Annual Report 2006-2007 - Gammon India

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Annual Report 2006-2007
10. Foreign currency exposure un-hedged as at 31 st March, 2007 is Rs. 185.39 crores (Previous Year Rs. 84.88 crores) and Rs. 106.89
crores (Previous year Rs. 50.29 crores) payables. The Company does not have any outstanding derivative contracts as at 31.03.07.
(In the previous year, there was one option contract for Rs. 32.33 crores outstanding towards hedging).
11. Sundry Creditors include Rs. Nil (Previous Year Rs. 2.24 crores) due to Vizag Seaport Pvt. Ltd., a Joint Venture Company,
Rs. 2.33 crores (Previous Year Rs. 1.11 crores) due to Gammon Infrastructure Projects Ltd., a subsidiary Company and Rs. 0.16
crores (Previous Year Nil) due to Cochin Bridge Infrastructure Company Ltd., a subsidiary Company.
Sundry Debtors include Rs. 2.27 crores (Previous Year Rs. 4.64 crores) due from Rajahmundry Expressway Ltd., a subsidiary
Company, Rs. 2.15 crores (Previous Year Rs. 2.36 crores) due from Andhra Expressway Ltd., a subsidiary Company and
Rs. 0.99 crores (Previous Year Nil) due from Associated Transrail Structures Ltd., an associate Company.
Loans and Advances include Rs. 9.10 crores (Previous Year Rs. 13.55 crores) due from Gammon & Billimoria Ltd, Rs. 41.00 crores
(Previous Year Nil) due from Gammon Realty Ltd., Rs. 0.04 crores (Previous Year Nil) due from Gammon Cooling Towers Ltd. and
Rs. 0.28 crores (Previous Year Nil) due from Sikkim Hydro Power Ventures Ltd., all subsidiary Companies and Rs. 0.41 crores
(Previous Year Rs. 0.39 crores) due from Vizag Seaport Pvt. Ltd., a Joint Venture Company.
Interest receivables include Rs. 1.15 crores (Previous Year Rs. 0.31 crores) due from Gammon & Billimoria Ltd., Rs. 0.06 crores
due from Gammon Realty Ltd., both subsidiary Companies and Rs. 0.31 crores due from Associated Transrail Structures Ltd., an
associate Company.
Investment includes Rs. 32.84 crores received from Gammon Infrastructure Projects Ltd., on account of deposit for acquisition of
shares.
12. The depreciation for the year is net of write back of depreciation of assets in Oman Branch of the Company. Hitherto, the Company
was charging depreciation on the assets lying in Oman as per the rates specified in the Omani laws, which were higher than the
schedule XIV rates. During the year, Oman branch has changed the method of depreciation to bring it in line with the rates and in
the manner specified in the schedule XIV. The excess depreciation charged during previous years amounting to Rs. 2.68 crores has
been reversed. The effect of the change in method of depreciation for the year is Rs. 2.85 crores. On account of this change in the
method of charging depreciation the profit for the year is higher by Rs. 5.53 crores.
13. MANAGERIAL REMUNERATION:
Particulars
Year
ended
March
2007
(Rs. in Crores)
Period
ended
March
2006
(Rs. in Crores)
Managerial remuneration for Directors included in the Profit and Loss Account comprises:
Salaries, contribution to Provident Fund and Other Funds 1.84 1.90
Commission 0.30 0.00
Sitting fees to Independent Directors 0.00 0.01
Perquisites (at monetary value) 0.02 0.03
Total 2.16 1.94
Computation of remuneration payable to Managing and Whole-time Directors as per
Schedule XIII to the Companies Act, 1956
Profit before taxation as per Profit and Loss Account 143.04 111.17
Add: Directors’ remuneration 2.16 1.94
Directors’ fees 0.00 0.01
Depreciation 35.22 37.10
Loss on sale of assets (net) 0.20 0.06
Less: Depreciation under Section 350 35.22 37.10
Loss on sale of assets (net) – as per Section 350 0.20 0.06
Net Profit under Section 349 of the Companies Act, 1956 145.20 113.12
Managerial Remuneration at 10% thereof 14.52 11.31
14. Work in progress includes Rs. 20 crores pertaining to variation and escalation claims of certain road projects for which the Company
has verdicts of DRB in favour of the Company. These claims however have been disputed by the clients and the clients have
preferred arbitration. The Company contends that based on favourable awards by arbitrator in case of similar claims by other
contractors, favourable verdict is expected to be received in respect of the claims. The Company has however earmarked out of
special contingency reserve an equal amount towards possible awards against the Company following the principles of conservatism
and prudence.