FINANCIAL RESULTS :

The Financial results for the Company under review are as follows :

                                                          (Rs. Lakhs.)

                                                  1999-2000    1998-99

Gross Profit Before Depreciation                       7.97      13.49

Provision for Depreciation                            82.57      76.14

Amortisation of Miscellaneous Expenditure             17.11      17.12

Profit/(Loss) before Taxation                       (91.72)    (79.76) 

Less : Provision for Taxation                             -          -   

Profit/(Loss) after Taxation                        (91.72)    (79.76)     

Profit Brought forward From previous year            (5.46)      31.30

Available Surplus/(Deficit)                         (97.18)    (48.46) 

Surplus/(Deficit) Carried forward                   (97.18)    (48.46)

At the very outset, your directors are glad to inform you that despite difficult business environment prevailing in the pesticide Industry, your Company could achieve reasonable growth in volumes and operating margins by recording a turnover of Rs. 2266.68 lakhs (Previous year Rs. 2405.67 lakhs). This is to be viewed against the back drop of steep price erosin and static sales growth in the pesticide industry. The reasons for moderate performance is mainly due to further continuation of adverse season for commercial crops, which not only had a negative effect on the pesticide consumption but also resulted in poor yields to the user segment. Inspite of poor Industry performance, your company could increase its volumes through continuous efforts on market penetration and widening distribution net work there by improving its market share on food crops by launching new products and sustaining its investment in marketing efforts on key Products.

During the year the Monocrotophos plant was to shutdown for 3 months for installation of new equipment intended for manufacturer of Quinolphos. The Trial runs have been carried out and commercial production is expected to be commenced shortly.

DIVIDEND :

Keeping in view the financial performance of the Company, yours Directors do not recommend any dividend for this year also.

CAPITAL EXPENDITURE :

During the year review the company has incurred capital Expenditure of Rs. 214.13 Lakhs.

FUTURE OUTLOOK :

Pesticide Industry today is witnessing certain positive change and is passing through a transformation to a much better phase. There has been major shakeouts of many units leaving only few players having strong distribution net work in the market including your company who have survived the turbulent times. Monocrotophos is also likely to improve as some of the units in the industry have stopped or curtailed production. Your company is re-orienting its strategies to take advantage of this situation and it hopes to operate at its optimum capacity. Plans are also on the anvil for introducing value-added products so as to improve its performance. You company is constantly endeavoring to improve its existing product portfolio and develop new ones intandem with the customer's needs.

The current year started on a promising note with sales picking up. Company's various initiatives like adding new products to the existing product range, aggressive marketing initiatives supported by improvement in supply chain management, various cost reduction measures and focus on improving customer value would be able to sustain the growth of the company and better its performance in the current year.

Y2K PROJECT :

Your company has successfully rolled over to the new millennium with out any problem.

DIRECTORS :

In accordance with the requirements of the Companies Act, 1956, Sri. P. Bhaskara Rao and Smt. P. Durgamba retire by rotation and being eligible, offer themselves for reappointment.

AUDITORS :

M/s. Love Lock & Lewes, Chartered Accountants, the Company's Auditors retire at the conclusion of this Annual General Meeting. They have intimated their willingness to accept the re-appointment and have confirmed their eligibility under Section 224(1-B) of the Companies Act.

PARTICULARS RELATING TO EMPLOYEES :

Information required under Section 217(1)(e) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, are set out in a separate statement attached hereto and forms part of this report.

INDUSTRIAL RELATIONS :

The industrial relations continue to be cordial during the year.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, EXPORTS & FOREIGN EXCHANGE EARNINGS AND OUTGO AND PARTICULARS OF EMPLOYEES :

Your Company is not engaged in power intensive industry and the average power consumption has been well within the norms. The requisite information in terms of Companies (disclosures of particulars in the report of Board of Directors) Rules 1988 are set out in a separate statement attached hereto and forms part of report.

RESEARCH AND DEVELOPMENT-NOT APPLICABLE

TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. The present method is indigenous and advanced method is used to upgrade the process.

2. Information required in case of imported technology (imported during the last 5 years reckoned from the beginning of the financial year) : Not applicable as there has been no import of technology.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Earnings             : Nil

Outgo