Pyramid Saimira Theatre

The Directors are pleased to present their report on the business and
 operations of your Company for the year ended March 31, 2008.
 
 Financial Results
 
 An overview on financial performance of the company:
 
                                                      (Rs. in lakhs)
                               For the year ended  For the year ended
 Particulars                       March 31, 2008      March 31, 2007
 
 Total Income                           74,930.59          16,476.14
 Operating Expenditure                  63,510.39          14,290.81
 Profit Before Interest, 
 Depreciation and Tax                   11,420.20           2,185.33
 Interest                                  881.50              25.31
 Depreciation & Amortisation             1,118.99             308.76
 Profit Before Tax (PBT)                 9,419.71           1,851.26
 Provision for Tax                       3,632.34             507.93
 Net Profit for the year                 5,787.37           1,343.33
 Balance brought forward from 
 previous year                           1,519.08             175.75
 Amount available for appropriation      7,306.45           1,519.08
 Appropriations                               NIL                NIL
 Balance carried to the Balance Sheet    7,306.45           1,519.08
 Earning per share (Basic)                  20.47               6.23
 Earning per share (Diluted)                14.52
 Results of Operations
 
 The company continued to exhibit strong and profitable growth in the
 financial year from 1st April, 2007 to 31st March, 2008.
 
 For the financial year total income earned by the company was Rs.749.31
 crore, which recorded an increase of 355 % over previous financial
 year’s total income of Rs.164.76 crore. As per the Consolidated
 Accounts for the financial year total income stood at Rs.970.98 crore.
 
 Net profit of the company for the financial year was Rs.57.87 crore
 (7.72% of the total income), at an increase of 330% over the net profit
 of Rs.13.43 crore (8.15% of the total income) for the previous
 financial year. As per Consolidated Accounts for the financial year the
 net profit was Rs.114.30 crore.
 
 This leap forward is attributable to the addition of 500 screens during
 the year. As at 31.3.08 the company operated a total of 765 screens
 with a seating capacity of 4.86 lakhs and registered a foot fall of 175
 million people with average revenue of Rs. 40.05 per patron during the
 year. The average capacity utilization for the year under review stood
 at 36.40%.
 
 Business Overview
 
 A separate section on “Business Discussion and Analysis” has been
 annexed to the Corporate Governance Report under Clause 49 of the
 Listing Agreements.
 
 Dividend
 
 Your Directors have not recommended any dividend for the year under
 review. Considering expansion plans and growth opportunities as
 witnessed from the performance during the year, your directors took the
 liberty of ploughing back the entire accruals.
 
 Capital & Finance
 
 Share Capital
 
 During the year the company has not made any fresh issue of share
 capital.
 
 Convertible Warrants
 
 Pursuant to the resolution passed by the members at the annual general
 meeting held on 29th September 2007, the company has allotted to one of
 the promoters 36,40,000 warrants on 22nd October 2007, convertible into
 equal no of equity shares of Rs.10/- each at a conversion price of
 Rs.310/- (Rupees three hundred ten only) per share, at any time during
 18 months from the date of allotment of the warrants. The company has
 received an amount of Rs. 11,28,40,000/- on date of allotment of
 warrants from the allottees being 10% of the total price payable on
 conversion.
 
 Public Deposits
 
 Your Company had not accepted any fixed deposits and, as such, no
 amount of principal or interest was outstanding as of the balance sheet
 date.
 
 Foreign Currency Convertible Bonds
 
 The company has issued USD 90 Million 1.75% Bonds on 3rd July 2007
 convertible into equity shares of Rs.10/- each at any time from 3rd
 August 2007 to 4th June 2012. The initial conversion price was fixed at
 Rs.454/- (Rupees four hundred fifty four only) per share, which as per
 terms and conditions of the issue, was reset on 3rd July 2008 at
 Rs.385.90 (Rupees three hundred eighty five and ninety paise only) per
 share. Interest is payable semiannually. The bonds, unless converted or
 repaid earlier, shall be redeemed on 4th July 2012. As on date of this
 report, your company has not received any request for conversion of the
 bonds.
 
 Responsibility Statement of Board of Directors
 
 As per requirement under Section 217 (2AA) of the Companies Act, 1956
 and based on the representations received from the operating
 management, the directors here by confirm that:
 
 (i) in the preparation of the annual accounts for the financial year
 ended March 31, 2008, the applicable accounting standards had been
 followed along with proper explanation relating to material departures;
 
 (ii) the Directors have selected such accounting policies and applied
 them consistently and made judgments 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 or
 loss of the company for that period;
 
 (iii) the Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956 for safeguarding the assets of
 the company and for preventing and detecting fraud and other
 irregularities;
 
 (iv) the Directors have prepared the annual accounts on a going concern
 basis.
 
 Corporate Governance
 
 A report on Corporate Governance as stipulated under Clause 49 of the
 Listing Agreement with the Stock Exchanges forms part of the Annual
 Report.
 
 Certificate of Auditor on Compliance with Corporate Governance
 
 A certificate from the Auditor of the Company on compliance with
 Corporate Governance guidelines as stipulated in Clause 49 of the
 Listing Agreements with the Stock Exchanges is annexed and forms part
 of this report.
 
 Subsidiary/ Joint Venture Companies and Consolidated Financial
 Statements
 
 During the year the following companies were setup as or other wise
 became, subsidiary/ Joint Venture of your company.
 
 Joint Venture:
 
 Pyramid Saimira Theatre Chain (M) Sdn. Bhd., Malaysia
 
 Subsidiaries and Associates:
 
 - Pyramid Saimira Entertaiment Limited, Singapore
 
 - Pyramid Saimira Entertainment America Inc., USA
 
 - Pyramid Saimira Production International Limited, India
 
 - Dimples Cine Advertising Private Limited, India
 
 - Aurona Technologies Limited, UK
 
 - Aurona Technologies Private Limited, India
 
 - Pyramid Saimira Production Services Limited, India
 
 As required under the Listing Agreements with the Stock Exchanges, the
 Consolidated Financial Statement of the company and all above
 subsidiaries, joint venture is attached. The Consolidated Financial
 Statements has been prepared in accordance with Accounting Standards
 21, 23 and 27 issued by the Institute of Chartered Accountants of
 India.
 
 In terms of the exemptions under Section 212(8) of the Companies Act,
 1956, the Balance Sheets, Profit & Loss Accounts, Auditors’ Reports,
 Directors Reports and other financial statements of the subsidiary
 companies are not attached to the Balance Sheet of the company. However
 a statement of summery of financial of the subsidiaries is annexed to
 the report. The annual accounts and detailed financial information of
 the subsidiaries shall be made available to the members on their
 specific request. These are available for inspection by any member of
 the company/ it’s subsidiaries at the Registered Office of the company.
 Accounts of the subsidiary companies can also be inspected at the
 Registered Office of the respective companies.
 
 Directors
 
 Since the last Annual General Meeting, the following changes have taken
 place in the Board of Directors:
 
 (1) Mr. M. S. Narasimhan, who was an Independent Non-executive
 Director, had passed away on 23rd January 2008. The board of directors,
 convey their deep condolence on the sad demise of Mr. M S Narasimhan.
 
 (2) Mr. G. Ramakrishnan and Mr. N. Venkataraman were appointed as
 additional directors to hold office of Independent Non-executive
 Directors with effect from 30th January 2008 and 30th June 2008
 respectively and their office shall be vacated on the date of
 forthcoming annual general meeting. The company has received notices
 for candidature of Mr. G. Ramakrishnan and Mr. N. Venkataraman for
 being appointed as directors at the forthcoming annual general meeting.
 
 (3) Mr. V Natarajan who was holding office of Chairman & Whole-time
 Director has resigned from the board with effect from 21st April 2008.
 
 (4) At the board meeting held on 21st April 2008, Mr. P. S. Saminathan
 was appointed as Chairman of the board of directors to hold office of
 Chairman & Managing Director with effect from that date.
 
 (5) The current tenure of whole-time directorship held by Mr. N.
 Narayanan comes to end on 31st August 2008.  The board of directors at
 their meeting held on 1st September 2008 reappointed him as whole-time
 director for a period of three years with effect from 1st September
 2008.
 
 (6) Mr. P.S. Saminathan and Mr. N. Narayanan shall retire by rotation
 at the forthcoming Annual General Meeting of the Company and being
 eligible offer themselves for reappointment.
 
 Auditors
 
 Mr. R Mugunthan, Chartered Accountant, Statutory Auditor of the company
 is retiring at the forthcoming Annual General Meeting and is eligible
 for re-appointment.
 
 Reports of the statutory auditor on the stand-alone accounts and
 consolidated accounts for the financial year ended 31st March 2008 do
 not contain any qualification or adverse remarks.
 
 Particulars of Employees
 
 Particulars of employees as required under the provisions of Section
 217 (2A) of the Companies Act, 1956, read with the Companies
 (Particulars of Employees) Rules, 1975 is forming part of this Report
 as Annexure. In terms of section 219(1)(iv) of the Companies Act, 1956
 the report is being sent with out attaching the annexure. But it is
 available for inspection at the registered office during working hours
 for a period of twenty-one days before the date of the annual general
 meeting. If, any shareholder is interested for a copy of the same, he
 may write to the company secretary at the registered office.
 
 Conservation of Energy, Technology Absorption, Foreign Exchange
 Earnings and Outgo
 
 The particulars as prescribed under section 217(1)(e) of the Companies
 Act, 1956 read with the Companies (Disclosure of Particulars in the
 Report of Board of Directors) Rules, 1988, is attached to this report
 as Annexure.
 
 Signifcant events after financial year
 
 Formation of Subsidiary / Joint Venture
 
 A wholly owned subsidiary named Pyramid Saimira Content Distribution
 Private Limited was formed. This company will focus on distribution of
 movies in Indian Territory.
 
 Acknowledgment
 
 The Directors are thankful to the members, investors, customers,
 vendors and bankers for their confdence and continued support extended
 to the company. The directors are grateful to the Central and State
 Governments, Securities and Exchange Board of India, Reserve Bank of
 India and other Government/ Regulatory Authorities for their continued
 support.
 
 The Directors would like to express their sincere thanks to the Film
 Producers Council, Distributors Associations and various other agencies
 associated with film Industry and place on record the support extended
 by them.
 
 The Directors also place on record their appreciation to all the
 employees for their commendable contribution at various levels.
 
                                       For and on behalf of the Board
 
 Chennai                                      P. S. SAMINATHAN
 30th October, 2008                      Chairman & Managing Director