Corporate Governance Report - The United Basalt Products Ltd
Corporate Governance Report - The United Basalt Products Ltd
Corporate Governance Report - The United Basalt Products Ltd
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Dear Shareholder,<br />
<strong>The</strong> Board of Directors is pleased to present the<br />
Annual <strong>Report</strong> of <strong>The</strong> <strong>United</strong> <strong>Basalt</strong> <strong>Products</strong> <strong>Ltd</strong><br />
for the year ended June 30, 2007, the contents of<br />
which are listed below.<br />
This report was approved by the Board of Directors<br />
on November 19, 2007.<br />
Thierry Lagesse<br />
Chairman<br />
Contents<br />
3<br />
5<br />
6<br />
7<br />
8<br />
10<br />
11<br />
15<br />
20<br />
25<br />
26<br />
27<br />
28<br />
29<br />
31<br />
32<br />
63<br />
Jean-Michel Giraud<br />
Managing Director<br />
Notice of Meeting to Shareholders<br />
<strong>Corporate</strong> Information<br />
Directors’ Profiles<br />
Group Shareholding Structure<br />
Financial Highlights<br />
Value Added Statement<br />
Chairman’s <strong>Report</strong><br />
<strong>Corporate</strong> <strong>Governance</strong> <strong>Report</strong><br />
Other Statutory Disclosures<br />
Certificate from the Company Secretary<br />
<strong>Report</strong> of the Auditors to the Members<br />
Balance Sheets<br />
Income Statements<br />
Statements of Changes in Equity<br />
Cash Flow Statements<br />
Notes to the Financial Statements<br />
Proxy Form
Notice of Meeting to Shareholders<br />
Notice is hereby given that the Annual Meeting of Shareholders of the Company will be held at its registered office,<br />
Trianon, Quatre Bornes, on Friday December 21, 2007 at 15.00 hours for the following purposes:<br />
1. To receive, approve and adopt the Minutes of Proceedings of the preceding Annual Meeting held on<br />
December 27, 2006.<br />
2. To receive, approve and adopt the Audited Financial Statements for the year ended June 30, 2007 and reports<br />
of the Directors thereon.<br />
3. To re-appoint Mr Jean Giraud, aged above 70, to continue to hold office as Director of the Company until the<br />
next Annual Meeting in accordance with sec 138 (6) of the Companies Act 2001.<br />
4. To re-appoint Mr J. Cyril Lagesse, aged above 70, to continue to hold office as Director of the Company until<br />
the next Annual Meeting in accordance with sec 138 (6) of the Companies Act 2001.<br />
5. To appoint as Director of the Company, Mr Jean Claude Maingard who was nominated by the Board and who<br />
offers himself for appointment.<br />
6. To re-appoint Ernst & Young as Auditors for the year ending June 30, 2008 and to authorise the Board of Directors<br />
to fix their remuneration.<br />
By Order of the Board<br />
Christophe Quevauvilliers F.C.C.A.<br />
Company Secretary<br />
November 19, 2007<br />
A member of the Company entitled to attend and vote at this meeting may appoint a proxy<br />
(whether a member or not) to attend and vote on his/her behalf. <strong>The</strong> instrument appointing<br />
a proxy or any general power of attorney shall be deposited at the registered office of the<br />
Company, Trianon, Quatre Bornes, not less than twenty-four hours before the time fixed for<br />
the holding of the meeting or else the instrument of proxy shall not be treated as valid.<br />
A proxy form is included at the end of the Annual <strong>Report</strong> for this purpose.<br />
For the purpose of this Annual Meeting, the Directors have resolved, in compliance with<br />
Section 120(3) of the Companies Act 2001, that the shaholders who are entitled to receive<br />
notice of the meeting and attend such meeting shall be those shareholders whose names<br />
are registered in the share register of the Company as at November 23, 2007.<br />
ANNUAL REPORT 2007
<strong>Corporate</strong> Information<br />
Board of Directors<br />
Thierry Lagesse - Chairman<br />
Jean Paul Adam C.B.E.<br />
François Boullé<br />
Marc Freismuth<br />
Jean Giraud<br />
Jean Michel Giraud<br />
Joël Harel<br />
J. Cyril Lagesse<br />
Alternate : Arnaud Lagesse<br />
Raymond Lagesse<br />
E. Jean Mamet<br />
Audit Committee<br />
E. Jean Mamet - Chairman<br />
François Boullé<br />
Joël Harel<br />
<strong>Corporate</strong> <strong>Governance</strong> Committee<br />
Thierry Lagesse - Chairman<br />
Marc Freismuth<br />
Joël Harel<br />
Managing Director<br />
Jean Michel Giraud<br />
Company Secretary<br />
Christophe Quevauvilliers F.C.C.A.<br />
Auditors<br />
Ernst & Young<br />
Bankers<br />
<strong>The</strong> Mauritius Commercial Bank <strong>Ltd</strong><br />
Barclays Bank PLC<br />
HSBC (Mauritius) <strong>Ltd</strong><br />
State Bank of Mauritius <strong>Ltd</strong><br />
Legal Form<br />
<strong>The</strong> <strong>United</strong> <strong>Basalt</strong> <strong>Products</strong> <strong>Ltd</strong> is a public<br />
company incorporated in Mauritius and<br />
listed on the Stock Exchange of Mauritius<br />
Registered Office<br />
Trianon, Quatre Bornes, Mauritius<br />
ANNUAL REPORT 2007
Directors’ Profiles<br />
Thierry Lagesse Chairman<br />
Mr Thierry Lagesse was appointed Director of the Company in<br />
December 1989 and subsequently Chairman of the Board in<br />
December 2002. Born in 1953, Mr Lagesse holds a ‘Maîtrise des<br />
Sciences de Gestion’ from the University of Paris Dauphine. He has<br />
been the founder and Executive Chairman of the Palmar Group of<br />
Companies for the last twenty-five years, an international textile<br />
and garment manufacturing group. He is also the promoter and<br />
Chairman of both Companhia de Sena, a sugar estate and a sugar<br />
processing and refining factory in Mozambique and Parabole<br />
Réunion SA, a Direct to Home Satellite TV company in the media<br />
and communication fields across the islands of the Indian Ocean.<br />
Mr Lagesse also sits on the Board of several of the major Mauritian<br />
companies and is also the Chairman of Flacq <strong>United</strong> Estates<br />
<strong>Ltd</strong>, Phoenix Beverages <strong>Ltd</strong>, Compagnie Desmem Limitée and<br />
Compagnie d’Investissement et de Developpement Limitée and<br />
Director of Ireland Blyth <strong>Ltd</strong> and Sun Resorts <strong>Ltd</strong>. He is a member of<br />
the Mauritius Chamber of Agriculture and was in 1995, Chairperson<br />
of the Mauritius Export Processing Zone Association.<br />
Jean Paul Adam C.B.E.<br />
Mr Jean Paul Adam was appointed Director of the Company in<br />
June 2001. Born in 1934, Mr Adam is the ex-Chairman and now a<br />
Director of General Construction <strong>Ltd</strong> a well known firm of building<br />
and civil engineering contractors operating in Mauritius for almost<br />
fifty years now. Mr Adam was formerly Chairman of <strong>The</strong> Mauritius<br />
Commercial Bank <strong>Ltd</strong> and of <strong>The</strong> Mauritius Union Assurance Co.<br />
<strong>Ltd</strong>. He also sits on the Board of several Mauritian companies. On<br />
account of his contribution to the construction industry, Mr Adam<br />
was made Commander of the British Empire (C.B.E.) in 1989 and<br />
Grand Officer of the Star and Key of the Indian Ocean (G.O.S.K.)<br />
in 1999. In 1997 he became Chevalier de l’Ordre de St. Grégoire Le<br />
Grand (K.C.S.G.), a title conferred to him by Pope Jean Paul II.<br />
François Boullé<br />
Mr François Boullé was appointed alternate Director to late<br />
Mr Jacques Lagesse in 1998 and full-fledged Director of the<br />
Company in May 2004. Born in 1948, Mr Boullé holds a degree<br />
from the ‘Institut d’Etudes Politiques de Paris (Sciences Po –<br />
Section Economique et Financière). He is currently the Managing<br />
Director of Suchem <strong>Ltd</strong>, a company specialized in importation and<br />
distribution of chemicals for textiles and other industries, plastic<br />
raw-materials and sprayers for agriculture.<br />
Marc Freismuth<br />
Mr Marc Freismuth was appointed Director of the Company<br />
in March 2006. Born in France in 1952, Mr Freismuth holds a<br />
‘Diplôme d’Etudes Supérieures de Sciences Economiques’ from<br />
the University of Panthéon-Sorbonne(Paris). He has been lecturer<br />
at the University of Montpellier up to July 1988 when he decided<br />
to join the University of Mauritius as lecturer in management and<br />
finance up to July 1994. Whilst at this position, Mr Freismuth has<br />
contributed to the setting up of the Stock Exchange of Mauritius<br />
as consultant to the ‘Stock Exchange Commission’ and member of<br />
the ‘Listing Committee’. Mr Freismuth is currently self-employed<br />
as consultant in management and finance. He also sits as Director<br />
on the Board of several public companies.<br />
Jean Giraud<br />
Mr Jean Giraud was appointed Director of the Company in October<br />
1956. Born in 1919, Mr Giraud was one of the founder members<br />
of the Company of which he was the Manager from 1953 to<br />
1984. He has largely contributed to establish the reputation of the<br />
Company over the years and to the participation in most of the<br />
major infrastructure projects of the country.<br />
Jean Michel Giraud<br />
Mr Jean Michel Giraud joined the Company in 1974 and became<br />
General Manager in 1984 succeeding his father at this position.<br />
He was appointed Managing Director in November 2004. Born in<br />
1950, Mr Giraud is the Chairman of Pre-mixed Concrete <strong>Ltd</strong> and<br />
sits on several Boards within the Group. Former President of the<br />
Mauritius Turf Club, he is currently the President of the Mauritius<br />
Tennis Federation.<br />
Joël Harel<br />
Mr Joël Harel was appointed alternate Director to Mr Jean Raymond<br />
Harel in May 2004 and became full-fledged Director of the<br />
Company with effect from July 1, 2006. Born in 1967, Mr Harel<br />
holds a National Higher Diploma in Mechanical Engineering from<br />
Cape Technikon in Cape Town. He is currently the Projects Manager<br />
at Emineo <strong>Ltd</strong>, a newly incorporated company in partnership with<br />
Robert Le Maire <strong>Ltd</strong>, involved in proposing engineering solutions<br />
and in the realisation of projects locally and overseas, mainly in<br />
the sugar sector.<br />
J. Cyril Lagesse<br />
Mr J.Cyril Lagesse was appointed Director of the Company in<br />
November 1958. Well known entrepreneur, Mr Lagesse, born in<br />
1932, took over his father’s business in 1969 (Mon Loisir S.E.) and<br />
set up the ‘Compagnie d’Investissement et de Développement Ltée’<br />
in the early 1970’s, to take advantage of the diverse investment<br />
opportunities that arose, while Mauritius moved towards greater<br />
industrialisation. Since then, the ‘Groupe Mon Loisir’(GML) grew<br />
in size, and is now the major shareholder of several other well<br />
established firms. Mr Lagesse represents GML on the Board of<br />
Directors of several most prestigious Mauritian companies, many<br />
of which are listed on the Stock Exchange of Mauritius. He is also a<br />
former Chairman and Director of the Mauritius Commercial Bank <strong>Ltd</strong>.<br />
Raymond Lagesse<br />
Mr Raymond Lagesse was appointed full-fledged Director of the<br />
Company in replacement of Mr Clément Lagesse in October 2004.<br />
Born in 1958, Mr Lagesse holds a certificate in Technical Road<br />
Transportation and a Diploma in Management. He is currently the<br />
Managing Director of Mechanical Transport Co. <strong>Ltd</strong>, a company<br />
specialized in the Road Haulage Industry. Mr Lagesse also sits on<br />
the Board of several companies in Mauritius and Madagascar.<br />
Arnaud Lagesse<br />
Mr Arnaud Lagesse was appointed alternate Director to Mr J. Cyril<br />
Lagesse in March 1994. Born in 1968, Mr Lagesse holds a<br />
‘Maîtrise de Gestion’ from the University of Aix-Marseille III and<br />
is a Graduate of the ‘Institut Supérieur de Gestion’ from France.<br />
He also completed an Executive Education Program at INSEAD<br />
Fontainebleau, France. He joined the ‘Groupe Mon Loisir’ in 1995<br />
as Finance and Administrative Director, and was appointed as Chief<br />
Executive Officer in August 2005. He participated in the National<br />
<strong>Corporate</strong> <strong>Governance</strong> Committee as a member of the Board of<br />
Directors’ sub committee and sits on the Board of several of the<br />
country’s major companies. Mr Lagesse is an ex-President of the<br />
Mauritius Chamber of Agriculture, the Mauritius Sugar Producers<br />
Association and the Sugar Industry Pension Fund.<br />
E. Jean Mamet<br />
Mr E.Jean Mamet was appointed Director of the Company in November<br />
2004 and is currently the Chairman of the Audit Committee. Born in<br />
1943, Mr Mamet is a fellow member of the Association of Chartered<br />
Certified Accountants. He has been in practice for forty-three years<br />
involved in auditing and consulting services up to 2003 when he<br />
retired as Managing Partner of Ernst & Young Mauritius. He is currently<br />
the Vice Chairman of <strong>The</strong> Mauritius Commercial Bank <strong>Ltd</strong>.<br />
THE UNITED BASALT PRODUCTS LTD<br />
Subsidiaries as at June 30, 2007<br />
100 %<br />
100 %<br />
100 %<br />
100 %<br />
76.5%<br />
100 %<br />
100 %<br />
100 %<br />
100 %<br />
100 %<br />
* Dormant as from July 2007<br />
Marbella Espace Maison Ltée<br />
Cie de Gros Cailloux Ltée<br />
Société d’investissement Rodriguais<br />
UBP International <strong>Ltd</strong><br />
Ste Marie Crushing Plant <strong>Ltd</strong><br />
Société des Petits Cailloux<br />
Marbella <strong>Ltd</strong><br />
Land Reclamation <strong>Ltd</strong><br />
Stone & Bricks Co <strong>Ltd</strong><br />
<strong>The</strong> Stone Masters Co <strong>Ltd</strong><br />
Pricom <strong>Ltd</strong> *<br />
Associates as at June 30, 2007<br />
Operational<br />
Dormant<br />
** Via UBP International <strong>Ltd</strong><br />
THE UNITED BASALT PRODUCTS LTD<br />
Group<br />
Shareholding<br />
Structure<br />
75.9 % Welcome Industries <strong>Ltd</strong><br />
100 % UBP Madagascar<br />
71.7% <strong>United</strong> Granite Product (Pvt) <strong>Ltd</strong><br />
46 % Produits <strong>Basalt</strong>iques du Nord Ltée<br />
34 % Prochimad Mines et Carrières**<br />
30 % Pre-Mixed Concrete <strong>Ltd</strong><br />
30 % Compagnies des Transports Réunis Ltée<br />
25.5 % Highway Properties <strong>Ltd</strong><br />
25 % Sud Concassage Ltée<br />
25 % Cement Transport <strong>Ltd</strong><br />
100 % DHK Metal Crusher (Pvt) <strong>Ltd</strong><br />
100 % Sheffield Trading (Pvt) <strong>Ltd</strong><br />
20 % Compagnie d’Exploitation Agricole Ltée<br />
ANNUAL REPORT 2007 ANNUAL REPORT 2007<br />
7
Financial Highlights<br />
June 30, 2007<br />
THE GROUP<br />
2007 200<br />
Income Statement Rs’000 Rs’000<br />
Revenue 1,404,40 1,355,677<br />
EBITDA 214, 71 214,965<br />
Depreciation and amortisation (111,288) (100,001)<br />
Operating profit 10 ,28 114,964<br />
Net finance costs (7 ,22 ) (50,763)<br />
Share of results of associates 11,748 11,771<br />
Exceptional items 11,2 -<br />
Profit before taxation 0,0 9 75,972<br />
Profit for the year 4,21 60,504<br />
Rs Rs<br />
Earnings per share 1. 4 2.78<br />
Earnings per share excluding exceptional items 1.0 2.78<br />
Dividend per share 1. 0 1.50<br />
2007 200<br />
Balance Sheet Rs’000 Rs’000<br />
Total assets 2,8 8,28 2,160,699<br />
Interest bearing debts 1,011,7 1 870,648<br />
Borrowings excluding bank overdraft 79,0 686,568<br />
Shareholders’ interests 1, 0, 78 929,688<br />
Rs Rs<br />
Net assets value per share 70.18 42.09<br />
Financial Ratios 2007 200<br />
Revaluation<br />
Before After<br />
Operating margin - % 7. 7. 8.48<br />
Interest cover - times 1. 4 1. 4 1.78<br />
Dividend cover - times 1.0 1.0 1.83<br />
Return on equity - % .47 2.28 6.50<br />
Return on assets - % 1.20 1.20 2.84<br />
Debt to equity – times 1.0 0. 0.94<br />
Net Assets per share<br />
80<br />
70<br />
60<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
Shareholders’ Fund<br />
1,600,000<br />
1,400,000<br />
1,200,000<br />
1,000,000<br />
800,000<br />
600,000<br />
400,000<br />
200,000<br />
0<br />
Share Price<br />
43.00<br />
42.00<br />
41.00<br />
40.00<br />
39.00<br />
38.00<br />
37.00<br />
2005<br />
2006 2007<br />
2005 2006 2007<br />
2005 2006 2007<br />
Earnings per share<br />
3.50<br />
3.00<br />
2.50<br />
2.00<br />
1.50<br />
1.00<br />
0.50<br />
0<br />
Dividend per share<br />
2.50<br />
2.00<br />
1.50<br />
1.00<br />
0.50<br />
0<br />
2005 2006 2007<br />
2005<br />
2006 2007<br />
ANNUAL REPORT 2007 ANNUAL REPORT 2007<br />
9
Value Added Statement<br />
Year ended June 30, 2007<br />
10 ANNUAL REPORT 2007<br />
2007 200<br />
Rs’000 Rs’000<br />
Sale of goods and services 1,404,40 1,355,677<br />
Less: Paid to suppliers for materials and services (979,784) (928,348)<br />
Value added 424, 21 427,329<br />
Other operating income 2,192 43,904<br />
Total wealth created 48 ,81 471,233<br />
Distributed as follows:<br />
Members of staff<br />
Salaries and other benefits 214,427 207,838<br />
Providers of capital<br />
Dividends paid to ordinary shareholders ,1 8 33,138<br />
Interest paid on borrowings 101,079 76,981<br />
Dividends paid to minority shareholders 1,271 48<br />
Lease costs 7 1,010<br />
1 ,2 1 111,177<br />
Government and parastatal corporations<br />
Income tax (Current and deferred) 1 ,82 15,468<br />
Environment protection fee , 00 6,770<br />
Licences and permits 1, 2 1,739<br />
2 ,98 23,977<br />
Reinvested in the group to maintain and develop operations<br />
Depreciation and amortisation 111,288 100,001<br />
Retained profit 8 2 28,240<br />
112,1 0 128,241<br />
Total wealth distributed and retained 48 ,81 471,233<br />
Chairman’s <strong>Report</strong><br />
Dear Shareholder,<br />
On behalf of the Board of Directors,<br />
I am pleased to submit to you the<br />
Annual <strong>Report</strong> of <strong>The</strong> <strong>United</strong> <strong>Basalt</strong><br />
<strong>Products</strong> <strong>Ltd</strong> and of the Group for<br />
the year ended June 30, 2007 and<br />
to comment on the operations and<br />
results.<br />
Review of Activities<br />
and Results<br />
Revenue<br />
<strong>The</strong> Group’s revenue for the year<br />
increased by 3.6% over 2006 to reach<br />
Rs 1.4 billion. This slight overall rise<br />
was characterized by a significant<br />
increase in our Espace Maison<br />
activities which was almost fully<br />
compensated by a downward trend<br />
experienced in the market for our<br />
core business products. <strong>The</strong> drop in<br />
our core business activities was mainly<br />
due to the slackening of the private<br />
dwellings market resulting from the<br />
indirect effects of the 2006-2007<br />
national budget’s measures on the<br />
construction industry as well as to the<br />
absence of major public infrastructure<br />
projects, the scarcity of iron bars on<br />
the market and the fierce competition<br />
that prevailed. This drop was to a<br />
slight extent compensated by a better<br />
sales mix in favour of higher margin<br />
products. On the other hand, our<br />
Espace Maison activities maintained<br />
its upward trend, both in terms of<br />
retail store sales and project sales,<br />
namely for hotels and Integrated<br />
Resorts Schemes (I.R.S.) projects. In<br />
fact, unlike in 2006, our three Espace<br />
Maison retail stores were in operation<br />
for the full financial year.<br />
Operating Profit<br />
<strong>The</strong> Group’s operating profit for the<br />
year went down from Rs 114.9 million<br />
in 2006 to Rs 103.2 million this year<br />
after having recognised a provision of<br />
Rs 15 million against trade debtors.<br />
<strong>The</strong> operating profit of the Company<br />
moved from Rs 139.0 million in 2006<br />
to Rs 120.7 million this year. Marbella<br />
Espace Maison Ltée, although not<br />
being profitable yet, showed a<br />
significant improvement during the<br />
year thereby reducing its operating<br />
loss from Rs 29.2 million in 2006 to<br />
Rs 17.2 million this year.<br />
As regards foreign activities, our<br />
subsidiary company in Madagascar<br />
incurred a loss of Rs 10.7 million for<br />
the year (2006 : Rs 0.2 million profit)<br />
due to an unexpected delay in one<br />
project and to production disruption<br />
during April and May 2007 caused by<br />
the transfer of our plant to Tamatave.<br />
In Sri Lanka, our subsidiary company<br />
incurred a loss of Rs 5.6 million for<br />
the year (2006 : Rs 4.6 million) due<br />
to poor market conditions resulting<br />
from the political instability prevailing<br />
there. Consequently, amounts<br />
receivable from our subsidiary in<br />
Sri Lanka appearing in the Company’s<br />
balance sheet were impaired by<br />
Rs 20 million to cover part of the<br />
accumulated losses to date.<br />
Our fully-owned subsidiary, Compagnie<br />
de Gros Cailloux Ltée made a profit<br />
after tax of Rs 8.9 million for the year<br />
(2006 : Rs 12.4 million) after accounting<br />
for the fair value of consumable<br />
biological assets.<br />
Our share of results from associate<br />
companies remained stable at Rs 11.7<br />
million.<br />
<strong>The</strong> Group’s finance costs rose<br />
substantially by Rs 24.1 million<br />
during the year due to an increase in<br />
interest rate and as a result of heavy<br />
borrowings contracted over the past<br />
three years.<br />
Some quoted available-for-sale<br />
investments were realised in June 2007,<br />
thereby generating an exceptional<br />
profit of Rs 11.3 million.<br />
Consequently, the Group’s profit for<br />
the year went down from Rs 60.5<br />
million in 2006 to Rs 34.2 million<br />
this year.<br />
EPS and Dividend<br />
Earnings per share dropped from<br />
Rs 2.78 in 2006 to Rs 1.54 this year.<br />
A dividend of Rs 1.50 per share<br />
(2006 : Rs 1.50) was declared by the<br />
Company on May 23, 2007 and paid<br />
on June 29, 2007.<br />
Financial Situation<br />
Investments in property, plant and<br />
equipment amounted to Rs 191.3<br />
million for the year under review, out<br />
of which Rs 42.3 million was financed<br />
through leasing facilities. Besides<br />
normal recurring expenditure for<br />
the replacement and upgrading of<br />
plant, machinery and equipment for<br />
our core business operations, Rs 50.3<br />
million was incurred for a complete<br />
crushing plant, standing on a plot of<br />
land of sixty-four acres at St Julien,<br />
operating under the name of Pricom<br />
<strong>Ltd</strong> until June 2007 and under UBP<br />
thereafter. Another Rs 30.2 million<br />
was incurred for the acquisition of<br />
some eleven acres of land next to<br />
our site at Geoffroy Road. <strong>The</strong> other<br />
significant group cash outflows made<br />
during the year were an additional<br />
investment of Rs 20.5 million in our<br />
subsidiary company in Sri Lanka to<br />
finance the acquisition of extra quarry<br />
ANNUAL REPORT 2007<br />
11
Chairman’s <strong>Report</strong> (continued)<br />
land and to increase our stake from<br />
60% to 71%, the net refund of term<br />
loans amounting to Rs 33.2 million<br />
and a dividend payment of Rs 33.1<br />
million in June 2007.<br />
As a result of the above, the Group’s<br />
financial situation was adversely<br />
affected. <strong>The</strong> level of borrowings<br />
was further increased during the year<br />
under review, thereby confirming the<br />
trend noted since 2004 as a result of<br />
massive investments made to acquire<br />
Compagnie de Gros Cailloux Ltée and<br />
to finance the Espace Maison expansion<br />
plan besides providing funds for our<br />
operations in Madagascar and Sri<br />
Lanka. Furthermore, a deterioration<br />
of the ratio of cash sales to total sales<br />
was noted during the year.<br />
As mentioned already, some quoted<br />
available-for-sale investment s<br />
were disposed of during the year.<br />
<strong>The</strong> remaining available-for-sale<br />
investments were revalued at the<br />
balance sheet date and gave rise to<br />
a fair value reserve gain of Rs 51.5<br />
million for the year under review. In<br />
view of reducing the Group’s level of<br />
indebtedness and to finance future<br />
capital expenditure, the Board of<br />
Directors intends to pursue the disposal<br />
of a major part of the non-strategic<br />
investments which comprise of the<br />
remaining quoted available-for-sale<br />
investments and the 25.5% stake in<br />
Highway Properties <strong>Ltd</strong>, an associate<br />
company which owns the Trianon<br />
Shopping Park buildings.<br />
On the assets side, the Group’s land<br />
and buildings were revalued at June<br />
30, 2007, giving rise to a revaluation<br />
surplus of Rs 564.0 million, thereby<br />
increasing the Group’s net assets<br />
value (NAV) by Rs 25.53.<br />
Developments<br />
and Projects<br />
Another development achieved<br />
during the year for our core business<br />
activities was the installation of a new<br />
crusher on our plant at La Mecque at a<br />
cost of Rs 15.4 million. Our subsidiary<br />
company Sainte Marie Crushing Plant<br />
<strong>Ltd</strong> at Bel Ombre spent Rs 2.3 million<br />
to upgrade its crushing plant in view<br />
of the on-going hotel and Integrated<br />
Resort Schemes (I.R.S.) projects in the<br />
region. On the foreign front, operating<br />
leases were sought for the acquisition<br />
of drilling equipments, lorries and<br />
excavators needed for the extraction<br />
of boulders on the quarries.<br />
In July 2007, a strategic thinking<br />
exercise was undertaken by the<br />
management and the Board of<br />
Directors to outline the main strategic<br />
objectives for the development of the<br />
Group over the next three years both<br />
locally and overseas and to review, if<br />
need be, the current business model<br />
in the light of new market conditions<br />
and opportunities. In line with this<br />
exercise, and if the market justifies<br />
it, the production of blocks on our<br />
site at St Julien is being planned as<br />
from early 2008. In addition, a new<br />
sales point was set up on a rented<br />
plot of land at Phoenix in an aim<br />
to bring our products closer to the<br />
market. Furthermore, two lorries were<br />
acquired in October 2007 and fitted<br />
with cranes to facilitate the delivery<br />
and handling of blocks on sites<br />
comprising of single-storey buildings<br />
and houses. Last but not least, iron<br />
bars will soon be imported and sold<br />
on a trial basis from all our sites to<br />
meet the needs of our customers.<br />
<strong>The</strong> budget for the current financial<br />
year 2007-2008 provides Rs 6.8<br />
million for the acquisition of a<br />
new crusher for our plant at Plaine<br />
Magnien and Rs 4.4 million for a new<br />
mixer for our subsidiary company,<br />
Sainte Marie Crushing Plant <strong>Ltd</strong>,<br />
thereby enhancing and improving<br />
the capacity and efficiency of our core<br />
business production units. In order<br />
to remedy the increasing constraints<br />
experienced on the availability of<br />
boulders, the budget has made<br />
provision for the replacement and<br />
addition of appropriate equipments<br />
for this purpose. Another major<br />
exceptional capital expenditure to be<br />
provided for during the financial year<br />
2007-2008 and probably the next year,<br />
is the transfer of our crushing plant<br />
of La Mecque to our site at Geoffroy<br />
Road, required since the land owners<br />
have informed us of their intention to<br />
use the site for property development<br />
projects. This move will also imply<br />
the transfer of our PPB concrete slab<br />
factory to our recently acquired plot<br />
of land of eleven acres next to our<br />
site at Geoffroy Road. Given the good<br />
performance achieved by our PPB<br />
division this year and considering the<br />
number of contracts in the pipe-line<br />
for 2007-2008, the PPB factory will be<br />
extended upon its transfer. <strong>The</strong> cost<br />
of these major items of expenditure is<br />
at the time of writing being worked out.<br />
<strong>The</strong> acquisition of land next to our<br />
site at Plaine Magnien which was<br />
mentioned in our previous annual<br />
reports, is still under consideration,<br />
the aim being to enable future plant<br />
expansion or potential industrial and<br />
commercial projects.<br />
As regards our Espace Maison<br />
activities, the three retail stores were in<br />
operation for the full financial year. <strong>The</strong><br />
floor amenities were further improved<br />
with the installation of new racks<br />
whilst our warehouse at Roche-Bois<br />
was extended further. In aiming at<br />
constantly improving the product<br />
range and the service offered to our<br />
customers, some new products were<br />
introduced with a complete after-sales<br />
service. Our purchasing department<br />
is constantly sourcing new products<br />
from Europe and Asia which offer the<br />
best value-for-money ratings. A fidelity<br />
card under the name of ‘V.I.B.’ - ‘Very<br />
Important Bricoleur’, was launched<br />
in July 2006. <strong>The</strong> response noted<br />
was very positive as this card enables<br />
the holder to benefit from discounts,<br />
priority promotions and a whole range<br />
of personalized privileges. As regards<br />
future projects, the Board of Directors<br />
is currently considering the setting up<br />
of new Espace Maison retail stores in<br />
other regions.<br />
Concerning our fully-owned subsidiary<br />
Compagnie de Gros Cailloux Ltée, the<br />
nursery was extended further to satisfy<br />
the supply to our Espace Jardin outlets<br />
and to hotels and Integrated Resort<br />
Schemes (I.R.S.) projects. Regarding<br />
the two land parcelling projects<br />
that were initiated, the agricultural<br />
one has still not materialized whilst<br />
the conversion permit for the<br />
residential one has been obtained.<br />
At the time of writing, the project is<br />
at the shaping phase with the help<br />
of consultants in view of deciding<br />
between two options, namely the<br />
sale of bare plots of land and the<br />
construction of several residential<br />
compounds, making maximum use<br />
of our own building materials and<br />
fittings and engaging several of our<br />
clients involved in the contracting<br />
business. This type of project is part<br />
of our future development strategy<br />
both at Gros Cailloux and elsewhere.<br />
<strong>The</strong> master plan referred to in our<br />
previous annual report was submitted<br />
by the foreign consultant but is still<br />
under consideration. However, we<br />
have received and are objecting to a<br />
notice served under section 6 of the<br />
Land Acquisition Act to permit the<br />
installation of an electrical network on<br />
part of the estate to connect the coal<br />
power plant currently being planned<br />
by CT Power <strong>Ltd</strong> at Pointe-aux-Caves.<br />
Should our objection fail, this project<br />
will most certainly have a significant<br />
negative impact on our current and<br />
future development plans of the estate.<br />
Concerning our new IT system, the<br />
servers and communication network<br />
were upgraded and backed by a<br />
disaster recovery system whilst our<br />
workshop service operations system<br />
was launched in November 2007. <strong>The</strong><br />
computerization of our contracting<br />
services is under way whilst that of<br />
our core business production and<br />
sales units is being planned for 2008.<br />
Outlook<br />
In the light of our results since July<br />
2007 and assuming favourable<br />
economic conditions and the timely<br />
materialization of projects, it seems<br />
that the performance of our core<br />
business activities will be sustained<br />
in the financial year 2007-2008<br />
whilst that of Espace Maison is likely<br />
to improve despite the arrival of<br />
new competitors on the market.<br />
<strong>The</strong> above-mentioned development<br />
projects and new ventures should<br />
impact our turnover and results<br />
positively and contribute to finance<br />
the major plant relocations which lie<br />
ahead of us. On the foreign front, our<br />
subsidiary in Madagascar is on the<br />
way to a positive performance with<br />
many contracts on hand in Tamatave<br />
mainly. As regards our subsidiary in<br />
Sri Lanka, the production capacity<br />
has been increased but our future<br />
results depend on the recovery of the<br />
economy. Furthermore, as mentioned<br />
above the Board intends to pursue<br />
the disposal of major non-strategic<br />
investments which, if crystallised<br />
during the financial year 2007-2008,<br />
should have a material impact on the<br />
net results of the Group.<br />
Appreciation<br />
On behalf of the Board of Directors,<br />
I wish to express my thanks and<br />
appreciation to the Managing<br />
Director and his management team<br />
and personnel for their unrelenting<br />
efforts during the year under review.<br />
I wish to express my gratitude to my<br />
colleagues of the Board of Directors for<br />
their support and their contribution to<br />
the affairs of the Group with special<br />
thanks to Mr Jean Paul Adam who<br />
will resign as Director as from after<br />
the next Annual Meeting after having<br />
served valuably the Company and the<br />
Group since June 2001.<br />
Thierry Lagesse<br />
Chairman<br />
November 19, 2007<br />
12 ANNUAL REPORT 2007<br />
ANNUAL REPORT 2007<br />
1
<strong>Corporate</strong><br />
<strong>Governance</strong> <strong>Report</strong><br />
<strong>The</strong> <strong>United</strong> <strong>Basalt</strong> <strong>Products</strong> <strong>Ltd</strong> is a public company incorporated in<br />
Mauritius since July 1953 and listed on the Stock Exchange of Mauritius. In<br />
December 2004, the shareholders adopted a new Constitution in line with<br />
the provisions of the Companies Act 2001.<br />
Shareholding Structure<br />
<strong>The</strong> detailed shareholding structure is as detailed on page 7 with <strong>The</strong><br />
<strong>United</strong> <strong>Basalt</strong> <strong>Products</strong> <strong>Ltd</strong> having no Ultimate Holding Company. Please<br />
refer to page 21 - Other Statutory Disclosures for the names of common<br />
Directors.<br />
Shareholders<br />
Shareholders holding more than 5% interest in the shares of the Company<br />
at June 30, 2007 were as follows :<br />
Shareholders Number % Amount<br />
of shares Interest Rs<br />
Compagnie d’Investissement<br />
et de Développement Ltée 5,140,206 23.26 51,402,060<br />
Forward Investment and<br />
Development Enterprises <strong>Ltd</strong> 2,088,318 9.45 20,883,180<br />
<strong>The</strong> Company’s shareholding analysis at June 30, 2007 was as follows :<br />
Size of shareholding Number of Number of Percentage<br />
shareholders shares owned (%)<br />
1 – 500 622 123,223 0.56<br />
501 – 1,000 208 161,438 0.73<br />
1,001 – 5,000 535 1,327,489 6.01<br />
5,001 – 10,000 157 1,139,275 5.16<br />
10,001 – 50,000 170 3,531,884 15.99<br />
50,001 – 100,000 28 1,906,956 8.63<br />
100,001 – 250,000 16 2,614,170 11.83<br />
250,001 – 500,000 5 1,932,774 8.75<br />
Over 500,000 5 9,354,493 42.34<br />
Total 1,74 22,091,702 100.00<br />
ANNUAL REPORT 2007<br />
1
<strong>Corporate</strong> <strong>Governance</strong> <strong>Report</strong> (continued)<br />
Category of shareholders Number of Number of Percentage<br />
shareholders shares owned (%)<br />
Individuals 1,554 6,991,517 31.65<br />
Insurance and assurance companies 15 1,708,993 7.74<br />
Pension and provident funds 39 2,399,210 10.86<br />
Investment and trust companies 38 8,008,853 36.25<br />
Other corporate bodies 100 2,983,129 13.50<br />
Total 1,74 22,091,702 100.00<br />
Share Price Information<br />
Please refer to Financial Highlights on page 8 and 9 for indicators and share price movements.<br />
At time of writing the share of the Company is quoted at Rs 42.00 on the Stock Exchange with a Price Earnings Ratio<br />
(PER) of 24.56, a Dividend Yield of 3.57% and a Price to Net Assets Value (NAV) of 0.61.<br />
Dividend Policy<br />
Dividends are paid once yearly in June subject to the solvency test. <strong>The</strong> dividend declared is based on the Company’s<br />
performance, the capital expenditure and the debt servicing requirements, the investment needs and the market<br />
conditions. In so doing, the Board of Directors attempts to distribute a yearly dividend which, under normal circumstances,<br />
should remain sustainable in the medium to long term.<br />
Important Events<br />
Declaration of dividend : May<br />
Payment of dividend : June<br />
Financial year end : June<br />
Annual Meeting of shareholders : December<br />
Directors<br />
<strong>The</strong> Company has a unitary Board composed of ten Directors with an adequate mix of executive, non-executive and<br />
independent non-executive Directors. According to the Constitution, the Board shall consist of a minimum of seven<br />
and a maximum of fifteen Directors. A quorum of five Directors is required for Board meetings.<br />
<strong>The</strong> Directors’ and alternate Directors’ category, other directorships in listed companies and interests in the shares of<br />
the Company were as follows :<br />
Category Other June 30, 2007 June 0, 200<br />
Directorships No. of ordinary shares No. of ordinary shares<br />
Direct Indirect Direct Indirect<br />
Thierry Lagesse - Chairman NICB 6 9 0 20,077 930 20,077<br />
Jean Paul Adam C.B.E. NED - 4 ,002 , 47 51,002 53,082<br />
François Boullé INED - - 9, 7 - -<br />
Marc Freismuth INED 1 - - - -<br />
Jean Giraud INED - ,07 - 5,075 -<br />
Jean Michel Giraud ED - 2, 47 2,10 2,047 2,105<br />
Joël Harel INED - - - - -<br />
J. Cyril Lagesse NED 6 742 - 742 -<br />
Alternate - Arnaud Lagesse NED 5 - 2 , - 23,655<br />
Raymond Lagesse INED - 19, 07 2, 00 1,200 -<br />
E. Jean Mamet INED 2 - 1, 00 - 1,500<br />
ED – Executive Director<br />
NED – Non-Executive Director<br />
INED – Independent Non-Executive Director<br />
NICB – Non-Independent Chairman of the Board<br />
None of the Directors of the Company have a direct interest in the shares of the subsidiary companies.<br />
<strong>The</strong> Directors ensure that they follow the principles of the model code on securities transactions by Directors as detailed<br />
in Appendix 6 of the Mauritius Stock Exchange Listing Rules. Details of Directors’ dealings in shares of the Company<br />
are as depicted on the table above.<br />
Board Committees<br />
Audit Committee<br />
Chairman : E. Jean Mamet<br />
Members : François Boullé<br />
Joël Harel<br />
<strong>The</strong> Audit Committee Charter was approved by the Board of Directors on May 20, 2005. <strong>The</strong> main duty of the<br />
committee is to approve the financial statements before submission to the Board of Directors. <strong>The</strong> Audit Committee also<br />
assists the Board of Directors in carrying out its responsibilities relating to internal control systems and procedures. <strong>The</strong><br />
committee also monitors the role and scope of work of internal and external auditors, including the identification of any<br />
risk areas, and ensure compliance with legal and regulatory provisions and the articles of association. <strong>The</strong> committee<br />
met nine times this year, mainly to review all published financial statements, to fix the terms of reference of the internal<br />
auditor of Marbella Espace Maison Ltée, to review the reports of both internal and external auditors and to assess and<br />
make recommendations to the Board on auditors’ remuneration.<br />
1 ANNUAL REPORT 2007<br />
ANNUAL REPORT 2007<br />
17
<strong>Corporate</strong> <strong>Governance</strong> <strong>Report</strong> (continued)<br />
<strong>The</strong> annual remuneration of the Chairman and of each member of the committee amounts to Rs 60,000 and Rs 40,000<br />
respectively.<br />
<strong>Corporate</strong> <strong>Governance</strong> Committee<br />
Chairman : Thierry Lagesse<br />
Members : Marc Freismuth<br />
Joël Harel<br />
Mr Joël Harel was appointed on July 1, 2006 in replacement of Mr Jean Raymond Harel.<br />
<strong>The</strong> <strong>Corporate</strong> <strong>Governance</strong> Committee is also responsible for Nomination and Remuneration aspects of the Code.<br />
Its main duties are to determine the policy on <strong>Corporate</strong> <strong>Governance</strong> in accordance with the principles of the Code<br />
of <strong>Corporate</strong> <strong>Governance</strong>, to advise and make recommendations to the Board of Directors on all aspects of <strong>Corporate</strong><br />
<strong>Governance</strong> and to report thereon. <strong>The</strong> committee met once during this financial year.<br />
<strong>The</strong> annual remuneration of the Chairman and of each member of the committee amounts to Rs 5,000.<br />
Meetings Attendance Board Audit Committee <strong>Corporate</strong> <strong>Governance</strong><br />
Committee<br />
Thierry Lagesse 10 out of 10 - 1 out of 1<br />
Jean Paul Adam C.B.E. 9 out of 10 - -<br />
François Boullé 9 out of 10 8 out of 9 -<br />
Marc Freismuth 9 out of 10 - 0 out of 1<br />
Jean Giraud 2 out of 10 - -<br />
Jean Michel Giraud 10 out of 10 - -<br />
Joël Harel* 8 out of 10 8 out of 9 1 out of 1<br />
J. Cyril Lagesse 5 out of 10 - -<br />
Raymond Lagesse 10 out of 10 - -<br />
E. Jean Mamet 7 out of 10 9 out of 9 -<br />
* Appointed as Director on July 1, 2006 in replacement of his father Mr Jean Raymond Harel.<br />
Remuneration Philosophy Statement<br />
<strong>The</strong> <strong>Corporate</strong> <strong>Governance</strong> Committee has been delegated to act as Nomination and Remuneration Committee.<br />
As such it is responsible for making recommendations with regard to determining and developing the Company’s<br />
general policy on executive and senior management remuneration, determining specific remuneration packages for<br />
executive Directors of the Company and the level of remuneration of non-executive Directors taking into consideration<br />
the market trend and the Group’s performance.<br />
Please refer to page 22 – Other Statutory Disclosures for a table of total emoluments and benefits received by the<br />
Directors from the Company and subsidiary companies.<br />
Related Party Transactions<br />
Please refer to note 29 on page 57 – Notes to the Financial Statements<br />
Employee Share Option Plan<br />
<strong>The</strong> Company does not have any Employee Share Option Plan.<br />
Key Risks Identification and Management<br />
<strong>The</strong> Directors are ultimately responsible for the adequacy and effectiveness of the internal control system to ensure that<br />
the Company carries on its activities in an orderly manner and in minimisation of all potential risks. In so doing, a firm<br />
of consultants was appointed to carry out a thorough study of the internal control system in place, and to report on<br />
any weaknesses and recommendations thereon. Regular internal audit visits were effected and reported to the Audit<br />
Committee, and ultimately to the Board of Directors. <strong>The</strong>se visits were performed with the assistance of our internal<br />
auditor, the objective being to ensure the effective and efficient use of available resources and ascertaining the accuracy<br />
of information used in the preparation of financial statements.<br />
Financial Risks<br />
Please refer to note 3 on page 43 – Notes to the Financial Statements<br />
Social, Ethical, Safety, Health and Environmental Policies and Practices<br />
<strong>The</strong> policies and practices of the Company in terms of social aid translates mainly into financial assistance to various<br />
school projects and sport federations besides sponsorships to children of employees for school and tertiary training<br />
courses. Amongst these is the André Bazerque primary school at Camp-Levieux, being part of the ‘Zones d’Education<br />
Prioritaire’ (ZEP), is being sponsored since three years now. Marbella Espace Maison Ltée, via its personnel, is also<br />
embarking into a social aid program aimed at sponsoring various projects in the vicinity of each of our Espace Maison<br />
retail stores. At Trianon, books and computers will be donated to the ‘Centre Municipal de Pellegrin’. At Tamarin, we<br />
have supplied products for the renovation of the floor of the ‘Paille en Queue’ day nursery and are sponsoring an art<br />
education program for ‘L’association La Pointe Tamarin’. We are also planning to assist in the renovation of the Village<br />
Hall. At Cottage, Forbach, we are sponsoring the renovation of a primary school and are planning to organise an<br />
initiation program to the Mauritian flora for the pupils of the school.<br />
In terms of safety, health and environmental issues, our policy is to ensure that our production plants are equipped to<br />
run in such a way to minimise causing damage to the environment and that the health and safety of our employees is<br />
not at risk by insisting on the use of protective clothing and accessories and through regular health screen tests.<br />
Donations<br />
Please refer to page 23 – Other Statutory Disclosures for details of donations made during the year.<br />
Christophe Quevauvilliers<br />
Company Secretary<br />
November 19, 2007<br />
18 ANNUAL REPORT 2007<br />
ANNUAL REPORT 2007<br />
19
Other Statutory Disclosures June 30, 2007<br />
(Pursuant to Section 221 of the Companies Act 2001)<br />
Activities<br />
<strong>The</strong> principal activity of the Group remains the manufacture and sale of building<br />
materials which consist mainly of our core products: aggregates, rocksand and hollow<br />
concrete blocks. Other products include precast concrete slabs, various concrete<br />
building components including paving-blocks and roof tiles, imported floor and<br />
wall tiles, sanitary ware and a complete range of home building products, fittings<br />
and tools. Services rendered consist mainly of engineering works by the Company’s<br />
workshop and contracting services.<br />
As from July 2005, all the commercial activity under Espace Maison was transferred<br />
to a separate legal entity, namely Marbella Espace Maison Ltée. For this purpose, the<br />
name of our subsidiary company, Centre Commercial de Trianon Ltée was changed<br />
accordingly before June 30, 2005.<br />
Directors<br />
Members of the Board of Directors at June 30, 2007 were:<br />
THE COMPANy<br />
Messrs: Thierry Lagesse - Chairman<br />
Jean Paul Adam C.B.E.<br />
François Boullé<br />
Marc Freismuth<br />
Jean Giraud<br />
Jean Michel Giraud<br />
Joël Harel – Appointed on July 1, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
J. Cyril Lagesse - alternate : Arnaud Lagesse<br />
Raymond Lagesse<br />
E. Jean Mamet<br />
SUBSIDIARy COMPANIES<br />
Sainte Marie Crushing Plant <strong>Ltd</strong><br />
Messrs: Thierry Lagesse - Chairman<br />
Jean Michel Giraud<br />
Richard Koenig<br />
Raymond Lagesse<br />
Welcome Industries <strong>Ltd</strong><br />
Messrs: Thierry Lagesse - Chairman<br />
Jacques Brousse de Laborde<br />
Jean Michel Giraud<br />
Marbella Espace Maison Ltée<br />
(Formerly known as Centre Commercial<br />
de Trianon Ltée)<br />
Messrs: Jean Michel Giraud - Chairman<br />
Jean Paul Adam C.B.E.<br />
François Boullé<br />
Marc Freismuth – Appointed on<br />
November 27, 2006.<br />
Jean Giraud<br />
Joël Harel – Appointed on November 27, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
J. Cyril Lagesse<br />
Raymond Lagesse<br />
Thierry Lagesse<br />
E. Jean Mamet<br />
Marbella <strong>Ltd</strong><br />
Messrs: Jean Michel Giraud - Chairman<br />
François Boullé<br />
Joël Harel – Appointed on November 1, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
Land Reclamation <strong>Ltd</strong><br />
Messrs: Jean Michel Giraud - Chairman<br />
François Boullé<br />
Jean Giraud<br />
Joël Harel – Appointed on November 1, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
Louis Raoul Harel<br />
In October 2007, Mr Jean Paul Adam<br />
resigned as Director of the Company<br />
effective as from after the next Annual<br />
Meeting and Mr Jean Claude Maingard<br />
was appointed on November 19, 2007<br />
to replace him.<br />
Stone & Bricks Co. <strong>Ltd</strong><br />
Messrs: Jean Michel Giraud - Chairman<br />
Jean Giraud<br />
Joël Harel – Appointed on November 1, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
<strong>The</strong> Stone Masters Co. <strong>Ltd</strong><br />
Messrs: Jean Michel Giraud - Chairman<br />
Jean Giraud<br />
Joël Harel – Appointed on November 1, 2006 in<br />
replacement of his father Mr Jean Raymond Harel.<br />
UBP International <strong>Ltd</strong><br />
Messrs: Thierry Lagesse - Chairman<br />
Jean Michel Giraud<br />
Louis Raoul Harel<br />
UBP Madagascar<br />
Mr: Gino Guness - Manager<br />
<strong>United</strong> Granite <strong>Products</strong> (Pvt.) <strong>Ltd</strong><br />
Messrs: Jean Michel Giraud - Chairman<br />
Joseph Albert<br />
Jacques Brousse de Laborde<br />
A. Mahir Didi<br />
Hussain Saad Hashim<br />
Haresh Karunanayake<br />
Eddy Mancienne<br />
Mohamed Umar Maniku<br />
Mr Haresh Karunanayake resigned in October 2006.<br />
Compagnie de Gros Cailloux Ltée<br />
Messrs: Thierry Lagesse - Chairman<br />
François Boullé<br />
Jacques Brousse de Laborde<br />
Jean Michel Giraud<br />
Joseph Vaudin<br />
Pricom <strong>Ltd</strong><br />
Messrs: Thierry Lagesse - Chairman<br />
Jean Michel Giraud<br />
Joël Harel<br />
20 ANNUAL REPORT 2007<br />
ANNUAL REPORT 2007<br />
21
Other Statutory Disclosures (continued) June 30, 2007<br />
Directors’ Service Contracts<br />
Except for Mr Jean Michel Giraud who has a contract of employment with the Company, there are no service contracts<br />
between the Company and any of the Directors.<br />
Directors’ Remuneration<br />
Total remuneration and benefits received by the Directors from the Company and its subsidiary companies were<br />
as follows:<br />
2007 200<br />
Executive Non- Executive Non-<br />
Executive Executive<br />
Rs’000 Rs’000 Rs’000 Rs’000<br />
<strong>The</strong> Company 4, 78 1,1 4 4,018 566<br />
Subsidiary Companies :<br />
Sainte Marie Crushing Plant <strong>Ltd</strong> - 9 - 60<br />
Welcome Industries <strong>Ltd</strong> - - - -<br />
Marbella Espace Maison Ltée - - - -<br />
Marbella <strong>Ltd</strong> - - - -<br />
Land Reclamation <strong>Ltd</strong> - - - -<br />
Stone & Bricks Co. <strong>Ltd</strong> - - - -<br />
<strong>The</strong> Stone Masters Co. <strong>Ltd</strong> - - - -<br />
UBP International <strong>Ltd</strong> - - - -<br />
UBP Madagascar - - - -<br />
<strong>United</strong> Granite <strong>Products</strong> (Pvt.) <strong>Ltd</strong> - - - -<br />
Compagnie de Gros Cailloux Ltée - - - -<br />
Pricom <strong>Ltd</strong> - - - -<br />
Directors’ Share Interests<br />
Please refer to page 17 – <strong>Corporate</strong> <strong>Governance</strong> <strong>Report</strong><br />
Statement of Directors’ Responsibilities<br />
in respect of the preparation of financial statements and internal control.<br />
<strong>The</strong> Directors are responsible for the proper maintenance of accounting records which disclose at any time, and with<br />
reasonable accuracy, the financial position of the Group and the Company. <strong>The</strong>y are also responsible for safeguarding<br />
the assets of the Group and the Company and for taking reasonable steps to prevent and detect any fraud and other<br />
irregularities.<br />
<strong>The</strong> Directors are also responsible for the preparation and presentation of financial statements for each financial year,<br />
and in so doing they are required to :<br />
• select and apply consistently suitable accounting policies<br />
• comply with the provisions of the Companies Act 2001 and the International Financial <strong>Report</strong>ing Standards (IFRS),<br />
and to explain any departure therefrom<br />
• use the going-concern basis wherever appropriate.<br />
<strong>The</strong> Directors acknowledge that they have exercised their responsibilities as described above for the financial year under<br />
review and report that nothing has been brought to their attention which could indicate any material breakdown in<br />
the internal control systems and cause a material impact on the trading and financial position of the Group and the<br />
Company.<br />
Donations<br />
<strong>The</strong> Company and its subsidiary companies have donated Rs 746,045 during the year ended June 30, 2007 (2006:<br />
Rs 564,081).<br />
Auditors<br />
<strong>The</strong> auditors’ remuneration was as follows:<br />
THE GROUP THE COMPANY<br />
2007 200 2007 200<br />
Rs’000 Rs’000 Rs’000 Rs’000<br />
Audit fees 1,042 817 9 510<br />
Non-audit fees 12 215 107 197<br />
<strong>The</strong> auditors, Ernst & Young, have expressed their willingness to continue in office and a resolution for their reappointment<br />
is being proposed at the Annual Meeting of shareholders.<br />
On behalf of the Board<br />
Thierry Lagesse Jean Michel Giraud<br />
Chairman Managing Director<br />
November 19, 2007<br />
22 ANNUAL REPORT 2007<br />
ANNUAL REPORT 2007<br />
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