
The Turnover of the German entity for 201011 was Euro 36.3 Million (Rs
229 crore) and PBTwas Euro 0.41 million (Rs2.62crore). The company has
opened offices in China, Russia. Brazil & Indonesia for access to
countries with high mineral deposits.
MBE Minerals SAPty Limited South Africa
The turnover of the South African entity for 2010-11 was Rand 90.16
Million (Rs 5& crore) and PBTwas Rand 12.03 Million [Rs 7.3 crore],
Subsidiaries
The Statement pursuant to Section 212 of the Com panics Act, 1956
containing details of the Company's subsidiaries is attached. The
Ministry of Corporate Affairs. Government of India issued a General
Circular no 2/ 2011 dated February 8, 2011 by which it has provided art
exemption to Companies from complying with Section 212 of the Companies
Act. 1556, provided such companies publish the audited consolidated
Financial statements In the Annual Report. In terms of the said general
exemption granted by the Central Government undersection 212(8) of the
Companies Act, 1956, the Audited Statements of Accounts and the
Auditors' Reports thereon for the year ended March 31, 2011 along with
the Reports of the Board of Directors of the Company's Subsidiaries
have not been annexed. These documents would be made available upon
receipt from any member of the Com pany Interested in obtaining the
same.
The Consolidated Financial Statements of the Company and its
Subsidiaries, prepared in accordance with Accounting Standard AS 21, as
notified in the Companies (Accounting Standards] Rules, 2006, form part
of the Annual Report.
The accounts of the individual subsidiary companies shall be uploaded
on the website of your Company.
Dividend
In view of the Company's performance, the Board of Directors of your
Company is pleased to recommend a dividend oF Rs 2 (20%) per equity
share af Rs 10 each (compared to 2009-10: Rs 1.50 per equity share of
Rs 10 each),
The dividend will be tax free in the hands of the shareholders. The
register of members and share transfer books will remain closed from
September 17, 2011 to September 23, 2011 (both days inclusive).
Insurance
The assets of the Company including building, shed, plant & machinery,
etc are adequately insured.
Health and Safety
Your company gives utmost Importance to health and safety of the
employees. Various measures are being taken at our site locations,
such as:
- Daily safety inspection at site by Security Officers of each Project
site.
- To identify unsafe acts & conditions and accordingly safety measures
are taken on a daily basis.
- Regular safety training programs are conducted at sites for workmen.
- Safety promotion activities are carried out on an ongoing basts.
Posters, Slogans. No Smoking signs. Safety barricades displayed
prominently.
- Competition & contests on Safety are conducted for workmen and prizes
distributed.
Directors
Mr SP Singhi. Vice Chairman of the Company, after 22 years of service
in the Company stepped down with effect from June 14, 2011. The Board
has placed on record its deep appreciation of MrSinghi's immense
contribution and valuable services during his association with the
Company.
Mr San jay Pasari and MrChandrakant Pasari. Directors of the Company.
stepped down with effect from June 27, 2011. The Board has placed on
record its deep appreciation of their contribution and valuable
services during theirassociation with the Company.
The Board of Directors at their meeting held on May 6. 2011, appointed
MrSudipto Sarkar as an Additional Director of the Company with effect
from May 6. 2011
- Mr Sudipto Sarkar is a Barrister of Gray's Inn, London and is
presently practising as a Senior Advocate in the Calcutta High Court.
He has wide experience in Commercial Law particularly Company,
Intellectual and Shipping Laws. The Company has received a Notice from
a member signifying his intention to propose Mr Sudipto Sarkar for the
office of Director at the forthcoming Annual Genera! Meeting.
The Board of Directors at their meeting held on May 6, 2011, has also
appointed Mr PH Ravikumar as an Additional Director of the Company with
effect horn May 6, 2011. Having work experience of over 3? years in the
Banking and Financial services sector, Mr PH Ravikumar has worked in
organisations tike National Commodity and Derivatives Exchange Limited,
as their Managing Directorand Chief Executive Officer. ICICI Bank, as
their Senior General Manager and Head of Emerging Corporate 8, Agri
Business Group, and Bank of India. The Company has received a notice
from a member signifying his intention to propose Mr PH Ravikumar for
the office of Director at the forthcoming Annual General Meeting.
The Board of Directors at their meeting held on June 27, 2011, has also
appointed Mr Aditya Khaitan as an Additional Director of the Company
with effect from June 27, 2011. Mr Aditya Khaitan has had in depth
exposure to and involvement in steering diverse businesses and has
gained considerable experience and expertise in management, production,
marketing, corporate finance and other related areas and also in the
matter of restructuring, mergers, demergers and acquisitions of
corporate entities. The Company has received a notice from a member
signifying his intention to propose Mr Aditya Khaitan for the office of
Director at the forthcoming Annual Genera! Meeting.
The Board of Directors at their meeting held on February 14, 2011,
appointed Mr Prasanta Kumar Chandra as a Whole-time Director and Chief
Operating Officer of the Company for a period of five years with effect
from February 14, 2011. Mr Prasanta Kumar Chandra is a Mechanical
Engineer, a Cost Accountant and has done his Post-graduation in
Marketing Management. Mr Chandra has over 30 years of experience in
diverse fields like Design & Engineering, Manufacturing, Project
Management, Operations Management and Corporate Planning.
The Board of Directors at their meeting held on lime 27. 2011, has also
appointed Mr Prabir Ghosh as a Whole-time Director and Group CFO of the
Company for a period of five years with effect from June 27, 2011. Mr
Prabir Ghosh Is a Chartered Accountant having experience of over 2 5
years in the areas of Financial Policies and Systems, Corporate
Finance, Treasury Management, Manufacturing Accounting. International
Finance including GDR, ECB & Suppliers Credit, Taxation, Commercial
Function including export, import, purchase, EXIM matters, handling and
leading techno- commercial team for large projects, Information System
Development, General Management, Industrial Relations and Corporate
Strategy.
The Board oF Directors at their meeting, held on August 12, 2011, has
appointed Mr Deepak Khaitan as the Executive Chairman of the Company
for a period of five years with effect from August 12, 2011.
MrVKVerma, MrSR Dasgupta and Mr Amritanshu Khaitan retire by rotation
and being eligible, offer themselves for reappointment.
Auditors
The Statutory Auditors of the Company M/s Lovelock & Lewes, Chartered
Accountants, retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office of
Auditors, if reappointed. The Audit Committee and the Board of
Directors recommended M/s Lovelock & Lewes, as Statutory Auditors of
the Company For the financial year 2011-2012 for shareholders approval.
As required under the provisions of Section 2 24(1 B) of the Companies
Act, 1956, the Company has obtained a written certificate from the
above auditors proposed to be reappointed to the effect that their
reappointment, if made, would be in conformity with the limits
specified in the said section
Auditors' Report
The Board has duly examined the Statutory Auditors* Report to the
accounts and clarifications, wherever necessary, have been included in
the notes to the Accounts section of the Annual Report.
Fixed Deposit
The Company hasn't accepted any deposit from the public, and as such,
there are no outstanding deposits in terms of the Companies [Acceptance
of Deposits) Rules. 1975.
Share Capital
During the year. authorised and paid-up share capital of the Company
remain unchanged in comparison to the previous year,
Corporate Governance
The Company has adopted the best corporate governance norms and it has
been our endeavour to comply and upgrade to the changing norms.
A separate section on Corporate Governance and a certificate from the
Statutory Auditors of the Company regarding compliances of conditions
of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement(s) with the Stock Exchange(s) form part of the annual
report.
In terms of sub-clause (v) of the Clause 49 of the Listing Agreement, a
certificate of the CEO /CFO. inter alias, confirming the correctness of
the financial statements, adequacy of the internal control measures and
reporting of matters to the Audit Committee in terms of the said
Clause, is also enclosed as a part of this Report.
Particulars Of Employees
Information pursuant to Section 217(2A) of the Companies Act, 1956 read
with Companies (Particulars of Employees) Rules, 197^. forms part of
this Report. Any Member interested may obtain a copy of the statement
from the Company.
Persons Constituting Group
Statement of Persons constituting group within the definition of
'Group' for the purpose of Regulation 3{lKe)(i) of the Securities and
Exchange Board of India (Substantial Acquisition of Shares and
Takeover) Regulation, 1977 form a part of the Report.
Energy Conservation, Technology Absorption And Foreign Exchange Earning
And Outgo
The details as prescribed under Subsection (l)(e) of Section 217 of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
In the Report of Board of Directors) Rules, 1988. are given in Annexure
A to the Directors* Report.
Director's Responsibility Statement
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, your Directors confirm as under:
1, In the preparation of annual accounts, the applicable accounting
standards have been Followed. There are no material departures from
prescribed accounting standards:
2, We 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 2010-11 and of profit of
the Company for that period:
3, We have 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; and
4. We have prepared the annual accounts on a going concern basis.
Cautionary Statement
Certain statements in the Directors'
Report describing the Company's operations, objectives, projections and
expectations regarding future performance may constitute 'forward
looking statements' with the meaning of applicable laws and
regulations. Actual results may differ materially from those either
expressed or implied, depending on the economic conditions. Government
policies and other incidental factors and developments.
Acknowledgement
The Directors place on record their sincere appreciation for
significant contribution made by the employees through their
dedication, hard work, active involvement and devoted services
rendered. The Directors would also like to thank all the stakeholders,
investors including Bankers and other business associates, who have
extended their valuable support and encouragement. This has.
understandably, been critical for the Company's success. The Directors
look forward to their continued support and understanding in the years
to come.
On behalf of the Board of Directors
Deepak Khaitan
Executive Chairman
Kolkata, August 12, 2011
Mar 31, 2010
Not Available
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