Directors’ Report

Bangladesh Lamps Limited

Directors’ Report for the 18 months period ended on 30 June 2017

 

Dear Shareholders,

Assalamu Alaikum. On behalf of the Board of Directors and myself, I am pleased to welcome you to the 56th Annual General Meeting of Bangladesh Lamps Limited and present before you the Annual Report and Audited Financial Statements of the Company for the 18 months period ended on 30 June 2017.

Business

During the 18 months period ended on 30 June 2017 our Company has performed well and achieved a higher profitibility. The overall state of business of the company for the 18 months period ended on 30 June 2017 is summarized below:

                                                                                        (Taka in Million)

  

January-June 2016 (06 Months)

July 2016-June 2017 (12 Months)

Jan 2016-June 2017 (18 Months)

Jan-Dec 2015 (12 Months)

Taka% of SalesTaka% of SalesTaka% of SalesTaka% of Sales
Sales624.03100%1,219.93100%1,843.97100%1,262.86100%
Net Profit after Tax26.874.31%39.353.23%66.223.59%30.862.44%

During the period we undertook various measures to improve our business; particularly, we are continuing our efforts to bring about more efficiency in the areas of sales, supply chain and human resource management of the Company. We are also working to expand the distribution reach of our products to the remotest parts of the country and to gain market share. Such activities are ongoing and will be further strengthened for a sustainable growth and profitability of the Company. In order to keep up with new developments in the lighting industry, we are also broadening our product portfolio particularly in the LED (Light-emitting Diode) segment business.

Dividend

Keeping in view of the performance of the Company, the Board of Directors is pleased to recommend cash dividend of Taka 3.00 per share of Taka 10.00 each (i.e. 30%) for the 18 months period ended on 30 June 2017.

The appropriation of profit is shown below:

(Taka)
Profit for the 18 months period ended on 30 June 201766,219,521
____________
 Total Divisible profit66,219,521
———————-
Proposed appropriations
Proposed dividend @ Taka 3.00 per share on
9,370,608 ordinary shares of Taka.10.00 each28,111,824
Transfer to General Reserve38,107,697
———————–
 Total appropriation66,219,521
———————–

Shareholders & share value

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Total number of shareholders of the Company at 30th June 2017 was 2,977 as against 2,641 in the previous year. The price index of shares on that date stood at Taka 173.30 per share at the Dhaka Stock Exchange and Taka 174.00 per share at the Chittagong Stock Exchange.

Board Matters
The Board of Directors of Bangladesh Lamps Limited comprises of 12 (twelve) members including three Independent Directors. Mrs. Shahnaz Rahman is the Chairman of the Company. Mr. Latifur Rahman is the Managing Director and Chief Executive Officer (CEO) of the Company. To enable the Board to function effectively and allow Directors to discharge their responsibilities efficiently, full and timely information is made available to them by the professional managers of each of the business segments. The Board of Directors met 7(seven) times during the period under review. The attendance record of the Directors is as follows:

Name of DirectorsTotal MeetingsAttended
Mrs. Shahnaz Rahman77
Mr. Latifur Rahman77
Mr. Saifur Rahman77
Mr. Atiqur Rahman77
Mr. Shamsur Rahman77
Mr. Obaidur Rahman Khan77
Mr. Arshad Waliur Rahman76
Mrs. Simeen Hossain76
Mrs. Shahzreh Huq76
Mr. Ahmed Shafi Choudhury (Independent Director)77
Mrs. Rokia Afzal Rahman (Independent Director)75
Mr. Anis-uz-Zaman Khan (Independent Director)77

Audit Committee

The Audit Committee comprises of 04 (four) Directors. The Committee is headed by the Independent Director, Mr. Ahmed Shafi Choudhury. The objective of the Audit Committee is to ensure an adequate and effective internal control to facilitate the smooth functioning of the Company’s operations and assist the Board in discharging its responsibilities. The Audit committee also reviews the interim and annual financial statements before submission to the Board.

Corporate Reporting
The Board of Directors is pleased to inform the following as required by the Bangladesh Securities and Exchange Commission:

  • The growth in the lighting industry which encompasses the CFL (Compact Fluorescent Light) , LED bulbs, FTL (Fluorescent Tube Light) and its accessories like Starter, Ballast, Industrial Shades etc. was moderate during the 18 months period ended on 30 June 2017. The CFL and LED segment, however, has grown significantly because of the energy saving benefit and longer life.
  • Segment-wise or product-wise performance :

The segment wise sales performance of the Company during the 18 Months Period (Jan’16-Jun’17) is shown below:

                                                                                             (Taka in Million)

Particulars
 GLS
CFL
FTL
LED
 
Starter
 
Ballast
 
Others
Total
Net Sales
391.59
1,002.30
171.11
254.90
12.86
10.80
0.41
1,843.97
  • The Company is aware of the different risks associated with doing business and is prepared to manage those risks through a professional approach. The financial and other risks have been disclosed in the notes 34 and 39 to the financial statements respectively.
  • During the 18 months period ended on 30 June 2017, the net sales of the Company was Taka 1,843.97 million and the net profit after tax was Taka 66.22 million. The financials are shown in the following table:
Particulars             Taka in Million
For the 18 months period ended 30 June 2017 For the year ended 31 December 2015
Net Sales Revenue1,843.971,262.86
Cost of goods sold(1,401.53)(963.56)
Gross profit442.44299.30
Other income63.5423.08
Operating expenses(390.84)(271.99)
Profit before finance cost
115.1350.38
Net finance expense(23.01)(6.46)
Profit/(loss) before contribution to WPPF92.1343.92
Contribution to WPPF(4.39)(2.09)
Profit/(loss) before income tax87.7441.83
Income tax expenses21.5210.97
Profit/(loss) after tax66.2230.86
  • No extra-ordinary gain or loss has been recognized in the financial statement.
  • All transactions with related parties have been made on commercial basis. Details of related party transactions have been disclosed under Note No. 35 of the Financial Statements.
  • No significant variance occurred between Quarterly Financial performance and Annual Financial Statements.
  • The Board of Directors including Independent Directors received fees for attending Board Meeting only in accordance with the Articles of Association of the Company. The remuneration of Tk. 4,50,000.00 was paid to the Managing Director of the Company during the 18 months period ended on 30 June 2017.
  • The Financial Statements together with the notes thereon have been drawn up in conformity with the Companies Act 1994 and Securities and Exchange Rules 1987. These statements present fairly the Company’s state of affairs and the results of its operations, cash flow, and changes in equity.
  • Proper books of accounts of the Company have been maintained.
  • Appropriate Accounting Policies have been consistently applied in the preparation of Financial Statements and the accounting estimates are based on reasonable and prudent judgment.
  • International Accounting Standards (IAS)/Bangladesh Accounting Standards (BAS)/International Financial Reporting Standards (IFRS)/Bangladesh Financial Reporting Standards (BFRS), as applicable in Bangladesh, have been followed in preparation of the financial statements and any departure there-from has been adequately disclosed.
  • The systems of internal control are sound and have been effectively implemented and monitored.
  • There are no significant doubts upon the Company’s ability to continue as a going concern.
  • All significant variations in operating results from the previous year have been highlighted and reasons thereof have been explained.
  • The CEO and CFO have certified to the Board that they have reviewed the Financial Statements and believe that these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading.
  • The CEO and CFO have certified to the Board that they have reviewed the Financial Statements and believe that these statements together present a true and fair view of the company’s affairs and are in compliance with existing accounting standards and applicable laws.
  • The CEO and CFO have further certified to the Board that there are, to the best of their knowledge and belief, no transactions entered into by the Company during the period which are fraudulent, illegal or in violation of the Company’s codes of conduct.
  • The key operating and financial data for the last ten years, including those of the last 18 months period, is enclosed.
  • The pattern of shareholding (name wise) is also enclosed.

Corporate governance compliance Report

In accordance with the requirement of Bangladesh Securities Exchanges Commission, Corporate Governance Compliance Report is enclosed.

Directors

In terms of article 113 of the Articles of Association of the Company, Transcom Limited is entitled to appoint one-third of the total number of Directors who shall not retire by rotation. Accordingly, Mr. Latifur Rahman and Mrs. Shahnaz Rahman who were appointed by Transcom Limited as Directors of the Company will not retire by rotation.

Out of the other Directors, Mr. Saifur Rahman, Mr. Atiqur Rahman, Mr. Obaidur Rahman Khan and Mrs. Shahzreh Huq will retire by rotation in accordance with article 124 of the Articles of Association of the Company and, being eligible, offer themselves for re-election.

Auditors

The existing auditors of the Company Messrs. Nurul Faruk Hasan & Co., Chartered Accountants, will retire at this meeting and they have expressed their unwillingness to act as the statutory auditors of the Company for the year 2017-2018 vide letter dated August 05, 2017 necessitating the appointment of new auditors. In the meantime, Messrs. A. Qasem & Co., Chartered Accountants, have expressed their interest to act as the statutory auditors of the company for the year 2017-2018.

Acknowledgement
On behalf of the Board of Directors and myself, I would like to thank our shareholders, employees of the Company, our business partners including distributors, customers, banks, financial institutions, government agencies, and our suppliers for their continuous support and co-operation extended to the Company. We expect that this commitment will persist in future as well, so that the Company can attain greater success.

       On behalf of the Board

Dated, Dhaka                                                                  Shahnaz Rahman
August 07, 2017                                                                         Chairman