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Full Year Financial Statement And Dividend Announcement For The Period Ended 31/03/2004

BackAug 16, 2004
PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3),
        HALF-YEAR AND FULL YEAR RESULTS


1(a) An income statement (for the group) together with a comparative statement for the
      corresponding period of the immediately preceding financial year.
      The Board of Directors of Meghmani Organics Limited ("MOL" or "the Company" or "the Issuer") wishes to make the announcement of the Company's results for the financial year ended 31 March, 2004 as follows:

      Company
      12 months ended 31.03.2004
      12 months ended
      31.03.2003
      % Increase /
      (Decrease)
      Rs '000
      Rs '000
      Revenue
      2,440,319
      2,024,034
      20.6
      Cost of sales
      (1,793,153)
      (1,426,667)
      25.7
      Gross Profit
      647,166
      597,367
      8.3
      Other operating income
      66,287
      107,751
      (38.5)
      Distribution costs
      (184,465)
      (261,801)
      (29.5)
      Administrative expenses
      (92,163)
      (78,826)
      16.9
      Other operating expenses
      (4,509)
      (44,957)
      (90.0)
      Profit from operations
      432,316
      319,534
      35.3
      Finance costs
      (60,896)
      (43,395)
      40.3
      Income from investments
      30
      23
      30.4
      Profit before income tax
      371,450
      276,162
      34.5
      Income tax
      (76,454)
      (59,655)
      28.2
      Profit after income tax
      294,996
      216,507
      36.3

1(a)(ii) The net profit attributable to the shareholders includes the following charges/(credits):

Company
12 months ended
31.03.2004
12 months ended
31.03.2003
% Increase /
(Decrease)
Rs '000
Rs '000
Allowance for doubtful trade receivables
-
36,712
(100.0)
Bad trade receivables written off
-
1,565
(100.0)
Depreciation expense
94,423
78,134
20.8
Foreign currency exchange
adjustment loss
4,737
5,751
(17.6)
Interest expense
44,981
35,137
28.0
Interest income
(977)
(884)
10.5
Loss on disposal of plant and equipment
740
929
(20.3)
Research and development expenditure
7,969
5,781
37.8
Under-provision of current tax in respect of
prior years
2,855
-
n/m

      note: n.m. - not meaningful


1(b)(i) A balance sheet (for the issuer and group), together with a comparative statement
      as at the end of the immediately preceding financial year.
      Company
      As at 31.03.2004
      As at 31.03.2003
      Rs '000
      Rs '000
      ASSETS
      Current assets
      Cash & bank balances
      117,254
      67,881
      Trade receivables
      1,184,627
      847,570
      Other receivables and prepayments
      173,422
      184,755
      Inventories
      402,157
      305,549
      Income tax recoverable
      929
      -
      Total current assets
      1,878,389
      1,405,755
      Non - current assets
      Property, plant and equipment
      943,780
      765,141
      Available for sale investments
      4,546
      2,146
      Total non - current assets
      948,326
      767,287
      Total assets
      2,826,715
      2,173,042
      LIABILITIES AND EQUITY
      Current liabilities
      Bank borrowings
      674,181
      442,428
      Trade payables
      305,792
      329,851
      Other payables
      89,034
      83,501
      Loans from related parties (unsecured)
      -
      44,350
      Income tax payable
      -
      5,519
      Total current liabilities
      1,069,007
      905,649
      Non - current liabilities
      Bank borrowings
      221,550
      -
      Deferred tax liabilities
      82,336
      67,385
      Total non - current liabilities
      303,886
      67,385
      Capital & reserves
      Issued capital
      165,930
      165,930
      Share premium
      229,390
      229,390
      General reserve
      364,130
      324,130
      Capital redemption reserve
      18,433
      18,433
      Dividend reserve
      44,925
      41,182
      Accumulated profits
      631,014
      420,943
      Total equity
      1,453,822
      1,200,008
      Total liabilities and equity
      2,826,715
      2,173,042


1(b)(ii) Aggregate amount of group's borrowings and debt securities.
      Amount repayable in one year or less, or on demand

      As at 31.03.2004
      As at 31.03.2003
      Secured
      Unsecured
      Secured
      Unsecured
      Rs '000
      579,565
      Rs '000
      94,616
      Rs '000
      442,428
      Rs '000
      44,350


      Amount repayable after one year

      As at 31.03.2004
      As at 31.03.2003
      Secured
      Unsecured
      Secured
      Unsecured
      Rs '000
      221,550
      Rs '000
      -
      Rs '000
      -
      Rs '000
      -


      Details of any collateral

      The details of bank borrowings from various banks and securities are shown below:

      Bank borrowings from consortium banks

      As at March 31, 2004, bank borrowings amounting to Rs. 606,336,000 are secured by :

      (a) first ranking pari passu charge in favour of a consortium of banks by way of hypothecation on the Company's trade receivables and inventories ; and
      (b) first ranking pari passu charge in favour of a consortium of banks by way of hypothecation and/or legal mortgage over certain of Company's present and future properties, plant and equipment .

      As at March 31, 2003, bank borrowings amounting to Rs. 441,017,000 are secured by :

      a) first ranking pari passu charge in favour of a consortium of banks by way of hypothecation on the Company's trade receivables and inventories ;
      b) first ranking pari passu charge in favour of a consortium of banks by way of hypothecation and/or legal mortgage over certain of Company's present and future properties, plant and equipment ; and
      c) personal guarantees by certain directors.

      Bank borrowings from other banks

      Bank A

      As at March 31, 2004, bank borrowings amounting to Rs. 17,849,000 are secured by :

      a) first ranking pari passu charge by way of hypothecation on the Company's current assets; and
      b) first ranking pari passu charge by way of hypothecation and/or legal mortgage over certain of Company's present and future properties, plant and equipment.

      Bank B

      As at March 31, 2004, bank borrowings amounting to Rs. 94,616,000 are unsecured and Rs. 142,687,000 are secured by :

      a) second charge by way of hypothecation on the Company's receivables and inventories ;
      b) second charge by way of hypothecation over certain of Company's present and future, plant and equipment; and
      c) personal guarantees by certain directors.

      Bank C

      As at March 31, 2004, bank borrowings amounting to Rs. 32,664,000 are secured by first ranking pari passu charge by way of hypothecation on the Company's plant and machinery purchased after October 9, 2003.

      As at March 31, 2004, motor vehicle loans amounting to Rs 1,579,000 (March 31, 2003 : Rs 1,411,000) are secured by hypothecation of the respective motor vehicles purchased.

      As at March 31, 2004, the Company has unutilized bank credit facilities amounting to Rs. 155,800,000 (March 31, 2003: Rs. 337,600,000).


1(c) A cash flow statement (for the group), together with a comparative statement for
      the corresponding period of the immediately preceding financial year.
      Company
      12 months ended
      12 months ended
      31.03.2004
      31.03.2003
      Rs '000
      Rs '000
      Cash flows from operating activities
      Profit from operations
      432,316
      319,534
      Adjustments for :
      Depreciation of property, plant and equipment
      94,423
      78,134
      Loss on disposal of property, plant and equipment
      740
      929
      Operating cash flows before movements in working capital
      527,479
      398,597
      Trade receivables
      (337,057)
      (12,917)
      Other receivables and prepayments
      11,333
      (8,923)
      Inventories
      (96,608)
      (93,115)
      Trade payables
      (24,059)
      65,346
      Bills payables
      104,256
      (22,187)
      Other payables
      5,533
      18,758
      Cash generated from operations
      190,877
      345,559
      Income taxes paid
      (67,951)
      (92,407)
      Interest and finance charges paid
      (60,896)
      (43,395)
      Net cash from operating activities
      62,030
      209,757
      Cash flows from investing activities:
      Purchase of property, plant & equipments
      (275,974)
      (190,766)
      Purchase of available-for-sale investments
      (2,400)
      (300)
      Proceeds on disposal of property, plant & equipment
      2,172
      2,531
      Investment income received
      30
      23
      Net cash used in investing activities
      (276,172)
      (188,512)
      Cash flows from financing activities:
      Dividend paid
      (36,505)
      (16,753)
      Tax on dividends paid
      (4,677)
      (6,770)
      Proceeds from bank borrowings, net of repayments
      377,086
      (41,053)
      Proceeds from other borrowings, net of repayments
      (44,350)
      21,550
      Net cash (used in)from financing activities
      291,554
      (43,026)
      Net (decrease) increase in cash and cash equivalents
      77,412
      (21,781)
      Cash and cash equivalents at beginning of year
      39,842
      61,623
      Cash and cash equivalents at end of year
      117,254
      39,842


1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or
      (ii) changes in equity other than those arising from capitalisation issues and
      distributions to shareholders, together with a comparative statement for the
      corresponding period of the immediately preceding financial year.
      Issued
      capital
      Share
      premium
      General
      reserve
      Capital
      redemption
      reserve
      Dividend
      reserve
      Accumulated
      Profits
      Total
      Rs'000
      Rs'000
      Rs'000
      Rs'000
      Rs'000
      Rs'000
      Rs'000
      Balance as at
      April 1, 2002
      165,930
      229,390
      233,830
      18,433
      -
      335,918
      983,501
      Net profit for
      the year
      -
      -
      -
      -
      -
      216,507
      216,507
      Proposed
      dividend
      -
      -
      -
      -
      41,182
      (41,182)
      -
      Transfer to
      (from) reserve
      -
      -
      90,300
      -
      -
      (90,300)
      -
      Balance as at
      March 31,2003
      165,930
      229,390
      324,130
      18,433
      41,182
      420,943
      1,200,008
      Net profit for the year

      -
      -
      -
      -
      -
      294,996
      294,996
      Transfer to (from) reserve

      -
      -
      40,000
      -
      -
      (40,000)
      -
      Proposed dividends
      -
      -
      -
      -
      44,925
      (44,925)
      -
      Final dividend paid
      -
      -
      -
      -
      (41,182)
      -
      (41,182)
      Balance as at
      March 31,2004
      165,930
      229,390
      364,130
      18,433
      44,925
      631,014
      1,453,822


1(d)(ii) Details of any changes in the company's share capital arising from rights issue,
      bonus issue, share buy-backs, exercise of share options or warrants, conversion of
      other issues of equity securities, issue of shares for cash or as consideration for
      acquisition or for any other purpose since the end of the previous period reported
      on. State also the number of shares that may be issued on conversion of all the
      outstanding convertibles as at the end of the current financial period reported on
      and as at the end of the corresponding period of the immediately preceding
      financial year.
      Since the end of the previous financial year, pursuant to a resolution passed in an extraordinary meeting held on March 30, 2004, the shareholders of the Company approved the sub-division of every one ordinary share of Rs 10 each in the authorized and issued share capital of the Company into 10 ordinary shares of Rs 1 each. Consequently, the number of authorised shares increased from 37,000,000 to 370,000,000 and the number of issued and fully paid up ordinary shares increased from 16,593,000 to 165,930,000.


2. Whether the figures have been audited or reviewed and in accordance with
      which auditing standard or practice.
      These figures have not been audited or reviewed by the Company's auditors.


3. Where the figures have been audited or reviewed, the auditors' report (including
      any qualifications or emphasis of a matter).
      Not applicable.


4. Whether the same accounting policies and methods of computation as in the
      issuer's most recently audited annual financial statements have been applied.
      The Company's financial statements have been prepared from those accounting records maintained under General Accepted Accounting Practices in India ('Indian GAAP") and adjusted to comply, in all material respects, with the requirements of the International Financial Reporting Standards ("IFRS").

      Previously, the Company prepared its financial statements in accordance with International Accounting Standards ("IAS"). The transition from IAS to IFRS did not result in any significant changes in accounting policies and figures presented in the financial statements for the financial year ended March 31, 2003.


5. If there are any changes in the accounting policies and methods of computation,
      including any required by an accounting standard, what has changed, as well as
      the reasons for, and the effect of, the change.
      Please refer to Point No. 4 above.


6. Earnings per ordinary share of the group for the current financial period reported
      on and the corresponding period of the immediately preceding financial year,
      after deducting any provision for preference dividends.
      Company
      12 months ended
      12 months ended
      31.03.2004
      31.03.2003
      (a) Based on weighted average number of
      ordinary shares in issue (Rs)
      1.78
      1.30
      (b) On a fully diluted basis (detailing any
      adjustments made to the earnings) (Rs)
      1.78
      1.30

      For comparative purposes, the basic and diluted earnings per ordinary share for the financial year ended March 31, 2003 have been restated and computed based on the profit after income tax of Rs 216,507,000 divided by 165,930,000 ordinary shares of Rs 1 each after taking into account the effect of the sub-division of every one ordinary share of Rs 10 each into 10 ordinary shares of Rs 1 each as disclosed in Point No. 1(d)(ii) above.

      There is no dilution as no share options were granted during the financial year.


7. Net asset value (for the issuer and group) per ordinary share based on issued share
      capital of the issuer at the end of the:-

      (a) current financial period reported on; and
      (b) immediately preceding financial year.

      Company
      As at 31.03.2004
      As at 31.03.2003
      Net assets value per ordinary share based on issued
      share capital at the end of the year reported in Rs
      8.76
      7.23

      For comparative purposes, the net assets value per ordinary share for the financial year ended March 31, 2003 have been restated and computed based on the net assets value of Rs 1,200,008,000 divided by 165,930,000 ordinary shares of Rs 1 each after taking into account the effect of the sub-division of every one ordinary share of Rs 10 each into 10 ordinary shares of Rs 1 each as disclosed in point 1(d)(ii) above

8. A review of the performance of the group, to the extent necessary for a reasonable
      understanding of the group's business. It must include a discussion of the
      following:-

      (a) any significant factors that affected the turnover, costs, and earnings of the
      group for the current financial period reported on, including (where applicable)
      seasonal or cyclical factors; and

      (b) any material factors that affected the cash flow, working capital, assets or
      liabilities of the group during the current financial period reported on.

      Revenue

      Our revenue is principally derived from the manufacture and sale of our Pigments and Agrochemicals products. We also derive a small portion of our revenue from exporting trading of dyes, dyes intermediates and Agrochemicals products that are not manufactured by us.
      During the financial year, sales revenue increased by Rs 416.3 million (or 20.6%) from Rs 2,024.0 million in FY2003 to Rs 2,440.3 million in FY2004. The Company has achieved 71% of its revenue from export activities, which increased by 18.0% from Rs 1,468.5 million in FY 2003 to Rs 1,733.2 million in FY 2004.

      The increase in export sales was due to increase in exports of CPC and Beta Blue manufactured by the Pigment Panoli division, which was converted into 100% Export Oriented Unit (EOU). The long-term contracts for manufacturing of Agrochemicals entered into with MNCs also contributed to overall higher export sales.

      Gross Profit

      Gross profit increased by Rs 49.8 million (or 8.3%) from Rs 597.4 million to Rs 647.2 million. The gross profit %, however, declined from 29.5% in FY 2003 to 26.5% in FY 2004 due mainly to:
      • Pressure on sales price of Pigment Green-7 and Acephate Technical Cypermethric Acid Chloride (CMAC) , Cypermethrin and Alpha Cypermethrin.
      • Effect of Exchange Rate Difference on depreciation of US $
      • Increase in Raw Material cost of Acephate Technical Cypermethric Acid Chloride (CMAC) , Cypermethrin and Imdiachloprid.

      Other Operating Income
      Other operating income comprises mainly export benefits such as Duty Entitlement Pass Book ("DEPB") and Duty drawback. DEPB is a government export incentive and represents a credit entitlement which can be used to offset against custom duties payable. Only products falling within a pre-specified list are eligible for DEPB. Duty drawback is an alternative export scheme to the DEPB. Under the duty drawback scheme, the Indian Government provides cash incentives for exports, calculated as a percentage of the FOB value of the export item, which is currently 3%.

      Despite an increase in exports, the Company's export benefits decreased by Rs 40.6 million (or 38.6%) mainly due to a reduction in DEPB. This was mainly due to conversion of our Panoli pigment plant into an Export Oriented Unit ("EOU") and reduction in DEPB rates. As an approved EOU, our Panoli plant benefited from certain exemptions from import duties, excise duties and income tax but no longer qualifies for DEPB.


      Distribution , Administrative and Other Operating Expenses
      Distribution costs decreased by Rs 77.3 million (or 29.5%) mainly due to lower sales commission expenses arising from a change in the Company's export policy to eliminate intermediaries and to sell directly to customers.
      Administrative expenses increased by Rs 13.3 million (or 16.9%) mainly due to salary increments, increase in traveling expenses as a result of more frequent overseas marketing trips, and increase in insurance expenses corresponding to an increased asset base insured.
      Other operating expenses decreased by Rs 40.4 million (or 90.0%) mainly due to higher allowance for doubtful trade receivables and bad trade receivables written off in the previous financial year. Slower collections of receivables in FY 2003 were mainly due to shorter monsoon season which affected the harvest of the Indian farming community for the Agrochemicals business.


      Balance sheet

      Trade receivables
      Trade receivables increased by Rs. 337.1 million (or 39.8%) mainly due to increase in revenue by 20.6%, extension of credit given to Pigments customers and seasonality of agrochemicals business where recovery of debts is dependent on the monsoon and climate conditions.
      Inventories

      Inventories increased by Rs. 96.6 million (or 31.6%) mainly due to raw mateiral build up in anticipation of contract with a new Agrochemicals customer, inventory build-up for both Agrochemicals and Pigments products in anticipation of higher market demand, as well as increased inventory holdings of Pigments products at warehouses in Belgium and Uruguay to facilitate direct sales to end customers in lieu of sales through intermediaries for savings in sales commission.
      Property, plant and equipment

      Fixed assets increased by Rs. 178.6 million (or 23.3%) due to expansion of production capacity for the following plants and/or products:
      • Panoli: CPC - Hysol P, Beta Blue, Blue 16 and Blue 69
      • Chharodi: Permethtrin
      • Vatva: Additives
      Bank Borrowings
      Bank borrowings (current and non - current) increased by Rs. 453.3 million (or 102.4%) mainly due to financing of higher working capital requirements and the purchase of additional plant, machinery and equipment for the expansion of production capacity for Pigment and Agrochemical products.
    Cash flow statement
      During the financial year the company has generated positive cash flow of Rs. 62 million from operating activities and is expected to have sufficient cash flow to meet its working capital requirement in the next financial year.
    Cash Flow from Operating activities :-
      Reduction in cash flow was due to increase in trade payables and inventories as explained herein above.

    Cash Flow from investing activities :-
      Reduction in Cash flow due to substantial expansion of production capacity of existing as well as new products.

    Cash Flow from financing activities :-
      Increase in cash flow due to increase in working capital requirements and term loan for capital expansion.

      However over all cash flow was positive because of increase in cash profit from operation and increase in bank borrowings.


9. Where a forecast, or a prospect statement, has been previously disclosed to
      shareholders, any variance between it and the actual results.
      Not applicable.


10. A commentary at the date of the announcement of the significant trends and
      competitive conditions of the industry in which the group operates and any
      known factors or events that may affect the group in the next reporting period
      and the next 12 months.
      Pigments

      Demand for Pigment is growing steadily, driven primarily by the continuous growth in key market areas like ink, Paints and Plastics. With the high quality manufacturing in India more and more companies from developed countries are outsourcing either by having tie-ups or through contracts. With this shift of manufacturing base to India more consumers in regions like US, Europe, Central & South America, Japan are also shifting for direct supplies from India. Further with the strong emphasis on development the domestic demand that is low is bound to increase in areas like Paints & Plastics. With increasing usage of ink jet, web offset printing, the Indian ink industry itself will consume more Pigments in coming years.

      We also expect global competition in the Pigments market to increase, particularly between Pigments manufacturers in India and the PRC. With WTO agreement the Chinese price is expected to be in line with Indian Price and the difference in quality will make Indian Pigments more competitive.

      Agrochemicals

      Sustained economic growth in India in recent years has led to increased awareness in usage of Pesticides among farmers. Decreasing dependency of rain irrigation is also resulting in more cropping area and there by increasing the consumption of pesticides.

      As like Pigments industry, we are also witnessing a trend amongst manufacturers in developed economies to reduce their production of Agrochemical products within such developed countries, as a result of higher costs of production as compared with developing countries. These manufacturers may outsource to Indian or PRC manufacturers or may set up or acquire captive plants in India and PRC. Such a trend would create opportunities for us in increasing our contract manufacturing projects. This view is further strengthened by implementation of TRIPS and GATT by the Indian Government by 2005. The patent holders will have confidence to shift the production to India after implementation in 2005. Our company with strong technical capabilities will be looking out to produce such patented molecules in future.
      The proposed reforms in farm subsidies in developed nations are to be implemented in the medium to long term. We expect that farmers in such developed countries will seek to compensate for the loss in subsidies by reducing costs of inputs, which may lead to their increased demand for Agrochemical products from countries like India. Such a development would again create opportunities for greater export growth of our Agrochemical business.

      Also Generic molecules and molecules which will be out of patent in near future are the focus of our company. These molecules produced at competitive cost can immediately take over the costly patented molecules when they go off patent.

      Trend Information

      The prices of our Pigment products have been relatively stable in FY2001, FY2002 and FY2003. The prices of our Agrochemical products have however experienced a downward trend in FY2001, FY2002 and FY2003, with average prices of our Agrochemical products decreasing by approximately 11.6% from FY 2001 to FY 2002 and approximately 5.4% from FY 2002 to FY 2003. Prices in 2004 are in line with the 2003 year and recently in last few months the prices are firming up both in Pigments and Agro Chemicals due to increasing demand and overall slight increase in cost of production of raw materials. We expect future prices for our Pigments and Agrochemical products to remain stable and slightly above the prices prevailing in 2003.

      We have not experienced any material volatility in the prices of our main raw materials. We do not expect any material volatility in the prices of our main raw materials in the near future.

      Effect of increase in crude oil prices
      Some of our raw materials we use in our manufacturing processes are petroleum based but they are not derived directly. So the price hike of the crude oil will only affect our raw material prices marginally.

      Historically, the company was successful in passing the increase in raw material prices to the customers. This year too, the company has already started the process and has informed the customers about the price increase of its products due to price increase of its raw material.


11. Dividend
      (a) Current Financial Period Reported On

      Any dividend declared for the current financial period reported on? Yes

      Name of Dividend
      Interim
      Dividend Type
      Cash
      Dividend Amount per Share (in cents) Rs 0.24 per ordinary share (tax not applicable)
      Optional:- Dividend Rate (in %)
      Par value of shares
      Rs 1
      Tax Rate


      (b) Corresponding Period of the Immediately Preceding Financial Year

      Any dividend declared for the corresponding period of the immediately preceding financial year? Yes

      Name of Dividend
      Final
      Dividend Type
      Cash
      Dividend Amount per Share (in cents) Rs 0.22 per ordinary share (tax not applicable)
      Optional:- Dividend Rate (in %)
      Par value of shares
      Rs 1
      Tax Rate


      (c) Date payable

      The interim dividend was paid on July 8, 2004


      (d) Books closure date

      July 8, 2004


12. If no dividend has been declared/recommended, a statement to that effect.
      Not applicable.



PART II - ADDITIONAL INFORMATION REQUIRED FOR FULL YEAR ANNOUNCEMENT
        (This part is not applicable to Q1, Q2, Q3 or Half Year Results)


13. Segmented revenue and results for business or geographical segments (of the
      group) in the form presented in the issuer's most recently audited annual financial
      statements, with comparative information for the immediately preceding year.
      a) Business segment

      Financial year ended March 31, 2004:

      Pigments
      Agro
      chemicals
      Others
      Eliminations
      Total
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Revenue:
      External sales
      1,176,754
      1,214,392
      49,173
      -
      2,440,319
      Inter-segment sales
      110,509
      14,512
      -
      (125,021)
      -
      Total revenue
      1,287,263
      1,228,904
      49,173
      (125,021)
      2,440,319
      Results:
      Segment results
      254,216
      231,250
      (1,636)
      -
      483,830
      Unallocated expenses
      (51,514)
      Profit from operations
      432,316
      Finance costs
      (24,121)
      (36,285)
      (490)
      -
      (60,896)
      Income from investment
      30
      -
      -
      -
      30
      Profit before income tax
      371,450
      Income Tax
      (76,454)
      Profit after income tax
      294,996

      Pigments
      Agro
      chemicals
      Others
      Total
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Other information:
      Capital additions
      168,993
      65,328
      41,653
      275,974
      Depreciation
      (52,421)
      (38,490)
      (3,512)
      (94,423)
      Balance Sheet:
      Segment assets
      1,423,458
      1,314,653
      31,842
      2,769,953
      Unallocated corporate assets
      56,762
      Total assets
      2,826,715
      Segment liabilities
      445,520
      836,615
      8,422
      1,290,557
      Unallocated corporate liabilities
      82,336
      Total liabilities
      1,372,893

      Financial year ended March 31, 2003:

      Pigments
      Agro
      chemicals
      Others
      Eliminations
      Total
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Revenue:
      External sales
      1,064,144
      868,245
      91,645
      -
      2,024,034
      Inter-segment sales
      70,665
      6
      -
      (70,671)
      -
      Total revenue
      1,134,809
      868,251
      91,645
      (70,671)
      2,024,034
      Results:
      Segment results
      203,630
      157,489
      582
      -
      361,701
      Unallocated expenses
      (42,167)
      Profit from operations
      319,534
      Finance costs
      (11,812)
      (30,986)
      (597)
      -
      (43,395)
      Income from investments
      23
      -
      -
      -
      23
      Profit before income tax
      276,162
      Income Tax
      (59,655)
      Profit after income tax
      216,507
      Pigments
      Agro
      chemicals
      Others
      Total
      Rs '000
      Rs '000
      Rs '000
      Rs '000
      Other information:
      Capital additions
      73,901
      57,787
      59,078
      190,766
      Depreciation and amortisation
      41,028
      33,834
      3,272
      78,134
      Balance Sheet:
      Segment assets
      1,048,830
      1,032,906
      34,686
      2,116,422
      Unallocated corporate assets
      56,620
      Total assets
      2,173,042
      Segment liabilities
      350,342
      533,384
      16,404
      900,130
      Unallocated corporate liabilities
      72,904
      Total liabilities
      973,034

      (b) Geographical Segment
          Segment revenue is analysed based on the location of customers regardless of where the goods are produced.

          The following provides an analysis of the Company's sales by geographical markets:

          2004 2003
          Rs '000 Rs '000
          Africa 82,455 62,694
          Asia 440,523 159,507
          Australia 80,213 92,002
          Europe 544,374 351,874
          India 707,089 555,549
          North America 419,606 581,494
          South America 166,059 220,914
          2,440,319 2,024,034


14. In the review of performance, the factors leading to any material changes in
      contributions to turnover and earnings by the business or geographical segments.
      During the financial year, sales revenue increased by Rs 416.3 million (or 20.6%) from Rs 2,024 million in FY2003 to Rs 2,440.3 million in FY2004. Out of total revenue of Rs. 2,440.3 million, the pigment division has contributed Rs. 1,176.8 million (or 48.2%) and agrochemicals Rs. 1,214.4 million (or 49.8%). The Company has achieved 71% of its revenue from export activities and balance from domestic activities.

      For further detail, please refer Point No. 8 above.


15. A breakdown of sales.
      Not applicable, as this being the first announcement of the Company


16. A breakdown of the total annual dividend (in dollar value) for the issuer's latest
      full year and its previous full year.

      Total Annual Dividend (Refer to Para 16 of Appendix 7.2 for the required details)

      Latest Full Year (2004)
      Previous Full Year (2003)
      Ordinary
      39,823
      36,505
      Preference
      0
      0
      Total:
      39,823
      36,505