WHAT’S - Harel Mallac Group · Compagnie des Magasins Populaires Limitée, Harel Mallac & Co....

Dear Shareholder,

The Board of Directors is pleased to present the Annual Report of Bychemex Limited for the year ended

31 December 2015, the contents of which are listed below.

This report was approved by the Board of Directors at its meeting held on 27 April 2016.

Antoine L. HarelChairman

Shemboosingh CheekhooreeManaging Director

04 Company Profile Corporate Information

06 Chairman’s Report

05 Business Segments

08 Managing Director’s Report

10 Board of Directors Senior Management Profile

12 Corporate Governance Report

19 Statutory Disclosures

21 Statement of Directors’ Responsibilities

22 Statement of Compliance

23 Secretary’s Certificate

24 Independent Auditors’ Report

25 Statement of Financial Position

26 Statement of Profit or Loss and Other Comprehensive Income

27 Statement of Changes in Equity

28 Statement of Cash Flows

29 Notes to the Financial Statements

WHAT’SINSIDE

02 Vision - Mission - Values

1Annua l Report 2015

GROUPSTRUCTURE

VISIONTo be a regional leader in textile chemicals and auxiliaries

2 Bychemex L im ited


MISSION

VALUESPassion Generate desire for success

RelationshipBuild a strong bond with our partners and with the community

IntegrityBe honest and ethical in our dealings

DevelopmentPromote a learning culture and embrace change

ExcellenceNurture creativity, share best practices and deliver on promises

• Todevelopastrongandcompetitiveorganisationwhichdeliversonits

targets and maximise shareholder’s value.

• Toprovideawiderrangeofeco-friendlyproductstothetextilesector.

• Tofosteraqualitycultureandsustainabledevelopment.

• Toprovideitsemployeeswithaworkenvironmentwhichpromotes

participation, innovation and customer service.

OPERATINGSINCE

1987TURNOVER(Rs’M)

58.9

BUSINESSSEGMENTS

3PROFIT AFTERTAXATION (Rs’000)

35

NO OF EMPLOYEES

11DIVIDENDPER SHARE (Rs)

0.10

Setupin1987,BychemexLimitedhasestablisheditselfasakeyandreliable supplier of speciality high-end chemicals and auxiliaries for the textile industry in Mauritius. Bychemex is listed on the Development andEnterpriseMarket(DEM)since2007andisasubsidiaryofHarelMallac & Co. Ltd. Bychemex represents worldwide recognised principals which includes CHT (Chemische Fabrik Tubingen) inGermany,EvonikSouth-Africa,FormosaGroupandArabianAlkali.

Bychemex has also extended its activities to promote export to countrieswithintheCommonMarketforEastern&SouthernAfrica(COMESA)andSouthernAfricanDevelopmentCommunity(SADC).

COMPANYPROFILE

NOTARYMr Didier MaigrotNotary Public

REGISTERED OFFICEChaussée TromelinFort GeorgePort Louis

REGISTRYHarelMallacCorporateServicesLtd.18 Edith Cavell StreetPort Louis

BUSINESS REGISTRATION NUMBERC07006253

COMPANY SECRETARY HMSecretariesLtd.18 Edith Cavell StreetPort Louis

AUDITORSBDO & Co

BANKERSTheMauritiusCommercialBankLtd.

LEGAL ADVISERSIvan Collendavelloo ChambersÉtude Georges Robert

CORPORATE INFORMATION


32% 32% 36%Textile Auxiliaries

Products

Detergents, Wetting Agents, Anticrease Agents, Sequestrants, Dispersants, Softeners

End Uses

CompleterangeofCHTspecialty auxiliaries for the textile industry

Bleaching and Dyeing Chemicals

Products

1)HydrogenPeroxide,2)BrineSolutionand3)DyestuffsincludingBemacron dispersed dyes and Tubantin as well as the BEZAKTIV GO range which comprises eco-friendly and efficient dyes

End Uses

Basic and specialised chemicals for the textile industry

Scouring Chemicals

Products

Caustic Solutions

End Uses

Textile processing and Mercerising


* The Laboratory is ISO 17025 certified

BUSINESSSEGMENTS

GROUPSTRUCTURE

The Company’s profitability was impacted by a reduction in operating margin. Profit after tax was lower than the previous year.



The textile and apparel sector contracted by 1% in volume terms in 2015. Some companies continued their delocalization strategy to move production to other manufacturing bases.

Bychemex registered a marginal increase in turnover over the previous year. The Company’s profitability was impacted by a reduction in operating margin. Profit after tax was lower than the previous year.

The Company will persevere in its differentiation strategy by introducing more and more environment-friendly chemicals and processes, in line with the sector’s own differentiation strategy with the support of its principal CHT-Bezema.

Acknowledgements

TheBoardwouldliketothanktheManagementandthestafffortheirdedicationandhardwork.TheBoardrenews its confidence in Management to improve the Company’s profitability and meet its goals next year.

Dear Shareholder,

CHAIRMAN’SREPORT


GROUPSTRUCTURE


Going forward, Bychemex will further strengthen its collaboration withCHT-Bezema.


The textile and apparel sector did not grow aspertheforecasts(+2%)madefor2015. Infact the sector contracted by 1% during the year.

The Company, however, saw turnover grow by 2% over previous year. Operating costs were in line with budget and lower than previous year. Margins were under pressure as competitors focused on market share.Profit was down over previous year. Turnover of CHT-Bezema textile auxiliaries grew by6%. On the other hand, turnover of basic pretreatment chemicals dropped by 5%. Going forward, Bychemex will further strengthen its collaborationwithCHT-Bezema

Bychemex Green Initiatives 2016

In 2016, the Company intends to expand its business into more eco-friendly services to widen its product and services pool by offering more intelligent bleaching processes with reduced environmental load as well as bio-degradable textile chemicals.

MANAGING DIRECTOR’SREPORT


ANTOINE L. HAREL (58)Chairman(Non-Executive)

AntoineL.HarelisaFellowMemberoftheInstituteofChartered Accountants in England and Wales and holds a

BA(Hons)degreeinAccountingandComputing.HejoinedHarelMallac&Co.Ltd.in1987.In1997,hewasappointed

Group CEO and is Chairman of the Board since April 2005. HewasPresidentoftheMauritiusChamberofCommerce

andIndustryin1992/1993.HewasappointedtotheBoardofDirectors of Bychemex Limited on 30 November 1999.

OtherDirectorships(listedCompanies):HarelMallac&Co.Ltd.(Chairman),Compagnie des

Magasins Populaires Limitée(Chairman),TheMauritiusChemicalandFertilizerIndustryLimited(Chairman),Chemco

Limited and Les Gaz Industriels Ltd(Chairman).

CHARLES HAREL (48)Non-Executive Director

CharlesHarelholdsanMBAfromtheUniversityofBirmingham, UK, as well as a National Diploma in Management andFinancefromCapeTechnikon,SouthAfrica.HejoinedtheHarelMallacGroupin1993andwasnominatedCEOoftheGroupeffectiveJanuary2014.HewasappointedtotheBoard of Directors of Bychemex Limited on 29 May 2013.

OtherDirectorships(listedCompanies):HarelMallac&Co.Ltd.,Compagnie des Magasins Populaires Limitée, The Mauritius Chemical and Fertilizer Industry Limited and Chemco Limited.

GUY HAREL (67)Non-Executive Director

Aged67,GuyHareljoinedHarelMallacGroupin1981asManagingDirectorofFapcomLtd.In1983,hecreatedHenkelChemicals(Mauritius)LimitedandbecameitsManagingDirectorin1996.Hewas,sincetheacquisitionoftheformerbytheHarelMallacGroupin2007,theManagingDirectorofArchemicsLtd.upto31December2012.Hewasappointedto the Board of Bychemex Limited on 29 May 2013.

OtherDirectorships(listedCompanies):Chemco Limited and The Mauritius Chemical and Fertilizer Industry Limited.

SHEMBOOSINGH CHEEKHOOREE (54)Executive Director

ShemboosinghCheekhooreeholdsaBachelor’sdegreeinChemical Engineering from the North East London Polytechnic,

UnitedKingdom.Hehasover25years’experienceintextileand apparel sector and occupied various senior management

positions during the last 15 years in the textile industry, in Mauritius andinIndia,beforejoiningtheHarelMallacGroupin2012as

ManagingDirectorofHarelMallacExportLtd,acompanyformingpartoftheChemicalArmofHarelMallacandhasoccupiedthisposition up to now. In October 2013, he was appointed General

Manager of MCFI Ltd. Group of Companies. Since October 2014, heistheManagingDirectorofHarelMallacExportLtd.,Harel

Mallac(Tanzania)LimitedandMCFIGroupofcompanies.Hewasappointed to the Board of Directors of Bychemex Limited on

31 October 2014.

OtherDirectorships(listedCompanies):Chemco Limited and The Mauritius Chemical and Fertilizer

Industry Limited.

SUIE SEN HOCK MEEN AH KINE (54)Executive Director

In office as from 6 November 2015

SuieSenHockMeenAhKineisanAssociateMemberofthe Institute of Chartered Accountants in England and Wales

andholderofaBSc(Hons)ManagementSciencefromtheUniversityofOttawa.HejoinedHarelMallacin2005as

FinancialControllerofHarelMallacBureautiqueLtdandwasappointed Group Financial Controller in February 2007. Since

15 November 2015, he holds the position of Finance Director of HarelMallac’sChemicalArm.

OtherDirectorships(listedCompanies):Chemco Limited and The Mauritius Chemical and Fertilizer

Industry Limited.

BOARD OFDIRECTORS


VINCENT LABAT (53)Independent Director

Vincent Labat graduated as a Chemical Engineer. From 1996 to 2009, he was the Managing Director

of Les Gaz Industriels Ltd, a listed company. In2010,hejoinedMedineLimitedasProjectDevelopment Executive. In July 2011, he was

appointed as Managing Director of the Agriculture Cluster.HewasappointedtotheBoardofDirectors

of Bychemex Limited on 12 August 2010.

OtherDirectorships(listedCompanies):Chemco Limited and The Mauritius Chemical and

Fertilizer Industry Limited.

MICHEL RIVALLAND G.O.S.K. (62)Non-Executive Director

Michel Rivalland G.O.S.K. is a Fellow Member of the Chartered AssociationofCertifiedAccountants.HejoinedtheBoardof Directors of The Mauritius Chemical and Fertilizer Industry Limited on 1 June 2006 and served as Managing Director from October2006to30June2009.HeiscurrentlyanExecutiveDirectorofHarelMallac&Co.Ltd.HewasappointedtotheBoard of Directors of Bychemex Limited on 21 December 2006.

OtherDirectorships(listedCompanies):Compagnie des Magasins Populaires Limitée,HarelMallac& Co. Ltd., Chemco Limited and The Mauritius Chemical and Fertilizer Industry Limited.


SHEMBOOSINGH CHEEKHOOREEManaging Director

ShemboosinghCheekhooreeholdsaBachelor’sdegreeinChemicalEngineeringfromtheNorthEastLondonPolytechnic,UnitedKingdom.Hehasover25years’experienceintextileandapparelsectorandoccupiedvariousseniormanagementpositionsduringthelast15yearsinthetextileindustry,inMauritiusandinIndia,beforejoiningtheHarelMallacGroupin2012asManagingDirectorofHarelMallacExportLtd,acompanyformingpartoftheChemicalArmofHarelMallacandhasoccupied this position up to now. In October 2013, he was appointed General Manager of MCFI Ltd. Group of Companies. SinceOctober2014,he is theManagingDirectorofHarelMallacExportLtd.,HarelMallac (Tanzania)LimitedandMCFIGroup of companies.

SUIE SEN HOCK MEEN AH KINE Finance Director

SuieSenHockMeenAhKine is an Associate Member of the Institute of Chartered Accountants in England and Wales and holderofaBSc(Hons)ManagementSciencefromtheUniversityofOttawa.HejoinedHarelMallacin2005asFinancialController of Harel Mallac Bureautique Ltd and was appointed Group Financial Controller in February 2007. Since 15November2015,heholdsthepositionofFinanceDirectorofHarelMallac’sChemicalArm.

AJAY LUXIMUNOperations Manager

AjayLuximunholdsaBSc(Hons)inBusinessStudiesandaMastersinInternationalBusinessManagement.HejoinedChemcoLimited in May 1993, and assumed various positions within the Company, started as Technical Sales Representative, Sales Executive(1999),SeniorSalesExecutive(2004),andProductManager(2005).FromJanuary2012toDecember2014,heworkedasGeneralManager–Export,forHarelMallacExport.AsfromJanuary2015,AjaywasappointedasOperationsManager for Chemco Limited and Bychemex Limited.

SENIOR MANAGEMENT PROFILE

BychemexLimited(the‘Company’)iscommittedtothehigheststandardsofbusinessintegrity,transparencyandprofessionalisminallits activities to ensure that the activities within the Company are managed ethically and responsibly to enhance business value for all stakeholders.

THE BOARD OF DIRECTORS

TheBoardendeavourstoexerciseleadership,entrepreneurship,integrityandjudgementindirectingtheCompany,soastoachievecontinuing prosperity for the organisation whilst ensuring both performance and compliance.

The Board also ensures that the activities of the Company comply with all legal and regulatory requirements as well as with its constitution from which the Board derives its authority to act.

The Board inter alia oversees the development and implementation of the Company’s corporate strategy and reviews performance objectives. Itprovidesforsuccessionplansforkeyindividuals,ensureseffectivecommunicationwiththeCompany’sstakeholders,promotes the Company’s Code of Ethics, and oversees financial and capital management. As such, it reviews and approves quarterly andannualfinancialreports,monitorsfinancialresultsandapprovesmajorcapitalexpenditure,acquisitions,divestituresandmaterialcommitments.TheBoardfinallyoverseescomplianceandriskmanagement.

At 31 December 2015, the Board of Directors consisted of seven members, of whom one is an independent director and two are executive directors. In view of its size, the Board is of the view that having one independent director is in line with the Code’s spirit.

Non-executive Directors have free access to members of the senior management team. All Directors have access to the Company Secretary. The Directors are elected as per the provisions of the Company’s constitution that do not provide for a definite term of office.

With a view to enhancing the Board’s effectiveness, a Board performance review is carried out yearly to assess the directors’ appreciation of the Board’s performance, its procedures and practices. The results of the assessment are examined by the Corporate GovernanceCommittee.ThisCommitteemakesitsrecommendationstotheBoardonanyrequiredremedialaction.

SincetheCompanyhasamanagementcontractwithTheMauritiusChemicalandFertilizer IndustryLimited (MCFI), theBoardhasdelegated authority to MCFI’s Audit Committee and Corporate Governance Committee to provide it with assistance in discharging its duties and responsibilities. This is done through a more comprehensive evaluation of specific issues that are the remit of such committees.TheBoardregularlyreceivesthereportsandrecommendationsofthesecommitteesandtakesappropriateaction.

The Board entrusts the day-to-day management of the Company to MCFI through its Managing Director who ensures the smooth running of the organisation. The composition of the Board of Directors and other directorships held by the Directors in other listed companies are given on pages 10 and 11.

BOARD MEETINGS

The Board meets regularly during the year. For the period under review, the Board met seven times. Board meetings are conducted in accordance with the Company’s constitution and the Companies Act. Board meetings are organised in such a way as to allow Directors to receive all relevant information critical to their understanding of the business to be conducted at the Board meeting, and therefore to participatefullyinthedecisionmakingprocess.TheBoardmayinvitemanagementorexternalconsultantstoattendBoardmeetingswhenever required.

RESPONSIBILITIES ENTRUSTED TO MCFI’S CORPORATE GOVERNANCE COMMITTEE

TheBoardhasentrustedtoMCFI’sCorporateGovernanceCommitteethekeyareasthataretheremitofanominationandremunerationcommittee. The Committee’s main responsibilities include establishing a formal and transparent procedure for developing policy on senior management remuneration. The Committee also fixes the fees of the Company’s non-executive and independent non-executive Directors. It oversees the process regarding recommendation of potential candidates as Directors, ensures that proposed Directors are not disqualified from holding that position, and monitors the balance and effectiveness of the Board. The Committee met three times in 2015.

CORPORATE GOVERNANCEREPORT


RESPONSIBILITIES ENTRUSTED TO MCFI’S AUDIT COMMITTEE

TheBoardhasentrustedtoMCFI’sAuditCommitteethekeyareasthataretheremitofanAuditCommitteeasdetailedintheformalterms of reference approved by the Board. The Committee thus assists the Board in discharging its duties relating to the safeguarding of assets, the operation of adequate systems and control processes, and the preparation of accurate financial reports and statements, incompliancewithallapplicablelegalrequirementsandaccountingstandards.TheCommitteealsoaddressesissuesrelatingtoriskmanagementandprovidesaforumfordiscussingbusinessrisksandcontrolissues,andforformulatingrelevantrecommendationsforconsideration by the Board. During the period under review, the Committee met four times.

RISK MANAGEMENT

The Board regularly addresses and evaluates physical, human resources, IT, business, financial, reputational as well as regulatory andcompliancerisks. Inthecourseof2015, the internalauditfunctionexaminedandevaluatedtheadequacyandeffectivenessofcontrol systems in place within the Company. Reports were subsequently produced and submitted to the Audit Committee. The Audit Committeereviewedthereportsand,whenapplicable,maderelevantrecommendationstotheBoard.Since2010,ariskmanagementframeworkfortheCompanywasadoptedfollowedbytheimplementationofacontinuousanddynamicsystemofriskassessmentthroughcompliancechecksanddiscussionswiththemanagementforenhancedriskmitigationstrategies.Someoftheriskareasandrelevantcontrolprocedureshavebeenidentifiedasfollows:

Physical Risks

Amongthephysicalrisksidentifiedareunavoidableeventssuchasriots,cyclonesandothernaturalcalamities.Mitigatingactionssuchas the adoption of cyclone and fire procedures, the subscription to a relevant insurance cover, and the identification of a business continuityplananddisasterrecoveryplanhavebeentaken.

To limit the occurrence of on-site accidents, health and safety as well as security procedures have been implemented.

TheCompanyalsodrawsupontheexpertiseofbothanOccupationalPhysicianConsultantandafull-timeHealthandSafetyOfficer.TheCompany’scontrolproceduresensuremitigationofrisksrelatingtofraudandtheft.

Technology Risks

In order to mitigate the risk of an IT crashor majorbreakdown, back-upand restrictionprocedures havebeenset upwithin theCompany.

ATTENDANCE AT BOARD MEETINGS HELD IN 2015

Directors Attendance

AntoineL.Harel 7/7

SuieSenHockMeenAhKine 2/2

ShemboosinghCheekhooree 7/7

CharlesHarel 7/7

GuyHarel 6/7

Vincent Labat 7/7

Michel Rivalland G.O.S.K 7/7



Internal Control

Internalcontrolisaprocessdesignedtoprovidereasonableassuranceregardingtheachievementoforganisationalobjectiveswithrespectto:

•Effectivenessandefficiencyofoperations•Safeguardingofassetsanddataoftheorganisation•Reliabilityoffinancialandotherreporting•Preventionoffraudandirregularities•Acceptanceandmanagementofrisk•Conformitywiththecodesofpracticeandethicsadoptedbytheorganisation•Compliancewithapplicablelawsandregulations•Supportingbusinesssustainabilityundernormalaswellasadverseoperatingconditions.

Internal Control is applicable to and is built into various business processes so as to cover all significant enterprise areas.

During the year, one review of internal control was performed by the Internal Audit.

The Board has set appropriate policies to ensure that the above control measures are implemented.

Internal Audit

Internalaudit isanobjectiveassurancefunctionreportingtotheBoardofDirectorsandManagement.TheInternalAuditfunction isperformedbytheHarelMallacGroupInternalAuditor.

Internalauditprovidesassuranceastotheadequacyandeffectivenessoftheriskmanagementandinternalcontrolframeworkofanorganisation.InternalauditassiststheBoardandManagementtomaintainandimprovetheprocessbywhichrisksareidentifiedandmanaged,andhelpstheBoarddischargeitsresponsibilitiestomaintainandstrengthentheinternalcontrolframework.

TheInternalAuditorhasexaminedthecurrentcontrolsystemstochecktheirsuitabilityandtoensurethattheyarebeingadheredto.The Internal Auditor conducts its assignments based on a yearly plan which is validated by the Audit Committee and has unrestricted access to the Company’s records, Management and employees. Systems reviewed in 2015 at Company level include the sales, debtors’andcashcycle,fixedassetscycles,expensesaswellasthestockcycleandcoverallsignificantareasoftheCompany’sinternal control.

In 2015, the Internal Auditor has regularly submitted to the Audit Committee reports for discussion and follow-up of the implementation of recommended actions. GROUP STRUCTURE

TheDirectorsrecognisethattheparententityisHarelMallac&Co.Ltd.andthattheultimateparententityisSociétéPronema.TheDirectorscommontotheaforesaidentitiesareMrAntoineL.HarelwhoisgérantofSociété PronemaandDirectorofHarelMallac&Co.Ltd.andMessrsCharlesHarelandMichelRivallandG.O.S.K.whositontheBoardofDirectorsofHarelMallac&Co.Ltd.

SHAREHOLDERS HOLDING MORE THAN 5 PERCENT OF THE COMPANY

Shareholders directly or indirectly interested in 5 percent or more of the ordinary share capital of the Company are detailed on page 20.

DIVIDEND POLICY

Dividends are distributed after considering the Company’s performance and profitability, gearing, investment needs, capital expenditure requirements and growth opportunities.

Year Dividend per share Dividend Cover Dividend Yield(Rs) (Times) (%)

2011 1.0 1.5 5.42012 0.5 0.6 3.62013 0.6 0.4 5.62014 0.7 0.2 5.82015 0.1 0.1 1.5



SHARE PRICE INDEX FROM JANUARY 2015 TO MARCH 2016

Bychemex Share Price v/s Demex from January 2015 to March 2016

DIRECTORS’ INTERESTS IN SHARES

The direct and indirect interests of Directors in the ordinary shares of the Company are to be found on page 19.

DIRECTORS’ DEALING IN SHARES OF THE COMPANY

The direct and indirect interests of Directors in the ordinary shares of the Company are to be found on page 19. The Directors are awareofAppendix6oftheListingRulesoftheStockExchangeofMauritiusLtd.whichprovidesforrestrictionsondealingsduringaclose period as well as the provisions of the Companies Act 2001 on disclosure and restrictions on share dealings by Directors. All the disclosures made by the Directors are entered into an Interest Register.

During the year under review, none of the Directors bought or sold any of the Company’s shares.

RELATED PARTY TRANSACTIONS

Related party transactions are detailed on page 46.

SENIOR MANAGEMENT PROFILE

The profile of the senior management members is given on page 11.

COMPANY’S CONSTITUTION

The constitution of the Company does not provide any ownership restrictions or pre-emption rights. It is in agreement with the Companies Act 2001 and the DEM rules, and does not contain any material clause that needs to be disclosed.



PROFILE OF COMPANY’S SHAREHOLDERS AS AT 31 MARCH 2016

Size of Shareholding Number of Shareholders Number of Shares Owned % Holding

1-500 281 38,563 0.77

501-1,000 112 96,459 1.93

1,001-5,000 174 361,487 7.23

5,001-10,000 15 105,598 2.11

10,001-50,000 24 545,871 10.92

50,001-100,000 2 172,450 3.45

100,001-250,000 4 660,420 13.21

250,001-500,000 2 773,669 15.47

Over 500,000 1 2,245,483 44.91

Total 615 5,000,000 100.00

SHAREHOLDERS AGREEMENT AFFECTING THE GOVERNANCE OF THE COMPANY BY THE BOARD

The Company is not aware of any such agreement during the period under review.

THIRD PARTY MANAGEMENT AGREEMENT

The Company has a management agreement with The Mauritius Chemical and Fertilizer Industry Limited for management support services including but not limited to financial, accounting, legal, internal audit and human resources fields. The agreement is renewable on a yearly basis.

DIRECTORS’ FEES

Directors are paid directors’ fees with the exception of the Executive Directors and two of the non-executive directors.

DIRECTORS’ REMUNERATION

Directors’ remuneration is given on page 19. It has been disclosed globally due to sensitivity of the information.

REMUNERATION POLICY

The Company’s remuneration policy recommends that the Company provides competitive rewards for its senior management staff, taking intoaccounttheCompany’sperformanceandexternalmarketdatafromindependentsources, inparticular,whereavailablesalarylevelsforsimilarpositionsincomparablecompanies.Theremunerationpackageconsistsofbasesalary,fringebenefitsandanannualindividualperformancebonus.TheremunerationpackageisdeterminedbytheBoardofDirectorsuponrecommendationsofthe Corporate Governance Committee.

EMPLOYEE SHARE OPTION PLAN

No employee share option plan is available within the Company.

CODE OF ETHICS

The Board has adopted a Code of Ethics reflecting the Company’s values and corporate culture.




SUMMARY OF SHAREHOLDING CATEGORY AS AT 31 MARCH 2016

Category of Shareholders Number of Shareholders Number of Shares Owned % Holding

Individual 562 949,103 18.98

Insurance and assurance companies 4 332,640 6.65

Pension and provident funds 1 297,439 5.95

Other corporate bodies 48 3,420,818 68.42

Total 615 5,000,000 100.00

SHAREHOLDER INFORMATION

Forthcoming Annual Meeting

A proxy form is enclosed for those shareholders unable to attend. Shareholders are requested to bring their identity cards or passports to the meeting, as these are required for registration.

Schedule of Events

Publication of condensed audited results for previous year March 2016

Annual Meeting May/June 2016

Publication of condensed results for the 1st quarter May 2016

Publication of condensed results for the 2nd quarter August 2016

Publication of condensed results for the 3rd quarter November 2016

Dividend declaration & payment December 2016/January 2017

Shareholders’ Practical Guide

Issues Action

Change of address Contact the Company’s secretariat

If shares are deposited with CDS Contactpersonalbroker

Change of name Contact the Company’s secretariat

Acquisition or disposal of shares Contactpersonalbroker

Share transfers Contact the Company’s secretariat

Lost share certificate Contact the Company’s secretariat

Direct dividend credit Forward the relevant form to the Company’s secretariat


SOCIAL, HEALTH AND SAFETY

MaintainingahighstandardofHealth&SafetyatworkisakeyobjectivefortheCompanyinensuringthewelfareofitsemployees.ThustheCompanystrivestocontinuouslyimprovetheworkplaceenvironmentwhilstdrivinginjuries,occupationalillnessesandoperationalincidentsasclosetozeroaspossible.Ithasinplaceon-goinghazardandriskassessmentprocesses,controlsystemsandpreventivemeasuresagainstanyoccupationaldiseasesincompliancewithOSHA2005.

In2016,theworkenvironmentwillbefurtherenhancedbyinstigatingasustainablechangeinemployees’safety-orientedbehavioursattheworkplace.

The Company also ensures that its recruitment and promotion policies are fair and that procedures adopted are both transparent as well as competency and merit based. We also promote honest and transparent business practices.

CORPORATE, SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

AsamemberoftheHarelMallacGroup,Bychemexfullysupportsthecausesespousedbythe Fondation Harel Mallac through action-led campaigns.

In existence since 2009, the Fondation Harel Mallac (FHM) is the CSR arm of the Harel Mallac Group, supporting initiatives for asustainable and inclusive Mauritius. It focuses on improving the living conditions of disadvantaged children, in particular in the localities where the Group companies operate.

In2015,theFMH’sactionwasthree-fold,focusingonemployees,thebusinesses’deprivedneighbourhoodsandtheGroup’svisionforan integrated Mauritius.

TheFHM supported environmental initiatives benefitting the children of École Sainte Famille of Bois Marchand (Upcycling Waste),the Étoile du BergershelterinAlbion(WaterConservationAwareness),andtheMouvement pour le Progrès de Roche Bois(MPRB),whichprovidesvocationaltrainingtostreetchildrenonorganicfarming.Thefundingoftheseprojectswasenhancedbythesupportofvolunteering employees throughout the group, who engaged in the cleaning of localities and planting of endemic plants.

ThekeyGroupprojectundertakenbytheFHMthisyearwasthe‘HarelMallacGoGreen’sensitisationcampaign,launchedbyMissEcoUniverse2015andtheMinisterofEnvironment.GoGreenbroughttogetherover200groupemployeestorethinkandimprovetheirdailyimpactonthenaturalenvironment.Majorhighlightsofthecampaignincluded,inter-alia,thecreationofanorganicroofgardenontheHarelMallacBuildinginPortLouis,thelaunchoftherecyclingprogramme,awarenesssessionsbyMission Verte, exhibition of “upcycled”items.TheFHMiscurrentlyseekingtoextendtherecyclingprogrammetoallitsbusinessunitswhilstensuringanoptimalwaste management system is in place across the Group

Furthermore,toensuregreaterparticipationinitsCSRactivities,asolidarityreleaseofoneworkdayduringtheyearhasbeengrantedto each employee. Many NGOs have benefited from technical advice in areas in which our staff have particular interests and expertise.




PRINCIPAL ACTIVITIES

The principal activities of the Company during the year have remained unchanged and consist of the trading of specialised chemical products for the textile industry.

DIRECTORS

The Directors of the Company as at 31 December 2015 are listed on pages 10 and 11.

DIRECTORS’ SERVICE CONTRACTS

There are no service contracts between the Company and its Directors.

DIRECTORS’ REMUNERATION AND BENEFITS

Remunerationandbenefitsreceived,orduefromtheCompanywere:

2015 2014Rs’000 Rs’000

Executive Director - -

Non-executive Directors 426 477

Total 426 477

DIRECTORS’ INTERESTS IN SHARES

TheinterestsoftheDirectorsinthesharesoftheCompanyasat31December2015were:

Directors Direct Interest

Indirect Interest

AntoineL.Harel - 112,775CharlesHarel - 110,191

The other Directors have no shares either directly or indirectly in the Company.

CONTRACTS OF SIGNIFICANCE

There was no contract of significance to which the Company has been a party and in which a Director of the Company was materially interested, be it directly or indirectly.

THIRD PARTY MANAGEMENT AGREEMENT

The Company has a management contract with The Mauritius Chemical and Fertilizer Industry Limited.

STATUTORY DISCLOSURES

SHAREHOLDERS

At 31 December 2015, the following shareholders were directly or indirectly interested in more than 5 percent of the Company’s share capital.

Shareholders Interest %HarelMallac&Co.Ltd. 44.90The State Investment Corporation 9.52National Pension Fund 5.94

CORPORATE SOCIAL RESPONSIBILITY

2015 2014Donations Rs’000 Rs’000

Political - -Others - -Corporate Social Responsibility 35 48

AUDITORS’ FEES

Thefeespayabletotheauditors,fortheauditandotherserviceswere:2015 2014

Rs’000 Rs’000Audit fees payable:-BDO & Co 130 130Feespaidforotherservicesprovidedby:-BDO & Co - -

STATUTORY DISCLOSURES


TheDirectorsacknowledgetheirresponsibilitiesfor:

1. Adequate accounting records and maintenance of effective internal control systems.

2. The preparation of financial statements which fairly present the state of affairs of the

Company as at the end of the financial year, the results of its operations, and cash flow

forthatyearandcomplywithInternationalFinancialReportingStandards(IFRS).

3. The selection of appropriate accounting policies supported by reasonable and prudent

judgements.

The External Auditors are responsible for reporting on whether the Company’s financial

statements are fairly presented.

TheDirectorsreportthat:

1. Adequate accounting records and an effective system of internal controls and risk

management have been maintained.

2. Appropriateaccountingpoliciessupportedbyreasonableandprudentjudgementsand

estimates have been used consistently.

3. International Financial Reporting Standards have been adhered to. Any departure in the

fair presentation has been disclosed, explained and quantified.

4. The Code of Corporate Governance has been adhered to. Reasons have been provided

where there has not been compliance.

Signed on behalf of the Board of Directors on 21 March 2016.



STATEMENT OF DIRECTORS’ RESPONSIBILITIES


Name of PIE: BYCHEMEXLIMITED

Reporting Period: Year ended 31 December 2015

We,theDirectorsofBychemexLimited,confirmtothebestofourknowledgethatthePIEhasnotcompliedwith sections 2.2.2. and 2.8.2 of the Code of Corporate Governance. The reasons for non-compliance are detailed on pages 12 and 16 of the Corporate Governance Report.

Antoine L. Harel Shemboosingh CheekhooreeChairman Managing Director

21 March 2016

(Section75(3)oftheFinancialReportingAct)

STATEMENT OF COMPLIANCE



SECRETARY’SCERTIFICATE

Wecertifytothebestofourknowledgeand belief, that the Company has filed with the Registrar of Companies all such returns as are required of the Company under the Companies Act 2001. HM Secretaries Ltd. Secretary 21 March 2016

Independent Auditors’ Report to the Members

This report is made solely to the members of Bychemex Limited, (the“Company”)asabody, inaccordancewithSection205oftheCompaniesAct2001.Ourauditworkhasbeenundertakensothat we might state to the Company’s members those matters we are required to state to them in an auditors’ report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and theCompany’smembersasabody, forourauditwork, for thisreport, or for the opinions we have formed.

Report on the Financial Statements

We have audited the financial statements of Bychemex Limited on pages 25 to 47 which comprise the statement of financial position as at 31 December 2015 and the statement of profit or loss and other comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Directors’ Responsibility for the Financial Statements

The directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and in compliance with the requirements of the Companies Act 2001, and for such internal control as the directors determine is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgement,includingtheassessmentoftherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror.Inmakingthose risk assessments, the auditors consider internal controlrelevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements on pages 25 to 47 give a true and fair view of the financial position of the Company as at 31 December 2015, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards and comply with the Companies Act 2001. Report on Other Legal and Regulatory Requirements

Companies Act 2001

We have no relationship with, or interests in, the Company, other than in our capacity as auditors and dealings in the ordinary course of business.

We have obtained all information and explanations we have required.

In our opinion, proper accounting records have been kept bythe Company as far as it appears from our examination of those records.

Financial Reporting Act 2004

The Directors are responsible for preparing the corporate governance report. Our responsibility is to report the extent of compliance with the Code of Corporate Governance as disclosed in the annual report and on whether the disclosure is consistent with the requirements of the Code.

In our opinion, the disclosure in the annual report is consistent with the requirements of the Code.

BDO & Co Chartered Accountants

Port Louis,Mauritius.

21 March 2016

Rookaya Ghanty, F.C.C.A. Licensed by FRC

For the year ended 31 December 2015


Statement of Financial PositionAs at 31 December 2015

Antoine L. Harel Chairman

The notes on pages 29 to 47 form an integral part of these financial statements. Auditors’ report on page 24.


Notes 2015 2014Rs Rs

ASSETS Non-current assetsProperty, plant and equipment 5 4,702,805 4,699,057 Intangible assets 6 335,259 - Investment in financial assets 7 100,000 100,000

5,138,064 4,799,057 Current assetsInventories 8 9,526,906 18,330,233 Trade and other receivables 9 19,216,094 20,672,346 Cash and cash equivalents 26(b) 10,183,890 8,352,845

38,926,890 47,355,424

Total assets 44,064,954 52,154,481

EQUITY AND LIABILITIESCapital and reservesShare capital 10 5,000,000 5,000,000 Actuarial reserves (374,243) (436,044)Retained earnings 24,697,187 25,161,703 Owners’ interest 29,322,944 29,725,659

LIABILITIESNon-current liabilitiesObligations under finance lease 12 577,679 - Deferred tax liabilities 13 288,930 284,942 Retirement benefit obligations 14 1,330,032 1,246,434

2,196,641 1,531,376 Current liabilitiesTrade and other payables 15 11,805,316 17,316,234 Current tax liabilities 16 106,391 81,212 Obligations under finance lease 12 133,662 - Dividends 17 500,000 3,500,000

12,545,369 20,897,446

Total liabilities 14,742,010 22,428,822

Total equity and liabilities 44,064,954 52,154,481

These financial statements have been approved for issue by the Board of Directors on 21 March 2016


Statement of Profit or Loss and Other Comprehensive IncomeFor the year ended 31 December 2015


Revenue 2.16 58,882,354 57,792,330 Cost of sales 24 (45,643,047) (42,290,837)Gross profit 13,239,307 15,501,493 Other income 18 326,819 177,314 Othergains/(losses) 19 465,043 (54,730)Operating expenses 24 (14,169,341) (14,999,132)

(138,172) 624,945 Net finance income 20 273,129 194,258 Profit before taxation 22 134,957 819,203 Income tax expense 16 (99,473) (219,934)Profit for the year 35,484 599,269

Other comprehensive income:Items that will not be reclassified to profit and loss:Remeasurements of post employment benefit obligations 11 61,801 (383,283)Other comprehensive income for the year, net of tax 61,801 (383,283)Total comprehensive income for the year 97,285 215,986

Earningspershare(Rs/share) 25 0.01 0.12



Statement of Changes in EquityFor the year ended 31 December 2015

NotesShare capital

Actuarialgains/

(losses)Retainedearnings Total

Rs Rs Rs Rs

Balance at 01 January 2015 5,000,000 (436,044) 25,161,703 29,725,659

Profit for the year - - 35,484 35,484 Other comprehensive income for the year 11 - 61,801 - 61,801 Total comprehensive income for the year - 61,801 35,484 97,285

Dividends - 2015 17 - - (500,000) (500,000)

Balance at 31 December 2015 5,000,000 (374,243) 24,697,187 29,322,944

Balance at 01 January 2014 5,000,000 (52,761) 28,062,434 33,009,673

Profit for the year - - 599,269 599,269 Other comprehensive income for the year 11 - (383,283) - (383,283)Total comprehensive income for the year - (383,283) 599,269 215,986

Dividends - 2014 17 - - (3,500,000) (3,500,000)Balance at 31 December 2014 5,000,000 (436,044) 25,161,703 29,725,659




Cash flows from operating activitiesCash generated from operations 26(a) 5,636,240 7,861,236 Interest received - 176,354 Interest paid (23,224) (20)Tax paid (81,212) (346,844)Net cash generated from operating activities 5,531,804 7,690,726

Cash flows from investing activitiesPurchase of property, plant and equipment 5 (368,250) (462,284)Purchase of intangible assets 6 (365,704) - Proceeds from sale of property, plant and equipment 289,652 - Net cash used in investing activities (444,302) (462,284)

Cash flows from financing activitiesFinance lease principal payments (52,810) - Dividends paid 17 (3,500,000) (3,000,000)Net cash used in financing activities (3,552,810) (3,000,000)

Net increase in cash and cash equivalents 1,534,692 4,228,442

Movement in cash and cash equivalentsAt 1 January, 8,352,845 4,118,323 Increase 1,534,692 4,228,442 Effect of foreign exchange rate changes 296,353 6,080

At 31 December, 26(b) 10,183,890 8,352,845

Statement of Cash FlowsFor the year ended 31 December 2015



Notes to the Financial Statements For the year ended 31 December 2015

1. GENERAL INFORMATION

Bychemex Limited is a limited liability company incorporated and domiciled in Mauritius. The address of its registered office is Chaussée Tromelin, Fort George, Port Louis. Its main activities consist of the trading of specialised chemical products for the textile industry. The CompanyislistedontheDevelopment&EnterpriseMarket(DEM)oftheStockExchangeofMauritius. ThedirectorsconsiderHarelMallac&Co.Ltd,incorporatedintheRepublicofMauritiusastheholdingcompanyandSociétéPronema,an entity registered in the Republic of Mauritius as the ultimate parent entity. 2. SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

The financial statements of Bychemex Limited comply with the Companies Act 2001 and have been prepared in accordance with InternationalFinancialReportingStandards(IFRS).

These financial statements are that of an individual entity. The financial statements are presented in Mauritian Rupees.

Where necessary, comparative figures have been amended to conform with change in presentation in the current year. The financial statements are prepared under the historical cost convention, except that investment in financial assets are stated at their fair value.

(a) Amendments to published Standards and Interpretations effective in the reporting period

DefinedBenefitPlans:EmployeeContributions(AmendmentstoIAS19)appliestocontributionsfromemployeesorthirdpartiestodefinedbenefitplansandclarifiesthetreatmentofsuchcontributions.Theamendmentdistinguishesbetweencontributionsthatarelinkedtoserviceonlyintheperiodinwhichtheyariseandthoselinkedtoserviceinmorethanoneperiod.Theobjectiveoftheamendmentisto simplify the accounting for contributions that are independent of the number of years of employee service, for example employee contributions that are calculated according to a fixed percentage of salary. Entities with plans that require contributions that vary with servicewillberequiredtorecognisethebenefitofthosecontributionsoveremployee’sworkinglives.Theamendmenthasnoimpacton the Company’s financial statements.

Annual Improvements 2010-2012 Cycle

IFRS 2, ‘Share based payments’ amendment is amended to clarify the definition of a ‘vesting condition’ and separately defines‘performancecondition’and‘servicecondition’.TheamendmenthasnoimpactontheCompany’sfinancialstatements.

IFRS3, ‘Businesscombinations’ isamendedtoclarifythatanobligationtopaycontingentconsiderationwhichmeetsthedefinitionofa financial instrument isclassifiedasa financial liabilityorequity,on thebasisof thedefinitions in IAS32, ‘Financial instruments:Presentation’. It also clarifies that all non-equity contingent consideration is measured at fair value at each reporting date, with changes in value recognised in profit and loss. The amendment has no impact on the Company’s financial statements. IFRS8, ‘Operatingsegments’ isamendedtorequiredisclosureof the judgementsmadebymanagement inaggregatingoperatingsegments. It is also amended to require a reconciliation of segment assets to the entity’s assets when segment assets are reported. The amendment has no impact on the Company’s financial statements. IFRS13(Amendment),‘FairValueMeasurement’clarifiesintheBasisforConclusionsthatshort-termreceivablesandpayableswithnostated interest rates can be measured at invoice amounts when the effect of discounting is immaterial. The amendment has no impact on the Company’s financial statements. IAS16,‘Property,plantandequipment’andIAS38,’IntangibleAssets’areamendedtoclarifyhowthegrosscarryingamountandtheaccumulated depreciation are treated where an entity uses the revaluation model. The amendment has no impact on the Company’s financial statements.

IAS 24,’Related party disclosures’ is amended to include, as a related party, an entity that provides key management personnelservicestothereportingentityortotheparentofthereportingentity(the‘managemententity’).Disclosureoftheamountschargedtothe reporting entity is required. The amendment has no impact on the Company’s financial statements. IAS38,‘IntangibleAssets’isamendedtorequireanentitytotakeintoaccountaccumulatedimpairmentlosseswhenadjustingtheamortisation on revaluation. The amendment has no impact on the Company’s financial statements.



2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

2.1 Basis of preparation (cont’d)

(a) Amendments to published Standards and Interpretations effective in the reporting period (cont’d)

Annual Improvements 2011-2013 Cycle

IFRS1, ‘First-timeAdoptionofInternationalFinancialReportingStandards’ isamendedtoclarify intheBasisforConclusionsthatanentity may choose to apply either a current standard or a new standard that is not yet mandatory, but permits early application, provided either standard is applied consistently throughout the periods presented in the entity’s first IFRS financial statements. The amendment has no impact on the Company’s financial statements, since the Company is an existing IFRS preparer.

IFRS 3,’Business combinations’ is amended to clarify that IFRS 3 does not apply to the accounting for the formation of any jointventure under IFRS 11. The amendment has no impact on the Company’s financial statements. IFRS13,’Fairvaluemeasurement’ isamendedtoclarifythattheportfolioexceptioninIFRS13appliestoallcontracts(includingnon-financialcontracts)withinthescopeofIAS39orIFRS9.TheamendmenthasnoimpactontheCompany’sfinancialstatements. IAS 40,’Investment property’ is amended to clarify that IAS 40 and IFRS 3 are not mutually exclusive. IAS 40 assists users to distinguish between investment property and owner-occupied property. Preparers also need to consider the guidance in IFRS 3 to determine whether the acquisition of an investment property is a business combination. The amendment has no impact on the Company’s financial statements. (b) Standards, Amendments to published Standards and Interpretations issued but not yet effective

Certain standards, amendments to published standards and interpretations have been issued that are mandatory for accounting periods beginning on or after January 1, 2016 or later periods, but which the Company has not early adopted.

Atthereportingdateofthesefinancialstatements,thefollowingwereinissuebutnotyeteffective:

IFRS 9 Financial Instruments DefinedBenefitPlans:EmployeeContributions(AmendmentstoIAS19) IFRS 14 Regulatory Deferral Accounts AccountingforAcquisitionsofInterestsinJointOperations(AmendmentstoIFRS11) ClarificationofAcceptableMethodsofDepreciationandAmortisation(AmendmentstoIAS16andIAS38) IFRS 15 Revenue from Contract with Customers Agriculture:BearerPlants(AmendmentstoIAS16andIAS41) EquityMethodinSeparateFinancialStatements(AmendmentstoIAS27) SaleorContributionofAssetsbetweenanInvestoranditsAssociateorJointVenture(AmendmentstoIFRS10andIAS28)Annual Improvements to IFRSs 2012-2014 Cycle InvestmentEntities:ApplyingtheConsolidationException(AmendmentstoIFRS10,IFRS12andIAS28)DisclosureInitiative(AmendmentstoIAS1)

Where relevant, the Company is still evaluating the effect of these Standards, amendments to published Standards and Interpretations issued but not yet effective, on the presentation of its financial statements.

2.2 Property, plant and equipment

Allproperty,plantandequipmentarestatedathistoricalcostlesssubsequentdepreciation.Historicalcostincludesexpenditurethatis directly attributable to the acquisition of the items.

Subsequent costs are included in the assets’ carrying amount or recognised as a separate asset as appropriate, only when it is probable that the future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably.

Depreciation is calculated on the straight line method at annual rates to write off the cost of the assets over their estimated useful lives asfollows:


Theassets’residualvalues,usefullivesanddepreciationmethodarereviewed,andadjustedprospectively,ifappropriate,attheendof each reporting period. When the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.

Gains and losses on disposal of property, plant and equipment are determined by comparing proceeds with carrying amount and are included in profit or loss.

2.3 Inventories

Inventories are stated at lower of cost and net realisable value. Cost is determined on a weighted average basis. The cost of finished goodsandwork inprogresscomprisesofpurchasecostorrawmaterials,direct labour,otherdirectcostsandrelatedproductionoverheads(basedonnormaloperatingcapacity)butexcludesborrowingcosts.Netrealisablevalueistheestimatedsellingpriceintheordinary course of business less the costs of completion and applicable variable selling expenses.

2.4 Foreign currencies

(i) Functional and presentation currency Items included in the financial statements are measured using Mauritian Rupees, the currency of the primary economic environment in whichtheentityoperates(“functionalcurrency”).ThefinancialstatementsarepresentedinMauritianrupees,whichistheCompany’sfunctional and presentation currency.

(ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing on the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Foreignexchangegainsandlossesthatrelatetoborrowingsandcashandcashequivalentsarepresentedinprofitorlosswithin‘netfinanceincome’.Foreignexchangegainsthatrelatetopurchasesand tradepayablesarepresented inprofitor losswithin ‘costofsales’.Allotherforeignexchangegainsandlossesarepresentedinprofitorlosswithin‘othergains/(losses)-net’.

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of transaction.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date the fair value was determined.

2.5 Current and deferred income tax

The tax expense for the period comprises of current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current taxThe current income tax charge is based on taxable income for the year calculated on the basis of tax laws enacted or substantively enacted by the end of the reporting period.

Deferred tax Deferred income tax is provided in full, using the liability method, for all temporary differences arising between the tax bases of assets andliabilitiesandtheircarryingamountsinthefinancialstatements.However,ifthedeferredincometaxarisesfrominitialrecognitionofan asset or liability in a transaction, other than a business combination, that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for.


YearsLeasehold land 40Buildings 40Plant and Machinery 10Forklift 5Furniture and Office equipment 3.5 - 10Motor vehicles 5


2.2 Property, plant and equipment (cont’d)



2.5 Current and deferred income tax (cont’d)

Deferred tax (cont’d)

Deferred income tax is determined using tax rates that have been enacted or substantively enacted at the reporting date and are expected to apply in the period when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which deductible temporary differences can be utilised.

2.6 Alternative Minimum Tax (AMT)

AlternativeMinimumTax(AMT)isprovidedfor,wheretheCompany,whichhasataxliabilityoflessthan7.5%ofitsbookprofit,paysadividend.AMTiscalculatedasthelowerof10%ofthedividendpaidor7.5%ofbookprofit. 2.7 Intangible assets

Computer software Costs incurred to acquire and bring to use computer software are capitalised and are amortised using the straight line method over its estimatedusefullife(3years).

2.8 Retirement benefit obligations

(i) Defined contribution plans A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. The Company has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

The Company operates a defined contribution retirement benefit plan for all qualifying employees.

Payments to deferred contribution retirement plans are recognised as an expense when employees have rendered service that entitle them to the contributions.

(ii) Gratuity on retirement Foremployeeswhoarenotcoveredbythepensionplan(orwhoareinsufficientlycoveredbytheabovepensionplans),thenetpresentvalue of gratuity on retirement payable under the Employment Rights Act 2008 is calculated by a qualified actuary and provided for. The obligations arising under this item are not funded. 2.9 Impairment of non-financial assets

Assetsthathaveanindefiniteusefullifearenotsubjecttoamortisationandaretestedannuallyforimpairment.Assetsthataresubjectto amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. For the purposes of assessing impairment, assets are grouped at the lowest level for which there are separately identifiable cash flows (cash-generatingunits). 2.10 Leases

(a)Leasesareclassifiedasfinanceleaseswherethetermsoftheleasetransfersubstantiallyallrisksandrewardsofownershiptothelessee.Allotherleasesareclassifiedasoperatingleases.Paymentsmadeunderoperatingleases(netofanyincentivesreceivedfromthelessor)arechargedtoprofitorlossonastraight-linebasisovertheperiodofthelease. (b) Finance leases are capitalised at the lease’s inception at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged to profit or loss.




2.11 Financial assets

(a) Categories of financial assets TheCompanyclassifiesitsfinancialassetsinthefollowingcategories:available-for-salefinancialassetsandloansandreceivables.The classification depends on the purpose for which the investments were acquired. Management determines the classification of its financial assets at initial recognition.

(i) Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within twelve months of the end of the reporting period. (ii) Loans and receivables Loansandreceivablesarenon-derivativefinancialassetswithfixedordeterminablepaymentsthatarenotquotedinanactivemarket.They are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, loans and receivables are measured at amortised cost less any impairment. They are included in current assets when maturity is within twelve months after the end of the reporting period or non-current assets for maturities greater than twelve months.

The Company’s loans and receivables comprise of cash and cash equivalents, and trade and other receivables. (b) Recognition and measurement Purchasesandsalesoffinancialassetsarerecognisedontrade-date(orsettlementdate),thedateonwhichtheCompanycommitstopurchase or sell the asset. Investments are initially measured at fair value plus transaction costs. Unrealised gains and losses arising from changes in the fair value of financial assets classified as available-for-sale are recognised in other comprehensive income.

Whenfinancialassetsclassifiedasavailable-for-salearesoldorimpaired,theaccumulatedfairvalueadjustmentsareincludedinprofitorloss as gains and losses on financial assets.

Thefairvaluesofquotedinvestmentsarebasedoncurrentbidprices.Ifthemarketforafinancialassetisnotactive(andforunlistedsecurities),theCompanyestablishesfairvaluebyusingvaluationtechniques.Theseincludetheuseofrecentarm’slengthtransactions,reference to other instruments that are substantially the same and capitalised earnings method.

(c) Impairment of financial assets

(i) Financial assets classified as available-for-saleTheCompanyassessesattheendofeachreportingperiodwhetherthereisobjectiveevidencethatafinancialassetoragroupoffinancial assets is impaired. In the case of equity investments classified as available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is considered in determining whether the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss, measured as the difference between acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss - is removed from equity and recognised in profit or loss. Impairment losses recognised in profit or loss for an investment in an equity instrument classified as available-for-sale are not reversed through profit or loss. (ii) Financial assets carried at amortised costFor loans and receivables category, the amount of the loss is measured as the difference between the asset’s carrying amount and thepresentvalueofestimatedfuturecashflows(excludingfuturecreditlossesthathavenotbeenincurred)discountedatthefinancialasset’s original effective interest rate. The carrying amount of the asset is reduced and, the amount of the loss is recognised in profit or loss. If a loan has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. If inasubsequentperiod, theamountof the impairment lossdecreasesand thedecreasecanberelatedobjectively toaneventoccurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the previously recognisedimpairment loss is reversed through profit or loss to the extent that the carrying amount of the financial asset at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.




2.12 Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost less provision for impairment. AprovisionforimpairmentoftradereceivablesisestablishedwhenthereisobjectiveevidencethattheCompanywillnotbeabletocollect all amounts due according to the original terms of receivables.

The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows. The amount of provision is recognised in the statement of profit or loss.

2.13 Trade and other payables

Trade and other payables are stated at fair value and subsequently measured at amortised cost using the effective interest method.

2.14 Cash and cash equivalents

Cashandcashequivalentsincludecashinhand,depositsheldatcallwithbanks,othershort-termhighlyliquidinvestmentswithoriginalmaturitiesof3monthsorless,andbankoverdrafts.Bankoverdraftsareshownwithinborrowingsincurrentliabilitiesinthestatementof financial position.

2.15 Share capital

Ordinary sharesOrdinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as deduction, net of tax, from proceeds.

2.16 Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for goods supplied, stated net of discounts, returns, value added taxes, rebates and other similar allowances.

(a) Sale of goods Salesofgoodsarerecognisedwhenthegoodsaredeliveredandtitleshavepassed,atwhichtimeallofthefollowingconditionsaresatisfied:(i)TheCompanyhastransferredtothebuyerthesignificantrisksandrewardsofownershipofthegoods; (ii)TheCompanyretainsneithercontinuingmanagerialinvolvementtothedegreeusuallyassociatedwithownershipnoreffectivecontroloverthegoodssold; (iii)Theamountofrevenuecanbemeasuredreliably; (iv)ItisprobablethattheeconomicbenefitsassociatedwiththetransactionwillflowtotheCompany;and (v)Thecostsincurredortobeincurredinrespectofthetransactioncanbemeasuredreliably.

(b)OtherrevenuesearnedbytheCompanyarerecognisedonthefollowingbases: - Interest income - on a time proportion basis using the effective interest rate method. - Dividend income - when the shareholder’s right to receive payment is established.

2.17 Provisions

Provisions are recognised when the Company has a present or constructive obligation as a result of past events and it is probable that an outflow of resources that can be reasonably estimated will be required to settle the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of thereportingperiod,takingintoaccounttherisksanduncertaintiessurroundingtheobligation.Whenaprovisionismeasuredusingthecashflowsestimatedtosettlethepresentobligation,itscarryingamountisthepresentvalueofthosecashflows(whentheeffectofthetimevalueofmoneyismaterial). 2.18 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Company’s financial statements in the period in which the dividends are declared.

2.19 Related parties

Related parties are considered to be related if one party has the ability to control the other party or exercise significant influence over thepartymakingfinancialoroperationaldecisions.



3. FINANCIAL RISK MANAGEMENT

3.1 Financial Risk Factors

TheCompany’sactivitiesexposeittoavarietyoffinancialrisks,namelymarketrisk(includingcurrencyrisk),creditriskandliquidityrisk.

The Company’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimisepotential adverse effects on the Company’s financial performance. Adescriptionofthesignificantriskfactorsisgivenbelowtogetherwiththeriskmanagementpoliciesapplicable. (a) Market risk Currency risk

Thecompanyoperates internationally and is exposed to foreignexchange risk arising fromvarious currencyexposures primarilywith respect toUSDollarandEuro.Foreignexchangeriskarises fromfuturecommercial transactionsandrecognisedassetsandliabilities.

Currency profile

ThecurrencyprofileoftheCompany’sfinancialassetsandliabilitiesissummarisedbelow:

At31December2015,iftherupeehadweakened/strengthenedby5%againstthefollowingcurrencieswithallothervariablesheldconstant, post tax profit for the year would have been as shown in the table, mainly as a result of foreign exchange gains/losses on translation of foreign currency denominated financial assets and liabilities.

(b) Credit risk CreditriskistheriskoffinanciallosstotheCompanyifacustomerorcounterpartytoafinancialinstrumentfailstomeetitscontractualobligations, and arises principally from the Company’s trade and other receivables. The amounts presented in the statement of financial position are net of allowances for doubtful receivables, estimated by the company’s management based on prior experience and the current economic environment. TheCompanyhasnosignificantconcentrationofcreditrisk,withexposurespreadoveralargenumberofcounterpartiesandcustomers. The Company has policies in place to ensure that sales of products are made to customers with an appropriate credit history.

2015 2014Financial

assetsFinancialliabilities

Financial assets

Financialliabilities

Rs Rs Rs Rs

US Dollar 3,828,823 3,448,397 2,352,941 12,260,197 Euro 4,904,746 3,418,786 3,134,512 2,881,930 Mauritian Rupee 20,441,415 3,185,840 21,384,777 1,069,141

29,174,984 10,053,023 26,872,230 16,211,268

The table above excludes prepayments and accruals.

2015 2014Financial

assetsFinancialliabilities

Financial assets

Financialliabilities

Rs Rs Rs Rs

Impact on post-tax resultsUS Dollar 162,725 146,557 100,000 521,058 Euro 208,452 145,298 133,217 122,482

371,177 291,855 233,217 643,540



Less than1 year

Between 1 and 2 years

Between 2and 3 years

Between 3and 5 years

Rs Rs Rs RsAt 31 December 2015Obligations under finance lease 182,480 182,480 182,480 296,568 Trade and other payables 7,296,118 - - - Payable to related companies 2,722,742 - - -

At 31 December 2014Trade and other payables 15,273,600 - - - Payable to related companies 937,668 - - -

3. FINANCIAL RISK MANAGEMENT (CONT’D)

3.1 Financial Risk Factors (cont’d)

(c) Liquidity risk LiquidityriskistheriskthattheCompanywillencounterdifficultyinmeetingtheobligationsassociatedwithitsfinancialliabilitiesthataresettledbydeliveryofcashoranotherfinancialasset.Riskmanagementimpliesmaintainingsufficientcash,theavailabilityoffundingthroughanadequateamountofcommittedcreditfacilities.TheCompanyaimsatmaintainingflexibilityinfundingbykeepingcommittedcredit lines available. Management monitors rolling forecasts of the Company’s liquidity reserve on the basis of expected cash flow.

Thetablebelowanalysesthecompany’sfinancialliabilitiesbasedontheremainingperiodattheendofthereportingperiod:

3.2 Capital risk management

TheCompany’sobjectivewhenmanagingcapital is tosafeguard theentity’s ability tocontinueasagoingconcernso that it cancontinuetoprovidereturnsforshareholdersandbenefitsforotherstakeholders.

TherewerenochangesintheCompany’sapproachtocapitalriskmanagementsduringtheyear.

3.3 Fair value estimation

Thefairvalueoffinancialinstrumentsthatarenottradedinanactivemarketisdeterminedusingvaluationtechniques,suchasestimateddiscountedcashflowsorcapitalisedearningsandisnotbasedonobservablemarketdata.Thisinstrumentisincludedinlevel3.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimatesandjudgementsarecontinuouslyevaluatedandarebasedonhistoricalexperienceandotherfactors,includingexpectationsof future events that are believed to be reasonable under the circumstances.

4.1 Critical accounting estimates and assumptions

TheCompanymakesestimatesandassumptionsconcerningthefuture.Theresultingaccountingestimateswill,bydefinition,seldomequaltherelatedactualresults.Theestimatesandassumptionsthathaveasignificantriskofcausingamaterialadjustmenttothecarrying amounts of assets and liabilities within the next financial year are disclosed below.

(a) Depreciation policies Property, plant and equipment are depreciated to their residual values over their estimated useful lives. The residual value of an asset is the estimated net amount that the company would currently obtain from disposal of the asset, if the asset were already of the age and in condition expected at the end of its useful life.

Thedirectors thereforemakeestimatesbasedonhistoricalexperienceandusebest judgement toassess theuseful livesandtoforecast the expected residual values of the assets at the end of their expected useful lives.



4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONT’D)

4.1 Critical accounting estimates and assumptions (cont’d)

(b) Limitation of sensitivity analysis Sensitivityanalysisinrespectofmarketriskdemonstratestheeffectofachangeinakeyassumptionwhileotherassumptionsremainunchanged. In reality, there is a correlation between the assumptions and other factors. It should also be noted that these sensitivities are non-linear and larger or smaller impacts should not be interpolated or extrapolated from these results. SensitivityanalysisdoesnottakeintoconsiderationthattheCompany`sassetsandliabilitiesaremanaged.Otherlimitationsincludetheuseofhypotheticalmarketmovementstodemonstratepotentialriskthatonlyrepresentthecompany`sviewofpossiblenear-termmarketchangesthatcannotbepredictedwithanycertainty.

(c) Asset lives and residual values Property,plantandequipmentaredepreciatedoveritsusefullifetakingintoaccountresidualvalues,whereappropriate.Theactuallives of the assets and residual values are assessed annually and may vary depending on a number of factors. In reassessing asset lives, factors such as technological innovation and maintenance programmes are taken into account. Residual value assessmentsconsiderissuessuchasfuturemarketconditions,theremaininglifeoftheassetandprojecteddisposalvalues.Considerationisalsogiven to the extent of current profits and losses on the disposal of similar assets.

(d) Impairment of financial assetsThe Company follows the guidance of IAS 39 on determining when an investment is other-than-temporarily impaired. This determination requiressignificantjudgement.Inmakingthisjudgement,theCompanyevaluates,amongotherfactors,thedurationandextenttowhichthefairvalueofaninvestmentislessthanitscost,andthefinancialhealthofandnear-termbusinessoutlookfortheinvestee,includingfactors such as industry and sector performance, changes in technology and operational and financing cash flow.

(e) Fair value of securities not quoted in an active market ThefairvalueofsecuritiesnotquotedinanactivemarketmaybedeterminedbytheCompanyusingvaluationtechniquesincludingthirdparty transaction values, earnings, net asset value or discounted cash flows, whichever is considered to be appropriate. The Company wouldexercisejudgementandestimatesonthequantityandqualityofpricingsourcesused.Changesinassumptionsaboutthesefactors could affect the reported fair value of financial instruments.

5. PROPERTY, PLANT AND EQUIPMENT

Leaseholdland Buildings

Plant and Machinery Forklift

Furnitureand Officeequipment

Motorvehicles Total

Rs Rs Rs Rs Rs Rs Rs

(a) COSTAt 1 January 2015 22,691 2,303,048 15,590,620 550,000 2,215,139 2,942,275 23,623,773 Additions - - - - 249,000 883,400 1,132,400 Disposals - - - - - (1,867,605) (1,867,605)At 31 December 2015 22,691 2,303,048 15,590,620 550,000 2,464,139 1,958,070 22,888,568

DEPRECIATION

At 1 January 2015 15,601 1,105,026 12,634,206 550,000 1,899,607 2,720,276 18,924,716 Charge for the year 567 57,576 760,403 - 110,766 199,340 1,128,652 Disposaladjustment - - - - - (1,867,605) (1,867,605)At 31 December 2015 16,168 1,162,602 13,394,609 550,000 2,010,373 1,052,011 18,185,763

NET BOOK VALUES

At 31 December 2015 6,523 1,140,446 2,196,011 - 453,766 906,059 4,702,805



Leaseholdland Buildings

Plant and Machinery Forklift

Furnitureand Officeequipment

Motorvehicles Total

Rs Rs Rs Rs Rs Rs Rs

(b) COSTAt 1 January 2014 22,691 2,303,048 15,321,561 550,000 2,021,914 2,942,275 23,161,489 Additions - - 269,059 - 193,225 - 462,284 At 31 December 2014 22,691 2,303,048 15,590,620 550,000 2,215,139 2,942,275 23,623,773

DEPRECIATION

At 1 January 2014 15,034 1,047,450 11,809,926 550,000 1,827,482 2,609,276 17,859,168 Charge for the year 567 57,576 824,280 - 72,125 111,000 1,065,548 At 31 December 2014 15,601 1,105,026 12,634,206 550,000 1,899,607 2,720,276 18,924,716

NET BOOK VALUES

At 31 December 2014 7,090 1,198,022 2,956,414 - 315,532 221,999 4,699,057

(c)AdditionsincludeRs883,400(2014:Nil)ofassetsleasedunderfinanceleases.

5. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

(d)Leasedassetsincludedabovecomprisemotorvehicles: 2015 2014Rs Rs

Cost-capitalised under finance lease 883,400 - Accumulated depreciation (88,340) - Netbookvalue 795,060 -

(e)DepreciationchargeofRs1,128,652(2014:Rs1,065,548)hasbeenchargedinoperatingexpenses.

6. INTANGIBLE ASSETS Computer software2015 2014

(a) COST Rs Rs

At 1 January, - - Addition 365,704 - At 31 December, 365,704 -

AMORTISATIONAt 1 January, - - Charge for the year 30,445 - At 31 December, 30,445 -

NET BOOK VALUEAt 31 December, 335,259 -

(b)AmortisationchargeofRs30,445(2014:Nil)hasbeenchargedinoperatingexpenses.

7. INVESTMENT IN FINANCIAL ASSETS

2015 2014Rs Rs

At 1 January and 31 December, 100,000 100,000

The investment in financial assets are denominated in Mauritian Rupees and are classified under level 3.



8. INVENTORIES 2015 2014 Rs Rs

Raw materials 427,812 1,119,111 Finished goods 9,099,094 17,211,122

9,526,906 18,330,233

ThecostofinventoriesrecognisedasexpenseandincludedincostofsalesamountedtoRs45,643,047(2014:Rs42,290,837).

9. TRADE AND OTHER RECEIVABLES

2015 2014 Rs Rs

Trade receivables 19,623,307 17,400,727 Less:provisionforimpairment (859,468) (441,054)Trade receivables - net 18,763,839 16,959,673 Prepayments 225,000 2,152,961 Receivablesfromrelatedcompanies(note29) 224,241 808,681 Other receivables 3,014 751,031

19,216,094 20,672,346

The carrying amount of trade and other receivables approximate their fair value.

Asof31December2015,tradereceivablesofRs859,468(2014:Rs441,054)wereimpaired.TheamountoftheprovisionwasRs859,468asof31December2015(2014:Rs441,054).

Theageingofthesereceivablesisasfollows:2015 2014 Rs Rs

Over 6 months 859,468 441,054

Asof31December2015, tradereceivablesofRs927,230 (2014:Rs636,268)werepastduebutnot impaired.Theserelates toanumber of independent customers for whom there is no recent history of default.

Theageinganalysisofthesetradereceivablesisasfollows:2015 2014 Rs Rs

3 to 6 months 540,808 636,268 Over 6 months 386,422 -

927,230 636,268

ThecarryingamountsoftheCompany`stradeandotherreceivablesaredenominatedinthefollowingcurrencies:

2015 2014Rs Rs

Rupee 12,516,879 14,799,921 US Dollar 3,828,823 4,225,002 Euro 2,870,392 1,647,423

19,216,094 20,672,346

Movementsontheprovisionforimpairmentoftradereceivablesareasfollows:

2015 2014Rs Rs

At 1 January, 441,054 - Provision for receivable impairment 418,414 441,054 At 31 December, 859,468 441,054

The other classes of trade and other receivables do not contain impaired assets.

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. TheCompany does not hold any collateral as security.



10. SHARE CAPITAL2015 2014

Authorised, issued and fully paid Rs Rs 5,000,000 ordinary shares of Rs1.00 each 5,000,000 5,000,000

11. OTHER COMPREHENSIVE INCOME

Notes

Actuarial gains/

(losses)2015 RsItems that will not be reclassified to profit or loss:Remeasurement of defined benefit obligations 14 72,707 Deferred tax on remeasurements of post retirement benefit obligations 13 (10,906)Other comprehensive income for the year 2015 61,801

2014Items that will not be reclassified to profit or loss:Remeasurement of defined benefit obligations 14 (450,921)Deferred tax on remeasurements of post retirement benefit obligations 13 67,638 Other comprehensive income for the year 2014 (383,283)

Actuarial gains/(losses)Theactuarialgains/(losses)reserverepresentsthecumulativeremeasurementofdefinedbenefitobligationrecognised.

12. OBLIGATIONS UNDER FINANCE LEASE2015 2014Rs Rs

Non-currentObligationsunderfinancelease(seenote(c)) 577,679 -

CurrentObligationsunderfinancelease(seenote(c)) 133,662 -

711,341 -

(a)Leaseliabilitiesareeffectivelysecuredastherightstotheleasedassetreverttothelessorintheeventofdefault.Therateofinterest on the lease is 7.5% per annum.

(b)TheexposureoftheCompany’sborrowingstointerestratechangesandthecontractualrepricingdatesareasfollows:

6 months or less 6-12 months 1-5 years TotalRs Rs Rs Rs

At 31 December 2015Total borrowings 65,582 68,080 577,679 711,341

(c)Financeleaseliabilities-minimumleasepayments 2015 2014Rs Rs

Not later than one year 182,480 - Later than one year and not later than two years 182,480 - Later than two years and not later than three years 182,480 - Later than three years and not later than five years 296,568 -

844,008 - Future finance charges on finance lease (132,667) - Present value of finance lease liabilities 711,341 -



12. OBLIGATIONS UNDER FINANCE LEASE (CONT’D)

(c)Financeleaseliabilities-minimumleasepayments(cont’d)

Thepresentvalueoffinanceleaseliabilitiesmaybeanalysedasfollows:2015 2014Rs Rs

Not later than one year 133,662 - Later than one year and not later than two years 144,038 - Later than two years and not later than three years 155,220 - Later than three years and not later than five years 278,421 -

711,341 -

(d)TheCompanyleasesamotorvehicleunderfinancelease.Theleasehaspurchaseoptionsontermination.Therearenorestrictionsimposed on the Company by lease arrangements.

(e)ThecarryingamountsofborrowingsaredenominatedinMauritianRupeesandarenotmateriallydifferentfromtheirfairvalue.

13. DEFERRED INCOME TAX

Deferredincometaxiscalclulatedonalltemporarydifferencesundertheliabilitymethodat15%(2014:15%).

(a)Thereisalegallyenforceablerighttooffsetcurrenttaxassetsagainstcurrenttaxliabilitiesanddeferredincometaxassetsandliabilities when the deferred income taxes relate to the same fiscal authority on the same entity. The following amounts are shown in thestatementoffinancialposition:

2015 2014 Rs Rs

Deferred tax assets (199,505) (186,965)Deferred tax liabilities 488,435 471,907

288,930 284,942

(b)Themovementonthedeferredincometaxaccountisasfollows:2015 2014 Rs Rs

At 1 January, 284,942 395,412 Creditedtoprofitorloss(note16(b)) (6,918) (42,832)Charged/(credited)toothercomprehensiveincome 10,906 (67,638)At 31 December, 288,930 284,942

(c) Deferred tax liabilities

Deferred tax assets

Accelerated tax

depreciation

Retirement benefit

obligations Total Rs Rs Rs

At 1 January 2014 503,420 (108,008) 395,412 Credited to profit or loss (31,513) (11,319) (42,832)Credited to other comprehensive income - (67,638) (67,638)At 31 December 2014 471,907 (186,965) 284,942 Charged/(credited)toprofitorloss 16,528 (23,446) (6,918)Charged to other comprehensive income - 10,906 10,906 At 31 December 2015 488,435 (199,505) 288,930



(iii)Themovementintheretirementbenefitobligationsovertheyearisasfollows:2015 2014 Rs Rs

At 1 January, 1,246,434 720,054 Current service cost 64,537 23,416 Interest cost 91,768 52,043 Actuarial(gains)/losses (72,707) 450,921 At 31 December, 1,330,032 1,246,434

14. RETIREMENT BENEFIT OBLIGATIONS2015 2014 Rs Rs

Amountrecognisedinthestatementoffinancialpositionasnon-currentliabilities:Otherpost-retirementbenefits(note14(ii)) 1,330,032 1,246,434

Amountchargedtoprofitorloss:Otherpost-retirementbenefits(note14(iv)) 156,305 75,459

Amount(credited)/chargedtoothercomprehensiveincome:Otherpost-retirementbenefits(note14(v)) (72,707) 450,921

(i)Otherpost-retirementbenefitscompriseofretirementgratuitypayableundertheEmploymentRightsActandotherbenefits.

(ii)Theamountsrecognisedinthestatementoffinancialpositionareasfollows:2015 2014 Rs Rs

Present value of unfunded obligations 1,330,032 1,246,434

Thereconciliationoftheopeningbalancestotheclosingbalancesforotherpost-retirementbenefitsisasfollows:

2015 2014 Rs Rs

At 1 January, 1,246,434 720,054 Charged to profit or loss 156,305 75,459 (Credited)/chargedtoothercomprehensiveincome (72,707) 450,921 At 31 December, 1,330,032 1,246,434

(iv)Theamountsrecognisedinprofitorlossareasfollows: 2015 2014 Rs Rs

Current service cost 64,537 23,416 Interest cost 91,768 52,043 Totalincludedinemployeebenefitexpense(note23) 156,305 75,459

The total charges were included in operating expenses.

(v)Theamountsrecognisedinothercomprehensiveincomeareasfollows:2015 2014 Rs Rs

Experience(gains)/losses (72,707) 450,921

(vi)Themainactuarialassumptionsusedforaccountingpurposes: 2015 2014 % %

Discount rate 7.00 7.00 Future long term salary increase 5.00 5.00



14. RETIREMENT BENEFIT OBLIGATIONS (CONT’D)

(vii)Sensitivityanalysisondefinedbenefitobligationstochangesintheweightedprincipalassumptionsis:

Increase Decrease 31 December 2015 Rs Rs Discountrate(1%increase) - 91,771 Futuresalarygrowth(1%increase) 110,597 -

31 December 2014Discountrate(1%increase) - 88,694 Futuresalarygrowth(1%increase) 105,707 -

The sensitivity analysis above has been determined on sensibly possible changes of the discount rate occuring at the end of the reporting period if all other assumptions remained unchanged.

Itisbasedonamethodthatextrapolatestheimpactonthenetdefinedbenefitobligationasitisunlikelythatthechangeinassumptionswould occur in isolation of one another as some of the assumptions may be correlated. There were no change in the methods and assumptions used in preparing the sensitivity analysis from prior years.

(viii)Theweightedaveragedurationoftheotherpost-employmentbenefitplansis6yearsattheendofthereportingperiod.(2014:8years)

15. TRADE AND OTHER PAYABLES 2015 2014 Rs Rs

Trade payables 7,296,118 15,273,600 Payablestorelatedcompanies(note29) 2,722,742 937,668 Accrued expenses and other payables 1,786,456 1,104,966

11,805,316 17,316,234

The carrying amounts of trade and other payables approximate their fair value.

16. CURRENT TAX LIABILITIES 2015 2014 Rs Rs

(a) Statement of financial positionAt 1 January, 81,212 165,290 Currenttaxonadjustedprofitfortheyearat15%(2014:15%) 106,391 262,766 Tax paid during the year (81,212) (165,290)Tax paid under advance payment scheme - (181,554)At 31 December, 106,391 81,212

2015 2014(b) Statement of profit or loss Rs Rs Currenttaxontheadjustedprofitfortheyearat15%(2014:15%) 106,391 262,766 Deferredtax(note13) (6,918) (42,832)Tax charge 99,473 219,934

(c)ThetaxontheCompany’sprofitbeforetaxdiffersfromthetheoreticalamountthatwouldariseusingthebasictaxrateoftheCompanyasfollows:

2015 2014 Rs Rs

Profit before taxation 134,957 819,203

Taxcalculatedat15%(2014:15%) 20,244 122,880 Expenses not deductible for tax purposes 79,229 97,054 Tax charge 99,473 219,934



18. OTHER INCOME 2015 2014 Rs Rs

Interest income 37,167 176,354 Profit on sale of property, plant and equipment 289,652 - Others - 960

326,819 177,314

19. OTHER GAINS/(LOSSES) - NET 2015 2014 Rs Rs

Netforeignexchangegains/(losses)(note21) 465,043 (54,730)

20. NET FINANCE INCOME 2015 2014 Rs Rs

Interestexpense:-Bankoverdraft - (20)- Finance lease (23,224) - Netforeignexchangegainsonfinancingactivities(note21) 296,353 194,278

273,129 194,258

21. NET FOREIGN EXCHANGE GAINS/(LOSSES)

Theexchangedifferences(charged)/creditedtothestatementofprofitorlossareincludedasfollows:

2015 2014 Rs Rs

Cost of sales (516,949) (284,194)Othergains/(losses)-net(note19) 465,043 (54,730)Netfinanceincome(note20) 296,353 194,278

22. PROFIT BEFORE TAXATION 2015 2014 Rs Rs

Profitbeforetaxationisarrivedatafter:Crediting:Profit on sale of property, plant and equipment 289,652 - Charging:Lease rentals - property 450,000 450,000 Depreciationonproperty,plantandequipment(note5)- owned assets 1,040,312 1,065,548 - assets under finance lease 88,340 - Amortisationofintangibleassets(note6) 30,445 - Employeebenefitexpense(note23) 4,672,049 4,660,940

17. DIVIDENDS 2015 2014 Rs Rs

At 1 January, 3,500,000 3,000,000 ProposeddividendpershareRs0.10(2014:Rs0.70) 500,000 3,500,000 Dividend paid (3,500,000) (3,000,000)At 31 December, 500,000 3,500,000



23. EMPLOYEE BENEFIT EXPENSE 2015 2014 Rs Rs

Wages and salaries 4,261,504 4,256,889 Social security cost 184,384 173,293 Pension costs - defined contribution plans 69,856 155,299 Pensioncosts-definedbenefitplans(note14) 156,305 75,459

4,672,049 4,660,940

24. EXPENSES BY NATURE 2015 2014 Rs Rs

Depreciation(note5) 1,128,652 1,065,548 Amortisation(note6) 30,445 - Employmentbenefitexpense(note23) 4,672,049 4,660,940 Changes in inventories of finished goods 8,803,327 (4,905,654)Raw materials used and consumed 36,839,720 47,196,489 Other expenses 8,338,195 9,272,645 Total cost of sales and operating expenses 59,812,388 57,289,968

25. EARNINGS PER SHARE 2015 2014

Netprofitattributabletoshareholders(Rs) 35,484 599,269

Number of ordinary shares in issue 5,000,000 5,000,000

Earningspershare(Rs/share) 0.01 0.12

26. NOTES TO THE STATEMENT OF CASH FLOWS 2015 2014 Rs Rs

(a) Cash generated from operations Profit before taxation 134,957 819,203 Adjustmentsfor:Depreciation on property, plant and equipment 1,128,652 1,065,548 Amortisation of intangible assets 30,445 - Profit on sale of property, plant and equipment (289,652) - Interest income (37,167) (176,354)Interest expense 23,224 20 Impairment loss recognised on inventory 64,628 119,840 Provision for impairment on trade receivables 418,414 (441,054)Retirement benefit obligations 156,305 75,459 Unrealisedexchange(gains)/losses (290,988) 32,274

1,338,818 1,494,936 Changesinworkingcapital:- inventories 8,738,699 (5,433,327)- trade and other receivables 1,093,270 4,022,871 - trade and other payables (5,534,547) 7,776,756 Cash generated from operations 5,636,240 7,861,236

(b) Cash and cash equivalents 2015 2014 Rs Rs

Cashinhandandatbank 10,183,890 8,352,845



29. RELATED PARTY TRANSACTIONS

Remuneration and benefits

(note a)

Purchase of goods andservices

Sales of goods and services

Management services and fees payable

Loan at call owed by

related party

Amountowed byrelated party

Amountowed torelated party

2015 Rs Rs Rs Rs Rs Rs RsHoldingcompany - - - - 8,500,000 37,167 24,638 Fellow subsidiaries - 10,828,236 4,745,623 1,880,004 - 187,074 2,698,104 Directorsandkeymanagement personnel 426,360 - - - - - -

2014Fellow subsidiaries - 5,839,938 3,040,965 2,280,004 - 808,681 937,668 Directorsandkeymanagement personnel 477,565 - - - - - -

The sales to and purchases from related parties are made in the normal course of business. Outstanding trade balances at the year-endareunsecured,interestfree(withtheexceptionofloanatcall)andsettlementoccursincash.

There has been no guarantees provided or received for any related party receivables or payables. For the year ended 31 December 2015, theCompanyhasnot recordedany impairmentof receivablesrelating toamountsowedbyrelatedparties (2014:Nil).Thisassessmentisundertakeneachfinancialyearthroughexaminingthefinancialpositionoftherelatedpartyandthemarketinwhichtherelated party operates.

(a)Remunerationandbenefitsfordirectorsandkeymanagementpersonnelrelatetodirectorsfees.

30. EVENTS AFTER THE REPORTING DATE

There are no event after the end of the reporting period which the directors consider may materially affect the financial statements for the year ended 31 December 2015.

27. COMMITMENTS

The Company leases land it occupies, from the Mauritius Ports Authority under non cancellable operating lease agreements. The lease has varying terms, escalating clauses and renewal rights.

Operating lease commitments

Thefutureaggregateminimumleasepaymentsunderoperatingleases(inrespectofleaseholdland)areasfollows:

2015 2014 Rs Rs

Not later than one year 450,000 450,000 Later than one year and not later than five years 225,000 675,000

675,000 1,125,000

28. SEGMENTAL INFORMATION

Due to the nature of the manufacturing process and to the type of products, the risks and rewards for the range of productsmanufactured cannot be separately identified. No separate reporting segment is therefore identifiable.



31. CONTINGENT LIABILITIES

As at 31 December 2015 and 2014, the Company had no contingent liabilities, in respect of legal claims and other matters arising in the ordinary course of business for which it is anticipated that material liabilities would arise.

32. THREE-YEAR SUMMARY OF PUBLISHED RESULTS AND ASSETS AND LIABILITIES

(a) Statements of profit or loss 2015 2014 2013Rs Rs Rs

Continuing operationsRevenue 58,882,354 57,792,330 58,828,720

Profit before taxation 134,957 819,203 1,640,816 Income tax expense (99,473) (219,934) (295,462)Profit for the year from continuing operations 35,484 599,269 1,345,354

Profitattributableto:- Owners of the parent 35,484 599,269 1,345,354

(b) Statements of profit or loss and other comprehensive income

Profit for the year from continuing operations 35,484 599,269 1,345,354 Other comprehensive income for the year 61,801 (383,283) 21,112 Total comprehensive income for the year 97,285 215,986 1,366,466

Totalcomprehensiveincomeattributableto:- Owners of the parent 97,285 215,986 1,366,466

Dividendpershare(Rs) 0.10 0.70 0.60 Earningspersharefromcontinuingoperations(Rs/share) 0.01 0.12 0.27

(c) Statements of financial position 2015 2014 2013Rs Rs Rs

ASSETSNon-current assets 5,138,064 4,799,057 5,402,321 Current assets 38,926,890 47,355,424 41,381,996 Total assets 44,064,954 52,154,481 46,784,317

EQUITY AND LIABILITIESCapital and reserves 29,322,944 29,725,659 33,009,673

LIABILITIESNon-current liabilities 2,196,641 1,531,376 1,115,466 Current liabilities 12,545,369 20,897,446 12,659,178 Total liabilities 14,742,010 22,428,822 13,774,644

Total equity and liabilities 44,064,954 52,154,481 46,784,317



Notes


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