Salem Textiles Ltd. के निदेशक की रिपोर्ट

Mar 31, 2012

The directors have pleasure in submitting the Forty seventh Annual Report together with the Audited Accounts for the year ended 31st March, 2012.

I.FINANCIAL RESULTS 2011-2012 2010-2011 (Rs. in Lacs) (Rs. in Lacs)

NET SALES Nil Nil

OTHER INCOME 697.37 858.11

697.37 858.11

(-) LOSS/PROFIT BEFORE FINANCIAL CHARGES AND DEPRECIATION (-) 103.65 97.78

LESS: FINANCIAL CHARGES 2.18 4.06

DEPRECIATION 34.12 42.55

(-) LOSS/PROFIT FOR THE YEAR (-) 139.95 51.17

LESS/ADD ADJUSTMENT RELATING TO PRIOR YEARS - OTHERS (-) 4.06 (-) 82.15

BALANCE (-) LOSS/PROFIT (-) 144.01 (-) 30.98

LOSS BROUGHT FORWARD 10066.48 10035.50

ACCUMULATED LOSS (-) 10210.49 10066.48

2. PERFORMANCE

2011 -12 was very bad for the Textile Industry. Due to high fluctuation of Raw Material price, global economic recession, severe power cut problems, all the Spinning Mills have suffered a huge loss. We are already in critical position. Even the Conversion party could not supply raw material continuously and give remunerative rate for the conversion.

The turnover for the year under review, only conversion charges and other income was Rs. 697.37 Lacs compared to the turnover of Rs. 858.11 lacs for the year 2010-11 The Company's operations resulted in a net loss of Rs. 139.95 Lacs in the year 2011 -12 compared to the net profit of Rs. 51.17 lacs in the year 2010-11.

Due to severe Power cut problem, we could not run the unit in full capacity. Because of the Power cut the production was reduced, consequently the conversion charges receipt also reduced.

Due to non availability of adequate working capital finance, the Company could not have own production, and therefore the Company had to continue doing conversion works to the available extent to keep the Mill working.

3. DIVIDEND

Due to accumulated losses, your directors are unable to recommend any dividend for the year under review.

4. FINANCIAL POSITION

The Company continues to face critical financial position, due to accumulated loss and the non-availability of sufficient working capital funds. The Company has been declared "Sick Industrial Company" by Hon'ble BIFR and rehabilitation process is in progress. The Rehabilitation scheme submitted by the Company to Hon'ble BIFR has not so far been cleared.

5. MANAGEMENT DISCUSSION AND ANALYSIS OF THE OPERATIONS

The management discussed and analyzed the operational results for 2011-2012 and critically studied the factors that affected production, sales and profit. The management was satisfied with the efforts taken by the Company in the situation prevailed during the year 2011 -12.

6. FUTURE TRENDS

Non-availability of raw materials at reasonable prices, remunerative prices for finished goods, stiff competition and uncertain power supply are haunting the Textile Industry. The Company could show improvement during this year if the situation changes favourably and the power supply position improves and also the Company is able to get sufficient conversion works. However, finalisation of viable rehabilitation scheme by Hon'ble BIFR and availability of sufficient working capital will enable the company to commence own production with good prospects of profitable working results in the years to come.

7. DIRECTORS

During the year under review there was no change in the Board of Directors.

At this Annual General Meeting, Sri R. Prabakaran is retiring by rotation and he being eligible, offers himself for re-appointment.

8. AUDITORS

The retiring auditors M/s. Elangovan & Natarajan, Chartered Accountants are eligible for re-appointment.

9. COST AUDITORS

a). Name and Address : S. Mahadevan & Co, Cost Accountants No. 112, Sri Abhirami, First Floor, Dr. Radhakrishnan Road, Tatabad Coimbatore - 641 012.

b). Last Date of Submission of Cost Audit Report: 30th September 2011.

c). Actual date of Submission of Cost Audit Report: 26.09.2011

10. DIRECTORS' RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act 1956 as amended by Companies (Amendment) Act, 2000, the Directors of your Company confirm that

a) In the preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures.

b) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Loss of the Company for the year ended on 31.03.2012.

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis.

11. STOCK EXCHANGES

The Company's equity shares are listed at the Bombay Stock Exchange Ltd, Mumbai and Madras Stock Exchange Ltd, Chennai. The Company has been paid Annual Listing Fee to both these Stock Exchanges for the Financial Year 2011-2012.

12. DISCLOSURES

(i) During the year, there were no transactions of material nature with the Directors, Management, Subsidiaries or their relatives etc., that had potential conflict with the interests of the Company at large.

(ii) There were no instances of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchanges or SEBI or any other Statutory Authority on any matter related to the Capital Markets, during the last three years.

13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO.

Information pursuant to Section 217(1)(e) of the Companies Act, 1956 is given in Annexure I and form part of this report.

14. PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration prescribed u/s 217(2A) of the Companies Act, 1956.

15. ACKNOWLEDGMENT

Your Directors wish to thank the employees at all ranks for the co-operation and untiring efforts given for running the Company.

On behalf of the Board

R. PRABAKARAN Managing Director

B. VENKATESAN Director

Place : Attur Date : 11.08.2012

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Mar 31, 2010

The directors have pleasure in submitting the Forty fifth Annual Report together with the Audited Accounts for the year ended 31st March, 2010.

1. FINANCIAL RESULTS

Rs. In Lacs

2009-2010 2008-2009

NET SALES & OTHER INCOME 893.24 706.19

PROFIT / LOSS (- ) BEFORE FINANACIAL 97.59 -123.62

CHARGES AND DEPRECIATION

LESS: FINANCIAL CHARGES 4.73 3.62

DEPRECIATION 39.63 47.99

PROFIT / ( - ) LOSS FOR THE YEAR 53.23 -175.23 LESS /ADD:ADJUSTMENT RELATING TO

PRIOR YEARS - OTHERS 24.24 1.48

BALANCE PROFIT / (- ) LOSS 77.47 -173.75

LOSS BROUGHT FORWARD 10112.97 9939.22

ACCUMULATED LOSS 10035.50 10112.97

2. PERFORMANCE

The turnover for the year under review, mainly conversion charges and other income was Rs. 893.24 Lacs compared to the turnover of Rs.706.19 lacs for the year 2008-09.The Company’s operations resulted in a net profit of Rs. 53.23 Lacs in the year 2009-10 compared to the net loss of Rs.175.23 lacs in the year 2008-09.

Due to non availability of adequate working capital finance, the Company could not have own production, and therefore the Company had to continue taking conversion works to keep the Mill working. However the Company made net profit in the year.

3. DIVIDEND

Due to accumulated losses, your directors are unable to recommend any dividend for the year under review.

4. FINANCIAL POSITION

The Company continues to face critical financial position, due to accumulated loss and the non availability of sufficient working capital funds. The Company has been declared “Sick Industrial Company” by Honb’le BIFR and rehabilitation process is in progress. The Company is hopeful that the Rehabilitation Scheme will be finalized soon and the operations will improve.

5. MANAGEMENT DISCUSSION AND ANALYSIS OF THE OPERATIONS

The management discussed and analysed the operational results for 2009-2010 and critically studied the factors that affected production, sales and profit. The management was satisfied with the efforts taken by the Company in the situation prevailed during the year 2009-10.

6. FUTURE TRENDS

Positive trends are noticed in the Textile Industry and the yarn market is good and improving. The Company will be able to show improvements during the current year, depending on the continuance of positive changes in the Textile Industry and power cut position. However, availability of the sufficient working capital funds and finalization of viable Rehabilitation Scheme are the key factors that are essential for improving the operations in the coming years.

7. DIRECTORS

During the year under review there was no change in the Board of Directors.

At this Annual General Meeting, Sri B. Venkatesan is retiring by rotation and he being eligible, offers himself for re-appointment.

8. AUDITORS

The retiring auditors M/s. Elangovan & Natarajan, Chartered Accountants are eligible for re- appointment.

9 . DIRECTORS RESPONSIBILITY STATEMENT

In compliance of Section 217(2AA) of the Companies Act 1956 as amended by Companies (Amendment) Act 2000, the Directors of your Company confirm that

a) In the preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures.

b) The directors have selected such accounting polices and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give

a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for the year ended on 31.03.2010.

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis.

10. STOCK EXCHANGES

The Company’s equity shares are listed at the Bombay Stock Exchange Ltd, Mumbai and Madras Stock Exchange Ltd, Chennai. The Company has been paid Annual Listing Fee to both these Stock Exchanges for the Financial Year 2009-2010.

11. DISCLOSURES

(i) During the year, there were no transactions of material nature with the Directors, Management, Subsidiaries or their relatives etc., that had potential conflict with the interests of the Company at large.

(ii) There were no instances of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchanges or SEBI or any other Statutory Authority on any matter related to the Capital Markets, during the last three years.

12. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTOIN AND FOREIGN EXCHANGE EARNING AND OUTGO.

Information pursuant to Section 217(1)(e) of the Companies Act, 1956 is given in Annexure I and form part of this report.

13. PARTICULARS OF EMPLOYEES

The Company had no employees during the year who were in receipt of remuneration prescribed u/s 217(2A) of the Companies Act, 1956.

14. ACKNOWLEDGMENT

Your Directors wish to thank the employees at all ranks for the co-operation and untiring efforts given for running the Company.

On behalf of the Board

Place : Attur Date : 07.08.2010 R.PRABAKARAN Managing Director

B.VENKATESAN Director