Annual Report 2009/10 - Colombo Stock Exchange

Annual Report 2009/10

Connecting Sri Lanka to Progress 

Sierra Cables PLC - Annual Report 2009/10 

1 

Group Financial Highlights 

2010 2009 Change 

Rs. Rs. % 

Results for the year 

Turnover 1,037,425,535 1,515,318,233 -32 

Profit Before Tax 132,621,176 46,416,006 185 

Profit After Tax 108,148,358 26,342,486 311 

Position at the year end 

Shareholders' Funds 1,383,550,178 1,275,401,820 8.5 

Total Assets 2,079,325,925 1,899,279,345 9.5 

Interest Cover (No. of Times) 2.5 1.2 

ROCE [%] 12 11 

Current Ratio 2.6 : 1 2.5 : 1 

Issued & Fully Paid No. of Shares 537,512,430 537,512,430 

Information per Share 

Earnings 0.20 0.05 

Net Assets 2.60 2.40 

Market Value 2.20 1.1 

Earnings per Share 

Net Assets per Share 

Net Assets 

Rs. 

Rs. 

Rs. Mn. 

0.30 

3.0 

1,600 

0.25 

2.5 

1,400 

1,200 

0.20 

2.0 

1,000 

0.15 

1.5 

800 

0.10 

1.0 

600 

400 

0.05 

0.5 

200 

0.00 

2006 

2007 

2008 

2009 

2010 

0.0 

2006 

2007 

2008 



0 

2006 

2007 

2008 


2010

2 Sierra Cables PLC - Annual Report 2009/10 Connecting Sri Lanka to Progress 

Group Financial Review 

Group Results 

During the year under review the group turnover reflects a growth in 

Tender & Project Business by 22% & 21% respectively. 

Profitability 

The Gross Profit margin of the Group has increased by 6% though the 

Turnover has decreased by 32% over the previous year. This shows 

a better control over the profitability by improvement in production 

efficiencies and cost control. Further 40% decrease in Finance Costs 

and 50% decrease in Energy Costs supported to achieve higher Pre- 

Tax Profit. Earnings per Share shows a remarkable growth over last 

year leading to the increase in net margin from 1.7% to 10.4% during 

the year. Also the Group’s Return on Equity and Return on Assets 

show the better performance. 

Other Income 

Other Income of the Group has increased by 35% due to the disposal 

of significant portion of associate company share during the year 

under review. 

Finance and Growth 

The Group is in a situation to invest in growth projects financing through 

debt in the presence of a low debt equity ratio of 32 : 68 respectively. 

During the year under review the Group diversified to a hydro power 

project which promises an attractive Return on Investment. 

Capital Expenditure 

The Group has incurred Rs.102 million against Capital Expenditure 

which utilized on purchasing new machinery and upgrading of existing 

machinery there by acquiring new technology to meet future demands 

of the industry. 

Taxation 

The Group made an Income Tax provision of Rs.23 million which was 

paid during the year itself through quarterly taxes and withholding 

taxes. Further the Group has paid Rs.121 million to the Government 

by way of Direct Sales Taxes during the year. 

Financial Indicators 

The Group’s Long-term Loans decreased by 24% while Shortterm 

Borrowings including Overdrafts have increased by 16%. 

Shareholders' Funds consist of 65% Stated Capital and 35% Revenue 

Reserves. 

Accounting Policies and Disclosures 

The Accounting Policies of the Group have been reviewed and 

amended where necessary, to comply with the Sri Lanka Accounting 

and Auditing Standards Act No.15 of 1995. 

The Group has adopted the practice of making full disclosure of both 

financial and non-financial information to enable the existing and 

potential shareholders to assess the performance of the Group and 

its future.



3 

Board of Directors 

W.A.P. Perera - Chairman 

Mr. W.A.P. Perera is a founder Director of Sierra Construction (Private) 

Limited and serves as the Chairman & Chief Executive Officer of Sierra 

Cables PLC. He has over 30 years experience in the construction 

industry. 

F.A.W. Irugalbandara 

Mr. F.A.W. Irugalbandara is a founder Director of Sierra Construction 

(Private) Limited and is a Chartered Architect by profession with over 

30 years experience in the construction industry. 

D.N.N. Lokuge 

Mr. D.N.N. Lokuge is a founder Director of Sierra Construction (Private) 

Limited with 30 years experience in the construction industry. 

D.S. Panditha 

Mr. D.S. Panditha is the Executive Director of Sierra Cables PLC. He 

is a member of both the Institute of Incorporated Engineers and the 

Institute of Marketing (SL). He has over 35 years of experience in the 

cable and plastic industry. 

J.H.P. Ratnayake 

Mr. J.H.P. Ratnayake is a Senior Corporate Lawyer who is also the 

precedent partner of Paul Ratnayake Associates, a leading firm in 

Sri Lanka which he founded in 1987 handling all areas of law and 

International Legal Consultancy work. 

Mr. Ratnayake is a Solicitor of England and Wales and an Attorneyat-Law 

of the Supreme Court of Sri Lanka. He has been awarded a 

Masters Degree in Law by the University of London. 

E.A.D.T.B. Perera 

Mr. E.A.D.T.B. Perera is a founder Director of Sierra Construction 

(Private) Limited with 30 years experience in the construction industry. 

Dr. D.G.K.E. Weerapperuma 

Dr. Kamal Weerapperuma is the Managing Director of PE Consultancy 

Services Ltd. Previously, he held the positions of CEO/Director of 

Delmege Forsyth Group, Kelani Cables Ltd., Executive Director of 

Haycarb Ltd. and Research Fellow in Chemical Engineering, Imperial 

College, University of London. 

He served as a Consultant to several industries and banks and also 

served on several public sector committees including those in the 

Ministries of Science and Technology and in the Ministry of Industry. 

Dr. Weerapperuma holds a B.Sc Degree from University of Ceylon, 

M.Sc. and Ph.D. Degree from the UK. He is a Chartered Engineer, UK, 

a Fellow of the Institute of Materials, Mining and Minerals, UK and an 

Alumnus of “Insead”, France. 

R.M.S. Fernando 

Mr. R.M.S. Fernando is the former Secretary to the Ministry 

of Enterprise Development Investment Promotion, Industrial 

Policy and Constitutional Affairs and former CEO and 

Director of National Development Bank of Sri Lanka. 

Mr. Fernando is a Graduate in Law and an Attorney-at-Law. He is 

also a Fellow of the Chartered Institute of Bankers, London, and the 

Chartered Institute of Management Accountants. Mr. Fernando is also 

a companion of the Chartered Institute of Management Accountants, 

London. At present he is Chairman of United Motors PLC., Orient 

Financial Services Corporation Ltd. and Latex Green Ltd. He also 

serves on the Board of several other companies both quoted and nonquoted. 

Currently, Mr. Ratnayake holds directorships in 62 Companies 

of which 08 are Public Quoted Companies. He has also been 

elected/appointed as Chairman/Deputy Chairman to several of 

these companies. He is also Chairman of P.R. Secretarial Services 

(Pvt) Ltd.


Chairman’s Message 

It is with great pleasure that I present the Annual Report of Sierra 

Cables PLC and its Subsidiaries for the year ended 31st March 

2010 and welcome you to the seventh Annual General Meeting. 

I am pleased to report that, after an extremely challenging period, 

the Group as a whole recorded results far exceeding expectations, 

for the year ended 31st March 2010. Viewed in the light of recent 

developments in the macro-economic front, this, I believe, is just a 

glimpse of more exciting things to come. 

In May 2009, the nation reached an unforgettable milestone in its 

history when the 30 year conflict was brought to an end, sparking 

a renewed sense of buoyancy and a revival of investor confidence. 

The economy rebounded in the second-half of 2009, even though 

overall growth clocked in at 3.5%. Financial markets stabilized, 

aided by surplus liquidity arising from a Stand-by-Arrangement IMF 

facility, the issue of a sovereign bond and from foreign inflows into 

government securities. With inflation moderating, monetary policy 

was relaxed, with cut back in policy interest rates. These benefits 

flowed into the overall market interest rate structure. The rate on 

364-day government securities dropped to 9.47% by end March 

2010 compared to 16.63% a year ago while commercial banks’ 

Average Weighted Prime Lending Rate dipped from 18.89% in 

March 2009 to 10.74% in March 2010, easing the financial burden 

of business entities and paving the way for private sector credit 

expansion. 

With foreign reserves strengthening significantly to about USD 

5 billion, Central Bank intervention was witnessed in the exchangerate 

management front, in an effort to curtail appreciation of the 

local currency. The resultant stability in the USD/LKR exchange 

rate, at around Rs.114/-, helped the construction sector to meet 

an important challenge, that of mitigating exposure to risky foreign 

exchange positions. 

to 5.6% in 2009 compared to 7.8% in the previous year. The 

decline in growth reinforces the widespread conviction that there 

is inadequate participation of the private sector in the country’s 

infrastructure development activities. The private sector focus has, 

in the main, been on housing construction. With the slowdown in 

housing construction activities during the year, an overall decline 

was witnessed in industry growth. 

It is therefore with a sense of pride that I report the impressive 

results posted by our group this year. Though top line growth in 

core business activities was illusive, our sales strategy enabled 

us secure comfortable gross profit margins. A concerted effort was 

made to curtail costs. The group also took a strategic decision to 

divest its stake in Central Industries Ltd. All of these measures led 

to commendable gains in the bottom line. 

Group pre-tax profits soared from Rs.46.4 million a year ago to 

Rs.132.6 million this year, a massive growth of 185%, while 

Company pre-tax profits grew from Rs.45.1 million last year to 

Rs.139.9 million this year depicting a growth of 210%. Group posttax 

profits rocketed from Rs.26.3 million a year ago to Rs.108.1 

million this year, a growth exceeding 311%. The Company post-tax 

profits rose by 249% to Rs.136.9 million in comparison to Rs.39.2 

million recorded the previous year. These results enabled the 

Group to build a strengthened Balance Sheet and further enhance 

shareholder value. 

185% 

GROUP 

Profit Before Tax (PBT) 

Profit After Tax (PAT) 

210% 

COMPANY 

The construction industry experienced a year of challenge. Despite 

massive public sector projects, such as road development projects 

and the construction of power plants, industry growth slowed 

311% 

GROUP 

249% 

COMPANY



5 

Chairman’s Message 

From a business standpoint, our confidence remains high as 

the nation is poised on the threshold of an era of unprecedented 

development. With peace now a reality, the government’s focus 

rests on reconstruction and national economic development, 

foremost in the North-East and Southern provinces, as well as 

the re-settlement of the internally displaced persons. Millions 

of dollars are being pledged as development assistance by 

major international donors including the World Bank, the ADB, 

China, India and more recently Japan, to support infrastructure 

development activities, restore essential services and the livelihood 

of people in war-affected areas. These programs offer tremendous 

scope for public-private partnerships. The government’s Eastern 

Province and Northern Province specific programs are aimed at 

revival of abandoned industries and development of new industries 

and comprise a resettlement component and an infrastructure 

development component. Given the large infrastructure gap 

between war affected regions and the rest of the country, the 

private sector could play a crucial role in overall economic revival. 

There are mainly macro challenges in the year ahead. The 

volatility in global financial markets and the Euro-zone debt crisis 

could have a spill-over effect on Sri Lanka. Reconstruction efforts 

and large-scale infrastructure projects, in particular, could be 

challenged by the need to reduce the high fiscal deficit. 

As stated in my previous messages, we at Sierra Cables had 

positioned ourselves to capture the vast opportunities that were 

to manifest with the dawn of peace. We are excited that these 

opportunities have now opened up. Opportunities abound in large 

infrastructure reconstruction projects as well as in resettlement 

programs. From rural electrification, reconstruction of commercial 

buildings and schools, to residential projects, our scope is 

wide. We will strive to maintain our market share as one of the 

undisputed leaders in the industry, by continuing to maintain our 

excellent customer service standards. We remain steadfast in our 

pledge to support the national development effort. 

I would like to take this opportunity to thank my colleagues on the 

Board for their counsel and support. A special word of thanks to the 

Executive Director, the management team and all our employees 

for their dedication and the excellent results posted this year. Our 

clients and business partners are an integral part of our success 

and I express my sincere thanks to all of them. To you, our 

invaluable shareholders, I extend a grateful thank you for the trust 

you have placed in us. 

Priyantha Perera 

Chairman 

Colombo 

04 June 2010


Executive Director’s Review of the Operations 

I present this Annual Report with a great sense of satisfaction at a 

time when our country is recording positive development trends 

with peace and political stability being regained subsequent to the 

historical achievement of defeating terrorism that plagued our country 

for three long decades. The recessionary trends in the global economy 

which were considered to be the worst since the great depression of 

the 1930’s also showed improvement this year and these two factors 

put together helped Sierra Cables to raise its head once more and 

increase profits after the marginal performance during the year that 

ended on 31st March 2009. 

Several macro-economic factors have had a significant impact on the 

cable industry in the country. 

The continuous flow of post war funds to the country for providing 

electricity to the rural areas has energized the Ceylon Electricity 

Board (CEB) to initiating a large number of power utility projects. 

These projects have facilitated cable manufacturers in Sri Lanka to 

strengthen their market presence. More investments have also been 

clearly visible in the construction area especially in the household 

sector. Yet another positive outlook where market openings are clearly 

apparent for industries such as ours, is the opening up of a new era in 

the construction industry where several opportunities are springing up 

for the reconstruction and redevelopment of the northern and eastern 

regions of the country where the infrastructure has been suffered by 

30 years of war. Further, the pledge of 160 million US dollars in loans 

to Sri Lanka from the Asian Development Bank (ADB) for expansion 

and upgrading electricity services, especially to the poor and those 

living in conflict-affected areas will have a constructive and direct 

effect on the cable industry in the country. 

Post-war development that has a direct impact on the Hotel industry. 

Sri Lanka’s hotel owners are racing to refurbish and add thousands 

of more rooms as foreign holidaymakers pour into the country. 

Millions of dollars are expected to be spent by leading hotel groups on 

refurbishment and redecoration for the influx of tourists attracted to our 

dream island where sunshine, beaches and magnificent landscapes 

are plentiful. This new development in the hotel industry has a direct 

impact on the construction industry and this invariably has a significant 

effect on the cable and building material industries. 

To maintain our position in the forefront of the cable industry, we have 

constantly upgraded and strengthened our product quality. This year we 

were granted ISO 9001: 2008 Certification reflecting our commitment to 

quality. Our dedication to our customers, design and customer service 

were amply rewarded and recognized when we achieved awards from 

the Sri Lanka Chamber of Small and Medium 

Industry and the Industrial Excellence Award 

2009 (Large Category - Gold Award). 

We also organized the Excon 2009 

Exhibition, the Annual Construction Fair 

that possessed an international flavour and 

had participation from several overseas 

delegates. 

Our vision goes beyond just what we already came to accomplish 

so far. Whilst maintaining our status-quo as one of the leading cable 

manufacturer in the country, we have been able to raise the bar. This 

year our technical achievements have been many, where we continued 

to innovate to become healthier competitor in the cable market. We 

were able to break the monopoly in the industry with ABC which is 

known as Arial Bundle Cable (ABC). Our In-house developments in 

machineries contributed a lot towards this achievement. 

Customer tailor made solutions enabled us to satisfy our customers 

to a greater extent. Thus Customers such as CEB, LECO has been 

satisfied throughout the years with their requirements. 

During the year under review our company has become an increasingly 

reliable partner in the cable business with sales from tenders alone 

increasing by 22% in comparison to the sales from tenders in the 

previous year in spite of heavy competition from rivals in the market. 

During the past two years the company has also encouraged the Sales 

Reps that are spread around different regions of the country to search 

for construction projects in their regions. Company’s continuous 

encouragement & Sales Reps commitment shows increasing project 

sales through direct Reps by 21% this year when compared to the 

sales in the previous year. Figure 1 shows the total sales fluctuations 

in last 5 financial years. 

Millions 

1,600 

1,400 

1,200 

1,000 

800 

600 

400 

200 

0 

2005 2006 2007 2008 2009 2010 

Figure 1 

With the company’s strong growth outlook and focus on profits our 

profits increased by 4 times when compared to the previous year 

even though the sales dropped by 32% during the same period. This 

demonstrates the positive effects of the company’s strategic move 

towards more profit making areas such as tenders and projects. 

Figure 2 shows the profitability boost in the financial year 2009/10 

compared to the previous year. 

The profit increase is even more significant in the light of increasing 

raw material prices. In the financial year 2008/09 the price of copper 

decreased by 57%, aluminium by 55% and PVC by 30%. In strong 

contrast to these decreases this year we witnessed an increase in the 

price of copper by 55%, aluminium by 44% and that of PVC by 20%. 

Figure 3 provides the evidence for that.



7 

Executive Director’s Review of the Operations 

The factory recorded an average capacity increase of 30% to 40% in 

the 2009/10 financial year compared to the financial year 2008/09. 

Total material consumption also increased by 21% in line with the 

capacity growth. 

With the installation of sophisticated machinery at the plant as well 

as the development of machinery in-house notable savings were 

achieved. The electricity consumption decreased by 31%, whilst the 

key ratio which is KWH per KG reduced from 0.78 to 0.61, which is a 

22% reduction. Figure 4 shows the annual reduction in the ratio from 

the year 2005 to 2010 

This year also saw an expanded phase of engagement with our 

stakeholders, the community and our employees proving that we are 

a socially responsible partner in the national business community. 

Our corporate vision guided our decisions and we continued being 

a significant member of the local society bearing fully in mind that we 

have to contribute towards the needs of the future generation. Our 

contributions to the society at large included building a house for a 

deprived family in the village, organizing the annual cricket tournament 

between two leading schools in the area, bearing the total cost of 

wiring a Buddhist temple in the village, introducing dress codes to the 

children who attend Sunday school in the village temple, providing 

wires and bulbs for lighting the roads during the wesak season and 

donating books to the children of the village. We also accommodated 

in plant trainees in our factory and increased the employee cadre by 

5% so as to provide job opportunities to the people who are living in 

the village where the factory is situated. 

Together with my team I look forward to your continued support as we 

journey together to grow and expand your company whilst maintaining 

the excellent market position we have been able to achieve during 

the year. 

I take this opportunity to convey my sincere appreciation to my 

colleagues on the Board who have at all times provided immense 

support and direction to raise your company to what it is today. To our 

shareholders, customers, suppliers, bankers and all our employees 

I say thank you for the confidence you have placed in us. Looking 

forward to 2010 and beyond, we assure you, our shareholders that we 

will remain focused on continued progress as a socially responsible 

company striving for continuous improvement in everything we do. 

Millions 

140 

120 

100 

80 

60 

40 

20 

0 

8,000 

7,000 

6,000 

5,000 

4,000 

3,000 

2,000 

1,000 

0 

Figure 2 

Apr-09 

May-09 

Jun-09 

Jul-09 

Aug-09 

Sep-09 

Oct-09 

Nov-09 

Dec-09 

Jan-10 

Feb-10 

Mar-10 

PVC Average Price Copper Average LME Aluminium Average LME 

Figure 3 

Figure 4 

D. Shamendra Panditha 

Executive Director 



Report of the Board of Directors 

on the Affairs of the Company 

The Directors of Sierra Cables PLC, have pleasure in submitting their 

report together with the audited Financial Statements of the Company 

for the year ended 31st March 2010 and the Auditors’ Report thereon. 

Review of Performance for the year ended 

31st March 2010 

The operations of the Company for the year ended 31st March 2010 

are reviewed in the Chairman’s Report. 

Principal Activities 

Sierra Cables PLC is the Holding Company of Alucop Cables Limited, 

Alucop Marketing (Private) Limited and Sierra Engineering and 

Construction (Private) Limited who carry out the operational aspects 

of manufacturing and marketing of cables. 

Financial Statements 

The Financial Statements of the Company are given in pages 

18 to 37. 

Finanacial Results 

GROUP 

COMPANY 

2010 2009 2010 2009 

Rs. Rs. Rs. Rs. 

Turnover 1,037,425,535 1,515,318,233 - - 

Cost of Sales (817,053,329) (1,284,599,262) - - 

Gross Profit 220,372,206 230,718,971 - - 

Other Income 64,417,258 47,802,929 155,183,514 65,525,182 

Selling & Distribution (56,318,845) (61,420,995) - - 

Administrative Expenses (48,453,881) (57.086,420) (10,101,303) (19,950,478 

Other Operating Expenses - - (5,000,000) - 

Operating Profit 180,016,738 160,014,485 140,082,211 45,574,704 

Finance Expenses (71,730,063) (134,233,405) (207,821) (419,817) 

Profit Before Associate Company’s Share of Profit 108,286,675 25,781,080 139,874,390 45,154,887 

Share of Profit of Associate Company (Net of Income Tax) 24,334,501 20,634,926 - - 

Profit Before Taxation 132,621,176 46,416,006 139,874,390 45,154,887 

Income Tax Expenses (24,472,818) (20,073,520) (2,908,373) (5,942,048) 

Profit for the year 108,148,358 26,342,486 136,966,017 39,212,839 

Earning Per Share 0.20 0.05 0.25 0.07 

Dividend Per Share - 0.06 - 0.06



9 



Auditors' Report 

The Auditors' Report on the Financial Statements is given in page 17. 

Accounting Policies 

The Accounting Policies adopted in the preparation of Financial 

Statements are given on pages 22 to 25. There were no material 

changes in the Accounting Policies adopted. 

Interest Register 

The Company maintains an Interest Register as required by the 

Companies Act No.07 of 2007. The information pertaining to Directors 

interest in contracts and their share ownership are disclosed in the 

Interest Register. 

Directors’ Remuneration and Other Benefits 

Directors’ remuneration in respect of the Company for the financial 

year ended 31st March 2010 is given in Note 27 to the financial 

statements. 

Property, Plant and Equipment 

Any analysis of the Property, Plant and Equipment of the Company is 

set out in Note 8 to the accounts on page 28. 

Directors 

The Directors of the Company for the year under review were as 

follows: 

Mr. W. A. P. Perera (Chairman) 

Mr. F. A. W. Irugalbandara 

(Director and Alternate Director to W. A. P. Perera) 

Mr. D. N. N. Lokuge 

(Director and Alternate Director to D. S. Panditha) 

Mr. E. A. D. T. B. Perera 

Mr. D. S. Panditha 

Mr. J. H. P. Ratnayeke 

Mr. R. M. S. Fernando 

Dr. D. G. K. E. Weerapperuma 

Ms. K. A. Suraweera 

(Alternate Director to E. A. D. T. B. Perera) 

Ms. G. S. M. Irugalbandara 

(Alternate Director to F. A. W. Irugalbandara) 

Investments 

Details of investments held by the Company are disclosed in Note 9 to 

the accounts on page 30. 

.Directors’ Interest in Shares of the Company 

Names of Director As at As at 

31/03/2010 31/03/2009 

Mr. W. A. P. Perera 3,920,510 3,920,510 

Mr. D. S. Panditha 16,572,250 16,972,250 

Mr. F. A. W. Irugalbandara 10 10 

Mr. E. A. D. T. B. Perera 10 10 

Mr. R. M. S. Fernando NIL NIL 

Ms. G. S. M. Irugalbandara (Alternate Director to F. A. W. Irugalbandara) 1,709,800 1,709,800 

Mr. D. N. N. Lokuge 10 10 

Mr. J. H. P. Ratnayake NIL NIL 

Dr. D. G. K. E. Weerapperuma NIL NIL 

Ms. K. A. Suraweera (Alternate Director to E. A. D. T. B. Perera) NIL NIL 

Retirement by Rotation 

Mr. E. A. D. T. B. Perera and Mr. D. S. Panditha retires by rotation 

in accordance with Article 91 of the Articles of Association of the 

Company and being eligible, offer themselves for re-election. 

Donations 

There were no donations made by the Company during the period 

under review.

10 Sierra Cables PLC - Annual Report 2009/10 Connecting Sri Lanka to Progress 



Shareholders 

The distribution and analysis of shareholdings as at 31st March 2010: 

Resident 

Non - Resident 

No. of No. of No. of No. of 

From To Shareholders Shares % Shareholders Shares % 

1 - 1,000 20,013 19,537,988 3.63 04 3,200 0.00 

1,001 - 10,000 8,469 16,540,560 3.08 21 115,400 0.02 

10,001 - 100,000 917 29,918,600 5.57 12 594,300 0.11 

100,001 - 1,000,000 190 50,198,100 9.34 18 7,749,400 1.44 

over 1,000,000 21 392,969,882 73.11 04 19,885,000 3.70 

Total 29,610 509,165,130 94.73 59 28,347,300 5.27 

No. of No. of 

Analysis of Shareholders Shareholders Shares % 

Resident 29,610 509,165,130 94.73 

Non-resident 59 28,347,300 05.27 

Total 29,669 537,512,430 100.0 

No. of No. of 

Analysis of Shareholders Shareholders Shares % 

Individual 29,318 154,129,412 28.67 

Institutional 351 383,383,018 71.33 

Total 29,669 537,512,430 100.0 

20 Largest Holders of Equity 

No. of % of No. of % of 

Names of Shareholder Shares as of Issued Shares as of Issued 

31-03-10 Capital 31-03-09 Capital 

1. Sierra Holdings (Private) Limited 312,335,490 58.11 312,335,490 58.11 

2. Mr. Daya Shamendra Panditha 16,572,250 03.08 16,972,250 03.16 

3. Seylan Bank Limited/S. V. Somasundaram 14,500,000 02.70 14,491,200 02.70 

4. Mr. Tarik Al-Nakib 12,592,700 02.34 12,592,700 02.34 

5. First Capital Markets Ltd/Nextventures Ltd 6,659,700 01.24 - - 

6. DPMC Financial Services (Private) Limited – A/C No. 1 4,632,968 00.86 3,746,668 00.70 

7. Mr. Abeyratna Banda Sarath Herath 4,615,000 00.86 5,000,000 00.93 

8. Employees' Provident Fund 4,417,600 00.82 3,911,500 00.73 

9. Mr. Bamunu Arachchige Mahipala 4,359,100 00.81 4,359,100 00.81 

10. Mr. Wahalathanthirige Anil Priyantha Perera 3,920,510 00.73 3,920,510 00.73 

11. Tranz Dominion, L.L.C 3,500,000 00.65 2,800,000 00.52 

12. Islamic Gold DMCC 2,770,700 00.52 2,770,700 00.52 

13. National Savings Bank 2,739,000 00.51 2,739,000 00.51 

14. Waldock Mackenzie Ltd/Mr. A. H. Udeshi 2,474,700 00.46 - - 

15. Nexus Nubart Holdings (Pvt) Ltd 2,000,000 00.37 2,000,000 00.37 

16. Mr. Kgendran Perumal 2,000,000 00.37 2,000,000 00.37 

17. Waldock Mackenzie Ltd/Hi-Link Towers (Pvt) Ltd 1,750,000 00.33 - - 

18. Mr. Yonmerenne Simon Hewage Indra Kumara Silva 1,746,367 00.32 - - 

19. Ms. Genevive Sujivie Madhuni Irugalbandara 1,709,800 00.32 1,709,800 00.32 

20. J. B. Cocoshell (Pvt) Ltd 1,574,400 00.29 1,574,400 00.29 

Total 406,870,282 75.70 392,922,418 73.11



11 



Auditors 

The accounts for the year ended 31st March 2010 have been 

audited by Messrs. KPMG Ford, Rhodes, Thornton & Co, Chartered 

Accountants, who offer themselves for re-appointment. In accordance 

with the Companies Act No. 07 of 2007 a resolution relating to their 

re-appointment and authorizing the Directors to determine their 

remuneration will be proposed at the forthcoming Annual General 

Meeting. 

The Auditors Messrs. KPMG, Ford, Rhodes, Thornton & Co., Chartered 

Accountants were paid Rs.215,000 (2008/2009 - Rs.198,000) as audit 

fees by the company. In addition they were paid Rs.7,500 (2008/2009 

- Rs. 65,000) by the company for audit related work. 

As far as the Directors are aware the Auditors do not have any 

relationship (other than that of an Auditor) with the Company other 

than those disclosed above. The Auditors also do not have any 

interest in the Company. 

Corporate Governance 

Non-Executive Independent Directors of the Company are: 



Audit Committee 

Mr. R. M. S. Fernando (Chairman) 


Remuneration Committee 

Dr. D. G. K. E. Weerapperuma (Chairman) 


On Behalf of the Board 

Capital Commitments 

No material financial commitments were outstanding as at 31st March 

2010. 

Contingent Liabilities 

There were no material contingent liabilities outstanding as at 

31st March 2010. 

Post Balance Sheet Events 

No circumstances have arisen since the Balance Sheet date, which 

require adjustments to or disclosure in the accounts. 


Director 

(Sgd.) 

D.S. Panditha 

Director 

P.R. SECRETARIAL SERVICES (PRIVATE) LIMITED 




Corporate Governance 

Today’s corporations operate in an environment of intense investor, 

regulatory and public scrutiny. The financial scandals of recent past 

have created a significantly more constrained regulatory environment. 

At the same time, increasing public and stakeholder concern about 

the social and environmental impacts of business practices is forcing 

companies to come to terms with a much broader set of interests and 

expectations. 

In this report Sierra Cables outline the Corporate Governance 

processes and activities for the financial year 2009/10 with reference 

to the code of best practice of the Institute of Chartered Accountants, 

the requirement of the Securities and Exchange Commission and the 

Colombo Stock Exchange. 

In addition to complying with the statutory requirements, effective 

governance systems and practices towards improving transparency, 

disclosure, internal control and ethics at workplace has been 

institutionalized. 

Sierra Cables recognizes that good Corporate Governance is a 

continuing exercise and reiterates its commitment to pursue highest 

standards of Corporate Governance in the overall interest of all stake 

holders. 

Board of Directors 

The current Board comprises of 8 Directors out of whom 7 are Non- 

Executive Directors. The core responsibility of the Directors is to 

exercise their judgment to act in what they reasonably believe to be 

in the best interest of the company. To ensure the efficient discharge 

of its responsibilities the board has established a Audit Committee. 

Board Meetings 

Regular Board Meetings are scheduled once in two months to consider 

among other matters, the performance and Financial Statements for 

the period and to approve routine capital expenditure. Special Board 

Meetings are held as and when required to discuss urgent matters. 

Audit Committee 

The Audit Committee is responsible for monitoring integrity of Financial 

Statements of the company by ensuring compliance with relevant 

financial reporting regulations and requirements. 

The Board had appointed an Audit Committee consisting of two Non- 

Executive Independent Directors. 

The names of the members of the Audit Committee are as follows: 

Mr. R.M.S. Fernando (Chairman) 

Dr. D.G.K.E. Weerapperuma 

The terms of reference defines the role of the Audit Committee 

and provides a framework of the company’s organization and 

responsibilities. The terms of reference has been approved by the 

Board. The committee comprises of 2 Non-Executive, Independent 

Directors. The meetings are attended by the Executive Director, and 

Chief Financial Officer by invitation and other Directors and Executives 

also do so as and when required. 

The Audit Committee examines any matters relating to the Financial 

Reporting System of the company and external and internal audits 

of the company. It also reviews the overall adequacy of the systems 

for compliance with legal, regulatory and ethical requirements as well. 

The committee met on 3 occasions during the year. The Company’s 

Annual and Interim Financial Statements were reviewed and approved 

by the Audit Committee prior to the final approval by the Board before 

there issuance. 

The Audit Committee has recommended to the Board of Directors that 

Messers KPMG Ford Rhodes Thornton and Co., be re-appointed as 

Auditors for the year ending 31st March 2010 subject to the approval 

of the Shareholders at the next Annual General Meeting. 

Remuneration Committee 

The Remuneration Committee is represented by 2 Non-Executive 

Independent Directors who meet when required to review remuneration 

of Senior Management. 

The names of the members of the Remuneration Committee are as 

follows: 

Dr. D. G. K. E. Weerapperuma (Chairman) 


Compliance Report 

The Directors confirm that to the best of their knowledge all taxes and 

duties payable by the company and all contributions, levies, and taxes 

payable on behalf of and in respect of the employees of the company 

and all other known statutory dues payable as at the Balance Sheet 

date has been paid or provided for in the accounts.



13 

Statement of Directors’ Responsibility 

The responsibility of the directors in relation to the Financial Statements 

is set out in the following statement. The responsibility of the auditors, 

in relation to the Financial Statements prepared in accordance with 

the provision of the Companies Act No. 07 of 2007, is set out in the 

Report of the Auditors. 

The Financial Statements comprise of: 

• A Balance Sheet, which presents a true and fair view of the 

state of affairs of the company and its subsidiaries as at the 

end of the financial year and 

• An Income Statement, which presents a true and fair view of 

the profit and loss of the company and its subsidiaries for the 

financial year, which comply with the requirements of the act. 

The Directors are required to ensure that, in preparing these Financial 

Statements: 

• The appropriate Accounting Policies have been selected and 

applied in consistent manner and material departures, if any, 

have been disclosed and explained; 

• All applicable Accounting Standards, as relevant, have been 

followed; 

• Judgements and estimates have been made which are 

reasonable and prudent. 

The Directors are also responsible for taking reasonable steps to 

safeguard the assets of the company and of the group and in this 

regard to give proper consideration to the establishment of appropriate 

internal control systems with a view to preventing and detecting fraud 

and other irregularities. 

The Directors are required to prepare the Financial Statements and to 

provide the auditors with every opportunity to take whatever steps and 

undertake whatever inspections they may consider to be appropriate 

to enable them to give their independent audit opinion. 

The Directors are of the view that they have discharged their 

responsibilities as set out in this statement. 

By Order of the Board 

P.R. Secretarial Services (Private) Limited 

Secretaries 

04 June 2010 

The Directors are also required to ensure that the company has 

adequate resources to continue in operation to justify applying the 

going concern basis in preparing these Financial Statements. 

Further, the directors have a responsibility to ensure that the company 

maintains sufficient accounting records to disclose, with reasonable 

accuracy the financial position of the company and of the group, and 

to ensure that the Financial Statements presented comply with the 

requirements of the act.


Group Chief Executive's 

and Group Chief Financial Officer's Declaration 

The Financial Statements have been prepared in compliance with the 

Sri Lanka Accounting Standards issued by the Institute of Chartered 

Accountants of Sri Lanka as per the requirements of the Companies 

Act No. 07 of 2007, and any other applicable statutes to the extent 

applicable to the Company and the Group. There are no departures 

from the prescribed accounting standards in their adoption. To the best 

of our knowledge, the Accounting Policies used in the preparation of 

the Financial Statements are appropriate and are consistently applied 

unless otherwise stated in the notes accompanying the Financial 

Statements. 

We the Group Chief Executive and Group Chief Financial Officer 

accept responsibility for the integrity and objectivity of these Financial 

Statements. The estimates and judgments relating to the Financial 

Statements were made on a prudent and responsible basis after 

making all reasonable enquiries in order that the Financial Statements 

reflect in a true and fair view, the form and substance of transactions, 

and reasonably present the company and the Group's state of affairs. 

To ensure this, Sierra Cable PLC, has taken proper and sufficient care 

in implementing a system of internal control and accounting records, 

for the safeguarding of assets, and preventing and detecting of fraud 

as well as other irregularities. Internal controls are reviewed, evaluated 

and updated on an ongoing basis and effective functioning of Board 

Audit Committee ensures that the internal controls and procedures are 

followed consistently. 

The Financial Statements were audited by Messrs. KPMG Ford, 

Rhodes, Thornton & Co, Chartered Accountants, the Independent 

Auditors. 

The Company's Board Audit Committee meets periodically with 

the Independent Auditors to review the manner in which they are 

performing their responsibilities, adherence to statutory and regulatory 

requirements, and to discuss auditing, internal control and Financial 

reporting issues. To ensure complete independence, the independent 

auditors have full and free access to the members of the Board Audit 

Committee to discuss any maters of substance. 

It is also declared and confirmed that after making all reasonable 

enquiries and to the best of our knowledge the Company and the 

Group has compiled with, and ensured compliance by the auditors with 

the guidelines for the audit of Listed Companies wherever mandatory 

compliance is required. It is further confirmed that all other guidelines 

have been complied with. 

We confirm that the Company and the Group have compiled with all 

applicable laws, regulations, and guidelines and there are no material 

litigation against the Group other than those disclosed in the Notes to 

the Financial Statements of the Annual Report. 

We also confirm that to the best of our knowledge all taxes, duties, 

levies and all statutory payments by the Company and the Group and 

all contributions, levies and taxes payable on behalf of and in respect 

of the employees of the Company and the Group as at the Balance 

Sheet date have been paid, or where relevant provided for. 

D.S. Panditha 

Executive Director 

Ms. Lalanthi Y. De Silva 

Chief Financial Officer

Financial Reports 

2009/10 

17 

Independent Auditor’s Report 

18 

Income Statement 

19 

Balance Sheet 

20 

Statement in Change in Equity 

21 

Cash Flow Statement 

22 

Significant Accounting Policies 

26 

Notes to the Financial Statements



17 

Independent Auditor’s Report 

KPMG Ford, Rhodes, Thornton & Co. Tel : +94-11 242 6426 

(Chartered Accountants) +94-11 542 6426 

32A, Sir Mohamed Macan Markar Mawatha, Fax : +94-11 244 5872 

P. O. Box 186, +94-11 244 6058 

Colombo 00300, +94-11 254 1249 

Sri Lanka. +94-11 230 7345 

Internet : www.lk.kpmg.com 

TO THE SHAREHOLDERS OF SIERRA CABLES PLC 

Report on the Financial Statements 

We have audited the accompanying financial statements of Sierra 

Cables PLC, the Consolidated Financial Statements of the Company 

and its subsidiaries as at March 31, 2010 which comprise the Balance 

Sheet as at March 31, 2010, and the Income Statement, Statement 

of Changes in Equity and Cash Flow Statement for the year then 

ended, and a summary of Significant Accounting Policies and other 

explanatory notes, as set out on page 18 to 37. 

Management’s Responsibility for the Financial Statements 

Management is responsible for the preparation and fair presentation of 

these Financial Statements in accordance with Sri Lanka Accounting 

Standards. This responsibility includes: designing, implementing 

and maintaining internal control relevant to the preparation and fair 

presentation of Financial Statements that are free from material 

misstatement, whether due to fraud or error; selecting and applying 

appropriate Accounting Policies; and making accounting estimates 

that are reasonable in the circumstances. 

Scope of Audit and Basis of Opinion 

Our responsibility is to express an opinion on these Financial 

Statements based on our audit. We conducted our audit in accordance 

with Sri Lanka Auditing Standards. Those standards require that we 

plan and perform the audit to obtain reasonable assurance whether 

the Financial Statements are free from material misstatement. 

An audit includes examining, on a test basis, evidence supporting 

the amounts and disclosures in the Financial Statements. An audit 

also includes assessing the Accounting Policies used and significant 

estimates made by management, as well as evaluating the overall 

Financial Statement presentation. 

We have obtained all the information and explanations which to the 

best of our knowledge and belief were necessary for the purposes of 

our audit. We therefore believe that our audit provides a reasonable 

basis for our opinion. 

Opinion - Company 

In our opinion, so far as appears from our examination, the Company 

maintained proper accounting records for the year ended March 31, 

2010 and the Financial Statements give a true and fair view of the 

Company’s state of affairs as at March 31, 2010 and its profit and cash 

flows for the year then ended in accordance with Sri Lanka Accounting 

Standards. 

Opinion – Group 

The investment in associate company, Central Industries PLC, which 

was disposed in part during the year, has been accounted for under 

equity method up to the disposal, as explained in Note 9.2.a to the 

Financial Statements, based on the un audited Financial Statements 

of the Associate Company. Consequently, we are unable to satisfy 

ourselves on accuracy of the amount of the share of profits of the 

Associate, the profit on disposal of the part investment included in the 

Consolidated Income Statement for the year ended 31 March 2010, 

the amount of the balance investment transferred to other Long-term 

investments and the retained earnings as at Balance Sheet date. 

In our opinion, except for the effect of such adjustments, if any, as 

might have been determined to be necessary due to the matter stated 

above, the Consolidated Financial Statements give a true and fair 

view of the state of affairs as at March 31, 2010 and the Profit and 

Cash Flows for the year then ended, in accordance with Sri Lanka 

Accounting Standards, of the Company and its subsidiaries dealt with 

thereby, so far as concerns the shareholders of the Company. 

Emphasis of Matter 

Without further qualifying our opinion, we draw attention to note 21 to 

the consolidated Financial Statements giving reference to the state 

of the subsidiary company, Alucop Marketing (Private) Limited With 

net loss for the year ended 31 March 2010, as of that date carried 

an accumulated loss, net liability and Adverse net current liability 

positions, further, the subsidiary’s net assets are less than half of the 

stated Capital resulting in a serious loss of capital situation in terms 

of Section 220 of the Companies Act No.07 Of 2007.These factors 

raise substantial doubt that the subsidiary will be able to continue as 

a going Concern. 

Report on Other Legal and Regulatory Requirements 

These Financial Statements also comply with the requirements of 

Sections 153(2) to 153(7) of the Companies Act No. 07 of 2007. 

Chartered Accountants 



KPMG Ford, Rhodes, Thornton & Co., a Sri Lankan Partnership 

and a member firm of the KPMG network of independent 

member firm affiliated with KPMG International, a Swiss 

cooperative. All rights reserved. 

A.N. Fernando FCA 

Ms. M.P. Perera FCA 

T.J.S. Rajakarier FCA 

Ms. S.M.B. Jayasekara ACA 

S. Sirikananathan FCA 

P.Y.S. Perera FCA 

W.W.J.C. Perera FCA 

W.K.D.C Abeyrathne ACA 

M.R. Mihular FCA 

C.P. Jayatilake FCA 

Ms. S. Joseph ACA 

S.T.D.L. Perera ACA



GROUP 

COMPANY 

For the year ended 31 March 2010 2009 2010 2009 

Note Rs. Rs. Rs. Rs. 

Turnover 1 1,037,425,535 1,515,318,233 - - 

Cost of Sales (817,053,329) (1,284,599,262) - - 

Gross Profit 220,372,206 230,718,971 - - 

Other Income 2 64,417,258 47,802,929 155,183,514 65,525,182 

Selling & Distribution Expenses (56,318,845) (61,420,995) - - 

Administrative Expenses (48,453,881) (57,086,420) (10,101,303) (19,950,478) 

Other Expenses - - (5,000,000) - 

Profit from Operations 3 180,016,738 160,014,485 140,082,211 45,574,704 

Finance Expenses 4 (71,730,063) (134,233,405) (207,821) (419,817) 

Profit before Associate Company's Share of Profit 108,286,675 25,781,080 139,874,390 45,154,887 

Share of Profit of Associate Company (Net of Income Tax) 24,334,501 20,634,926 - - 

Profit before Taxation 132,621,176 46,416,006 139,874,390 45,154,887 

Income Tax Expense 5 (24,472,818) (20,073,520) (2,908,373) (5,942,048) 

Profit for the Year 108,148,358 26,342,486 136,966,017 39,212,839 

Earnings per Share 6 0.20 0.05 0.25 0.07 

Dividend per Share - Paid 7 - 0.06 - 0.06 

Accounting Policies and Notes form an integral part of these Financial Statements. 

Figures in brackets indicate deductions.



19 

Balance Sheet 

GROUP 

COMPANY 

As at 31 March 2010 2009 2010 2009 

Note Rs. Rs. Rs. Rs. 

Restated 

Restated 

ASSETS 

Non Current Assets 

Property, Plant & Equipment 8 494,452,431 485,387,038 18,220,555 18,917,230 

Investment in Subsidiaries 9.1 - - 283,107,311 288,107,301 

Investment in Associate 9.2 - 186,411,187 - 25,712,683 

Other Long Term Investments 9.3 99,929,383 4,936,478 13,156,432 - 

Goodwill on Consolidation 10 8,578,260 8,578,260 - - 

Deferred Tax Asset 16 4,513,223 3,703,323 4,192,140 3,277,517 

Total Non Current Assets 607,473,297 689,016,285 318,676,438 336,014,731 

Current Assets 

Inventories 11 477,668,382 305,561,444 - - 

Trade & Other Receivables 12 591,455,874 623,747,866 3,143,568 3,143,569 

Related Party Receivables 13 101,718,102 98,631,249 510,762,874 542,845,459 

Current Tax Receivables 6,544,202 10,773,107 - - 

Investment in Treasury Bill/ Deposits 9.4 285,282,977 163,953,644 279,055,870 99,134,328 

Cash and Cash Equivalents 9,183,091 7,595,750 1,994,314 9,637 

Total Current Assets 1,471,852,628 1,210,263,060 794,956,626 645,132,993 

Total Assets 2,079,325,925 1,899,279,345 1,113,633,064 981,147,724 

EQUITY AND LIABILITIES 

Equity 

Stated Capital 14 894,565,898 894,565,898 894,565,898 894,565,898 

Retained Earnings 488,984,280 380,835,922 194,996,703 58,030,686 

Total Equity 1,383,550,178 1,275,401,820 1,089,562,601 952,596,584 

Non Current Liabilities 

Retirement Benefit Obligations 15 9,724,153 9,044,068 - - 

Deferred Tax Liability 16 48,230,599 46,559,935 - - 

Long Term Loans 17 56,629,434 74,386,296 - - 

Long Term Lease Liability 18 12,805,828 5,787,875 - - 

Total Non Current Liabilities 127,390,014 135,778,174 - - 

Current Liabilities 

Creditors and Accruals 19 487,544,242 439,636,548 4,963,796 5,473,561 

Current Portion of Long Term Loans 17 26,104,930 16,406,999 - - 

Current Portion of Lease Liability 18 5,250,830 2,872,916 - - 

Short Term Loan - 5,203,017 - - 

Current Tax Liability 4,156,968 8,059,215 4,156,968 8,008,824 

Related Party Payables 20 176,671 176,671 12,060,757 12,060,747 

Bank Overdraft (Secured) 45,152,092 15,743,986 2,888,942 3,008,007 

Total Current Liabilities 568,385,733 488,099,352 24,070,463 28,551,140 

Total Equity & Liabilities 2,079,325,925 1,899,279,345 1,113,633,064 981,147,724 


I certify that the Financial Statements have been prepared in compliance with the requirements of the Companies Act No. 07 of 2007. 

L.Y. De Silva 

Chief Financial Officer 

The Board of Directors is responsible for the preparation and presentation of these Financial Statements. 

Approved and signed for and on behalf of the Board of Directors. 


Chairman 



D. S. Panditha 

Director


Statement of Changes in Equity 

For the year ended 31 March 2010 

GROUP Stated Retained Total 

Capital Earnings 

Rs. Rs. Rs. 

Balance as at 1 April 2008 - As Previously Stated 894,565,898 380,989,737 1,275,555,635 

Prior Period Adjustment (Note A) - 8,315,332 8,315,332 

Balance as at 1 April 2008 - Restated 894,565,898 389,305,069 1,283,870,967 

Profit for the Year - 26,342,486 26,342,486 

Dividend Paid - (34,811,633) (34,811,633) 

Balance as at 31 March 2009 894,565,898 380,835,922 1,275,401,821 

Balance as at 1 April 2009 894,565,898 380,835,922 1,275,401,820 

Profit for the Year - 108,148,358 108,148,358 

Balance as at 31 March 2010 894,565,898 488,984,280 1,383,550,178 

For the year ended 31 March 2010 

COMPANY Stated Retained Total 

Capital Earnings 

Rs. Rs. Rs. 

Balance as at 1 April 2008 - As Previously Stated 894,565,898 45,314,148 939,880,046 

Prior Period Adjustment (Note A) - 8,315,332 8,315,332 

Balance as at 1 April 2008 - Restated 894,565,898 53,629,480 948,195,378 


Dividend Paid - (34,811,633) (34,811,633) 

Balance as at 31 March 2009 894,565,898 58,030,686 952,596,584 

Balance as at 1 April 2009 894,565,898 58,030,686 952,596,584 


Balance as at 31 March 2010 894,565,898 194,996,703 1,089,562,601 


Figures in brackets indicate deductions. 

Note A 

Re-invested interest income on Treasury Bills of Sierra Cables PLC has not been recognized in the financial statements of previous years 

and accordingly the investment in Treasury Bills (short term investments) and the retained earnings have been understated by Rs.8.3 Million. 

This has been corrected by restating the short term investments and the retained earnings as at 1 April 2008.



21 

Cash Flow Statement 

GROUP 

COMPANY 



Cash Flow from Operating Activities 

Profit before Associate Company of Profit 108,286,675 25,781,080 139,874,390 45,154,887 

Adjustments for 

Depreciation 52,026,161 45,533,854 475,000 475,000 

Provision for Bad and Doubtful Debts 5,088,842 3,141,105 - - 

Provision for Obsolete Inventories 2,450,903 1,075,527 - - 

Provision/(Reversal) for diminution in value of investments (636,539) - 5,000,000 - 

Profit on Sale of Property, Plant & Equipment (33,351) (1,038,447) - - 

Capital Work in Progress write-off 221,675 423,217 221,675 - 

Profit on Disposal of Associate (34,635,549) - (132,173,419) - 

Loss on Disposal of Long Term Investments - 661,428 - - 

Provision for Retiring Gratuity 2,362,450 3,292,892 - - 

Interest Expenses 71,730,063 134,233,405 207,821 419,817 

Interest Income (25,333,899) (44,714,564) (17,384,014) (35,355,064) 

Dividend Income (190,388) (149,558) (5,626,081) (30,170,118) 

Operating Profit/(Loss) before working Capital Changes 181,337,043 168,239,939 (9,404,628) (19,475,478) 

(Increase)/Decrease in Inventories (174,557,841) 13,462,636 - - 

(Increase)/Decrease in Trade & Other Debtors 27,203,151 (21,028,193) - (1,109,983) 

(Increase)/Decrease in Dues from Related Parties (3,086,853) (30,264,351) 32,082,585 (113,913,338) 

Increase/(Decrease) in Trade & Other Payables 47,907,694 29,944,193 (509,765) 3,774,291 

Increase/(Decrease) in Dues to Related Parties - - 10 (6,000,000) 

Cash Generated From/(Used in) Operations 78,803,194 160,354,224 22,168,202 (136,724,508) 

Interest Paid (68,804,399) (132,634,286) (207,821) (419,817) 

Income Tax/ESC Paid (23,285,397) (35,997,475) (7,674,852) (7,422,405) 

Payment of Retiring Gratuity (1,682,365) (662,670) - - 

Net Cash Flows From/(Used in) Operating Activities (14,968,967) (8,940,207) 14,285,529 (144,566,730) 

Cash Flow from Investing Activities 

Interest Income 25,333,899 44,714,564 17,384,014 35,355,064 

Dividend from Associate Company 6,376,151 5,487,079 5,626,081 4,841,982 

Dividend Received 190,388 149,558 - 25,328,136 

Acquisition of Property, Plant & Equipment (48,333,012) (96,633,125) - (221,675) 

Sale Proceeds of Property, Plant & Equipment 75,000 1,460,000 - - 

(Investment in)/Sale Proceeds from Treasury Bills/Commercial Papers (121,329,333) 49,839,501 (179,921,542) 110,256,133 

Sale Proceeds from Disposal of Shares 146,531,475 2,525,000 146,531,475 - 

Investment in Shares (1,801,805) (2,434,255) (1,801,805) - 

Investment in Subsidiaries - - (10) - 

Net Investment in Fixed Deposits (80,951) 4,495,033 - 3,631,496 

Net Cash Generated From/(Used in) Investing Activities 6,961,812 9,603,354 (12,181,787) 179,191,136 

Cash Flow from Financing Activities 

Loan Obtained 8,348,069 78,851,413 - - 

Repayment of Lease (6,551,662) (3,955,574) - - 

Dividend Payment - (34,811,633) - (34,811,633 

Repayment of Loans (21,610,017) (23,715,012) - - 

Net Cash Generated From/(Used in) Financing Activities (19,813,610) 16,369,194 - (34,811,633) 

Net Increase/(Decrease) in Cash and Cash Equivalents (27,820,765) 17,032,341 2,103,742 (187,227) 

Cash & Cash Equivalents at the beginning of the year (8,148,236) (25,180,577) (2,998,370) (2,811,143) 

Cash & Cash Equivalents at the end of the year (35,969,001) (8,148,236) (894,628) (2,998,370) 

Cash & Cash Equivalents 

Cash in Hand and at Bank 9,183,091 7,595,750 1,994,314 9,637 

Bank Overdraft (45,152,092) (15,743,986) (2,888,942) (3,008,007) 

(35,969,001) (8,148,236) (894,628) (2,998,370) 


Figures in brackets indicate deductions.



1. REPORTING ENTITY 

Sierra Cables PLC is a public limited liability company incorporated 

and domiciled in Sri Lanka. The registered office of the Company 

is located at 112, Havelock Road, Colombo 05 and principal place 

of business is located at 39/1A, Galwarusa Road, Korathota, 

Kaduwela. 

Issued Ordinary Shares of the Company are listed on the Colombo 

Stock Exchange. 

All values presented in the Financial Statements are in 

Sri Lanka Rupees unless otherwise indicated. 

Principal Activities 

The principal activity of the Company is stated as manufacture 

and sale of wires and cables. However the company has thus 

far acted as the holding company of Alucop Cables Ltd., whose 

principal activity is the manufacture and sale of wires and cables. 

Ultimate Parent Enterprise 

The Directors are of the opinion that the company’s ultimate 

parent undertaking and controlling party is Sierra Holdings (Pvt) 

Ltd., which is incorporated in Sri Lanka. 

Directors Responsibilities 

The Directors are responsible for preparation & presentation of 

these Financial Statements. 

2. BASIS OF PREPARATION 

Statement of Compliance 

The Balance Sheet, Statements of Income, Statement of 

Changes in Equity and the Cash Flow Statement, together 

with the Accounting Policies and Notes (the “Financial 

Statements”) of the Company and for the Group as at 31 March 

2010 and for the year then ended; have been prepared and 

presented in accordance with Sri Lanka Accounting Standards 

(SLAS) adopted by the Institute of Chartered Accountants of 

Sri Lanka and also are in compliance with the companies Act No. 

07 of 2007. 

Basis of Measurement 

The Financial Statements, presented in Sri Lanka Rupees, have 

been prepared on a historical cost basis. 


The Accounting Policies applied by the Group are consistent with 

those used in the previous year other than the above. 

Comparative information 

Previous years figures and phrases have been re-arranged, 

wherever necessary, to conform to the current year’s presentation. 

Events after the Balance Sheet Date 

All material post Balance Sheet events have been considered and 

appropriate adjustments or disclosures have been made in the 

respective Notes to the Financial Statements. 

Critical Accounting Estimates and Judgements 

Estimate and Judgement are cretically evaluated anda are based 

on historical experience and other factors, including expectations 

of future events that are believed to be reasonable under the 

circumstances. 

Basis of Consolidation 

The consolidated Financial Statements comprise those of Sierra 

Cables PLC and its subsidiary companies and associate company as 

disclosed in Note No. 9 to the Financial Statements. 

Subsidiaries 

Subsidiaries are those entities controlled by the Group. Control 

exists when the Group has the power, directly or indirectly, to 

govern the financial and operating policies of an entity so as to 

obtain benefits from its activities. The Financial Statements of 

subsidiaries are included in the consolidated Financial Statements 

from the date that control commences until the date that control 

ceases. 

Financial Period 

All companies in the Group have a common financial year, which 

ends on 31 March. 


The total profits and Losses of all the subsidiaries are included 

in the consolidated Income Statement after eliminating intragroup 

transactions and the proportion of the profit or loss after taxation 

applicable to outside shareholders, which is shown under the 

heading “Minority Interest”. 

Assets and Liabilities 

All assets and liabilities of the Company and its subsidiaries are 

included in the consolidated Balance Sheet. The proportionate 

interest of the outside shareholders in the net assets of the Group 

is stated separately in the consolidated Balance Sheet under the 

heading “Minority Interest”. 

Goodwill/Discount on Acquisition 

Goodwill arising in connection with the acquisition of subsidiaries, 

which is due to the excess of the purchase price or consideration 

over the net assets acquired, is shown as an asset. Such goodwill 

is tested for impairment annually. 

Discount on Acquisition arising on acquisition of assets/subsidiaries 

is recognized in the Income Statement. 

Associates 

Investments in companies where the Group’s share of holding is 

more than 20% and where the investor has power to participate in 

financial and operating policy decisions of investee company, have 

been treated as associate companies. The results of the associate 

companies have been accounted for on the equity method of 

accounting, by incorporating the investor’s share of profits or losses 

to the Group Income Statement, and the related investment is 

presented in the consolidated Balance Sheet at values adjusted to 

reflect the Group’s share of retained assets. The carrying value of 

the Group’s investment in such associates is reduced to the extent 

of the dividend received from these associate companies.



23 


3. FOREIGN CURRENCY TRANSLATION 

Foreign Currency Transactions 

The Company Financial Statements are presented in 

Sri Lanka Rupees, which is the Company’s functional and 

presentation currency. 

All foreign exchange transactions are converted to Sri Lanka 

Rupees, at the rates of exchange prevailing at the time the 

transactions are effected. 

Monetary assets and liabilities denominated in foreign currency are 

retranslated to Sri Lanka Rupee equivalents at the exchange rate 

prevailing at the Balance Sheet date. Non-monetary assets and 

liabilities are translated using exchange rates that existed when 

the values were determined. The resulting gains and losses are 

accounted for in the Income Statement. 

4. INCOME TAX EXPENSES 

Income tax expense comprises current and deferred tax. Income 

tax expense is recognized in profit or loss except to the extent that 

it relates to items recognized directly in equity, in which case it is 

recognized in equity. 

Current Tax 

Current tax is the expected tax payable on the taxable income 

for the year, using tax rates enacted or substantively enacted at 

the reporting date, and any adjustment to tax payable in respect 

of previous years. The elements of income and expenditure 

as reported in the Financial Statements and computed 

in accordance with the provisions of the Inland Revenue 

Act No. 10 of 2006 and amendments thereto. Relevant details are 

disclosed in Note 5 to the Financial Statements. 

Deferred Tax 

Deferred tax is provided using the liability method on temporary 

differences at the Balance Sheet date between the tax bases 

of assets and liabilities, and their carrying amounts for financial 

reporting purposes. 

Deferred tax assets and liabilities are recognised for all 

temporary differences. Deferred tax assets are recognised for 

all deductible temporary differences, carry-forward of unused 

tax credits and unused tax losses, to the extent that it is probable 

that taxable profit will be available against which the deductible 

temporary differences, and the carry-forward of unused tax 

credits and unused tax losses can be utilized. 

The carrying amount of deferred tax assets is reviewed at each 

Balance Sheet date and reduced to the extent that it is no longer 

probable that sufficient taxable profit will be available to allow 

all or part of the deferred tax asset to be utilised. Unrecognised 

deferred tax assets are reassessed at each Balance Sheet date 

and are recognised to the extent that it has become probable 

that future taxable profit will allow the deferred tax asset to be 

recovered. 

Deferred tax assets and liabilities are measured at tax rates that 

are expected to apply to the year when the asset is realised or 

liability is settled, based on the tax rates and tax laws that have 

been enacted or substantively enacted as at the Balance Sheet 

date. 

Income tax relating to items recognised directly in equity is 

recognised in equity. 

Deferred tax assets and deferred tax liabilities are offset, if a 

legally enforceable right exists to set off current tax assets against 

current tax liabilities and the deferred taxes relate to the same 

taxable entity and the same taxation authority. 

5. VALUATION OF ASSETS AND THEIR BASES OF 

MEASUREMENT 

Property, Plant & Equipment 

- Recognition and Measurement 

The property, plant & equipment are recorded at cost less accumulated 

depreciation and impairment losses as setout below. 

Items of property, plant and equipment are derecognised upon 

disposal or when no future economic benefits are expected from 

its use. Any gain or loss arising on derecognition of the asset 

is included in the Income Statement in the year the asset is 

derecognised. 

The cost of property, plant & equipment is the cost of purchase or 

construction together with any expenses incurred in bringing the 

assets to its working condition for its intended use. 

Expenditure incurred for the purpose of acquiring, extending 

or improving assets of permanent nature by means of which to 

carry on the businesses or to increase the earning capacity of the 

business has been treated as capital expenditure. 

The cost of property, plant & equipment is the cash price equivalent 

at the recognition date. If payment is deferred beyond normal credit 

terms, the difference between the cash price equivalent and the 

total payment is recognized as interest over the period of credit 

unless such interest is recognized in the carrying amount of the 

item in accordance with the allowed alternative treatment in SLAS 

20 “Borrowing Costs”. 

The carrying values of property, plant & equipment are reviewed 

for impairment when events or changes in circumstances indicate 

that the carrying value may not be recoverable. 

- Subsequent Costs/ Replacement of Parts 

The cost of replacing part of an item of property, plant & equipment 

is recognized in the carrying amount of the item if it is probable 

that the future economic benefits embodied within the part will 

flow to the Company and its cost can be measured reliably. The 

carrying amount of those parts that are replaced is derecognized. 

The costs of the day-to-day servicing of property, plant and 

equipment are recognized in profit or loss as incurred. 

Depreciation 

Provision for depreciation is calculated by using a straightline 

method on the cost or valuation of all property, plant and 

equipment, other than freehold land, in order to write off such



amounts over the estimated useful economic life of such assets. 

The leased assets are depreciated over the shorter of the lease 

term and their useful lives. 

The depreciation rates of the assets are as follows: 

Assets Depreciation % 

Buildings on Freehold Land 5 

Plant and Machinery 7.5 

Motor Vehicles 20 

Furniture and Fittings 20 

Office/Factory Equipment 20 

Computer Equipment 20 

The useful life, residual values and depreciation methods of 

assets are reviewed, and adjusted if required, at the end of each 

financial year. 

Leased Assets 

Where assets are financed under an agreement under which 

substantially all the risks and rewards of ownership are transferred 

to the lessee, such assets are recorded in the Balance Sheet 

as Property, Plant & Equipment at their cash price. The total 

interest payable is accounted as interest in suspense, and the 

corresponding credit is recorded as a payable to the lessor. The 

instalments paid are used to reduce this liability. 

An amount equal to the interest charge is transferred from the 

interest in suspense account to the Income Statement. 

Investments 

All quoted and unquoted securities, which are held as non-current 

investments, are valued at cost. The cost of the investment is the 

cost of acquisition inclusive of brokerage and costs of transaction. 

The carrying amounts of long term investments are reduced to 

recognise a decline which is considered other than temporary, in 

the value of investments, determined on an individual investment 

basis. 

In the Company’s Financial Statements, investments in 

subsidiaries and associate have been accounted for at cost, 

net of any impairment losses which are charged to the Income 

Statement. Income from these investments is recognised only to 

the extent of dividends received. 

Investment in Treasury Bills/Commercial Papers reflected at the 

cost and interest accrued as to the Balance Sheet date. 

Impairment of Assets 

The identifiable assets of the Company are reviewed at each 

balance sheet date to determine whether there is any indication 

of impairment. If any, such indication of impairment. If any, such 

indication exists the recoverable amount of the asset is estimated 

and shown in the Balance Sheet. The impairment loss is taken to 

the Income Statement. 

Inventories 

Inventories are measured at the lower of cost and net realizable 

value. Net realisable value is the estimated selling price less 

estimated costs of completion and the estimated costs necessary 

to make the sale. 

The costs incurred in bringing inventories to its present location 

and condition, are accounted for as follows: 

Raw Materials - On actual cost, on first-in-first-out basis 

Finished Goods and 

Work in Progress - At actual cost, on first-in-first-out basis 

Trade and Other Receivables 

Trade and other receivable are stated at the amounts they 

are estimated to realise, net of provisions for bad and doubtful 

receivables. 

Specific provision is made as provision for bad and doubtful debts. 

Short-Term Investments 

Treasury Bills and other interest bearing securities held for resale 

in the near future to benefit from short-term market movements 

are accounted for at cost plus the relevant proportion of the 

discounts or premiums. 

Cash and Cash Equivalents 

Cash and cash equivalents in the Cash Flow Statement comprise 

cash at bank and in hand and, net of outstanding bank overdrafts. 

6. LIABILITIES AND PROVISIONS 

Liabilities classified as current liabilities in the Balance Sheet are 

those obligations payable on demand or within one year from the 

Balance Sheet date. Liabilities classified, as non-current liabilities 

are those obligations, which expire beyond a period of one year 

from the Balance Sheet date. 

Trade & Other Payables 

Trade & Other Payables are stated at their cost. 

Defined Benefit Plan - Gratuity 

As required by the Sri Lanka Accounting Standard No. 16 (revised 

2006) - “ Employee Benefits” which became effective from 1 July 

2007, the group has provided for gratuity liability based on the 

Gratuity Formula Method (Principal assumptions used are disclosed 

in Note 15 to the Financial Statements). 

However, according to the payment of Gratuity Act No. 12 of 1983, 

the liability for gratuity to an employee arises only on completion 

of five years continued service with the Company. 

The liability is not externally funded nor actuarially valued. The 

item is grouped under Non-Current Liabilities in the Balance 

Sheet. 

Being a listed company, Sierra Cables PLC has not adopted 

actuarial valuation as there are no employees in the company. 

However, other companies in the group have used the Gratuity 

Formula Method as recommended by the Sri Lanka Accounting



25 


Standard 16 (revised 2006) Employee Benefits in determining 

their Retiring Gratuity Obligations. 

Defined Contribution Plan - Employees’ Provident 

Fund and Employees’ Trust Fund 

Employees are eligible for Employees’ Provident Fund contributions 

and Employees’ Trust Fund contributions in line with respective 

statutes and regulations. The Company contributes the defined 

percentages of gross emoluments of employees to an approved 

Employees’ Provident Fund and to the Employees’ Trust Fund 

respectively which are externally funded. 

Provisions, Contingent Assets and Contingent 

Liabilities 

A provision is recognized if, as a result of a past event, the 

Company has a present legal or constructive obligation that 

can be estimated reliably, and it is probable that an outflow of 

economic benefits will be required to settle the obligation. 

All contingent liabilities are disclosed as a note to the Financial 

Statements unless the outflow of resources is remote. Contingent 

assets are disclosed, where inflow of economic benefit is probable. 

7. INCOME STATEMENT 

Revenue Recognition 

Revenue from rendering services or sale of goods is measured 

at the fair value of the consideration received or receivable, net 

of returns and allowances, trade discounts and volume rebates. 

Revenue is recognized when the significant risks and rewards of 

ownership have been transferred to the buyer, recovery of the 

consideration is provable, the associated costs and possible return 

of goods can be estimated reliably, and there is no continuing 

management involvement with the goods or services rendered. 

The following specific criteria are used for recognition of revenue: 

Sale of Goods 

Revenue from the sale of goods is recognised when the significant 

risk and rewards of ownership of the goods have passed to the 

buyer with the Company retaining neither a continuing managerial 

involvement to the degree usually associated with ownership, nor 

an effective control over the goods sold. 

Rendering of Services 

Revenue from rendering of services is recognised in the accounting 

period in which the services are rendered or performed. 

Turnover Based Taxes 

Turnover based taxes include value added tax, economic service 

charge and turnover tax (TT), which is payable to the Provincial 

Council in respect of trading activities. Companies in the Group pay 

such taxes in accordance with the respective statutes. 

Dividend 

Dividend income is recognized on a cash basis. 

Interest Income 

Interest income is recognized on an accrual basis unless 

collectibles is in doubt. 

Gains and Losses 

Net gains and losses of a revenue nature arising from the 

disposal of property, plant & equipment and other non-current 

assets, including investments, are accounted for in the Income 

Statement, after deducting from the proceeds on disposal, the 

carrying amount of such assets and the related selling expenses. 

Gains and losses arising from activities incidental to the main revenue 

generating activities and those arising from a Company of similar 

transactions which are not material, are aggregated, reported and 

presented on a net basis. Any losses arising from guaranteed rentals are 

accounted for in the year of incurring the same. A provision is recognised 

if the best estimate indicates a loss. 

Other Income 

Other income is recognized on an accrual basis. 

Expenditure Recognition 

Expenses are recognized in the Income Statement on the basis of 

a direct association between the cost incurred and the earning of 

specific items of income. All expenditure incurred in the running of 

the business and in maintaining the property, plant & equipment 

in a state of efficiency has been charged to the Income Statement. 

For the purpose of presentation of the Income Statement, the 

“function of expenses” method has been adopted, on the basis 

that it presents fairly the elements of the Company and Company’s 

performance. 

Borrowing Costs 

Borrowing costs are recognized as an expense in the period in 

which they are incurred unless they are incurred in respect of 

qualifying assets in which case it is capitalized. 

8. SEGEMENT INFORMATION 

Reporting Segments 

A segment is a distinguishable component of an enterprise that 

is engaged in either providing products or services (Business 

Segments) or in providing products or services within a particular 

economic environment (Geographic Segment) which is subject to 

risks & rewards that are different from those of other segments. 

However, there are no distinguishable components to be identified 

as segments for the Company.


Notes to the Financial Statements 

GROUP 

COMPANY 



1. Turnover 

Sale of Electrical Cables 1,035,603,685 1,509,322,345 - - 

Contract Revenue - - - - 

Others 1,821,850 5,995,888 - - 

1,037,425,535 1,515,318,233 - - 

The above turnover is stated after deducting Value Added Tax which amounted to Rs.121,471,306 (2009 - Rs.157,125,412). 

2. Other Income 

Dividend Income 190,388 149,558 5,626,081 30,170,118 

Interest Income 25,333,899 44,714,564 17,384,014 35,355,064 

Profit on Sale of Property Plant & Equipment 33,351 1,038,447 - - 

Profit on Disposal of Associate 34,635,549 - 132,173,419 - 

Loss on Disposal of other Long-term Investment - (661,428) - - 

Reversal of provision for diminution in value of investments 636,539 - - - 

Exchange Gain 3,572,203 2,561,788 - - 

Sundry Income 15,329 - - - 

64,417,258 47,802,929 155,183,514 65,525,182 

3. Profit from Operations 

The Profit from Operations is stated after charging all expenses including the following; 

Directors' Emoluments 5,265,000 5,670,000 5,265,000 5,670,000 

Auditors' Remuneration - Audit 565,209 542,186 215,000 198,000 

- Audit Related Services - 115,000 7,500 65,000 

Provision for Bad and Doubtful Debts 5,088,842 3,141,105 - - 

Provision for Obsolete Inventories 2,450,903 1,075,527 - - 

Depreciation 52,026,161 45,533,854 475,000 475,000 

Capital Work in Progress Write-off 221,675 - 221,675 - 

Provision for impairment of investments in Alucop Marketing Ltd. - - 5,000,000 - 

Reversal of provision for other Long-term Investments 636,539 - - - 

Personnel Costs 

- Salaries, Wages & Other Related Cost 55,283,367 49,468,435 - - 

- Defined Contribution Plan- EPF & ETF 6,032,644 5,813,849 - - 

- Defined Benefit Plan - Retiring Gratuity 2,362,450 3,292,892 - - 

4. Finance Expenses 

Interest on - Overdraft 4,789,764 6,015,142 5,621 18,313 

- Lease 2,925,663 1,599,119 - - 

- Import Demand Loans 43,509,446 112,523,234 - - 

- Bank Loans 16,811,936 7,397,700 - - 

Bank & Other Charges 3,498,822 6,633,757 14,475 337,051 

Debit Tax 194,432 64,453 187,725 64,453 

71,730,063 134,233,405 207,821 419,817



27 


GROUP 

COMPANY 



5. Income Tax Expenses 

The charge for the year is made up as follows: 

Income Tax on Current year's profit 22,974,440 14,402,165 3,822,996 7,242,819 

Provision for Deemed Dividend Tax - 2,616,868 - 1,976,746 

WHT on Dividend 637,615 3,362,945 - - 

Deferred Taxation Charge/(Reversal) 860,763 (308,458) (914,623) (3,277,517) 

24,472,818 20,073,520 2,908,373 5,942,048 

5.1 Reconciliation between the Accounting Profit and Tax Expense 

Accounting Profit before Associate Company's Share of Profit 108,286,675 25,781,080 139,874,390 45,154,887 

Adjustments on Consolidation 94,485,285 30,266,508 - - 

Aggregate Disallowed Income (163,211,240) (73,080,264) (155,183,514) (63,104,496) 

Aggregate Disallowed Expenses 69,531,270 52,435,213 5,475,000 513,487 

Aggregate Allowable Expenses (50,254,507) (34,216,525) - - 

Profit/(Loss) from Business 58,837,483 1,186,012 (9,834,124) (17,436,122) 

Losses Incurred for the Year 10,580,941 22,327,541 9,834,124 17,436,122 

Income from Other Sources 25,284,109 42,044,485 17,384,014 32,934,378 

Total Statutory Income 94,702,533 65,558,038 17,384,014 32,934,378 

Tax Loss Claimed (35,799,671) (22,945,313) (6,084,405) (11,527,032) 

Taxable Income 58,902,862 42,612,725 11,299,609 21,407,346 

Tax on Exports @ 15% 334,879 276,254 - - 

Tax on Balance Income @ 35% 22,300,038 13,913,071 3,766,499 7,135,782 

22,634,917 14,189,325 3,766,499 7,135,782 

Social Responsibility Levy @ 1.5% 339,524 212,840 56,497 107,037 

22,974,440 14,402,165 3,822,996 7,242,819 

5.2 In terms of sec. 52 of Inland Revenue Act No.10 of 2006, the profit from exports of Alucop Cables Limited is taxable at 15% and others 

profits are tax at 35%. 

5.3 Under the provision of Inland Revenue Act No.10 of 2006, Sierra Cables PLC is liable to income tax at 33 1/3 % of the adjustable 

taxable profit for a period of 5 years commencing from the year of listing the company upto 2010/11 and there after at normal rates and 

all other companies within the group are liable to income tax at 35% of the adjusted taxable profit for the year.



For the year ended 31 March 

6. Earnings per Share 

Earnings per Share is calculated on the Profit after Taxation attributable to ordinary shareholders divided by the weighted average number of 

ordinary shares deemed to be issued during the year. 

GROUP 

COMPANY 

2010 2009 2010 2009 


Profit attributable to ordinary shareholders 108,148,358 26,342,486 136,966,017 39,212,839 

Weighted average number of ordinary shares outstanding at the year end 537,512,430 537,512,430 537,512,430 537,512,430 

Earnings per Share 0.20 0.05 0.25 0.07 

7. Dividend Paid 

7.1 Dividend Paid during the year 

Final Dividend - 34,811,633 - 34,811,633 

- 34,811,633 - 34,811,633 

7.2 Dividend per Share - 0.06 - 0.06 

8. Property, Plant & Equipment 

8.1 Company 

Land Freehold Total Total 

Buildings as at as at 

31.03.2010 31.03.2009 


Cost 

As at the beginning of the year 10,620,555 9,500,000 20,120,555 20,120,555 

Additions during the year - - - - 

Disposals during the year - - - - 

As at the end of the year 10,620,555 9,500,000 20,120,555 20,120,555 

Depreciation 

As at the beginning of the year - 1,425,000 1,425,000 950,000 

Charge for the year - 475,000 475,000 475,000 

As at the end of the year - 1,900,000 1,900,000 1,425,000 

Capital Working Progress - 221,675 

Net Book Value 

- As at 31 March 2010 10,620,555 7,600,000 18,220,555 

As at 31 March 2009 18,917,230



29 


8.2 Property, Plant & Equipment 

As at 31 March 2010 

Group Land Freehold Building on Plant Motor Leasehold Furniture Factory Office & Computer Capital Total Total 

Buildings Leasehold and Vehicles Motor and Equipment Computer Software Working as at as at 

Land Machinery Vehicles Fittings Equipment Progress 31.03.2010 31.03.2009 

Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. Rs. 

Cost 

As at the begining of the year 12,026,077 9,500,000 153,708,473 402,306,226 29,705,455 12,215,604 1,771,847 17,266,302 9,316,030 - 76,185,370 724,001,384 628,380,372 

Additions During the Year - - - - 1,679,066 - 226,780 2,080,845 365,759 - 57,002,428 61,354,878 98,002,345 

Transfer from CWIP - - 1,531,310 83,401,436 - - - 925,910 - 6,335,754 (92,416,085) (221,675) (423,217) 

Disposals During the Year - - - - (131,522) - - - - - - (131,522) (1,958,116) 

As at the end of the Year 12,026,077 9,500,000 155,239,783 485,707,662 31,252,999 12,215,604 1,998,627 20,273,057 9,681,789 6,335,754 40,771,713 785,003,065 724,001,384 

Depreciation 

As at the Beginning of the Year - 1,425,000 43,884,113 160,334,278 9,517,552 8,013,871 1,314,260 8,000,564 6,124,708 - - 238,614,346 194,617,055 

Charge for the Year - 475,000 7,705,704 32,175,559 4,898,221 1,029,440 221,814 2,886,999 1,366,273 1,267,151 - 52,026,161 45,533,854 

On Disposals - - - - (89,873) - - - - - - (89,873) (1,536,563) 

As at the end of the Year - 1,900,000 51,589,817 192,509,837 14,325,900 9,043,311 1,536,074 10,887,563 7,490,981 1,267,151 - 290,550,634 238,614,346 

Net Book Value 

As at 31 March 2010 12,026,077 7,600,000 103,649,966 293,197,825 16,927,099 3,172,293 462,553 9,385,494 2,190,808 5,068,603 40,771,713 494,452,431 - 

As at 31 March 2009 12,026,077 8,075,000 109,824,360 241,971,948 20,187,903 4,201,733 457,587 9,265,738 3,191,322 76,185,370 - - 485,387,038 

a) The management has reassessed the residual value, useful lives and depreciation method on above assets did not recognize any change to those estimates. 

b) Th Company has evaluated both internal and external indication of impairments of long lived assets and has not identify presence of such indications as at the Balance Sheet date.



GROUP 

COMPANY 



9. Investments No. of % of 

9.1 Investments in Subsidiaries 

Unquoted Investments 

Shares 

Holding 

Alucop Cables Ltd 23,451,978 100 - - 281,062,906 281,062,906 

Alucop Marketing (Pvt) Ltd 704,442 100 - - 7,044,375 7,044,375 

Sierra Engineering & Construction (Pvt) Ltd 10,003 100 - - 20 20 

[Formerly known as Alucop Engineering (Pvt) Ltd] 

Sierra Power (Pvt) Ltd 2 100 - - 10 - 

Less: Provision for impairment of investments 

in Alucop Marketing (Pvt) Ltd. - - (5,000,000) - 

9.2 Investment in Associate 

Movement during the year 

- - 283,107,311 288,107,301 

Balance at the beginning of the year 186,411,187 171,263,340 - - 

Share of profit for the period 24,334,501 20,634,926 - - 

Dividend received (6,376,151) (5,487,079) - - 

Disposed during the year (111,895,926) - - - 

Transfered to other long-term Investment (92,473,611) - 

- 186,411,187 - - 

Associate Company - Central Industries PLC - 186,411,187 - 25,712,683 

- 186,411,187 - 25,712,683 

9.2.a 

On 18 February 2010, Sierra Cables PLC disposed of 667,600 shares in its associate company, Central Industries PLC for a net 

consideration of Rs.146.5 Mn. Consequently, the holding (including the indirect holding) was reduced to 16.75% from 37.01% and 

it ceased to be an associate. 

The share of profit of Rs.24.3 Mn. recognised during the period has been based on the unaudited Financial Statements of Central 

Industries PLC for the 09 months ended 31 December 2009. Further, the profit on disposal of the associate and the amount of the 

balance investment transferred to other long-term investments has also been based on the same unaudited figures.



31 


As at 31 March 

9.3 Other Long-Term Investments 

GROUP 

COMPANY 

9.3.1 Quoted Investments No. of Market Value 2010 2009 2010 2009 

Shares 31 Mar 2010 

Rs. Rs. Rs. Rs. Rs. 

Central Industries PLC 551,751 121,385,220 92,473,611 - 11,354,627 - 

Chevron Lubricants Lanka PLC 10,000 1,700,000 1,801,805 - 1,801,805 - 

National Development Bank PLC 10,125 2,126,250 210,000 210,000 - - 

Richard Pieris Exports PLC 10,359 569,745 467,840 467,840 - - 

ACL Cables PLC. 200 15,000 3,900 3,900 - - 

DFCC Bank PLC 15,000 3,300,000 1,969,600 1,969,600 - - 

Seylan Bank PLC 51,000 11,220,000 2,168,323 2,168,324 - - 

Less: Provision for Diminution 

in Value of Investments (115,634) (752,173) - - 

98,979,445 4,067,491 13,156,432 - 

9.3.2 Long-Term Deposits 949,938 868,987 - - 

99,929,383 4,936,478 13,156,432 - 

9.4 Investments in Treasury Bills/Deposits 

Treasury Bills 266,261,375 142,171,349 260,034,268 82,786,888 

Commercial Papers 19,021,602 21,782,295 19,021,602 16,347,440 

285,282,977 163,953,644 279,055,870 99,134,328 

10. Goodwill on Consolidation 

Balance as at the Beginning of the Year 8,578,260 8,578,260 - - 

Impairment/Amortization for the Year - - - - 

Balance as at the End of the Year 8,578,260 8,578,260 - - 

11. Inventories 

Raw Materials 99,634,413 35,932,606 - - 

Work-in-Progress 117,899,294 46,858,433 - - 

Finished Goods 245,817,767 205,697,253 - - 

Spare Parts and Consumables 14,342,738 19,439,780 - - 

Packing Materials 4,664,728 - - - 

Stationery Stock 835,872 708,899 - - 

483,194,812 308,636,971 - - 

Less: Provision for Obsolete/Slow Moving Items (5,526,430) (3,075,527) - - 

477,668,382 305,561,444 - -



GROUP 

COMPANY 



12. Trade & Other Receivables 

Trade Receivables 462,242,266 521,170,006 - - 

Less: Provision for Bad and Doubtful Debts (13,232,501) (8,143,660) - - 

449,009,765 513,026,346 - - 

Other Receivables 356,508 6,331,700 - - 

Other Taxes Receivable 134,731,528 96,770,080 1,114,818 1,114,819 

Deposits & Prepayments 7,358,073 7,619,740 2,028,750 2,028,750 

591,455,874 623,747,866 3,143,568 3,143,569 

13. Amounts Due from Related Companies 

Trading 

Sierra Property Development (Pvt) Ltd 532,872 532,872 - - 

Sierra Civil Engineering & Construction (Pvt) Ltd 422,035 422,035 - - 

Sierra Construction Limited 51,752,868 27,976,624 - - 

Sierra Electrical Engineering (Pvt) Ltd 3,616,785 4,309,445 - - 

Sierra Information Technologies Ltd 42,328 42,328 - - 

Sierra Global Network (Pvt) Ltd 1,980,426 1,980,426 - - 

Sierra Road Engineering (Pvt) Ltd 5,109,318 5,109,318 - - 

Sierra Telecommunication (Pvt) Ltd 246 19,996,976 - - 

Sierra Water Works (Pvt) Ltd 522,224 522,225 - - 

Total Trading 63,979,102 60,892,249 - - 

Non Trading 

Alucop Cables Limited - - 482,229,542 517,845,459 

Sierra Property Development (Pvt) Ltd (Note 13.a) 32,854,000 32,854,000 25,000,000 25,000,000 

Sierra Civil Engineering & Construction (Pvt) Ltd 4,885,000 4,885,000 - - 

Sierra Power (Pvt) Ltd - - 3,533,332 - 

Total Non Trading 37,739,000 37,739,000 510,762,874 542,845,459 

Total 101,718,102 98,631,249 510,762,874 542,845,459 

13.a Sierra Property Development (Pvt) Ltd has agreed to assign two of its apartments to Sierra Cables PLC and Alucop Cables Ltd in 

settlement of the amount due. Accordingly, an "Agreement to Sell" has been signed in April 2009.



33 


GROUP 

COMPANY 



14. Stated Capital 

537,512,430 Ordinary Shares 894,565,898 894,565,898 894,565,898 894,565,898 

894,565,898 894,565,898 894,565,898 894,565,898 

The total amount received by company in respect of issue of shares are referred to as stated capital. 

15. Retirement Benefit Obligations 


Gratuity charge for the year 1,785,544 2,121,843 - - 

Interest charge for the year 672,160 502,371 - - 

Deficit/(Surplus) charge for the year (95,254) 668,678 - - 

Less: Payments made during the year (1,682,365) (662,670) - - 

Balance at the end of the year 9,724,153 9,044,068 - - 

15.1 The total amount charged to Income Statement in respect of Gratuity is made up as follows: 

Gratuity charge for the year 1,785,544 2,121,843 - - 

Interest cost 672,160 502,371 - - 

Deficit/(Surplus) for the year (95,254) 668,678 - - 

2,362,450 3,292,892 - - 

15.2 As required by the Sri Lanka Accounting Standard (Revised 2006) - “Employee Benefits” which came into effect 

from 1 July 2007, the Group has provided gratuity liability based on the Gratuity Formula Method. 

The principle assumptions used are as follows: 

Expected Annual Average Salary Increment 10% 

Discount Rate/Interest Rate 12% 

16. Deferred Taxation 

Balance at the beginning of the year 42,856,613 43,165,071 (3,277,517) - 

Charge/(Reversal) for the year 860,763 (308,458) (914,623) (3,277,517) 

Balance at the end of the year 43,717,376 42,856,613 (4,192,140) (3,277,517) 

Deferred tax asset (4,513,223) (3,703,322) (4,192,140) (3,277,517) 

Deferred tax liability 48,230,599 46,559,935 - - 

43,717,376 42,856,613 (4,192,140) (3,277,517)



GROUP 

COMPANY 



16.1 The closing Deferred Tax Liability/Asset balance relates to the following: 

Accelerated Depreciation for Tax Purposes 66,155,607 73,464,498 422,180 369,407 

Retirement Benefit Obligations (3,323,693) (2,992,948) - - 

Benefits arising from Tax Losses (19,114,538) (27,614,937) (4,614,320) (3,646,924) 

43,717,376 42,856,613 (4,192,140) (3,277,517) 

16.2 The Deferred Tax Liability/Asset has been provided using average effective tax rates applicable to each company in the group 

and the rates used are as follows: 

Sierra Cables PLC 33.33% 

Alucop Cables Limited 34.18% 

Sierra Engineering and Construction Limited 35.00% 

17. Long Term Loans Commercial Amana 2010 2009 2010 2009 

Bank 

Investments 

Rs. Rs. Rs. Rs. Rs. Rs. 

Balance at the begining of the year 14,239,882 76,553,413 90,793,295 29,609,882 - - 

Loans Obtained during the year - 8,348,069 8,348,069 78,851,413 - - 

14,239,882 84,901,482 99,141,364 108,461,295 - - 

Repayments during the year (12,960,000) (3,447,000) (16,407,000) (17,668,000) - - 

Balance at the end of the year 1,279,882 81,454,482 82,734,364 90,793,295 

Amount Payable within one year 1,279,882 24,825,048 26,104,930 16,406,999 - - 

Amount Payable after one year - 56,629,434 56,629,434 74,386,296 - - 

17.1 Security and Re-payment Terms 

Lending Institution Assets Pledged Facility Obtained Interest Rate Repayment 

Terms 

Commercial Bank of Land, Building, Plant, Machinery Term Loan Facility AWPLR + 1% p.m Repayable over 3 installments 

Ceylon Ltd & Equipment of the Group (3.4 Mn) amounting to Rs.1,080,000 and a 

and a Corporate Guarantee. 

final instalment of Rs.199,882. 

Amana Investments Ltd Machinery imported under the Import a Drum 44 monthly repayments as per 

facility (Drum Twister Twister Machine payment schedule. 

Machine), Movable Properties (72.5 Mn) 

and a corporate guarantee. 

Amana Investments Ltd Vehicles obtained under the Purchase two 60 monthly repayments as per 

facility. motor vehicles payment schedule



35 


GROUP 

COMPANY 


18. Long-Term Lease Liability 



Lease obtained during the year 22,337,308 2,445,540 - - 

33,529,495 15,147,761 - - 

Rentals paid during the year (6,551,662) (3,955,574) - - 

Gross Lease Liability 26,977,833 11,192,187 - - 

Less: Interest in Suspense (8,921,175) (2,531,396) - - 

Total Liability at the end of the year 18,056,658 8,660,791 - - 

Current Liability 

Lease Liability payable within one year 5,250,830 2,872,916 - - 

Non-current Liability 

Lease Liability payable after one year 12,805,828 5,787,875 - - 

19. Creditors and Accruals 

Trade Creditors & Other Payables 474,195,701 392,696,532 - - 

Accrued Expenses 8,579,418 15,170,731 4,963,796 5,473,561 

Withholding Tax Payable 149,750 149,750 - - 

Value Added Tax Payable 4,612,757 4,448,170 - - 

Nation Building Tax Payable 6,616 22,447 - - 

Bills Payable - 27,148,918 - - 

20. Amount Due to Related Companies 

487,544,242 439,636,548 4,963,796 5,473,561 

Allucop Marketing (Pvt) Ltd - - 12,060,747 12,060,747 

Sierra Power (Pvt) Ltd - - 10 - 

Sierra Construction Ltd 176,671 176,671 - - 

21. Going Concern of Subsidiary Company 

176,671 176,671 12,060,757 12,060,747 

The subsidiary company, Alucop Marketing (Private) Limited has incurred a net loss of Rs. 5.92 Mn. during the year ended 31 March 2010 and, 

as of that date its accumulated losses amounted to Rs. 18.5 Mn. and a net liability position of Rs. 11.5 Mn. Further its current liabilities exceeded 

its current assets by Rs. 12.9 Mn. Despite this, the Financial Statements of the company have been prepared on a going concern basis since the 

Directors are confident that other companies in the group will continue to extend facilities to enable the company to meet its obligations as and 

when they fall due for a period of 12 months from the date of the Directors signing these Financial Statements. 

22. Contingent Liabilities 

There were no material contingent liabilities as at 31 March 2010. 

23. Capital Commitments 

There were no material capital commitment as at 31 March 2010. 

24. Events Occurring after the Balance Sheet Date 

Subsequent to the Balance Sheet date, no circumstances have arisen which require adjustment to or disclosure in these 

Financial Statements. 

25. Comparative Figures 

The previous year's figures and phrases have been re-arranged wherever necessary to conform to the current year's presentation.



26. Related Party Transactions 

Related Party Disclosures as required by the Sri Lanka Accounting Standard No 30 on Related Party Disclosures (Revised 2005) is as follows. The Company Carries out transaction in the 

ordinary course of business with Related Parties including entities where the Chairman or a Director of the Company is the Chairman or a Director of such entities. 


Related Party Relationship Name of Director Position Details Amount (Paid) / Received as at 31 March 

Dealing 2010 2009 2010 2009 


Transaction with Subsidiary Companies 

Alucop Marketing (Pvt) Ltd Subsidiary Company Mr. W.A.P.Perera Chairman Total of funds/loans paid - 6,000,000 (12,060,747) (12,060,747) 

Mr. D.S.Panditha Director Total amount paid for the expense 

Mr. F.A.W.Irugalbandara Director Total of funds/loans obtained 

Mr. D.N.N.Lokuge Director 

Mr. E.A.D.T.B.Perera Director 

Sierra Engineering & Subsidiary Company Mr. W.A.P.Perera Chairman Settlement of intercompany expenses - - - - 

Construction (Pvt) Ltd Mr. D.S.Panditha Director 

Mr. E.H.C.Ranasinghe Director 

Mr. A.Arulthakshanan Director 

Alucop Cables Ltd Subsidiary Company Mr. W.A.P.Perera Chairman For Payments - EPF/ETF (3,832,776) (4,097,725) 482,229,542 517,845,457 

Mr. D.S.Panditha Director For Reimbursement of expenses received (4,124,228) 1,182,511 

Ms.G.S.M.Irugalbandara Director For Reimbursement of expenses received - (182,200) 

Mr. P.Weerasooriya Director For Working Capital purposes (57,835,091) (123,482,244) 

Mr. D.N.N.Lokuge Director Short-term Advance received 30,686,120 12,231,518 

Mr. E.A.D.T.B.Perera Director For Director fee and other expenses (509,939) 434,801 

Mr. R.M.S.Fernando Director 

Dr. K.Weerapperuma Director 

Sierra Power (Pvt) Ltd Subsidiary Company Mr. W.A.P.Perera Chairman Total amount paid for the expense 3,533,332 - 3,533,332 - 

Mr. D.S.Panditha Director Investment (10) - - - 

Ms.G.S.M.Irugalbandara Director 

Mr. A. Senarathne Director 

Transaction with Other Related Companies 

Sierra Property Affiliated Company Mr. F.A.W.Irugalbandara Chairman - - 25,000,000 25,000,000 

Development (Pvt) Ltd Mr. W.A.P.Perera Director 

Mr. D.N.N.Lokuge Director 

Mr. E.A.D.T.B.Perera Director



37 



27. Key Management Personnel Compensation 

Key Management Personnel comprise of the member of Board of Directors of the company. 

Key Management Personnel compensatiion comprised: 2010 2009 

Rs. 

Rs. 

Short-term employee benefits 5,265,000 5,670,000 

28. Directors’ Resposibility for Financial Statements 

The Financial Satements are prepared incompliance with the Sri Lanka Accounting Standard issued by the Institute of Chartered Accountants of 

Sri Lanka and requirements of the Companies Act No. 07 of 2007. 

The Board of Directors and the Management of Sierra Cables PLC accept the responsibility for the intergrity and objectivity of these Financial 

Statements. The estimates and judgements relating to the Financial Statements were made on a prudent and reasonable basis, in order that 

the Financial Statements reflect in a true and fair manner, the form and substance over transaction, reasonably present the Company's state of 

affairs. To ensure this, the Company has taken proper and sufficient care in installing a system of internal control and accounting records, for 

safe guarding assests and preventing & detecting frauds as well as other irregularities, which is reviewed, evaluated and updated ongoing basis.


Share Information 

For the year ended 31 March 2010 2009 

Rs. 

Rs. 

Earnings 

Earnings per Share Basic 0.20 0.05 

Book Value 

Net Assets per Share on 31 March 2.60 2.40 

Price Indices 

CSE All Share Price Index 3724.60 1,638.06 

Milanka Price Index 4270.70 1,736.20 

Share Prices 

Lowest 1.10 1.00 

Highest 2.60 2.00 

Last Transaction 2.20 1.10 

Market Capitalisation 

Value 1,182,527,346 591,263,673 

No. of Market Days 238 239 

No. of Days Trades 238 238 

Public Holding 37.74% 37.99%



39 

Five Year Summary 

For the year ended 31 March 2006 2007 2008 2009 2010 

Rs. Rs. Rs. Rs. Rs. 

OPERATING RESULTS 

Revenue 1,038,076,867 1,395,462,767 1,489,325,624 1,515,318,233 1,037,425,535 

Gross Profit 230,940,997 272,433,383 332,724,286 230,718,971 220,372,206 

Profit from Operations 176,436 199,432,274 277,533,324 160,014,485 180,016,738 

Profit Before Associate Company’s share of profit 139,337,547 151,152,240 174,694,115 25,781,080 108,286,675 

Profit After Tax 100,747,296 101,695,199 129,237,627 26,342,486 108,148,358 


Assets 

Property, Plant & Equipment 363,130,752 427,095,874 433,763,317 485,387,038 494,452,431 

Other Non-Current Assets 156,613,840 176,276,677 190,025,284 203,629,248 113,020,866 

Current Assets 1,139,457,086 1,105,979,883 1,210,165,531 1,210,263,060 1,471,852,628 

Total Assets 1,659,201,678 1,709,352,434 1,833,954,132 1,899,279,346 2,079,325,925 

Liabilities 

Long-Term Debt 77,027,087 43,326,142 21,564,397 80,174,171 69,435,262 

Other Non-Current Liabilities 16,432,279 29,204,037 49,578,917 55,604,003 57,954,752 

Short-Term Debt 22,842,754 19,987,553 35,317,723 15,743,986 45,152,092 

Other Current Liabilities 465,272,684 470,516,694 451,937,460 472,355,366 523,233,642 

Shareholders' Funds 

Stated Capital 894,565,898 894,565,898 894,565,898 894,565,898 894,565,898 

Reserves 183,060,976 251,752,110 380,989,737 380,835,922 488,984,280 

Ratios 

Total Assets/Equity 1.54 1.49 1.44 1.49 1.50 

Turnover/Assets 0.63 0.82 0.81 0.80 0.50 

Net Margin (%) 9.70 7.30 8.70 1.70 10.40 

Return on Equity (%) 12.90 13.20 13.70 2.00 7.80 

Return on Assets (%) 8.40 8.84 9.53 1.36 5.21 

Share Information 

Earning per Share (LKR) 0.19 0.19 0.24 0.05 0.20 

Price Earnings Ratio 10.67 10.57 7.49 22.45 10.93 

Net Assets per Share 2.18 2.27 2.51 2.37 2.57


Five Year Summary 

Exports 

Gross Profit 

Long-Term Borrowings 

Rs. Mn. 

300 

250 

200 

150 


50 

Rs. Mn. 

350 

300 

250 

200 

150 


50 

Rs. Mn. 

80 

70 

60 

50 

40 

30 

20 


0 

2006 

2007 

2008 



0 

2006 

2007 

2008 



0 

2006 

2007 

2008 



Net Profit After Tax 

Net Profit Before Associate 

Company’s Share of Profit 

Revenue 

Rs. Mn. 

Rs. Mn. 

Rs. Mn. 

150 

200 

2,000 

120 

150 

1,500 

90 


1,000 

60 

30 

50 

5,00 

0 

2006 

2007 

2008 



0 

2006 

2007 

2008 



0 

2006 

2007 

2008 



Rs. Mn. 

15 

Return On Equity 

Rs. Mn. 


Return On Assets 

12 

8 

9 

6 

6 

4 

3 

2 

0 

2006 

2007 

2008 



0 

2006 

2007 

2008 


2010



41 

Notice of Meeting 

NOTICE IS HEREBY GIVEN that the 07th Annual General Meeting 

of SIERRA CABLES PLC will be held on 04th August 2010 at 10.00 

a.m. at the Sri Lanka Foundation Institute, 100, Independence Square, 

Colombo 07. 

Agenda 

1. To read the notice convening the meeting. 

2. To receive and consider the Report of Directors and the Statement 

of Audited Accounts for the year ended 31 March 2010 and the 

Report of the Auditors thereon. 

3. To declare a final dividend as recommended by the Board of 

Directors. 

4. To re-elect Mr. E.A.D.T. B. Perera who retires by rotation in terms 

of Article 91 of the Articles of Association of the Company as a 

Director of the Company. 

6. To re-elect Mr. D.S. Panditha who retires by rotation in terms 

of Article 91 of the Articles of Association of the Company as a 

Director of the Company. 

7. To re-appoint Messrs KPMG Ford, Rhodes, Thornton & Co., 

Chartered Accountants as Auditor of the Company for the 

ensuring year and to authorise the Directors to determine their 

remuneration. 

8. To transact any other business of which due notice has been 

given. 

To consider and if thought fit to pass the following as special 

resolutions: 

A. To delete the Memorandum of Association of the Company in its 

entirety. 

B. To include the following as Article number 2(A) under the caption 

PRIMARY OBJECTS in the Articles of Association of the Company 

to read as follows: 

2 (A) Primary Objects 

(1) To carry on the business of manufacturers of all kinds of 

cables, wires and conductors from aluminium, copper, steel 

or any other metal or material including insulated, sheathed 

and armoured cables, wires and conductors for transmitting 

electricity and other types of power and telecommunications 

and for any other purpose. 

(2) To carry on the business of manufacturers of insulators, 

sheaths, conduits and tubes from any natural chemical or 

synthetic substance or any metal for the purpose of housing 

and protecting such cables, wires and conductors. 

(3) To carry on the business of electricians, electrical engineers 

and manufacturers of all kinds of machinery, equipment and 

apparatus including accumulators, lamps, meters, engines, 

dynamos, motors, switches, plugs, adapters, regulators, fuse 

boxes and batteries and telecommunication apparatus and 

equipment of every kind. 

(4) To carry on the business of importers, exporters, wholesale 

& retail dealers, stockists of all kinds of raw materials, 

wires, cables, machinery, apparatus goods and materials of 

all kinds. 

(5) To carry on the business relating to the rolling, mining, casting, 

smelting and working of minerals, the production and working 

of metals and the production, manufacture and preparation 

of any other items which may be conveniently combined with 

the business of the Company. 

(6) To carry on any other business the Board of Directors of the 

Company may determine to be beneficial to the Company. 

1) To add the following paragraph to existing Article 10 which shall 

read as follows: 

The Company shall not register more than three (03) persons as joint 

holders (including the principal holder) of any shares (except in the 

case of executors, administrators or heirs of a deceased member). 

By Order of the Board 

(Sgd.) 

P.R. Secretarial Services (Pvt) Ltd. 


Note : 

• A member entitled to attend and vote at the meeting, is entitled to 

appoint a Proxy to attend and vote instead of him/her; a Form of 

Proxy is enclosed for this purpose. 

• A Proxy need not be a member of the Company. 

• The completed Form of Proxy must be deposited at the Company 

Registrars’ Office, No.101, Inner Flower Road, Colombo 03 not less 

than forty-eight (48) hours before the time fixed for the meeting. 

• Any member or Proxy holder attending the meeting is kindly 

requested to bring this report. 

• For security reasons, Members/Proxy holders are kindly advised to 

bring along with them their National Identify Card or a similar form 

of acceptable identity when attending the meeting.


Notes

Form of Proxy 

I/We …………………………........………………………………......................................................................... (NIC No. ………………........…………..…) 

of …………………………………………………………...…………...………………………………………............................…... being a Member/Members 

of the above named Company, hereby appoint: 

(1) ……….…………………………………………………..…… (NIC No. ………….………………….) of …………....……………………...……..............… 

...............…………………………………………..…............................................................................................................................ failing him/her 

(2) Wahalathanthrige Anil Priyantha Perera, or failing him 

(3) Francis Anthony William Irugalbandara, or failing him 

(4) Don Nimal Nayana Lokuge, or failing him 

(5) Egodagoda Arachchige Don Tissa Benjamin Perera, or failing him 

(6) Daya Shamendra Panditha, or failing him 

(7) James Henry Paul Ratnayake, or failing him 

(8) Ranjit Michael Samuel Fernando or failing him 

(9) Dangedera Gamage Kamal Edger Weerapperuma 

as my/our Proxy to represent me/us and to speak and to vote on my/our behalf at the 07th Annual General Meeting of the Company to be held on 

04th August 2010 at 10.00 a.m. at the Sri Lanka Foundation Institute, 100, Independence Square, Colombo 07 and at every poll which may be taken 

in consequence of the aforesaid meeting and at any adjournment thereof. 

I/WE INDICATE MY/OUR VOTE ON THE RESOLUTIONS BELOW AS FOLLOWS: 

FOR 

AGAINST 

1. To receive and consider the Report of the Directors and the Statement of Audited Accounts 

for the year ended 31 March 2010 and the Report of the Auditors thereon. 

2. To declare a final dividend as recommended by the Board of Directors. 

3. To re-elect Mr. E.A.D.T.B. Perera who retires by rotation in terms of Article 91 of the Articles 

of Association of the Company as a Director of the Company. 

4. To re-elect Mr. D.S. Panditha who retires by rotation in terms of Article 91 of the Articles 

of Association of the Company as a Director of the Company. 

5. To re-appoint Messrs KPMG Ford, Rhodes, Thornton & Co., Chartered Accountants as Auditors 

of the Company for the ensuing year and to authorize the Directors to determine their remuneration. 

6. Special Resolution to amend the Articles of Association of the Company. 

Signed this…………………………………………day of……………………………………………..2010. 

………………………………… 

Signature of Shareholder NIC No. ............................................. 

Note: (i) A Proxy need not be a member of the Company. 

(ii) Instructions as to completion on reverse.

Form of Proxy 

INSTRUCTIONS FOR THE COMPLETION OF PROXY 

1. To be valid, this Form of Proxy must be deposited at the Company Registrars’ Office, No.101, Inner 

Flower Road, Colombo 04 by 10.00 a.m. on 02nd August 2010. 

2. In perfecting the Form of Proxy please ensure that all details are legible. 

3. If you wish to appoint a person other than the Chairman (or failing him, one of the Directors) 

as your Proxy, please insert the relevant details at (1) overleaf and initial against this entry. 

4. Please indicate with an “X” in the space provided how your Proxy is to vote on each resolution. 

If no indication is given, the Proxy in his discretion will vote, as he thinks fit. If you do not wish 

your Proxy to vote as he thinks fit on any other resolution brought before the meeting, please mark 

the box provided appropriately and initial. 

5. In the case of a Company/Corporation, the Proxy must be under its Common Seal, which should be 

affixed and attested in the manner prescribed by its Articles of Association/Act of Incorporation. 

6. In the case of a Proxy signed by an Attorney, the Power of Attorney must be deposited at the 

Registered Office for registration, if such Power of Attorney has not already been registered 

with the Company.

Designed & Printed by Printel (Pvt) Limited

Annual Report 2009/10 - Colombo Stock Exchange

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