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Directors’ Report
Dear Members,
The Board of Directors (Board) presents the Annual Report of Atul Ltd together with the audited Financial Statements for the
year ended March 31, 2017.
01.
Financial results
(
`
cr
)
2016-17
2015-16
Sales
2,639
2,403
Revenue from operations
2,848
2,609
Other income
43
43
Total revenue
2,891
2,652
Profit before tax
400
400
Provision for tax
115
126
Profit for the year
285
274
Balance brought forward
1,145
900
Transfer from Comprehensive Income
3
(2)
Disposable surplus
1,433
1,172
Less:
Dividend paid
30
25
Dividend distribution tax (net)
6
2
Balance carried forward
1,397
1,145
02.
Performance
Sales increased by 10% from
`
2,403 cr to
`
2,639 cr
mainly due to higher volumes (16%), partly offset
by lower prices (6%). Sales in India increased by 3%
from
`
1,198 cr to
`
1,239 cr. Sales outside India
increased by 16% from
`
1,205 cr to
`
1,400 cr.
The Earning per share increased from
`
92.53 to
`
96.18. While the operating profit before working
capital changes increased by 1% from
`
478 cr to
`
485 cr, the net cash flow from operating activities
decreased by 3% from
`
375 cr to
`
364 cr.
Sales of Life Science Chemicals (LSC) Segment
increased by 10% from
`
737 cr to
`
807 cr, mainly
because of higher sales in Sub-segments Crop
Protection and Aromatics - I; its EBIT decreased by
19% from
`
161 cr to
`
130 cr. Sales of Performance
and Other Chemicals (POC) Segment increased by
10% from
`
1,666 cr to
`
1,832 cr mainly because
of higher sales in Sub-segments Aromatics - II and
Polymers; its EBIT increased by 16% from
`
249 cr to
`
290 cr. More details are given in the Management
Discussion and Analysis (MDA) Report.
The borrowings of the Company decreased
(including current maturities of long-term
borrowings) by 49% from
`
302 cr to
`
155 cr
despite payments towards capital expenditure of
`
176 cr.
Credit Analysis and Research Ltd (CARE) maintained
its credit rating at ‘AA+’ (double A plus) for long-term
borrowings of the Company. Its rating for
short-term borrowings and commercial paper
remained at ‘A1+’ (A1 plus), the highest possible
awarded by CARE.
The Company completed 3 expansion projects with
an investment of
`
117 cr which are expected to
generate sales of
`
220 cr at full capacity utilisation.
03.
Dividend
The Board recommends payment of dividend of
`
10 per share on 2,96,61,733 Equity shares of
`
10 each fully paid up. The dividend will entail
an outflow of
`
35.70 cr {including dividend
distribution tax (net)} on the paid-up Equity share
capital of
`
29.66 cr.
04.
Conservation of energy, technology
absorption, foreign exchange earnings
and outgo
Information required under Section 134 (3) (m)
of the Companies Act, 2013, read with Rule 8 (3) of
the Companies (Accounts) Rules, 2014, as amended
from time to time, forms a part of this Report which
is given at page number 24.
05.
Insurance
The Company has taken adequate insurance to cover
the risks to its employees, property (land and buildings),
plant, equipment, other assets and third parties.
06.
Risk Management
Risk Management is an integral part of the business
practices of the Company. The framework of Risk
Management concentrates on formalising a system
to deal with the most relevant risks, building on
existing management practices, knowledge and
structures. With the help of a reputed international
consultancy firm, the Company has developed and