The 98^th Annual General Meeting of Balmer Lawrie & Co. Ltd. was held at Kolkata on 22^nd September, 2015.
 
Below is an extract of the Chairman’s Speech:
 
Overall Financial Performance
Balmer Lawrie has been able to maintain a stable financial position despite the adverse market conditions prevailing during the year 2014-15 especially in respect of raw material prices. The Company recorded its highest ever turnover of Rs.2944 Crore in 2014-15 representing a marginal growth of 3.5% over 2013-14. However, the Profit Before Tax (PBT) decreased to Rs. 210 Crore from Rs. 220 Crore in the preceding year. SBU: Logistics Services and SBU: Logistics Infrastructure continued to be the main revenue driver for the Company.
 
The Board of Directors recommended a dividend at the rate of Rs 18/- per share which corresponds to 180% for the financial year 2014-15 same as the previous year 2013-14.
 
The First Quarter: 2015-16The Company registered a positive increase in net turnover by 3.35% over the corresponding quarter in the preceding financial year. Profit Before Tax (PBT) and Profit After Tax (PAT) increased by 35% and 33% respectively in comparison to the corresponding period of the preceding financial year. The increase is primarily due to increase in sales volume in the food sector for SBU: Industrial Packaging, substantial increase in exports for SBU: Greases & Lubricants and increase in Air exports in the current year for SBU: Logistics.
 
Performance of Strategic Business Units (SBUs) & Future Outlook
 
Balmer Lawrie is a diversified PSU with a presence in both manufacturing and service sectors.
 
SBU: Industrial Packaging (SBU: IP)– The SBU achieved the highest ever sales in 2014-15. This was achieved despite the absence of orders from the PSU Oil Companies or Government in the wake of directives to Government Companies to procure MS Drums only from MSMEs.  The SBU commenced commercial production at its state-of-the-art manufacturing facility in Navi Mumbai for manufacturing of 200 Ltr. capacity Steel Drums effective July 2014. This plant will provide a competitive advantage to the SBU as it is located close to one of the largest consumption centers for Steel Drums in the Western Region.
 
SBU: Greases & Lubricants (SBU: G&L)– In 2014-15, due to the challenging business environment, volatility in lubricants market and falling base oil prices, the SBU recorded a fall of 8.9% in its turnover over the previous year. However, the SBU expects to achieve significant improvement in retail sales with a target of achieving a higher market share within the next couple of years.
 
SBU: Leather Chemicals (SBU: LC)– A new facility for production of syntans commenced operation in the previous year to cater to both the international and domestic markets. A project for foraying into the finishing chemicals segment is also under consideration. The turnover during 2014-15 was 4% lower than last year. While fatliquor volume has grown marginally, the syntan volume has reduced by 9% compared to last year. Sales volume and turnover vis-à-vis last financial year has marginally decreased in the current year.
 
SBU: Logistics – To leverage the synergy of SBUs: LI and LS, both of them have been merged to form one Business Unit – SBU: Logistics during the current financial year i.e. 2015-16.
 
SBU: Logistics Infrastructure (SBU: LI)– During the year 2014-15, the CFS business grew in volume, revenues and earnings as compared to the previous year due to the Company wresting some business which was lost to competition.  Warehousing activity suffered a bit during the year due to lack of fixed contracts and lower utilization of space. The SBU has started work in establishing three Temperature Controlled Warehouses at Hyderabad, Delhi NCR and Mumbai.
 
SBU: Logistics Services (SBU: LS) – The SBU focused on the Ocean freight forwarding sector, and registered a growth of around 9% in the fiscal year 2014-15. The SBU is in the process of consolidating the business in Ocean segment through change in organization structure of Logistics Services and Logistics Infrastructure with a view to provide one stop logistics solutions. During the year, the Central Pricing Desk was also established in order to get highly competitive rates. The SBU during 2014-15 achieved the highest ever profit since its inception despite a nominal growth of 2% in top line as compared to the previous year. This was achieved primarily on account of better sales mix coupled with economy in cost of operation.
 
SBU: Tours & Vacations (SBU: T&V) – During the year, to benefit from the possible synergies, the Company merged two of its SBUs earlier known as “Tours & Travel” and “Tours - Vacations Exotica” and renamed the combined strategic business unit as “Travel & Vacations” to build one seamless travel and vacations operation that offers end to end Travel & Vacation solutions. Despite the adverse environment, the SBU has continued to provide sizeable turnover from the ticketing business. Domestic travel accounted for ~57% of the turnover while international travel was around 22%. The revenue generated from the tours and other activities touched ~10% and ~11% of the turnover respectively.
 
SBU: Refinery & Oil Field Services (SBU: ROFS)– The SBU continues to enjoy sizeable market share in oil sludge processing. In 2014-15, the SBU has achieved growth on the last year’s turnover but there is a decrease in segmental profit. This is owing to overall sluggish business environment which persisted throughout the year in the particular segment. The SBU is endeavouring to bring forth technological
advancement in its services so as to reduce human interference.
 
 
Corporate Social Responsibility
 
Under the “Swachh Bharat Abhiyan” launched by the Prime Minister, Balmer Lawrie was assigned the construction of 306 toilets in 250 schools by 10th August, 2015. The Company is the first organization in MOPNG which has completed the said target within the scheduled time. During the fiscal 2014-15, Balmer Lawrie spent a sum of Rs. 388 lakh on CSR activities and Rs. 400 lakh on sustainability initiatives.