I am very delighted to invite you to the 39th Annual General Meeting of the Company. The Annual Report consisting of the Accounts for the year ended March 31, 2018 and the Notice convening the Annual General Meeting are enclosed herewith.
The Company’s performance has been discussed at length in the Directors’ Report.
GLOBAL MARKETS AND INDUSTRY OVERVIEW
World economy is still passing through a difficult time due to the slow growth in the economies of most of the countries and also due to the trade protectionism measures started by the USA. It is very difficult to judge anything at this stage about the cascading effect of the action of US to protect its trade and also the effect of USA’s renewed sanction against Iran. Iran is the second largest supplier of Oil to India.
The Oil price has increased in the past one year due to the geopolitical situation such as heightened tensions in Syria, new sanctions on Iran, unrest in Venezuelan oil fields, extended production cuts by OPEC, Transportation constraints and higher demand for Oil in the USA. Currently, the Oil price is moving in the range of USD 70-80 level. The price is expected to be firm in the coming months.
The Oil price has a direct impact to economy of many countries, including India; the certainty in Oil price will help these countries to manage its economy in a better manner. Oil is one of the heavily taxed commodities in most of the countries.
In view of the increase in Oil price, investment is picking up in Offshore and Maritime Industry and this will help this industry to come out from the current recession. One of the major problems in this industry is the inability of most of the clients to make timely payment. Due to this problem, your Company is also facing severe financial difficulties.
The implementation of GST is going without any major problem and as a result, ONGC had issued many tenders which were kept on hold earlier. The Oil has not been brought under GST by the Government due to fear of losing revenue.
CURRENT YEAR - 2017-18
The Company has implemented Indian Accounting Standards, Ind AS and the Financial Statements of FY 2017-18 are based on that. The performance of the Company remained lacklustre during this year also; the turnover during this year was decreased to Rs.55.56 Crs from Rs.62.95 crs in the previous year. The Net Loss was decreased to Rs.17.17 crs from Rs.39.13 crs in the previous year.
The consolidated turnover was decreased to Rs.168.53 Crs from Rs.228.61 crs in the previous year. The Net Loss was decreased to Rs.8.63 crs from Rs.11.12 crs in the previous year.
The long charter of the Barge, VIKRANT DOLPHIN owned by the wholly owned subsidiary, Dolphin Offshore Enterprises (M) Pvt Ltd with M/s. Representaciones Y Distribuciones Evya SA de CV, 2 (Evya), Mexico is facing lot of uncertainties and issues. The Charterer vide letter dated May 13, 2016 terminated the charter w.e.f. May 30, 2016, The subsidiary company took the redelivery of the Barge with all the defects stated in the re-delivery survey report. As per the provision of the C/P the Charterers are liable to pay 90% of the charter hire of the balance period as compensation for the early termination. This matter has been referred to arbitration before LMAA, London. The Charterer has filed petition under bankruptcy Laws of Mexico. The Charterer owes substantial amount of money under the Charter party to the subsidiary company.
ONGC had issued many tenders. The Company was able to pick up two contracts from ONGC, viz, (1) 64 Western Offshore Platform Makeover Project (2) Protective Coating of Wellhead Platforms Project-1 (In consortium with HAL Offshore).
The current order book position of the Company is around Rs.350 crs.
ONGC is likely to come out again with many high value tenders. Your Company is doing its best to get more orders from ONGC.
The barge Vikrant Dolphin owned by the wholly owned Mauritius subsidiary is undergoing repairs and efforts are on to find a gainful deployment of the said Barge.
With the price of oil stabilising at current levels, the investments in Oil and Gas sector is picking up in Saudi Arabia, UAE, other Middle East Countries. As a result, your Company has also procured some orders from Middle East.
In view of the above, the performance of your Company is expected to be substantially better during the FY 2018-2019.
As you are aware, your Company places a lot of emphasis on HSE and is accredited with OHSAS 18001-2007 & ISO 14001-2004.
I would like to inform you that in this Annual General Meeting of your Company, in accordance with the Articles of Association of the Company and the provisions of the Companies Act, 2013, Mr. Satpal Singh will be retiring by rotation, and being eligible, will be seeking re-appointment. Mr. Kiran Vaidya has been appointed as an Additional Director on April 25, 2018 and he will be seeking the shareholders approval for appointment as an Independent Director for 5 years. Mrs. Vasantha S Bharucha resigned from the Board of Directors of the Company w.e.f. November 26, 2017. I, along with the members of the Board, the Management and the staff express our appreciation for her matured advice given during her tenure in the Board.
I would like to re-iterate our strong commitment to good Corporate Governance. We are continuously striving to improve the quality of our disclosures..
I express my gratitude to all the shareholders for their continued co-operation. I thank my fellow Directors for their support and valuable guidance. I also thank our government, bankers, employees, our customers, dealers, suppliers and other business associates for their support and cooperation.
I look forward to your continued support to take the Company ahead to a promising future.
With warm regards,
Mr. Sabyasachi Hajara
August 08, 2018