18
Maldives Transport and Contracting Company Plc Quarterly Report 2nd Quarter 2015 (01st April - 30th June)
Maldives Transport and Contracting Company Plc
Quarterly Report2nd Quarter 2015
(01st April - 30th June)
1
Contents
Business Review 2
Marketing and Promotion 3
Human Resources 4
Club MTCC 5
Board Activities 7
Corporate Social Responsibility 10
Financials 11-14
Income Statement
Balance Sheet
Cash flow Statement
Segmental Performance
Our Share 15
Declaration 16
2
Business Review
Construction Segment
The Company is currently engaged in a number of
construction projects throughout the country most of
which are harbor development projects.
Looking into the activities of the 2nd Quarter 2015, a total
of 57 projects was carried out, of which seven projects
were completed. Which are:-
N.Kudafari Harbour Project
R.Maduvvari Coastal Protection Project
Repair work of sea water intake and discharge
pipe of Engine cooling system
K.Aarah Quay wall Construction Project
N.Naalaafushi Harbour Project
Reclaimationof G.Dh Dhaandhoo Football
Stadium
Construction of Harbours for Tsunami Victims-
G.Dh Thinadhoo
No.1 Jetty Project
Renovation of the no.1 Presidential Jetty was a Maldives
National Defense Force’s special project awarded to the
company during the quarter. The project was a
challenging project considering the deadline of 1 month
the company was given to remove and erect a new
modern jetty.
Musical Water Fountain
Development of musical water fountain was one of the
key projects carried out during the quarter. The Musical
Water Fountain was a gift under the company’s CSR to
the people of the Maldives on the occasion of the 50th
Independence Day. Works of the project was carried out
for more than 15 hours a day to keep up with the
deadline.
Transport Segment
Bringing improvement to the services provided under the
transport segment is one of the key objectives of the
board and management.
During the quarter few milestones were achieved under
this objective.
Improvement to Ferries
The company introduced double deck ferry to
Hulhumale’ Ferry Services catering to a capacity of 204
passengers with a speed of 15mins.
Special efforts were also made to offer a comfortable
journey for the passengers, for which fans were installed
in four ferries travelling in the Hulhumale sector.
Shuttle Bus Service
Shuttle Bus Services to INIA was introduced during the
quarter. The company invested on 2 Volvo Buses with 44
passenger capacity for this service.
These buses are targeted towards customers travelling
with their luggage as it has special compartment for
luggage carriage.
The service was officially inaugurated by Minister of
Economic Development, Mr.Mohamed Saeed.
New Ferry Terminal
From year 2007, the company has been providing ferry
services to Thilafushi – the industrial island. During the
quarter a new ferry terminal was opened and brought
into operation at Thilafushi.
3
Marketing and
Promotions
Marketing Trips
Product Promotional trips were made to A.Dh, R and
Thaa atolls. During these trips, the marketing team met
with boat owners, boat designers, and engineers to
provide information on products mainly marine and
outboard engines. Customers were also been informed
on the aftersales services provided by the company.
One of the main objectives of the company this year was
to facilitate the customers of the company an easy
access to the products and services provided under this
segment. As such the following milestone was achieved
during the quarter.
Odiverinnah Hallu Yageen
―Odiverinnah Hallu Yageen‖ program was inauguration
by Minister of Fisheries and Agriculture Mr.Mohamed
Shinee in a special event held at Dharubaaruge on 12th
April 2015.
The company introduced 3 major services in this
ceremony:
1. Certified Engineers
Certified engineers were appointed across the
country to provide pre and after sale services
to customers. These engineers were selected
based on merit and experience in the sector
and was further trained by Engineers from
Yanmar Asia and MTCC.
2. Agents
Agents were appointed across the country to
facilitate distribution of the spare parts and
other products.
3. Financing Scheme
An Islamic financing scheme was introduced to
facilitate the purchase of engines. Through this
scheme customers will be able to purchase
engines on installment basis that has a
repayment period of 3 years.
Minivan 50 Suzuki Roadha
Promotion
Minivan 50 Suzuki Roadha Promotion began on 1st June
at Kashavaru Show room as well as on 13th June 2015
at North Harbour. This promotion was conducted
focused on all ranges of Suzuki Outboard Engines.
Customers who purchase the engines were given a
special maintenance kit free with their engines.
4
Human Resources
There were a total of 1264 employees at the end of the 2nd Quarter. Out of which, 1152 are male and 112 are female staff.
At the end of the quarter the company employed 637 locals and 627 expatriates, throughout the country.
During the quarter, staffs were provided training on:
Product Training (366D & 924K Machine) – by Tractor Singapore
AT- Eng (Aggregate Training – D08 Engine) – by MAN Trucks India
Sigma (PPG Coating) Product Training – by Sigma
Customer Service
New employee Orientation
Dasvaru 2015
MOU was signed between the company and Technical and Vocational Education and Training Authority - Ministry of
Education to train interns of ―Dhasvaru 2015‖ on 20th April 2015. The training program will be conducted for a maximum
period of 06 months where trainees will be placed at different work site of MTCC. The interns will be provided with an
orientation where they will be exposed to the formal job environment, the responsibilities and the prospective benefits with
the job.
5
Club MTCC
Team MTCC Minivan 50ah Thahyaaruvun Team MTCC minivan 50 ah Thahyaaruvun’ was held on 06th June 2015. The main aim of this event was to get ready for
Minivan 50 and to celebrate world environmental day 2015. Staffs from all the departments took part in this event. Activities
carried out during this event include painting MTCC building walls and cleaning MTCC ferry terminal area.
Maahefun 1436 and Club MTCC inauguration
Maahefun 1436 and the official inauguration of the newly elected members of the Club MTCC was held on 8th
June 2015. Some of the activities carried out during this event were Lucky Draw, Surprise event, Musical chair, Maahefun
and BBQ.
6
Ooreedhoo Mas Race 2015 Club MTCC took part in annual Ooreedhoo Mas race this year. The seventh season of the intense event comprises of a total
of 16 teams represented by their respective companies. They include last year’s champions STELCO, as well as other
notable contenders such as STO, Universal Enterprises, Medianet, Ensis Fisheries and Coastline. The event was held on
20th June 2015. Team of 11 members from MTCC participated in this Mas race. Team MTCC was selected as the second
team from that night’s performance.
7
Board Activities
Board Composition/ Changes
As per clause no.63 of the Articles of Association of the
Company the Board of Directors comprises of 10
directors. With respect to the shareholding of the
Company 6 directors are appointed by the Government
and 4 directors are elected by the Public Shareholders.
As in the first quarter the board continues to perform
without an executive director and a director appointed by
the Government. Relevant authorities have been notified
on the non-compliance and its consequences and
request were made to expedite the appointment of the
directors.
The board of directors representing the government was
reappointed during the quarter. Mr.Ahmed Aboobakuru
and Mr.Nasrath Mohamed was re-elected by the
shareholders at the Annual General Meeting 2014.
Major Board Decisions
Major decisions of the Board of Directors for the quarter
include:-
- Approval of the Provisions in the annual
account for the financial year 2014
- Approval to propose to issue 1 Bonus share to
every share to the existing shareholders at
AGM 2014
- Approval of Directors Report, Auditors Report
and Annual Accounts of 2014
- Approved to proposed MVR 20.00 per share
as dividend for 2014 to AGM 2014
- Approval of signatories for Annual Accounts
2014
- Approval of the nominated candidates for
public shareholder directorship for the AGM
2014
- Approval to invest in the joint venture company
―Transport for Maldives Private Limited‖ with a
33.33% shareholding.
- Appointed board directors to represent MTCC
at the Transport for Maldives Private Limited.
- Appointed the Internal Audit Executive of the
Company.
- Approved the Agents Policy.
- Appointed Mr.Sinan Ali to the Grievance
Committee.
- Approval to go into an MOU with Onyx Group
to Develop MTCC Building
- Approved to propose salary and allowance of
the Members of the Board for AGM 2014
- Approval of the date and Agenda of AGM 2014
- Approval of the Budget for Musical Water
Fountain
- Approved the amended AOA of the Company
- Approved the amended MOA of the Company
- Formation of the board committees after AGM
2014.
Board Meetings
Seven meetings of the Board of Directors were held
during the 1st quarter of 2015. Following is the
attendance of directors for the Board meetings.
Director Position in Board Attendance
Hussain Salim Mohamed
Chairman 7/7
Ibrahim Abdul Razzag Haleem
Chief Executive Officer
7/7
Ahmed Abdulla Director 5/7
Sinaan Ali Director 5/7
Ahmed Aboobakuru
Director- Representing public Share
7/7
Nasrath Mohamed
Director- Representing public Share
6/7
Mohamed Imran Adnan
Director- Representing public Share
6/7
Fathulla Ismail Director- Representing public Share
7/7
Directors Training
Two board directors participated in short term training on
Finance for Non-finance Managers organized by the
Singapore Institute of Management.
8
Audit Committee
Two meetings of the Audit Committee were held during
this quarter. Mr.Ahmed Aboobakuru continued as the
Chairman of the committee.
Major works of the committee for the quarter include:-
- Proposed the dividend for the year 2014 as
MVR 20.00 to the board
- Selected and proposed to the board a
candidate for Internal Audit Executive position.
- Deliberation and Evaluation of Special
investigation Reports
- Deliberation of 1st Quarter Management
Accounts 2015 and forwarded to board
approval
- Identifying of risk areas in the company
Director Position in Board Attendance
Sinaan Ali Director- Representing public Share
2/2
Sinan Ali Director 1/2
Nasrath Mohamed
Director- Representing public Share
2/2
Fathulla Ismail Director- Representing public Share
2/2
Remuneration and Nomination Committee
A total of one meeting of the Nomination Committee was
held during this quarter. Mr.Sinaan Ali is the chairman of
the Committee.
Major works of the committee during the quarter include:-
- Finalized and forwarded to board approval the
candidates for the public directorship of the
company for election at 2014 AGM
Director Position in Board Attendance
Ahmed Abdulla
Director 1/1
Sinaan Ali Director 1/1
Ahmed Aboobakuru
Director- Representing public Share
0/0
Mohamed Imran Adnan
Director- Representing public Share
1/1
Corporate Governance and Compliance Committee
A total of three meeting of the Corporate Governance
and Compliance Committee was held during this quarter.
Mr.Nasrath Mohamed is the chairman of the Committee.
Major works of the committee during the quarter include:-
- Deliberation of the Amendments proposed by
the management to the AOA
- Amendment to the AOA and proposed for the
approval of the Board.
Director Position in Board Attendance
Nasrath Mohamed
Director- Representing public Share
3/3
Ahmed Abdulla
Director 3/3
Sinaan Ali Director 2/3
Ahmed Aboobakuru
Director- Representing public Share
3/3
Mohamed Imran Adnan
Director- Representing public Share
3/3
Fathulla Ismail Director- Representing public Share
3/3
9
Annual General Meeting
The Company held its 2014 Annual General Meeting on
31st May 2015 at Hotel Jen. A total of 1480 shareholders
participated in this meeting where 1454 members were
represented by proxies.
Agenda Item 1- Appointment and election of Board of
Directors for 2015-2016. According to the Articles of
Association, 4 members are to be appointed by the
Government. As such, the Directors appointed to the
Board by the Government were;
1. Mr. Hussain Salim Mohamed
2. Mr. Ibrahim Abdul Razzaq Haleem
3. Mr. Ahmed Abdulla
4. Mr. Sinan Ali
The Shareholders then voted for their preferred two
candidates as the Directors representing public
shareholders at the Board.
Mr. Nasrath Mohamed and Mr.Ahmed Aboobakuru was
re-elected for the posts.
Agenda Item 2- 2014 Annual General Meeting Minutes
was passed.
Agenda item 3 - 2014 Annual Report, Auditors Report
and Annual Accounts was passed.
Announcement of Dividend 2014- The Board proposed
MVR20.00 per share. Shareholders approved the
proposed dividend.
Agenda item 4- Appointment of Auditors— Earnst and
Young was appointed as the Auditors for 2015 with a fee
of MVR 328,500.00
Agenda item 5- The amended Memorandum of
Association of the Company was passed
Agenda item 6- The amended Articles of Association of
the Company was passed few amendments proposed by
the shareholders.
Agenda item 7- Passed to issue one bonus share to
each share to the existing shareholders of the Company.
Agenda item – Proposed Salary and Allowance of the
Board Directors was passed as below;
Salary for Chairman MVR 7000 per month
Salary for members of the board MVR 10,000 per month
Sitting allowance from the proposed MVR1000.00 per
sitting to MVR500.00 per sitting and removed the ceiling
The meeting adjourned after the Directors attended to
the questions and queries of Shareholders.
10
Corporate Social Responsibility
The Company continued to participate in the community development, were it assisted councils and NGO’s in the local
communities where its construction projects were carried out.
During the quarter the Company engaged in the following causes;
Contribution towards Health and Wellness
Contribution towards Sports and Culture Development
Contribution towards Education uplifting
Contribution towards Women Empowerment
MTCC continued funding of its commitment to the Kudakudhinge Hiyaa by providing remuneration to two teachers from
2007.
11
Income Statement (Unaudited)
All amounts in MVR 2nd Quarter, 2015 1st Quarter, 2015
Sales 244,391,086 219,278,018
Cost of sales (171,793,958) (168,329,668)
Gross profit 72,597,128 50,948,350
Selling and marketing costs (3,442,881) (2,402,749)
Administrative expenses (18,158,525) (17,952,748)
Other income 10,332,726 25,108,002
Other expenses (2,379,436) (2,334,148)
Operating profit 58,949,012 53,366,707
Finance costs (5,013,557) (4,356,632)
Profit before tax 53,935,455 49,010,075
Business profit tax (8,090,318) (7,351,511)
Profit after tax 45,845,137 41,658,564
Ibrahim Abdul Razzag Haleem Mohamed Hilmy
Chief Executive Officer Chief Financial Officer
12
Balance Sheet (Unaudited)
All amounts in MVR 2nd Quarter, 2015 1st Quarter, 2015
ASSETS
Non-current assets
Property, plant and equipment 189,425,811 186,019,713
Capital work in progress 2,644,127 1,031,404
Financial investments 32,298,540 32,298,540
Intangible assets 1,646,071 1,862,825
Total non-current assets 226,014,549 221,212,482
Current assets
Inventories 196,629,472 186,868,630
Trade and other receivables 472,979,856 399,283,225
Cash and cash equivalents 53,064,879 34,791,497
Total current assets 722,674,207 620,943,352
TOTAL ASSETS 948,688,756 842,155,834
EQUITY AND LIABILITIES
Share capital 25,000,000 12,500,000
General reserve 225,000,000 237,500,000
Fair value reserve 22,806,739 22,806,739
Retained earnings 189,792,498 136,595,850
Reserves 437,599,237 396,902,589
TOTAL EQUITY 462,599,237 409,402,589
Liabilities
Borrowings 30,560,371 43,339,737
Total non-current liabilities 30,560,371 43,339,737
Trade and other payables 308,630,120 244,661,038
Borrowings 125,961,967 117,133,006
Bank overdrafts 20,937,061 27,619,464
Total current liabilities 455,529,148 389,413,508
Total liabilities 486,089,519 432,753,245
TOTAL EQUITY AND LIABILITIES 948,688,756 842,155,834
13
Cash Flow Statement (Unaudited)
Figures in MVR 2nd Quarter, 2015 1st Quarter, 2015
Operating activities
Profit before tax for the period 53,935,455 49,010,075
Adjustment for:
Depreciation & amortization 15,435,685 14,721,569
Reversal of impairment provision of receivables (9,839,468) -
Government subsidy 2,500,000 (9,109,576)
Provision for inventory (261,200) 500,000
Interest income 2,411,157 (269,572)
Interest expense 3,856,952
Working capital adjustments
Decrease / (increase) in trade and other receivables (63,857,163) 53,056,138
Decrease / (increase) in Inventories (12,260,842) (1,254,910)
(Decrease) / increase in trade and other payables 65,558,546 (82,627,955)
Net cash flows from operating activities 53,622,170 27,882,721
Investing activities
Purchase of property plant & equipment (18,625,029) (8,601,784)
Expenditure on capital work-in-progress (1,612,723) (70,210)
Interest received 261,200 269,572
Net cash flows used in investing activities (19,976,552) (8,402,422)
Financing activities
Proceeds from borrowings 13,522,361 2,432,476
Repayment of borrowings (17,472,766) (8,318,871)
Interest paid (2,040,662) (2,278,644)
Dividend paid (2,698,766) (93,913)
Net cash flows from financing activities (8,689,833) (8,258,952)
Net decrease in cash and cash equivalents 24,955,785 11,221,347
Cash and cash equivalents, and bank overdrafts- Opening 7,172,033 (4,049,314)
Cash and cash equivalents, and bank overdrafts - Closing 32,127,818 7,172,033
14
Segmental Performance (Unaudited) Period from 1 April 2015 - 30 June 2015
Total Trading Contracting Transport Docking & Maintenance
Others
Revenue 244,391,086
47,974,345
169,197,228
25,540,450
327,855
1,351,208
Operating profit / (loss) 58,949,012
8,715,621
57,132,379
767,492
(166,449)
(7,500,031)
Finance income / (cost) (5,013,557)
(1,226,780)
(769,572)
(767,492)
-
(2,249,713)
Profit / (loss) before tax 53,935,455
7,488,841
56,362,807
-
(166,449)
(9,749,744)
Business profit tax (8,090,318)
-
-
-
-
(8,090,318)
Profit / (loss) after tax 45,845,137
7,488,841
56,362,807
-
(166,449)
(17,840,062)
Period from 1 January 2015 - 31 March 2015
Total Trading Contracting Transport Docking & Maintenance
Others
Revenue 219,278,018
37,491,330
151,998,722
26,737,967 1,547,326
1,502,673
Operating profit / (loss) 53,366,707
7,615,602
36,826,234
1,019,580 (84,057)
7,989,348
Finance income / (cost) (4,356,632)
(885,728)
(842,885)
(1,019,580) -
(1,608,439)
Profit / (loss) before tax 49,010,075
6,729,874
35,983,349
- (84,057) 6,380,909
Business profit tax (7,351,511)
-
-
- -
(7,351,511)
Profit / (loss) after tax 41,658,564
6,729,874
35,983,349
- (84,057)
(970,602)
15
55
120 130 130 130 130 130 130
020406080
100120140
Q22014
Q42014
Q12015
Q22015
0
50
100
150
200
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015
Our Share There were 28 shares traded during the second quarter of 2015. The last trading activity was carried out on 12th
May 2015 at MVR 130.00.
The Dividend yield for MTCC Share is being calculated based on dividend value of MVR 20.00 approved by the
Shareholders in 2014 Annual General Meeting.
Share Price Movement
Earnings per Share (MVR)
2nd Quarter, 2015 1st Quarter, 2015
Lowest traded price (MVR) 130.00 130.00
Highest traded price (MVR) 130.00 130.00
Last traded price (MVR) 130.00 130.00
Weighted average traded price (MVR)
130.00 130.00
No. of shares traded 28 57
Market capitalization (MVR millions) 32.50 32.50
Dividend Yield 15.38% 12.31%
Earnings per share (MVR) 183.38 166.63
Price Earnings Ratio 0.71 0.78
16
Declaration
Corporate Governance Code and Listing Rules Compliance
Steps were taken to comply with Corporate Governance Code and further strengthen the management of the company. The Company strictly
follows the Corporate Governance Code, Listing Rules, CDOI regulation and Securities Act.
Rules of Reporting
The Board of Directors and the staff always works towards complying with the Company’s Act and Corporate Governance Code and other
applicable rules and regulations and operate the company in fair and transparent manner.
The Company Published its Annual Report 2014 on April 30th as stipulated in the Continuing Disclosure Obligation of Issuers and Listing Rules
of MSE.
The 2nd Quarter report of 2015 includes the milestones achieved during the quarter, and steps taken to further strengthen/enhance the
management of the company and efforts made to achieve corporate goals. It also includes the share activities at the Maldives Stock Exchange
and discloses all information obligated by the Continuing Disclosure Obligations of Issuers of the Capital Market Development Authority.
Maldives Transport and Contracting Company Plc7th Floor, MTCC Tower,
Bothuthakurufaanu Magu,Male’
Republic of Maldives
This report is available at our website www.mtcc.com.mv
