Aban Offshore

The Directors of your company are pleased to present the Twenty Second
 Annual Report along with the accounts for the year ended 31st March
 2008.
 
 1.  FINANCIAL RESULTS
 
                                                 Rupees in Lacs
 Particulars                                  For the year ended
                                      31st March 2008   31st March 2007
 
 Income from Operations                         65792        49532
 
 Other Income                                    7389         6927
 
 Less Expenditure                               31385        24758
 
 Profit before Interest and Depreciation        41796        31701
 
 Less Interest                                   6924         4482
 
 Less Depreciation                               9545         9478
 
 Goodwill Amortised                               629          629
 
 Profit for the year before Tax                 24698        17112
 
 Provision for Tax                               9560         6250
 
 Fringe Benefit Tax                                66           89
 
 Provision for Deferred Tax                      (838)         813
 
 Profit after Tax & Amortisation of Goodwill    15910         9960
 
 Profit brought forward from the previous year  27361        23285
 
 Available for appropriation                    43271        33245
 
 Proposed Dividend- Equity                       1361         1108
 
 Tax on Dividend – Equity                         231          188
 
 Proposed Dividend – Preference                  2604         1357
 
 Tax on Dividend – Preference                     443          231
 
 Transfer to General Reserve                     1600         1000
 
 Transfer to Capital Redemption Reserve          3000         2000
 
 Balance Carried forward                        34032        27361
 
 2.  PERFORMANCE
 
 The Company has registered an Income of Rs.73181 Lacs during the year
 under review. All the rigs, drillship and the Floating Production Unit
 TAHARA were working satisfactorily. The rigs Aban III, IV and V started
 operations under the new contract. Oriental Oil Company had extended
 the contract for rig Aban VI for a further period of six years.
 
 2a. CHANGES IN SHARE CAPITAL
 
 During the year the following changes were effected in the Share
 Capital of the Company
 
 i) Issue of Shares under Aban Employee Stock Option Scheme 3050 Equity
 Shares of Rs.2/- each were issued allotted upon exercise of options
 under the Employee Stock Option Scheme 2005 ii) 8,51,055 equity shares
 of Rs. 2/- each fully paid were allotted on conversion of 620 Foreign
 Currency Convertible Bonds.
 
 3.  SUBSIDIARY COMPANIES INDIAN SUBSIDIARY
 
 Aban Energies Limited
 
 The Subsidiary Company activities relating to the maintenance of
 windmills of the Company has been satisfactory.
 
 INTERNATIONAL
 
 A new subsidiary named Aban Pearl Pte Ltd. incorporated through Aban
 Singapore Pte. Ltd. Aban Pearl Pte Ltd. owns a Semi submersible rig by
 name Aban Pearl. The rigs Deep Driller 1, Deep Driller 2, Deep Driller
 3, Deep Driller 4, Deep Driller 5, Aban VIII, Murmanskaya and Drillship
 Deep Venture were working satisfactorily. The Rig Aban VII, Semi
 submersible, Aban Pearl Drillship Aban Abraham are under upgradation
 and refurbishment and Aban Abraham is expected to commence operations
 by August 2008. The rigs Deep Driller 6, Deep Driller 7 and Deep
 Driller 8 are under various stages of constructions. Efforts are
 continuously on for marketing the vessels all over the world for
 drilling operations.
 
 4.  CONSOLIDATION OF ACCOUNTS
 
 The Audited consolidated accounts and cash flow statement comprising
 Aban Offshore Ltd and its Subsidiaries in accordance with the
 Accounting Standard Rules 2006 prescribed by the Institute of the
 Chartered Accountants of India in this regard is attached.Government of
 India, Ministry of Corporate Affairs, vide their letter No. 47/153/2008
 CLIII dated 2.5.2008 has granted its approval under section 212(8) of
 the Companies audited accounts from not attaching the full text of the
 financial statements for the year ended 31st March 2008 of subsidiaries
 namely Aban Energies Ltd, India, Aban Holdings Pte Ltd and Aban
 Singapore Pte. Ltd, Aban 7 Pte Ltd, Aban 8 Pte Ltd and Aban Abraham Pte
 Ltd. Aban Pearl Pte.  Ltd. Aban International Norway AS, Sinvest AS,
 DDI Holding AS, Deep Drilling Invest Pte Ltd., Deep Drilling 1 Pte
 Ltd.,Deep Drilling 2 Pte Ltd.,Deep Drilling 3 Pte Ltd.,Deep Drilling 4
 Pte Ltd.,Deep Drilling 5 Pte Ltd.,Deep Drilling 6 Pte Ltd.,Deep
 Drilling 7 Pte Ltd.,Deep Drilling 8 Pte Ltd.,Beta Drilling Pte Ltd
 Venture Drilling Pte Ltd., Sinvest (Cyprus) Ltd.
 
 Pursuant to the said approval, necessary disclosures have been made in
 respect of the said subsidiaries in this Annual Report along with the
 Statement pursuant to Section 212 of the Companies Act, 1956.
 
 The Audited Accounts of the said Subsidiaries and the related detailed
 information will be made available to the investors of the Companies /
 Subsidiaries seeking such information. The Annual Accounts of the
 Subsidiary Companies will be kept available for inspection by any
 investor at the Registered Office of the Company and that of the
 subsidiaries till the conclusion of Annual General Meeting.
 
 5.  MANAGEMENT’S DISCUSSION AND ANALYSIS
 
 Management Discussion and Analysis Report for the year under review as
 stipulated under clause 49 of the Listing Agreement with the Stock
 Exchanges in India is presented in a separate section forming part of
 the Annual Report.
 
 6.  DIVIDEND
 
 The Directors are pleased to recommend a dividend of 8% p.a. on the
 Cumulative Non Convertible Redeemable Preference Shares allotted in
 June 2005, recommended a dividend of 180% on the paid up Equity Share
 Capital of the Company (Rs.3.60 per fully paid up share and Rs.1.80 per
 partly paid up share) and recommend a dividend of 9% p.a on the
 Non-convertible Cumulative Redeemable Preference Shares allotted during
 the year 2006 -2007 for the year ended31st March 2008.
 
 7.  DIRECTORS
 
 The Directors Mr. V. S. Rao and Mr. P. Venkateswaran retire by rotation
 and, being eligible, offer themselves for reappointment.
 
 8.  DIRECTORS’ RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under Section 217(2AA) of the Companies
 Act, 1956, with respect to the Directors’ Responsibility Statement, it
 is hereby confirmed:
 
 (i) that in the preparation of the Annual Accounts for the financial
 year ended on 31st March 2008, the applicable accounting standards had
 been followed along with a proper explanation relating to material
 departures.
 
 (ii) that the Directors had selected such accounting policies and
 applied them consistently and made judgements and estimates that are
 reasonable and prudent so as to give a true and fair view of the state
 of affairs of the Company at the end of the financial year and of the
 profit of the Company for the year under review.
 
 (iii) that the Directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956 to safeguard the assets of the
 Company and for preventing and detecting fraud and other irregularities
 
 (iv) that the Directors had prepared the accounts for the financial
 year ended on 31st March 2008 on a going concern basis.
 
 9.   STOCK EXCHANGES
 
 Your Company’s Equity shares were listed in the following stock
 exchanges:
 
 Madras Stock Exchange Limited, Bombay Stock Exchange Limited, and
 National Stock Exchange of India Limited.
 
 The Preference Shares issued by the Company are listed with Bombay
 Stock Exchange Ltd.
 
 The Foreign Currency Convertible Bonds issued by the Company are listed
 with the Singapore Exchange Limited. The necessary stock exchange
 regulations are complied with.
 
 The necessary listing fees for the year 2008 -09 has already been paid
 to the respective Stock Exchanges.
 
 10. AUDITORS
 
 M/s Ford, Rhodes, Parks & Co., Chartered Accountants, Chennai, hold
 office until the conclusion of the ensuing Annual General Meeting and,
 being eligible, are recommended for re-appointment.
 
 11.  ADDITIONAL DISCLOSURES
 
 In line with the requirements of Accounting Standards Rules 2006 of the
 Institute of Chartered Accountants of India, your Company has made
 additional disclosures in respect of the financial reporting of
 interests in the joint venture in the notes on accounts
 
 12. PARTICULARS OF EMPLOYEES
 
 As required by the provisions of Section 217 (2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975,
 the names and relevant particulars of the employees who were employed
 throughout the financial year / part of the financial year under review
 and were in receipt of remuneration for the Financial Year in aggregate
 of not less than Rs.24,00,000 (Rs.2,00,000 per month or part thereof),
 are annexed.
 
 13. EMPLOYEE STOCK OPTION
 
 The Compensation Committee at its meeting held on 8th March 2008 had
 granted 1,25,000 options of Rs.2/- each to eligible employees including
 two Deputy Managing Directors. The details of information required to
 be disclosed under SEBI (ESOS &ESPS) Guidelines 1999 are annexed.
 
 14. In terms of Section 217(1) of the Companies Act, 1956 (as amended)
 and the Companies (Disclosure of Particulars in Report of the Board of
 Directors) Rules 1988, your Directors furnish hereunder the additional
 information as required.
 
 A.  Conservation of Energy
 
 The Company’s activities are not energy intensive. However measures are
 taken at all levels for the conservation of energy.
 
 B.  Research and development
 
 The Company’s research activities are mainly directed towards training
 and upgrading the skills of the personnel and import substitution of
 equipment tools and spares.
 
 C.  Technology absorption, adoption and innovation
 
 Efforts are being taken to maximize indigenization of the Rig and
 windmill operation and reduce the dependence on imported equipments
 used in rigs.
 
 Foreign exchange earnings and outgo for the year
 
                                               (Rupees in lacs)
                                                For the year
                                                2007-2008  2006-2007
 
 Foreign Exchange earned during the year           55,336     51,507
 
 Foreign Exchange outflow during the year           6,071      6,514
 
 15. CORPORATE GOVERNANCE
 
 A detailed note on the Company’s philosophy on Corporate Governance and
 such other disclosures as required under the listing agreement with the
 Stock Exchanges is separately annexed herewith and forms part of this
 report.
 
 16. COMPLIANCE CERTIFICATE
 
 A Certificate from the Auditors of the company has been attached to
 this report which testifies that the requirements of a sound Corporate
 Governance process, as stipulated under Clause 49 of the listing
 agreement with the stock exchanges, was met.
 
 17. ACKNOWLEDGEMENTS
 
 Your directors wish to place on record their sincere appreciation of
 the support and co-operation extended by the Bankers, financial
 institutions, relevant government authorities, valued clients, business
 associates, and members of the company. Directors also wish to place on
 record their sincere appreciation for the dedicated contribution made
 by employees at all levels.
 
 Cautionary Statement :
 
 Statement in the Management Discussion and Analysis describing the
 Company’s objective’s estimates expectation of projection may be
 Forward Looking Statement within the meaning of applicable laws and
 regulations. Actual results could differ materially from those
 expressed or implied. Important factors that could make a difference to
 the Company’s operations include Government Regulations, Taw Laws,
 economic developments in India and in the countries in which the
 Company conducts business, litigations and other allied factors.
 
                                  For and on behalf of the Board
 
                                      sd/-               sd/-
 Chennai                         Reji Abraham         V. S. Rao
 July 21, 2008                   Managing Director    Chairman