Mytrah Energy Lim
ited | 31
Decem
ber 20
12
| Annual Report
Mytrah Energy Limited 31 December 2012 | Annual Report
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ContentsCompany Information .............................................................................................................................................01
Directors’ Biographies .............................................................................................................................................14
Chairman and CEO’s Statement .........................................................................................................................22
Directors’ Report ........................................................................................................................................................38
Corporate Governance Report ............................................................................................................................40
Independent Auditor’s Report to the members of Mytrah Energy Limited .................................49
Consolidated Income Statement .......................................................................................................................50
Consolidated Statement of Comprehensive Income ..............................................................................51
Consolidated Statement of Financial Position ...........................................................................................52
Consolidated Statement of Changes in Equity ..........................................................................................53
Consolidated Statement of Cash Flow ...........................................................................................................54
Notes to the Consolidated Financial Statements .....................................................................................55 A product
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Company Information
Nominated & financial advisersStrand Hanson Limited
26 Mount Row
London W1K 3SQ
United Kingdom
Tel: +44 (0) 20 7409 3494
Joint BrokersInvestec Bank plc
2 Gresham St.
London EC2V 7QP
United Kingdom
Tel: +44 (0) 20 7597 4000
Mirabaud Securities LLP
33 Grosvenor Place
London SW1X 7HY
United Kingdom
Tel: +44 (0) 20 7321 2508
LegalMayer Brown International LLP
201 Bishopsgate
London EC2M 3AF
United Kingdom
Tel: +44 (0) 20 3130 3383
RegistrarsComputershare Investor Services
(Guernsey) Limited
P.O. Box 393
Kingsway House
Havilland Street
St. Peter Port
Guernsey
GY1 3FN
Channel Islands
AuditorsKPMG Audit LLC
Heritage Court
41 Athol Street
Douglas
Isle of Man, IM99 1HN
Tel: +44 (0) 1624 681 000
Financial PRSt Brides Media & Finance Limited
Chaucer House
38 Bow Lane
London EC4M 9AY
Tel: +44 (0) 20 7236 1177
Mytrah_AR_01_40_V1.indd 1 03/07/13 11:23 AM
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Our CompanyMytrah Energy Limited (MEL) is based in Guernsey and is listed
on the Alternate Investment Market (AIM) of the London Stock
Exchange.
Its wholly owned subsidiary, Mytrah Energy (India) Limited (MEIL)
is one of the largest wind based Independent Power Producers
in India with an operating portfolio of 309.9 MW of wind energy
assets spread over seven projects across four states in India.
All projects are under long term Power Purchase Agreements,
ensuring sustainable generation of revenue and profits over the
next 25 years.
3Mytrah Energy Limited31 December 2012Financial Statements
3Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 3 03/07/13 11:23 AM
44
Mytrah_AR_01_40_V1.indd 4 03/07/13 11:23 AM
Our MissionMytrah will be a renewable energy and
infrastructure company that leads the world in seizing the potential of emerging markets.
5Mytrah Energy Limited31 December 2012Financial Statements
5Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 5 03/07/13 11:23 AM
VisionaryWhen tax breaks were the key reason for interest in wind
energy, Mytrah had envisioned the huge potential of a
cheap and easily accessible source of power to solve the
huge power shortage in India.
Catalysts to changeWe at Mytrah believe that each one of us have the
ability to create the change that we want to see in
the world. In line with this thought, we forayed into
the renewable energy space.
Perceptive to the needs of othersWe were sensitive to the demand supply gap of power
and we realized that wind could be the most effective
answer to the power starved nation.
OpenMytrah encourages a culture of
diversity and inclusion.
InnovativeMytrah was one of the pioneers to start
the Independent Power Producer model
for wind.
GivingWe believe that we are co-creators of
wealth, which should be utilized for the
greater common good.
Our PhilosophyBeing an Inspiring Solution, we are visionary, catalysts
to change, perceptive to the needs of others, open,
innovative and giving.
66
Mytrah_AR_01_40_V1.indd 6 03/07/13 11:23 AM
Core ValuesMytrah believes that the company’s
values drives it’s valuations. Integrity, Creativity, Excellence, Respect for Individuals and Social Responsibility are the five core values that engineer Mytrah’s DNA.
Integrity
All our actions are governed by the principles of ethics, honesty and transparency
Creativity
We foster a spirit of innovation and entrepreneurship
Excellence
We deliver the best in class results, as we excel in everything we do
Respect for Individuals
We treat others the way we expect to be treated – with respect
Social Responsibility
We will be the catalysts of positive change in the society
7Mytrah Energy Limited31 December 2012Financial Statements
7Mytrah Energy Limited31 December 2012Financial Statements
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Highlights of 2012
Revenue of USD 38.91 m
EBITDA USD 35.48 m
PAT of USD 12.03 m
309.9 megawatts (“MW”) of fully
operational capacity
ROE of approximately 20%Licenses, access or concessions secured for areas
suitable for upto 8,000 MW of future projects
Increase in tariff of 22.75% in Rajasthan (75.60
MW installed capacity)
Increase in tariff of 34.29% in Andhra Pradesh
(63 MW installed capacity)
Average age of trade receivables 49 days (2012:
75 days)
88
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9Mytrah Energy Limited31 December 2012Financial Statements
9Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 9 03/07/13 11:23 AM
Revenue
US$ m
344%
6.3
28.1
0.7
30.92.8
0.0 0.0
7.0
0
5
10
15
20
25
31
Mar-10 Mar-11 Mar-12 Dec-12Sale of electricityGeneration Based Incentive
Operating Profit and Operating Profit Margin
US$ m
Operating Profit Operating Profit Margin
%
(0.4) (2.3) (0.8)
29.5
(5)
0
10
20
30
40
Mar-10 Mar-11 Mar-12 Dec-12 (30)
0
30
60
90
12095%
Return on Equity
%
NA
(2.2%)(5.0%)
20.0%
(10)
(4)
2
8
14
20
Mar-10 Mar-11 Mar-12 Dec-12
EBITDA and EBITDA Margin
US$ m
(0.4) (1.2)
3.8
35.5
(5)
0
10
20
30
40
Mar-10 Mar-11 Mar-12 Dec-12
%
826%
(30)
0
30
60
90
120115%
54%
EBITDAEBITDA Margin
Net Profit and Net Profit Margin
US$ m %
(0.4) (1.6)(2.8)
12.0
0
10
20
30
40
50
(5)
0
5
10
15
20
Mar-10 Mar-11 Mar-12 Dec-12
40%
Net Profit Net Profit Margin
Our Performance
Full year results ending March 9 months result following change to December year-end Margins (%)
1010
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11Mytrah Energy Limited31 December 2012Financial Statements
11Mytrah Energy Limited31 December 2012Financial Statements
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We continue to push the bar further.
Our assets continue to perform above expected, which is 95% of machine and grid availability, ensuring more power.
Vajrakarur site has performed better than expected.
Our turbine in Mahidad, Gujarat has produced the highest energy for turbine model S88 with a PLF of
34.41%.Implementing Generation Management Center, Management solution, to monitor and control assets in remote locations in real time.
Our Assets
13Mytrah Energy Limited31 December 2012Financial Statements
13Mytrah Energy Limited31 December 2012Financial Statements
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Directors’ Biographies
Ravi KailasChairman and Chief Executive Officer
Mr Kailas has 20 years of entrepreneurial
experience in telecoms, software and real
estate. He was the founder of a number of
start-up companies, including Zip Global
Network, a telecom services company, which
was subsequently sold to Tata Teleservices, Xius
Technologies, a telecom software company which
launched the world’s first inter-operator prepaid
roaming service and which was merged with
a leading SEI CMM Level 4 software company,
and Altius, a real estate investment company
which was later sold to The Chatterjee Group.
Mr Kailas has a Bachelor’s degree in Electronics
and Communications Engineering from Osmania
University and a Master’s degree from the
Graduate School of Business, Stanford University.
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15Mytrah Energy Limited31 December 2012Financial Statements
15Mytrah Energy Limited31 December 2012Financial Statements
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Directors’ Biographies
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Russell WallsNon-Executive Director
Mr Walls has a strong financial background,
with extensive experience as a Finance Director,
and possesses a broad range of experience
across a number of sectors. He is currently Non-
Executive Director of Biocon Limited (healthcare),
Signet Jewelers Ltd (retail) and the regulated
holding company for the UK General Insurance
business of Aviva (Insurance) plc. Mr Walls was
formerly independent Non-Executive Director
and Chairman of the Audit Committee of Aviva
(Insurance) plc, Group Finance Director of BAA plc
(transport), Wellcome plc (pharmaceuticals) and
Coats Viyella plc (textiles). In addition, Mr Walls
was former Senior Independent Non-Executive
Director and Chairman of the audit committee
of Stagecoach Group plc (transport) and Hilton
Group plc (leisure).
17Mytrah Energy Limited31 December 2012Financial Statements
17Mytrah Energy Limited31 December 2012Financial Statements
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Directors’ Biographies
Rohit PhansalkarNon-Executive Director
Mr Phansalkar is the Chairman and CEO of RKP
Capital, Inc., a US based merchant banking
boutique. He was previously the Chairman
and CEO of Osicom Technologies, an optical
networking company. He was the Co-Founder,
Vice Chairman and CEO of Newbridge Capital,
a private equity firm investing in India, and
formerly the Head of Energy Finance Group
at Oppenheimer & Co. Mr Phansalkar was Co-
Head of the Energy Finance Group at Shearson
American Express, Managing Director of Bear
Stearns and Managing Director at Oppenheimer
& Co. Mr Phansalkar was the Founding Chairman
of the NYSE listed, The India Fund. He received
an MBA from the Harvard Graduate School of
Business.
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19Mytrah Energy Limited31 December 2012Financial Statements
19Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 19 03/07/13 11:23 AM
2020
Mytrah_AR_01_40_V1.indd 20 03/07/13 11:23 AM
Subject to completion of the proposed acquisition, Mytrah is expected to have 600 MW spread over several sites across six different states, which has two benefits:
1. Portfolio effect: Diversifying of wind patterns across India, diversifying of political risk, diversifying of SEB off-taker risk, gives us stability, increases visibility and reduces uncertainty of revenue streams over the long term.
2. Brown field: Majority of our current sites can be expanded and hence benefits us, as a large part of the development risk on future capacity is reduced, since parts of the infrastructure are already in place.
21Mytrah Energy Limited31 December 2012Financial Statements
21Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 21 03/07/13 3:26 PM
Over the last nine months, Mytrah has consolidated its position as a profitable, cash generative, independent power
producer (“IPP”) with an expanding portfolio of operating wind farm projects across India.
We have also increased the visibility of our asset rollout schedule
by securing debt financing for a total of 238.2 MW of capacity
across three projects currently under development, which is
expected to bring our installed capacity to over 600 MW during
2013. Reaching this significant milestone will highlight our leading
position over our peer wind IPPs in India.
Our continued success is down to our ability to forge strong
relationship with wind turbine manufacturers; rigorous cost control;
securing financing across a diverse range of leading Indian lenders
and building teams with proven ability to execute wind projects
and secure land and legal permissions. Moreover, we aim to have
the best in class in asset management with respect to current and
future projects.
We announced in March 2013 that we had secured USD 203 m of
additional senior debt to finance the construction of 238.2 MW of
new capacity, split between two projects with Gamesa machines in
Andhra Pradesh and Karnataka totalling 137.7 MW and one project
of 100.5 MW with ReGen Power machines in Tamil Nadu. We
believe that we are the first IPP in the Indian wind sector to secure
this scale of funding and have now developed relationship with 15
banks, which we believe provides the Company with a significant
and broad based support from the Indian Banking Sector for the
Company’s development pipeline totalling 1,500 MW during 2015.
A testament to our project development strategy and a robust team
that has propelled our leading position in the industry.
Chairman and CEO’s Statement
2222
Mytrah_AR_01_40_V1.indd 22 03/07/13 11:23 AM
Our continued success is down to our ability to forge strong relationship with wind turbine manufacturers; rigorous cost control; securing financing across a diverse range of leading Indian lenders and building teams with proven ability to execute wind projects and secure land and legal permissions.
23Mytrah Energy Limited31 December 2012Financial Statements
23Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 23 03/07/13 11:23 AM
Following the completion of
these projects and the proposed
acquisition, Mytrah will have a
total of over 600 MW connected
to the grid and fully operational.
These assets are spread over 16
project sites in six different states.
We believe that this gives us two
significant advantages. Firstly, we
will benefit from a portfolio effect,
meaning that as our sites are spread
across the wind rich states in India,
any variation in wind patterns across
India is spread across our portfolio
giving us increased visibility of
generation and revenue streams
over the long term. Secondly,
the majority of our current sites
have the ability to be significantly
expanded. This means a large part
of the development risk on future
capacity is reduced as parts of the
infrastructure are already in place for
that expansion.
We would also like to highlight
that of our expected portfolio
of over 600 MW by the end of
2013, we anticipate that 20%
of those assets will be selling
power under the Group Captive
scheme. Group Captive scheme will
enable Mytrah to be able to sell
electricity that it produces directly
to the end consumers. This is a new
development for the Company and
will have the affect of enabling us
to leverage those assets into future
increases in the power price and
given the significant element of fixed
costs in our production, any rise
in the realised price for generated
electricity results in an increase in
the Company’s operating margins.
This is of particular importance as
there are no input cost inflation
across the life of those assets and
as a result we see this bringing
significant value to Mytrah. In
addition, it is worth noting that the
portion of our portfolio in the state
of Maharashtra are under Power
Purchase Agreements (“PPAs”) with
13-year terms. Consequentially, the
tariff on those off-take agreements
will get reset half way through the
expected 25 year life of those assets
that again should provide significant
upside to the Company.
As we announced in April 2013,
your Board is evaluating a potential
Mytrah will have a total of over 600 MW connected to the grid and fully operational. These assets are spread over 16 project sites in six different states.
Group Captive scheme will enable Mytrah to be able to sell electricity that it produces directly to the end consumers, which results in an increase in the Company’s operating margins.
We anticipate that 20% of those assets will be selling power under the Group Captive scheme.
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initial public offering and listing
of our wind power assets as a
Business Trust (“Business Trust”) on
the Singapore Exchange Securities
Trading Limited (“Proposed Listing”).
A Business Trust is similar to a Real
Estate Investment Trust (“REIT”)
structure for non-property assets.
The Proposed Listing will be subject
to regulatory approvals in Singapore
and an application will be made
to the relevant authorities in due
course. We have engaged Global
Book Runners and counsel for the
Proposed Listing.
The portfolio to be acquired by
Business Trust is being evaluated
and is currently envisaged that
the Company would maintain a
significant ownership stake in
Business Trust.. We expect the
proceeds of the Proposed Listing
to be used to pay down all or a
substantial part of the Group senior
and mezzanine debt and part finance
the rollout of the development
pipeline, focussing on our target of
1,500 MW during 2015. Your Board
believes that the Proposed Listing
would optimise the cost of the
Company’s debt and equity, which
is the Company’s largest operational
cost, and therefore enhance the
underlying value of its assets and
generating substantial shareholder
value.
Our current portfolio continues
to perform well, with PLFs at the
portfolio level at or exceeding our
initial estimates, validating our
vigorous evaluation process used
for all new projects and our strategy
to build scale quickly whilst not
compromising on the quality of our
assets.
We believe that Mytrah’s continued
access to financing in India; our
access to land enabling us to take
greater control over our roll-out
schedule; our diversified range
of strong partnerships with wind
turbine manufacturers; our ability
to build assets at a competitive cost
whilst managing development risk;
and the quality of our management
and teams will enable the Group
to continue to grow rapidly and
generate significant value for our
shareholders.
25Mytrah Energy Limited31 December 2012Financial Statements
25Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 25 03/07/13 11:23 AM
Financial ReviewA summary of key financial results is set out in the tables below and discussed in this section.
Income statement summary
Period/Year ended 9 months ended 31 December 2012
12 months ended 31 March 2012
Change
USD m USD m USD m
Revenue 30.92 6.97 23.95
Gross Profit 25.60 3.53 22.07
Other operating income 7.99 - 7.99
EBITDA 35.48 3.78 31.70
Finance costs (net) 16.67 4.70 11.97
Depreciation and amortisation 5.59 3.28 2.31
Profit/(Loss) before tax 13.22 (4.20) 17.42
Taxation credit/(expense) (1.19) 1.37 2.56
Profit/(Loss) after tax 12.03 (2.83) 14.86
344%growth in revenue.
USD 12.03 mmaiden profit.
ROE of approximately20%.
RevenueFor the nine month period ended 31
December 2012 the Group’s revenue
was USD 38.91 m, including other
operating income (revenue 12 month
period ended 31 March 2012: USD
6.97 m; other operating income 31
March 2012: USD Nil). The increase
in revenues is primarily attributable
to increase in installed capacity
during the period. USD 0.45 m and
USD 0.24 m of Generation Based
Incentive (“GBI”) and Renewable
Energy Certificates (“REC”) revenues
respectively not accrued pending
extension of GBI scheme and
realization of RECs.
Gross profitAs a result of increased revenues
the Group has recorded a gross
profit of USD 25.60 m for the nine
month period ended 31 December
2012 (31 March 2012: USD 3.53 m).
The gross profit margins increased
by 32.15% to 82.79% for the nine
month period ended 31 December
2012 (31 March 2012: 50.64%).
Gross profit increased by USD 4.27 m
on account of change in estimated
useful life and residual value of
wind farm assets as explained in
note 35 of the consolidated financial
statements.
EBITDAEBITDA for the nine month period
ended 31 December 2012 increased
to USD 35.48 m (31 March 2012:
USD 3.78 m), an increase of USD
31.70 m following the significant
increase in Group’s revenues. EBITDA
includes other operating income of
USD 7.99 m (31 March 2012: USD
Nil).
Finance costsFinance costs for the nine month
period ended 31 December 2012
were USD 16.67 m compared with
USD 4.70 m for the year ended
31 March 2012, which was due to
Business Review
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an increase in borrowings by USD
115.76 m to USD 268.43 m at 31
December 2012 (31 March 2012:
USD 152.67 m), reflecting the
increase in the Company’s installed
capacity during the period.
Depreciation and amortisationDepreciation and amortisation for
the nine month period ended 31
December 2012 was USD 5.59 m
(31 March 2012: USD 3.28 m). The
increase in depreciation was mainly
on account of depreciation on wind
farms and other plant and machinery
capitalised during the period. Also
during the period, in line with
International Accounting Standards,
the group has revised the useful life
of wind farms assets and increased
the useful life of Wind Turbine
Generator to 25 years from 20 years.
Refer note 35 of the consolidated
financial statements for further
details on change is useful life.
TaxationThe tax expense for the period
ended 31 December 2012 was
USD 1.19 m (31 March 2012: tax
credit of USD 1.37 m). The tax
expense represent the net deferred
tax liability on timing differences
accounted during the period.
Profit after taxThe Group recorded a profit after tax
of USD 12.03 m for the nine month
period ended 31 December 2012
(31 March 2012: USD (2.83) m). The
operations resulted in profit for the
period from continuing operations
attributable to the equity holders of
the Company which was primarily
due to an increase in revenues by
USD 23.95 m during the period
ended 31 December 2012.
Profit per shareBasic and diluted earnings per share
from continuing operations for
the nine month period ended 31
December 2012 were USD 0.0735,
compared with USD (0.0173) for the
year ended 31 March 2012.
The Group was able to establish good relationship with banks and financial institutions which enabled to raise further financing since period end.
Depreciation of the Indian Rupee against the US dollar of approximately
7.0%during the period, has not impacted the Company’s performance
at the India level.
27Mytrah Energy Limited31 December 2012Financial Statements
27Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 27 03/07/13 11:23 AM
Net assets increased by 6.4% to
USD 118.73 m (31 March 2012: USD
111.60 m) and the net assets per
share increased by 6.4% to USD
0.73 (31 March 2012: USD 0.68).
The main movements in the balance
sheet items were trade receivables,
trade payables and loans drawn
down during the financial year.
Capital structureStrong financial capital management
is an integral part of the Directors’
strategy to achieve the Group’s
stated objectives. The Directors’
review financial capital reports on
a quarterly basis and the Group
treasury function do so on a weekly
basis, ensuring that the Group has
adequate liquidity.
As at 31 December 2012, the Group
had net debt of USD 258.97 m (31
March 2012: USD 149.52 m). During
the nine month period ended 31
December 2012, additional loans
of USD 115.76 m were drawn down
(31 March 2012: USD 152.67 m).
The Group continues to be able to
borrow at competitive rates and
therefore currently deems this to
be the most effective means of
raising finance. The Group was able
to establish good relationship with
banks and financial institutions
which enabled to raise further
financing since period end.
Further information on the Group’s
capital structure is provided in
note 1 to the financial statements,
including details of how the Group
manages risk in respect of capital,
interest rates, foreign currencies and
liquidity. A debt maturity profile is
also included.
Principal risks and uncertaintiesThe Group is faced with a variety
of risks to the management of
the business and the execution
of its strategy. These risks are
managed on a day-to-day basis by
the Management Committee and
formally reviewed by the Audit
Committee and the Board to monitor
that appropriate and proportionate
mitigation in the form of processes
and controls are in place. A summary
of the key business risks are detailed
below.
Business interruption/Critical
service failure
The Group’s current wind farms are
dependent on stable patterns of
wind, operations and maintenance
undertaken by Suzlon Energy
Limited (“Suzlon”), grid connectivity
and other critical resources. In the
event that a critical resource was not
available then this could affect the
operation of a wind farm and have a
knock-on effect on our revenue.
In mitigation of this risk, Mytrah uses
independent consultants to conduct
wind feasibility studies when
evaluating projects and also use
independent consultants to evaluate
wind turbine generators supplied
to our wind farms. We also ensure
periodic preventative maintenance
is undertaken. The Group is building
an asset management team to
ensure, and where possible enhance
standards of asset management
undertaken both internally for
our self-build projects and those
projects built and maintained by our
turnkey partners.
We are commissioning 100.5 MW
Financial positionOur balance sheet at 31 December 2012 can be summarised as set out in the table below:
Period/Year ended Assets (USD m) Liabilities (USD m) Net assets/(liabilities) (USD m)
Property, plant and equipment 358.17 - 358.17
Other non-current assets and liabilities 45.40 (14.25) 31.15
Current assets and liabilities 14.61 (29.31) (14.70)
Post-retirement obligations - (0.01) (0.01)
Deferred tax 3.09 3.09
Total before net debt 377.70
Net debt (258.97) 258.97
Total as at 31 December 2012 118.73
Total as at 31 March 2012 111.60
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Mytrah_AR_01_40_V1.indd 28 03/07/13 11:23 AM
of capacity with ReGen Power and
137.7 MW with Gamesa, diversifying
our development and asset
management risk.
Delay in commissioning projects
Construction projects are by their
very nature complicated and subject
to numerous factors that could
cause a delay in the completion
and commissioning of a wind farm.
The majority of our current projects
and those under construction and
at final stages of delivery are under
contracts with Suzlon, and more
recently, ReGen Power and Gamsea
which have provisions that enable
Mytrah to make claims for liquidated
damages in the event there is a
delay in commissioning a project.
In addition, our projects are closely
managed on a daily basis, with issues
quickly escalated to senior levels
within the organisation.
Information Technology/Processing
As the business expands and
processes become increasingly
automated, our IT requirements
are growing and are now more
critical to our operations. We
have an experienced IT team in
place, ensuring systems are well
maintained and our growing IT
requirements are being fulfilled. We
have an SAP enterprise resource
management software which is
facilitating the expansion of the
business and enhancing the quality
of information available to our
management and executive teams.
Environmental compliance
Non-compliance with environmental
legislation would expose the Group
to various potential penalties and
would run counter to our core
values. To mitigate this risk, the
Group undertakes an environmental
and social due diligence report for
each project. The majority of our
environmental compliance activities
are currently undertaken by Suzlon
and Regen Power. However Mytrah
has the necessary expertise and
procedures to ensure compliance
with environmental legislation in
respect to the commissioning of
projects under our self-development
strategy. Compliance with
environmental legislation is at the
heart of our self-build development
strategy.
Managing change
The Group continues to be in a
rapid growth phase and the Indian
renewable energy sector is also one
of rapid change, with new measures
being introduced on a national and
state level. To mitigate this risk, the
Group uses independent consultants
and outsourced contractors where
appropriate to ensure the Group’s
activities can be scaled up or down
as required on a timely basis and
help ensure the business can be
flexible in response to changes in
the industry and the political and
economic environment.
Availability and cost of financing
The Group is reliant, at this early
stage of its development, on the
timely availability of senior debt
and mezzanine financing in order to
finance its ambitious asset roll-out
schedule. To mitigate this risk, the
financing team has established
relationship across a diverse range of
finance providers in India, including
The State Bank of India, which is a
testament to the attractiveness of
the Group’s business model and the
strength of our management team.
Projects can also be financed from
internal cash generation in the event
that new debt financing becomes
unavailable to the Group.
The largest operational cost of
the Group is the cost of debt. The
Group’s projects are financed by
project based debt. Management
has structured the projects in such
a way that debt is only drawn down
once key development milestones
are reached and the majority of debt
is only drawn down once capacity
is installed and it starts generating
revenue. The cost of debt is factored
into each project at the evaluation
stage to ensure it meets or exceeds
our minimum IRR requirements.
As mentioned earlier, the Board is
also evaluating the possibility of a
We are commissioning 100.5 MW of capacity with ReGen Power and 137.7 MW with Gamesa, diversifying our development and asset management risk.
29Mytrah Energy Limited31 December 2012Financial Statements
29Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_01_40_V1.indd 29 03/07/13 11:23 AM
Business Trust Listing that would
substantially or wholly pay down the
Group’s debt.
Strategy review and future growthThe Group’s business model is
based on delivering wind assets at a
competitive price whilst minimising
development risk to generate value
to shareholders. The Group has
agreements with three leading global
wind turbine manufacturers, Suzlon
Energy Limited (“Suzlon”), Regen
Power (“ReGen”) and Gamesa Wind
Turbines Private Limited (“Gamesa”).
As detailed above, we have also
announced the proposed acquisition
of 59.75 MW of operational assets
subject to regulatory approval and
formal documentation. Over time, we
expect the fragmented renewable
energy sector in India to consolidate
and the Group will continue to
evaluate opportunities as and when
they arise.
With 309.9 MW of operational
capacity now in place and an
expected total of 600 MW during
2013, the Group has demonstrated
its ability to deliver wind capacity
at speed and at a competitive
price, whilst firmly establishing
credibility as a relative newcomer
into the sector by being one of the
largest wind IPPs in India since its
incorporation two and a half years
ago.
Mytrah is not just intending to
become the number one wind IPP
in terms of scale in India, but also
aims to be a competitive cost and
value based operator in the country,
in order to secure higher returns
for shareholders. It’s not just about
scale, but about the quality, cost
and performance of the assets to
generate stable and long-term
income streams. Specifically, we
aim to achieve this through a
combination of achieving project
costs below the market benchmark,
innovative financing and attention
to detail in site selection and project
implementation cycles. These will
be significantly important and and
are key differentiating factors for the
Group against its peers.
During the financial year, in
September 2012, we embarked on
our first three projects with both
Gamesa and Regen in the states of
Karnataka, Andhra Pradesh and Tamil
Nadu totalling 238.2 MW. Following
the completion of these sites, Mytrah
will have over 600 MW spread
over 16 projects across six states,
providing both a portfolio effect from
a risk perspective and as highlighted
above reduced execution risk on
future developments as the majority
of these sites have the capacity to be
significantly expanded.
In September 2012, in order to
focus management time on its
core activities and in keeping
with the Company’s strategy to
outsoucre project development
to de-risk the development of our
projects, the Company entered
into an agreement with Bindu Urja
Infrastructure Limited (“BUIL”) for
the provision of balance of plant
services. Pursuant to the agreement
with BUIL, the Company finalised
the re-deployment of its plant and
project management teams, which
has enabled the Group to de-risk the
development of our projects.
In addition to our existing assets
we have secured a number of
allotments with exclusive licenses,
rights and concessions with the
Governments of Andhra Pradesh
in respect of approximately 2,800
MW, Karnataka for approximately
1,600 MW and Gujarat for 1,000
MW. The acquisition of high
quality development assets is a
Mytrah is not just intending to become the number one wind IPP in terms of scale in India, but also aims to be a competitive cost and value based operator in the country, in order to secure higher returns for shareholders.
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Mytrah_AR_01_40_V1.indd 30 03/07/13 11:23 AM
strategic priority for the long-term
sustainability of the business. The
availability of suitable land in the
wind-rich states is a valuable and
finite resource. These agreements
and any future agreements with
other wind-rich states are a
strategic priority for the long-term
sustainability of the business which
provides a competitive advantage
and a future engine for growth.
As at the period-end, our allotments
and concessions secured across
wind-rich locations in states in
western and southern India, which
include relevant leases and direct
allotments, licenses and sanctions
from the respective state authorities
for the installation of wind power
generation farms, are at an estimated
capacity of up to 8,000 MW.
In addition to the acquisition
of future land assets, we have
continued the installation of wind
masts to collect more wind data
across our various sites and we now
have 122 masts spread across all
wind-rich states.
Our existing development pipeline
is expected to take us to a total of
1,500 MW during 2015 and we look
forward to providing further updates
on our development activities and
more as the year progresses.
Operational overviewThe Group currently has seven projects fully developed and connected to the grid totalling to 309.9 MW of installed
capacity as set out below:
Project Location State Capacity (MW)
Tejva Rajasthan 42.0
Mahidad Gujarat 25.2
Chakla Maharashtra 39.0
Kaladonger Rajasthan 75.6
Jamanwada Gujarat 52.5
Sinnar Maharashtra 12.6
Vajrakarur Andhra Pradesh 63.0
Total 309.9
309.9 MW installed capacity across four states
42 MW
25.2 MW
39 MW
75.6 MW
52.5 MW
12.6 MW
63 MW Tejva, Rajasthan
Mahidad, Gujarat
Chakla, Maharashtra
Kaladonger, Rajasthan
Jamanwada, Gujarat
Sinnar, Maharashtra
Vajrakarur, Andhra Pradesh
31Mytrah Energy Limited31 December 2012Financial Statements
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Mytrah_AR_01_40_V1.indd 31 03/07/13 11:23 AM
The assets currently under development and due for completion in stages during 2013 are as follows:
Subsequent to the period end and following the announcement of the proposed acquisition of 59.75 MW, which remains subject to regulatory approval and formal documentation, we repositioned the timing of some our development pipeline which included the 24 MW at Gotne in Maharashtra and the movement of
31.25 MW at Sautada in Maharashtra
into the Group’s 2014-2015
development pipeline. This has been
done at no cost to the Group.
The Board believes that one of
the significant advantages of the
Group’s business model is its ability
to adapt by adjusting the size and
locations of individual projects. We
are aware of the many well reported
cases of significant delays within
the Indian infrastructure market
and consider our ability to redeploy
capital without any additional
cost and avoid being tied into
delayed projects with rising costs,
a significant and unique advantage
that Mytrah has over the majority of
its competitors.
Project Location State Capacity (MW)
Burgula Andhra Pradesh 37.4
Savalsang Karnataka 100.3
Vagarai Tamil Nadu 100.5
Total 238.2
The Board believes that one of the significant advantages of the Group’s business model is its ability to adapt by adjusting the size and locations of individual projects. We are aware of the many well reported cases of significant delays within the Indian infrastructure market and consider our ability to redeploy capital without any additional cost and avoid being tied into delayed projects with rising costs a significant and unique advantage that Mytrah has over the majority of its competitors.
Andhra Pradesh has increased the tariff for wind power projects from Rs 3.50 per kWh to Rs 4.70 per kWh, Gujarat has increased its tariff to Rs 4.15 per kWh and recently Maharashtra State Electricity Board announced a revised tariff structure ranging up to Rs. 5.81 per kWh.
In addition, the Rajasthan State Electricity Regulatory Commission has issued a tariff order determining the tariff for wind power plants as Rs. 5.46 per kWh and Rs. 5.73 per kWh for ”Jaisalmer” and “Barmer” districts respectively. This will have a positive impact on the Group’s future plans and portfolio.
3232
Mytrah_AR_01_40_V1.indd 32 03/07/13 11:23 AM
I am also pleased to inform that
the Group’s strategy of holding the
project and turbine prices generally
constant over a long period of time
is now playing out as there has
been positive momentum on the
regulatory side in terms of feed in
tariff; Andhra Pradesh has increased
the tariff for wind power projects
from Rs 3.50 per kWh to Rs 4.70 per
kWh, Gujarat has increased its tariff
to Rs 4.15 per kWh and recently
Maharashtra State Electricity Board
announced a revised tariff structure
ranging upto Rs. 5.81 per kWh.
In addition, the Rajasthan State
Electricity Regulatory Commission
has issued a tariff order determining
the tariff for wind power plants as
Rs. 5.46 per kWh and Rs. 5.73 per
kWh for ”Jaisalmer” and “Barmer”
districts respectively. This will have a
positive impact on the Group’s future
plans and portfolio. The Group also
expects the state of Karnataka to
increase their tariff in the near term
by passing a judgment in response
to the petitions filed in Karnataka
Electricity Regulatory Commission
by all the major Wind associations
of the country; again providing
significant benefit to the Group’s
future portfolio as any increases
in the feed in tariff will have a
favorable impact on the Group’s
future projects.
Of our existing projects only 16.8
MW have off-take agreements
related to the Renewable Energy
Certificate Market (“REC”). The
market for REC trading has been
subdued with trading occurring at
the floor price in limited volumes.
The Group is pleased that its
decision to enter into long term
PPAs for the majority of its assets
has proved correct at this stage
and provides a very high visibility
of revenues and profitability for
the duration of those contracts.
In addition, as highlighted above
we expect that about 20% of our
portfolio by the end of 2013 will be
from selling power under the Group
Captive scheme, this has the effect
of leveraging those assets into future
increases in the power price.
Depreciation of the Indian
Rupee against the US dollar of
approximately 7.0% during the
period, has not impacted the Group’s
performance at the Indian level. This
is primarily due to all capital assets
being procured in Indian Rupees
as well as all loan liabilities being
contracted in Indian Rupees. As a
result, the weakening of the Indian
Rupee against all major currencies is
not expected to have any economic
or cash impact on the Group and its
business.
During the period we have seen the
average age of our trade receivables
fall from 75 days to 49 days. This is
a reflection of the improved financial
position of many State Electricity
Boards following the government
refinancing announced in September
2012 and the increase in electricity
prices across the sector.
Market environmentThere continues to be a significant
shortage of power supply in India.
Although India’s development in
electricity generation has increased
significantly over the past decade,
the development of new power
generation facilities and increase in
electricity generation has not kept
up with the increase in demand
for electricity. This is in part due
to India’s dependence on thermal
sources for meeting its power
requirements. As of April 2013,
more than 67% of India’s installed
power generation capacity was from
thermal sources, primarily coal-
fuelled power plants, and these
sources represented 83% of India’s
electricity generation. However,
thermal power plants in India have
experienced challenges in meeting
generation targets primarily due
to an inadequate supply of coal
produced in India as a result of
low productivity and infrastructure
constraints and the increasing cost of
coal imports caused by, among other
things, a weakening Indian Rupee.
As a result, India has experienced,
and is currently facing, a significant
power supply deficit. This power
deficit was 8.5% and 8.7% in 2011-
12 and 2012-13, respectively, with
all states facing an energy shortage.
With some 50% of rural areas not
having access to the electricity grid,
current electricity consumption per
capita at only 25% of the global
average and with urbanisation
expected to increase from 28% to
41% by 2030, the energy sector
in India represents a significant
opportunity underpinned by a
substantial capacity deficit.
Indeed, the demand for electricity in
India is expected to continually grow
by some 7% compounded annual
rate over the next 10 years. The
33Mytrah Energy Limited31 December 2012Financial Statements
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Mytrah_AR_01_40_V1.indd 33 03/07/13 11:23 AM
current Five Year plan called for an
increase in total generation capacity
to 310 GW by 2017. It is expected
that this target will not be met with
an estimated shortfall of between 55
GW – 60 GW by 2017. The country’s
installed capacity is approximately
214 GW and with the well-publicised
difficulty in delivering cost-effective
fossil fuel based power, Mytrah is in
a strong position to benefit as the
deficit continues to grow. Due to
the above mentioned supply issues,
recent advances in wind turbine
technology and the opening of the
electricity market to the private
sector, in certain instances the cost
of wind power in India has reached
‘Grid Parity’ with traditional thermal
power generation. This is particularly
evident in Mytrah’s case as the
capital cost of our assets is estimated
to be the lowest in the industry.
The fundamental market continues
to move advantageously for Mytrah.
As highlighted above, over the last
eight months we have recently seen
significant increases in long-term
tariff for wind generated electricity
across all of our principal states
while our project and asset prices
remained at similar levels. We
believe we will continue to see
increase in power tariff flowing
through to energy producers as the
underlying prices charged to end
consumers have increased and as
India tries to address its continued
significant power shortage.
On 1 April 2012, the Generation
Based Incentive (“GBI”) scheme
expired. However, in the recent
Budget session for 2013-14, the
Finance Minister announced the
reintroduction of the GBI scheme.
Details of the new GBI scheme
are yet to be announced by the
government. Several of our projects
which are at an advanced stage of
development and are expected to
be commissioned during 2013 will
benefit from this scheme.
Whilst GDP growth in India has
slowed over the last year, it is still
estimated to be 5%. In April 2012,
the Reserve Bank of India cut interest
rates by 0.5% and a further 0.25%
cut in September 2012. Although the
Indian Rupee and inflation targets
remain under pressure, we believe
there is potential for further rate cuts
over the coming year. As interest
on our debt is our main operational
cost, any reduction in interest rates
provides a significant benefit to
Mytrah.
CorporateIn order to support our rapid
development, in December 2012 we
were pleased to appoint Investec
Bank as our Joint Broker alongside
Mirabaud Securities. We believe that
Investec’s involvement will help us
fulfil our growth potential.
The Board is committed to high
levels of corporate governance,
demonstrated by the broad
compliance with the Quoted
Companies Alliance Corporate
Governance Guidelines for Smaller
Quoted Companies (“QCA Code”).
The Board appointed KPMG as
auditors in place of Deloitte in
November 2012, following an
evaluation of a number of vendors
by management and a final
recommendation from the Audit
Committee.
In November 2012, the Board
reduced in size to three Directors,
Ravi Kailas (Chairman & CEO), Rohit
Phansalkar (Independent Non-
Executive) and Russell Walls (Senior
Independent Non-Executive) in order
to improve operating efficiencies.
We believe we will continue to see increase in power tariff flowing through to energy producers as the underlying prices charged to end consumers have increased and as India tries to address its continued significant power shortage.
3434
Mytrah_AR_01_40_V1.indd 34 03/07/13 11:23 AM
Human capitalAt Mytrah, our core values drive
our valuations. We aspire to be
considered as an employer of
choice, and thereby have fostered
high working standards and positive
employee relations. Our work culture
is inclusive, where we respect and
value individual differences.
Health, safety and wellbeingAs part of our health series initiative
Mytrah continued its investments
in various initiatives starting from
comprehensive health insurance
for its employees to regular health
check-ups. We have implemented
a Safety Health and Environment
Policy (SHE) to ensure safety of our
employees at project sites.
ComplianceHR tracks the changes in labour laws
in the locations where we have a
presence. We also ensure that there
is continued emphasis on developing
guidelines and approaches for HR
governance and compliance in this
phase of rapid growth.
Corporate and social responsibility (“CSR”)All CSR activities through out the
lifecycle of our turnkey projects are
undertaken by our turnkey suppliers,
namely Suzlon and more recently,
ReGen Power. These activities are
monitored internally.
As we initiate our self-development
projects, Mytrah is responsible for
CSR activities before and after the
construction phase (during which,
the manufacturer is responsible for
CSR activities).
We have engaged independent
third party expertise in this field
to assist in the development of
our own comprehensive social
environmental, health and safety
management system alongside
establishing detailed standards,
policies and procedures and internal
accountabilities and governance.
These standards, policies and
procedures are designed to ensure
Mytrah complies with the following
standards (which are consistent with
local regulatory requirements and
guidelines, both generic and sector
specific, issued by the World Bank
Group):
ISO 14001 (Environmental
Management Systems)
ISO 18001 (Occupational Health &
Safety)
ISO 9001 (Quality Management
Systems)
Compliance with our internal
standards, policies and procedures
will be monitored by a management
steering committee chaired by
the Chief Operating Officer and
also subject to quarterly review by
Internal Audit and at least annually
by an independent third party.
OutlookThis has been another period of
transformational growth for Mytrah
where we continue to demonstrate
our unrivalled ability to execute
our strategy of generating reliable
and long-term revenue streams
and enhancing shareholder value
through rapid execution at scale of
high quality assets at a competitive
price whilst managing development
risk. We will continue to be highly
active in our pursuit to generate
shareholder value by evaluating
the Proposed Listing detailed in
the Chairman and CEO’s statement,
seeking attractive opportunities
and further raising our profile as the
leading wind IPP in India to achieve
our ambitious and unprecedented
rollout schedule.
Finally, I would like to take this
opportunity to welcome our new
shareholders and once again thank
all our shareholders, management,
advisors and associates for their
support as we executed our strategy
over the period.
Ravi KailasChairman and CEO
35Mytrah Energy Limited31 December 2012Financial Statements
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Mytrah_AR_01_40_V1.indd 35 03/07/13 11:23 AM
3636
Mytrah_AR_01_40_V1.indd 36 03/07/13 11:23 AM
We help people reach their full potential through ongoing training and development programs
Our learning & development
37Mytrah Energy Limited31 December 2012Financial Statements
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Mytrah_AR_01_40_V1.indd 37 03/07/13 11:23 AM
Directors’ Report
The Directors present their report, together with the audited financial statements for the nine months ended 31 December
2012. The information in the statements from the Chairman & Chief Executive, the Business Review, The Directors’ Profiles,
The Corporate Governance Report and the Directors’ Responsibilities Statement forms part of the Directors’ Report.
Vikram Kailas, Alastair Cade, Philip Swatman and Peter Neville stepped down from the Board at the conclusion of the Annual General Meeting held on 8 November 2012.
The Board has a breadth of experience relevant to the Group at its current stage of development, and the Directors believe that any changes to the Board’s composition can be managed without undue disruption.
The biographical profiles of the Directors can be found on page 14.
The Company’s Articles of Incorporation require that all Directors are subject to re-election by shareholders at the first Annual General Meeting following their initial appointment, and at each Annual General Meeting one-third of the Directors retire by rotation. The Board have voluntarily adopted
the relevant provisions of the UK Corporate Governance Code regarding annual re-election of Directors who will offer themselves for re-election by shareholders at the 2013 Annual General Meeting.
Directors’ interestDetails of the share interests of the Directors, their service contracts and terms of appointment are shown in the Remuneration Report.
DirectorsThe Directors, who served throughout the period except as noted, were as follows:
Name Age Position Date of AppointmentRavi Kailas 45 Chairman & CEO 13 August 2010Vikram Kailas 31 Chief Financial Officer 13 August 2010 till 8 November 2012Alastair Cade 40 Executive Director 13 August 2010 till 8 November 2012Rohit Phansalkar 66 Non-Executive Director 13 August 2010Philip Swatman 62 Non-Executive Director 8 September 2010 till 8 November 2012Russell Walls 69 Non-Executive Director 4 November 2011Peter Neville 66 Non-Executive Director 4 November 2011 till 8 November 2012
Principal activities and review of businessThe principal activities of the Group are developing, owning and operating wind energy assets in India. A detailed review of the business is set out in the Chairman and Chief Executive’s Statement on page 22.
Business reviewThe Company is required by the Companies (Guernsey) Law 2008 to include a business review in this report. The information that fulfils the requirements of the business review can be found on pages 26 to 35, which are incorporated in this report by reference.
Results and dividendsThe Group posted a profit after tax of USD 12.03 m (2011: USD (2.83) m) on
a turnover of USD 38.91 m, including other operating income (revenue 31 March 2012: USD 6.97 m; other operating income 31 March 2012: USD Nil) and an EBITDA of USD 35.48 m (31 March 2012: USD 3.78 m). At 31 March 2012 the Group had cash and bank balances of USD 9.47 m (31 March 2012: USD 3.15 m).
The Directors do not recommend the payment of a dividend (31 March 2012: USD Nil).
Capital structureDetails of the issued share capital, together with details of the movements in the Company’s issued share capital during the period are shown in note 26. The Company has one class of ordinary shares, which carry no right to fixed income. Each
share carries the right to one vote at general meetings of the Company. There are no specific restrictions on the size of a holding nor on the transfer of shares, which are both governed by the general provisions of the Articles of Association and prevailing legislation. The Directors are not aware of any agreements between holders of the Company’s shares that may result in restrictions on the transfer of securities or on voting rights.
Details of employee share schemes are set out in note 33.
No person has any special rights of control over the Company’s share capital and all issued shares are fully paid.
38
Mytrah_AR_01_40_V1.indd 38 03/07/13 11:23 AM
Directors’ Report (continued)
Substantial shareholdersOn 12 June 2013, the Company had been notified of the following holdings of 3% or more of the 163,636,000 Ordinary
Shares:-
Name Percentage of voting rights and
issued share capitalBindu Urja Capital Inc. 35.60Esrano Overseas Ltd. 14.67Bindu Urja Holdings Inc. 14.67Capital Research Global Investors 8.33Bindu Urja Investments Inc. 7.33Henderson Global Investors Ltd. 5.41Blackrock Investment Management 4.03
Acquisition of the Company’s own sharesThe Company did not acquire any of its shares during the period ended 31 December 2012 (31 March 2012: USD Nil).
Statement of Directors’ responsibilities in respect of the Annual Report and the consolidated financial statementsThe Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
The Directors have elected to prepare the consolidated financial statements in accordance with International Financial Reporting Standards (“IFRS”) as adopted by the European Union. The consolidated financial statements are required to give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for the period.
In preparing those consolidated financial statements, the Directors are required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgments and estimates that are reasonable and prudent;
• State whether applicable accounting standards have been followed, subject to any material departures being disclosed and explained
in the consolidated financial statements;
• Prepare the consolidated financial statements on the going concern basis unless it is inappropriate to presume that the Group will continue in business.
The Directors confirm that they have complied with the above requirements in preparing the annual consolidated financial statements.
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Group and enable them to ensure that the consolidated financial statements comply with the Companies (Guernsey) Law 2008. They are also responsible for safeguarding the assets of the Group and hence for taking steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included in the Company’s website.
In addition, the Directors confirm, to the best of their knowledge, that:
• The Group financial statements prepared in accordance with IFRS as adopted by the European Union give a true and fair view of the assets, liabilities, financial position and profit of the Group;
• The Business Review includes a
fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces.
Disclosure of information to auditorsEach Director has responsibility for ensuring that, as far as he is aware, there is no relevant audit information of which the auditors are unaware, and that he has taken all the steps that he ought to have taken to make himself aware of any relevant information that is relevant to the preparation of the auditors’ report and to establish that the Group’s auditors are aware of that information.
AuditorsThe Auditors, KPMG Audit LLC, were appointed by the Board on 9 November 2012 to fill a casual vacancy following the resignation of Deloitte LLP. A resolution concerning the appointment of KPMG Audit LLC as Auditors will be proposed at the Annual General Meeting.
By order of the BoardDean ClarkeCompany Secretary
24 June 2013
Registered Office:Anson PlaceMill CourtLa Charroterie, St. Peter PortGuernsey GY1 1EJ
39Mytrah Energy Limited31 December 2012Financial Statements
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Mytrah_AR_01_40_V1.indd 39 03/07/13 11:23 AM
Corporate Governance Report
In respect to the QCA Guidelines, as
at the date of this report, the Group
was compliant, save for the following
exceptions:-
• TheBoarddoesnothaveaChairman deemed independent on appointment as recommended under Guideline 3 of the QCA Guidelines.TheBoardbelievesthat Ravi Kailas’s appointment as Chairman and CEO is appropriate forthebusinessinitscurrentearlystage of development.
TheBoardcontinuallyreviewsitsgovernance arrangements and has made the following changes during the period.
• TheBoardhasconductedanannualBoardandCommitteeeffectivenessreview;
• TheBoardhasreducedinsizetoimproveit’sspeedandefficiency;
• TheAuditCommitteehasadoptedapolicyontheprovisionofnon-auditservices to ensure independence of the external auditors and approved aGroupwhistleblowingprocedure;
• TheBoardanditsCommitteeshavereviewed and amended their terms ofreferences,inlinewithbestpractice;
• TheBoardhasestablishedaresponsibilitiesstatementsettingouttherolesandresponsibilitiesoftheBoard,Chairman&CEOandtheSenior Independent Director;
• Inlinewithbestpractices,theBoardhasmadeavailableontheinvestorrelations section of the corporate websitetherevisedtermsofreferenceforeachBoardCommittee.
TheBoardComposition
ThecompositionoftheBoardisshown
on page 38. During the period, the
Boardapprovedareductionintheir
numberinordertoincreasethespeed
andefficiencyofdecisionmakingby
reducingtheduplicationbetweenthe
BoardandtheoperationalBoardof
MytrahEnergy(India)Limited.
The Role and Operations of the Board
TheroleoftheBoardistoensure
deliveryofthebusinessstrategy
and long-term shareholder value.
ThegeneralobligationsoftheBoard
andtherolesandresponsibilities
oftheChairman&CEOandSenior
Independent Director are set out
inaformalBoardresponsibilities
statementapprovedbytheBoard.The
Boardfulfilsitsrolebyapprovingthe
annual operating plan and monitoring
businessperformancethroughoutthe
period.TheBoardheldfourformal
scheduledBoardMeetingsduring
thefinancialperiodandinaddition,
heldanumberofunscheduledad-hoc
meetings,typicallybyconferencecall
andsubjecttolocationrestrictions
setoutintheCompany’sArticles
ofIncorporation.Thereisinplace
a schedule of matters reserved for
Boardapproval.
TheBoardhaveapprovedanannual
Boardcalendarsettingoutthedates,
location and standing agenda items
foreachformalscheduledBoardand
Committee meetings and scheduled
Boardcalls.Boardpapersare
circulated to Directors in advance of
scheduled and unscheduled meetings,
whichareofanappropriatequality
toenabletheDirectorstofulfiltheir
obligationsandadequatelymonitor
theperformanceofthebusiness.
Directorswhoareunabletoattenda
meeting are expected to provide their
commentstotheChairman&CEO,
Senior Independent Director or the
CompanySecretaryasappropriate.
TheBoardalsoreceivesmanagement
informationonamonthlybasiswhich
sets out the performance of the
business.
Duringtheperiod,thetopicssubject
toBoarddiscussionatformal
scheduledBoardMeetingsincluded:-
• Businessstrategy;
• ApprovalofAnnualandHalf-YearReports;
• ApprovalofAnnualOperatingPlan;
• FinancialandOperationalperformance;
• Marketandcompetitorreports;
• Seniormanagementhires;
• Financingactivities;
• Relatedpartytransaction;
• AppointmentofExternalandInternal Auditors;
• AppointmentofBrokers;
• BoardCommitteecompositionandcorporate governance review;
• ApprovaloftheMarketAnnouncementspolicy,RolesandResponsibilitiesStatementandupdates to the Securities Dealing Code and Committee terms of references;
• BoardandCommitteeeffectivenessreview
TheBoardembraceshighstandardsofcorporategovernancecontainedinthe2010QuotedCompaniesAllianceCorporate
GovernanceGuidelinesforSmallerQuotedCompanies(“QCAGuidelines”)andwhererelevant,theUKCorporateGovernance
CodeissuedbytheFinancialReportingCouncil.TheQCAGuidelineshavebeenrefreshedin2013andthecorporate
governancereportinthenextAnnualreportfortheyearended31December2013willreportonourcompliancewiththe
updated QCA Guidelines.
4040
Mytrah_AR_01_40_V1.indd 40 03/07/13 3:28 PM
Board balance and independence
Following an annual formal review by the Board undertaken in June 2013, taking into account all relevant factors as set out in the QCA Guidelines and
UK Corporate Governance Code, the Board considers Rohit Phansalkar and Russell Walls to be independent in character and judgement.
Whilst the Board does not have a Chairman who was deemed independent on appointment, the Board consists of one Executive Director and two Independent Non-Executive Directors. Over half of the Board is comprised of Independent Non-Executive Directors to ensure that no individual or small group of individuals can dominate the Board’s decision making.
Senior Independent DirectorRussell Walls is the Senior Independent Director. He is available to investors to discuss governance issues or should there be matters of concern that have not, or cannot, be addressed through the normal channels with the Chairman & CEO.
Russell Walls is also available to act as an intermediary between Directors, if required, and to act as a sounding board for the Chairman & CEO.
Advice, insurance and indemnitiesAll Directors have access to the services of the Company Secretary and may take independent professional advice at the Company’s expense in conducting their duties.
The Company provides insurance cover for its Directors and Officers, which is reviewed annually, and has entered into deeds of indemnity with the Directors who were in service at the time of the IPO in 2010.
ConflictsDirectors’ interests is a standing agenda item at each formal scheduled Board Meeting. Each Director is required to disclose any actual or potential conflicts of interest and a register of Directors’ interests is maintained by the Company Secretary. If there is a conflict of interest or a matter relating to a particular Director or a related party transaction, then the Board understands that the relevant Director should recuse themselves from the discussion. In September 2012, Ravi Kailas recused himself from discussions regarding a related party transaction that was approved by the Board and announced to the market on 28 September 2012.
Board evaluationA formal and rigorous evaluation of the performance and effectiveness of the Board and its Committees was undertaken in Q4 2012 and was coordinated by the Company Secretary. The Senior Independent Director led the evaluation of Ravi Kailas in his role as Chairman. The review also gave Directors an opportunity to identify technical and wider industry topics for additional training.
The review involved a tailored questionnaire, the results of which were summarized in a Board report. The Board will consider each year whether the review should be coordinated by an independent third party. The following summary of the recommendations were agreed by the Board.
• Non-Executive Directors to make two visits to Hyderabad in 2013 to attend the Board and Committee meetings of Mytrah Energy (India) Limited and hold meetings and receive training sessions on various
aspects of the business and India’s wind energy sector by senior management.
• More materials and articles relevant to the Group to be circulated to the Board
• Increased time spent on discussing strategy
As a result of the above findings, the following actions have been taken:-
• The Non-Executive Directors visited the Hyderabad office in April 2013 and have another visit planned in September 2013. During the three day visit in April, the Non-Executive Directors attended a Board Meeting of Mytrah Energy (India) Limited and held meetings with senior management to discuss the business and the wider Indian wind energy sector and met representatives of the head of the internal management assurance group and audit partner at Ernst & Young who were appointed as our co-sourced internal audit firm effective 1 April 2013.
• Appropriate time was allocated on the agenda at the Board Meeting held in February 2013 to discuss strategy.
• Reading material of interest to the Board regarding Mytrah and the Indian wind energy sector are circulated as part of the quarterly Board packs.
Board developmentAll new Directors appointed to the Board receive a comprehensive structured induction programme. In 2012, Russell Walls visited twice the Hyderabad office to meet senior management. In 2013, Russell Walls
Corporate Governance Report (continued)
Formal Scheduled Board Meetings for the nine months ended 31 December 2012
Director Maximum Possible Attendance
Meetings Attended Attendance
Ravi Kailas 3 3 100%Rohit Phansalkar 3 3 100%Russell Walls 3 3 100%
4141Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 41 03/07/13 3:28 PM
and Rohit Phansalkar have two visits to the Hyderabad Office scheduled, where they will have a structured programme of meetings with Senior Management and receive training sessions on various aspects of the business and the Indian wind energy sector.
Reappointment of Directors at the
Annual General MeetingThe Company’s Articles of Incorporation require all new Directors to submit themselves for re-election by shareholders in their first year following appointment. The Company’s Articles of Incorporation also require all Directors to submit themselves for re-election at least every three years if they wish to continue to serve on the Board and are considered by the Board to be eligible.
Following the publication of the UK Corporate Governance Code, it is deemed best practice in the UK for the Boards of FTSE350 listed companies to annually submit themselves for re-election by shareholders. The Board has decided to voluntarily comply with this provision of the UK Corporate
Governance Code and annually submit themselves for re-election at the Annual General Meeting.
Relations with investorsThroughout the year, both Ravi Kailas and Alastair Cade have met with shareholders and their views have been reported back to the Board. Investor relations is a standing agenda item at each formal scheduled Board Meeting.
The Company produces an Annual Report which is distributed to all shareholders and available on the investor relations section of the Company’s website, which also contains information on the Group, copies of Board Committee terms of references and market announcements.
The Board ensures that financial reporting and operational updates are communicated to the market on a timely basis and give an accurate and balanced assessment of the business. In June 2012, the Board adopted a market communications policy that sets out how the Directors meet their
obligations under the AIM rules in this regard and the advisors involved in the market communications process coordinated by the Company Secretary.
Board CommitteesThe terms of reference of the Board Committees set out below are all available in the corporate governance section of the Mytrah Energy website at www.mytrah.com.
The Composition of all Board Committees are compliant with best practices as set out in the QCA Guidelines and the UK Corporate Governance Code.
NominationMembershipSince November 2012, the Nomination Committee is chaired by Ravi Kailas and its other members are Rohit Phansalkar and Russell Walls. The Committee formally met twice during the year to review its terms of reference and review Board and Committee composition. The Committee has a calendar of activities for the year.
Responsibilities The key responsibilities of the Committee are:-
i. Recommending Director nominees to the Board;
ii. Recommending Committee chairs and membership to the Board and Committees;
iii. When appropriate, taking into account the current and the early stage of the Company’s development, reviewing succession plans for the Board and Committees;
iv. Making recommendations to the Board in respect of the re-appointment of any Non-Executive Director at the conclusion of their specified term of office taking into account their performance and
their contribution together with the knowledge, skills, leadership and experience requirements of the Board and Committees;
v. Regularly reviewing the structure, size and composition (including the balance of skills, knowledge and experience), required for the Board.
RemunerationFull information on the composition, role, operation and meeting attendance of the Remuneration Committee is set out in the Remuneration Report on page 45.
AuditMembershipSince November 2012, the Audit Committee is chaired by Russell
Walls and its other member is Rohit Phansalkar. Russell Walls is considered by the Board to have recent and relevant financial experience.
The Committee has a calendar of activities agreed each year. Senior Management, the external auditors and a representative of the out-sourced internal audit service provider, Brahymayya & Co., attend meetings at the request of the Committee. Ravi Kailas has a standing invite to attend all meetings and receive all meeting materials.
Attendance at scheduled Committee Meetings during the year is shown below. Additional ad-hoc meetings by conference call were also held during the year.
Corporate Governance Report (continued)
Director Maximum Possible Attendance Meetings AttendedRavi Kailas - -Rohit Phansalkar 2 2Russell Walls 2 2
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Mytrah_AR_41_96_V1.indd 42 03/07/13 11:33 AM
ResponsibilitiesThe key responsibilities of the Committee are:-
i. Monitoring the integrity of financial statements, including approving any material changes in accounting policy, reviewing the financial statements, and any market announcements relating to the Group’s financial performance;
ii. Reviewing the integrity of internal financial control and risk management systems and codes of corporate conduct and ethics and any published statements regarding these systems and codes;
iii. Making recommendations to the Board regarding the engagement of the external auditors, approving their terms of engagement, monitoring their objectivity and performance and setting policy regarding the provision of non-audit services by the external auditors;
iv. Reviewing the plan, scope and results of the annual audit, the external auditors’ letter of comments and management’s response thereto;
v. Receiving reports from internal audit relating to risk control and management’s response to internal audit review findings.
During the year, the topics subject to Committee discussion at formal scheduled Board Meetings included:-
• Appointment of KPMG Audit LLC as external auditors following a ‘beauty parade’ of providers;
• Appointment of Ernst & Young as the outsourced internal audit service provider, effective from 1 April 2013;
• Received and considered reports from the external auditors regarding the scope and findings of their audit of the annual report and review of the half-year report;
• Recommendation of the annual report and half-year report to the Board for approval, together with the management representation letter and audit fees;
• Review of audit and non-audit related fees paid to the external auditors and monitoring the independence of the external auditors;
• Received and considered reports from the internal auditors and management’s responses to their findings.
To ensure the objectivity and independence of the external auditors, any service provided by the external auditors must be approved in accordance with the Group’s policy on auditor independence and the provision of non-audit services, which is consistent with the U.K. Auditing Practices Board’s Ethical Standards for Auditors.
The external auditor is only selected to provide non-audit services if they are well placed to provide the required service at a competitive cost and the Committee is satisfied that the assignment will not impair their objectivity. In accordance with relevant professional standards, the external auditors have confirmed their independence as auditors in a letter to the Directors. Details of fees paid to the external auditors for both audit and non-audit services are given in the Notes to the financial statements.
Internal controlThe Board is responsible for ensuring the Group has effective and sound systems of internal controls, which are
designed to manage, but not eliminate the risk of failure to achieve business objectives and provide reasonable, and not absolute, assurance against material misstatement and loss.
The day-to-day management and monitoring of the Group’s systems of internal control is delegated to the Executive Directors and the Management Committee comprising of the Chairman & Chief Executive, Chief Financial Officer and Managing Director of the Group’s main operating subsidiary, Mytrah Energy (India) Limited, President, Chief Operating Officer and Finance Director of Mytrah Energy (India) Limited.
The Management Committee ensures that the Group’s risk management framework and control culture are embedded within the business, and to that end, during the year the Management Committee ensured that each employee undertook induction training on the Group Code of Conduct established during the year. The Executive Directors provide assurance to the Board, through the Audit Committee, that risks are monitored, appropriately escalated and managed within the risk appetite of the Board.
The systems of internal control are designed to cover all business, financial, reputational and legal risks of the Group and is embedded within the day to day operations of the Group.
The financial reporting controls in place are designed to maintain proper accounting records and provide reasonable assurance concerning the accuracy and integrity of financial information reported both internally and externally. The financial reporting controls are monitored on a monthly basis by internal audit and reported on a monthly basis to the Management Committee and
Corporate Governance Report (continued)
Director Maximum Possible Attendance Meetings AttendedRohit Phansalkar 5 5Russell Walls 5 5
4343Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 43 03/07/13 11:33 AM
on a quarterly basis to the Audit Committee.
The identification and evaluation of business risk and the mitigation provided by controls are assessed on an annual basis by each business area. This annual review is coordinated by the internal auditors and reported to the Management Committee for review and challenge before ultimately being reported to the Audit Committee. This risk and control assessment process is a key input into the annual internal audit plan and links to the Board’s assessment of the key risks and the overall effectiveness of internal controls.
In accordance with the QCA Guidelines and UK Corporate Governance Code and best practices guidance for Directors of internal controls issued by the U.K. Financial Reporting Council, the Board, with the advice of the Audit Committee, has reviewed the effectiveness of the systems of internal control for the nine months ending 31 December 2012. As part of this review, the Board received
assurances from the Chairman & Chief Executive and the Chief Financial Officer of Mytrah Energy (India) Limited that the Directors Responsibilities Statement on page 39 is founded on a sound system of risk management and internal controls and that the systems of internal controls are operating effectively in all material respects in relation to reporting financial risks and the mitigation of material business risks.
Relationship agreementThe Company, Mirabaud (The Company’s Co-Broker), Strand Hanson (The Company’s Nomad) and certain Shareholder, namely, Bindu Urja Capital Inc., Bindu Urja Investments Inc., Bindu Urja Holdings Inc., Ravi Kailas, Sila Energy Inc., Esrano Overseas Limited and Angad Paul entered into a relationship agreement on 4 October 2010 whereby those Shareholders undertake to the Company and Strand Hanson, inter alia, not to exercise their voting rights to take control of the Board
of the Company and to conduct all transactions and relationships between them (and any of their associates or concert parties) and the Company on terms which allow the Company to carry on its business independently, at arm’s length and on a normal commercial basis. The agreement remains in force for so long as such Shareholders, their associates and concert parties together control, directly or indirectly, more than 30% of the voting rights of the Company.
Going concernAfter making enquiries and assessing the Group’s financial position, expected future performance, capital expenditure plans, together with other risks facing the Group, the Board have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future and has concluded that it is appropriate to adopt the going concern basis in preparing the financial statements of the Group.
Corporate Governance Report (continued)
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Mytrah_AR_41_96_V1.indd 44 03/07/13 12:12 PM
The Remuneration CommitteeMembershipSince November 2012, the Remuneration Committee is chaired by Rohit Phansalkar and its other member is Russell Walls. A calendar of activities for the Committee for the
year has been agreed.
Senior Management attend meetings at the request of the Committee and recuse themselves from discussions and decisions taken by the Remuneration Committee in respect of their own remuneration.
Attendance at scheduled Committee Meetings during the year is shown below. Additional ad-hoc meetings by conference call were also held during the year.
Director Maximum Possible Attendance Meetings AttendedRohit Phansalkar 3 3Russell Walls 3 3
Remuneration Report
This report describes the Group’s overall remuneration policy and gives details of the compensation arrangements for Directors for the nine months ended 31 December 2012.
Role and Responsibilities The Remuneration Committee determines and agrees with the Board the broad policy for the remuneration of the Group’s employees, as well as reviewing the ongoing appropriateness and relevance of the Group’s remuneration policy, ensuring that it is structured in a way that aligns reward with performance, shareholder interests and the long-term interests of the business.
The key responsibilities of the Committee are:-
i. Determining the total individual remuneration package, including pension arrangements, of the Executive Director, Senior Management and the Company Secretary;
ii. Reviewing and approving share incentive plans and non-material changes to them;
iii. Approving and determining targets for performance-related pay schemes, including the annual discretionary bonus scheme;
iv. Ensure that the remuneration and
other incentives of newly appointed Directors and Senior Management is within the Company’s overall remuneration policy;
v. Review and approve the scope of any termination payments and severance terms for Executive Directors, ensuring that contractual terms on termination and any payments made are fair to the individual and the Company, that failure is not rewarded and that the duty to mitigate loss is fully recognized.
The full terms of reference of the Remuneration Committee are available on the Group’s website (www.mytrah.com) and on request from the Company Secretary.
The Committee has access to the advice and views of the Chairman & Chief Executive as well as the use of external consultants, if required. No external consultants were engaged by the Committee during the period.
Remuneration policyThe Board considers that appropriate remuneration policies are a key driver
of performance and a central element of corporate strategy. The Group remuneration policy aims are:-
• provide market competitive total compensation;
• motivate, retain and promote individual and corporate outstanding performance;
• differentiate on merit and performance;
• emphasis on variable performance-driven remuneration;
• ensure adherence to the Group’s Code of Conduct;
• align Senior Management with Shareholders’ interests;
• deliver clarity, transparency and fairness of process;
The Group remuneration policy has a strong focus on variable compensation as the Board believes that the interests of the business, Shareholders and employees are best served by containing fixed remuneration costs and maximizing the proportion of total remuneration that is directly performance related.
4545Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 45 03/07/13 11:33 AM
Remuneration Report (continued)
The key components of the Group’s total remuneration package include:
Element Structure Purpose Performance MeasureBasic salary Fixed Base salary for the role Annual performance review.Other benefits Fixed Benefits in kind. Subject to market comparable reviewAnnual Bonus Variable Executive and Senior Management
bonuses are determined by the
Remuneration Committee taking
into account the performance of the
business, individual performance
and market comparatives.
Committee Discretion, taking into account:-
· Delivery of the Annual Operating Plan
· Performance against agreed KPIs
· Overall financial performance of the Group
· Market comparables
· Any other factor deemed relevant to the
CommitteeShare Option Grants Variable Share awards aim to align total
remuneration with the growth of the
business and shareholder value.
Market comparables and individual
performance. Annual awards are not
envisaged by the Remuneration Committee.
Basic salarySalaries are reviewed annually for
the Executive Director and certain
Executive Directors of Mytrah Energy
(India) Limited. During the year, the
salary of the Chairman and Chief
Executive Officer, at his request,
was reduced from £300,000 to £1,
effective from November 2012.
Annual bonusAt the discretion of the Committee,
each Executive Director and certain
Executive Directors of Mytrah
Energy (India) Limited may receive
a cash bonus subject to achieving
performance targets set by the
Committee and are generally paid in
May each year. The Committee has the
discretion and flexibility to take into
account other factors in determining
any bonus.
Each element of the Executive
Directors’ reward package supports
the achievement of key business
measures and rewards outstanding
performance.
Mytrah Share Option SchemesThe Company has three Share Option
Plans – The Caparo Energy Employee
Cashless Stock Option Scheme, Mytrah
Energy Employee Cashless Stock
Option Scheme and the Mytrah Energy
Executive Cashless Stock Option
Scheme.
All three schemes enable participants
to acquire shares at an option price
fixed at the time of grant. A participant
may receive one or several awards of
stock options.
Benefits and benefits in kindThe Chairman & Chief Executive is
contractually entitled to a lump-sum
life assurance benefit and private
healthcare medical insurance, car and
housing allowances. The Chairman
& Chief Executive does not have any
pension entitlements.
The Directors, both Executive and
Non-Executive, also benefit from
indemnity arrangements in respect
of their services as Directors, and
Directors’ and Officers’ liability
insurance.
Directors’ service contractsThe Chairman & Chief Executive
have a service agreement with the
Company, which is terminable by
either party on not less than 12
months notice. There are no provisions
for remuneration payable on early
termination.
Non-Executive DirectorsThe remuneration of the Non-
Executive Directors is determined by
the Executive Directors. The Non-
Executive Directors serve the Company
under formal letters of appointment
that are terminable on six months
written notice which sets out their
role, obligations as a Director and the
expected time commitment required. It
is the Company’s policy that the Non-
Executive Directors participate in the
Mytrah Share Option Plan to align the
interests of Non-Executive Directors
with shareholders. Such awards are
approximate in value on grant with
one year’s fees and in compliance with
the QCA Guidelines, are not subject
to performance conditions. The Group
share dealing code requires Non-
Executive Directors to hold shares
acquired through the exercise of
options throughout their tenure (other
than to the extent of paying taxes
related to the exercise of an option).
During the year, the annual fee
payable to each Non-Executive
Director was £45,000 per annum. An
additional fee of £10,000 is payable
in respect to the Chairmanship of
a Board Committee and £5,000 in
respect to the Senior Independent
Director role
4646
Mytrah_AR_41_96_V1.indd 46 03/07/13 11:33 AM
Remuneration Report (continued)
Directors’ emoluments and compensation (audited)Directors’ remuneration for the nine months ended 31 December 2012 was as follows:
Name USDTotal
31 December 2012
USDTotal
31 March 2012ExecutiveRavi Kailas 278,163 957,780Vikram Kailas * 327,834 678,428Alastair Cade * 185,442 558,705
Non-ExecutivePeter Neville* 53,646 16,295Rohit Phansalkar 65,567 125,715Philip Swatman 71,528 47,889Russell Walls 66,891 16,295Charles Wilkinson - 110,916Angad Paul - 127,444Total 1,049,071 2,639,467
* Alastair Cade, Vikram Kailas, Peter Neville and Philip Swatman stepped down from the Board on 8 November 2012 at the
conclusion of the AGM.
Performance graphThe following graph shows the Company’s share price performance compared with the performance of the FTSE AIM All Share
Index.
160
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120
100
80
60
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-11
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11
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-11
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-11
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ytra
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Mytrah FTSE AIM all share
4747Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 47 03/07/13 11:33 AM
Remuneration Report (continued)
Directors’ share interest (audited)The interests of the Directors in shares of the Company as at 31 December 2012 are shown below.
Ordinary Shares held at 31 December 2012Executive DirectorsRavi Kailas 94,276,575*Non-Executive DirectorsRohit Phansalkar -Russell Walls 30,000
*26,575 shares are held directly by Ravi Kailas and 94,250,000 shares are held by Bindu Urja Capital Inc., Bindu Urja
Investments Inc. and Bindu Urja Holdings Inc., which are owned by R&H Trust Co. (Jersey) Limited (the “Trustee”) as trustee
of The Raksha Trust (the “Trust”), a Jersey based discretionary trust settled by Ravi Kailas, of which he and some of his family
members and also a philanthropic trust are discretionary beneficiaries.
Directors’ interest in share awardsAs at 31 December 2012, the Directors held the following share options (refer to note 33 for more detail):
Name Date of grant Number of Ordinary Shares under option
Exercise price per share
(pence)ExecutiveRavi Kailas 22 December 2011 9,090,889 115pNon-Executive DirectorsRohit Phansalkar 4 October 2010 38,700 115p
10 January 2013 21,300 95pRussell Walls 22 December 2011 38,700 95p
10 January 2013 21,300 95p
During the period, no Director held any interest in the shares or loan stock of any subsidiary of the Company.
Approved and signed on behalf of the Board
Rohit Phansalkar
Remuneration Committee Chairman
4848
Mytrah_AR_41_96_V1.indd 48 03/07/13 11:33 AM
Independent Auditor’s Report to the members of Mytrah Energy Limited
We have audited the Group financial statements of Mytrah
Energy Limited for the nine month period ended 31
December 2012, which comprise the consolidated income
statement, the consolidated statement of comprehensive
income, the consolidated statement of financial position,
the consolidated statement of changes in equity, the
consolidated statement of cash flows and the related
notes 1 to 38. The financial reporting framework that has
been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as
adopted by the European Union.
This report is made solely to the Company’s members, as
a body, in accordance with Section 262 of the Companies
(Guernsey) Law, 2008. Our audit work has been undertaken
so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s
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 the Company’s
members as a body, for our audit work, for this report, or for
the opinions we have formed.
Respective responsibilities of Directors and auditor
As explained more fully in the Directors’ Responsibilities
Statement, the Directors are responsible for the preparation
of the financial statements and for being satisfied that they
give a true and fair view. Our responsibility is to audit and
express an opinion on the Group financial statements in
accordance with applicable law and International Standards
on Auditing (UK and Ireland). Those standards require
us to comply with the Auditing Practices Board’s Ethical
Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts
and disclosures in the financial statements sufficient to
give reasonable assurance that the financial statements
are free from material misstatement, whether caused by
fraud or error. This includes an assessment of: whether
the accounting policies are appropriate to the Group’s
circumstances and have been consistently applied and
adequately disclosed; the reasonableness of significant
accounting estimates made by the Directors; and the overall
presentation of the financial statements. In addition, we
read all the financial and non-financial information in the
annual report to identify material inconsistencies with the
audited financial statements. If we become aware of any
apparent material misstatements or inconsistencies we
consider the implications for our report.
Opinion on financial statements
In our opinion the Group financial statements:
give a true and fair view of the state of the Group’s affairs
as at 31 December 2012 and of its profit for the period
then ended;
have been properly prepared in accordance with IFRSs as
adopted by the European Union; and
have been prepared in accordance with the requirements
of the Companies (Guernsey) Law, 2008.
Matters on which we are required to report by exception
We have nothing to report in respect of the following
matters where the Companies (Guernsey) Law, 2008
requires us to report to you if, in our opinion:
proper accounting records have not been kept; or
the financial statements are not in agreement with the
accounting records; or
we have not received all the information and explanations
we require for our audit.
Other matters
In our opinion the part of the Director’s report relating to
Director’s remuneration has been properly prepared in
accordance with the provisions of AIM Rule 19.
24 June 2013
KPMG Audit LLC
Chartered Accountants
Heritage Court,
41 Athol Street
Douglas,
Isle of Man
4949Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 49 03/07/13 11:33 AM
CONSOLIDATED INCOME STATEMENTfor the period ended 31 December 2012
Note Period ended 31
December 2012
USD
Year ended 31
March 2012
USDContinuing operationsRevenue 6 30,922,696 6,973,960Cost of sales (5,320,355) (3,447,415)Gross profit 25,602,341 3,526,545Other operating income 6 7,993,199 -Administrative expenses (4,119,828) (4,323,041)
Operating profit/(loss) 7 29,475,712 (796,496)Finance income 10 409,624 1,296,425Finance costs 11 (16,664,459) (4,702,595)Profit/(loss) before tax 13,220,877 (4,202,666) Income tax (expense)/credit 12 (1,194,583) 1,370,067Profit/(loss) for the period/ year from continuing operations attrib-
utable to the equity holders of the Company
12,026,294 (2,832,599)
Earnings/ (loss) per share from continuing operationsBasic 13 0.0735 (0.0173)Diluted 13 0.0735 (0.0173)
The accompanying notes form an integral part of these consolidated financial statements
5050
Mytrah_AR_41_96_V1.indd 50 03/07/13 11:33 AM
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEfor the period ended 31 December 2012
Period ended 31
December 2012
USD
Year ended 31
March 2012
USDProfit/(loss) for the period/year from continuing operations attributable to the
equity holders of the Company
12,026,294 (2,832,599)
Other comprehensive lossForeign currency translation adjustments (5,867,292) (12,021,898) Change in fair value of available for sale financial instruments (11,230) 31,656Other comprehensive loss for the period/year (5,878,522) (11,990,242)Total comprehensive income/(loss) for the period/ year attributable to the
equity holders of the Company
6,147,772 (14,822,841)
The accompanying notes form an integral part of these consolidated financial statements
5151Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 51 03/07/13 11:33 AM
CONSOLIDATED STATEMENT OF FINANCIAL POSITIONas at 31 December 2012
Note 31 December 2012
USD
31 March2012
USDAssetsNon-current assetsIntangible assets 14 699,259 64,881Property, plant and equipment 15 358,174,528 371,212,559Other non-current assets 16 44,696,236 46,986,457Held-to-maturity investments 17 - 964,281Deferred tax assets 18 3,089,279 2,082,787Total non-current assets 406,659,302 421,310,965Current assetsTrade receivables 19 7,187,329 1,779,129Other current assets 20 4,230,125 7,235,260Available for sale investments 17 3,191,023 4,787,630Cash and bank balances 21 9,469,106 3,151,975Total current assets 24,077,583 16,953,994Total assets 430,736,885 438,264,959LiabilitiesCurrent liabilitiesBorrowings 22 16,402,362 2,281,959Trade and other payables 23 27,108,668 159,224,484Retirement benefit obligations 24 1,214 22,795Tax liabilities 12 2,201,272 480,717Total current liabilities 45,713,516 162,009,955Non-current liabilitiesBorrowings 22 252,036,630 150,392,048Liability component of compulsorily convertible preference shares 25 11,298,416 11,435,270Derivative financial instruments 22 & 25 2,947,030 2,779,637 Retirement benefit obligations 24 4,242 43,166Total non-current liabilities 266,286,318 164,650,121Total liabilities 311,999,834 326,660,076Net assets 118,737,051 111,604,883 EquityShare capital 26 72,858,278 72,858,278Retained earnings 27 7,443,230 (4,583,064) Other reserves 28 (16,959,629) (12,065,503) Equity attributable to owners of the Company 63,341,879 56,209,711Non-controlling interests 29 55,395,172 55,395,172 Total equity 118,737,051 111,604,883
These financial statements were approved by the Board of Directors and authorised for use on 24 June 2013
Signed on behalf of the Board of Directors by:
Ravi Kailas Russell Walls
Chairman and CEO Director
The accompanying notes form an integral part of these consolidated financial statements
5252
Mytrah_AR_41_96_V1.indd 52 03/07/13 11:33 AM
CONSOLIDATED STATEMENT OF CHANGES IN EQUITYfor the period ended 31 December 2012
Share capital
Foreign currency
translation reserve
Equity- settled-
employee- benefits reserve
Fair value reserve
Retained earnings
Non-controlling
interests
Total
USD USD USD USD USD USD USDBalance as at 31 March 2011 72,858,278 (933,080) 169,772 - (1,750,465) - 70,344,505Loss for the year - - - - (2,832,599) - (2,832,599)Other comprehensive loss for the year:Foreign currency translation adjustments (note 28)
- (12,021,898) - - - - (12,021,898)
Change in fair value of available for sale financial instruments (note 28)
- - - 31,656 - - 31,656
Issue of CCPS (note 25 and 29) - - - - - 57,937,332 57,937,332Deferred tax on share issue costs (note 18)
- - - - (651,753) (651,753)
Share issue costs on issue of CCPS (note 25 and 29)
- - - - - (1,891,056) (1,891,056)
Issue of equity shares of MEIL to IIF (note 25 and 29)
- - - - - 649 649
Equity settled share based payments (note 33)
- - 688,047 - - - 688,047
Balance as at 31 March 2012 72,858,278 (12,954,978) 857,819 31,656 (4,583,064) 55,395,172 111,604,883Profit for the period - - - - 12,026,294 - 12,026,294Other comprehensive loss for the period:Foreign currency translation adjustments (note 28)
- (5,867,292) - - - - (5,867,292)
Change in fair value of available for sale financial instruments (note 28)
- - - (11,230) - - (11,230)
Equity settled share based payments (note 33)
- - 984,396 - - - 984,396
Balance as at 31 December 2012
72,858,278 (18,822,270) 1,842,215 20,426 7,443,230 55,395,172 118,737,051
The accompanying notes form an integral part of these consolidated financial statements
5353Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 53 03/07/13 11:33 AM
CONSOLIDATED STATEMENT OF CASH FLOWSfor the period ended 31 December 2012
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDCash flows from operating activitiesProfit/(loss) from operations before tax 13,220,877 (4,202,666)Adjustments:Depreciation and amortisation 5,593,722 3,282,153Interest on fixed deposits and on non convertible debentures (203,052) (764,863)Finance costs 16,527,605 4,702,595Fair valuation of derivative financial instruments 313,367 283,794Gain on sale of mutual funds (519,939) (815,356)Equity settled employees benefits (984,396) (688,047)Unrealized foreign exchange loss/(gain) 6,462,370 2,354,961Operating cash flows before working capital changes 40,410,554 557,351Changes in working capital:Trade receivables (2,658,022) (7,225,851)Other assets (1,584,553) (5,527,671)Trade and other payables (3,279,839) 3,566,978Cash generated/(used in) from operating activities 32,888,140 (9,743,895)Taxes paid (460,293) (49,772)Net cash generated/ (used in) from operating activities 32,427,847 (9,793,667)Cash flows from investing activitiesPurchase of property, plant and equipment (134,301,589) (225,043,077)Redemption of/(investment in) mutual funds (net) 2,795,430 (5,380,924)Finance income received 225,054 856,882Cash used in investing activities (131,281,105) (229,567,119)Cash flows from financing activitiesProceeds from the issue of CCPS - 69,932,181Proceeds from borrowings 162,803,732 164,468,985Repayment of borrowings (38,409,829) -Interest paid (19,585,430) (7,868,510)Cash generated from finance activities 104,808,473 226,532,656Net increase in cash and cash equivalents 5,955,215 (12,828,130)Cash and cash equivalents at beginning of the period/year 3,151,975 16,861,883Foreign exchange effect on cash and cash equivalents 361,916 (881,778)Cash and cash equivalents at end of the period/ year 9,469,106 3,151,975
The accompanying notes form an integral part of these consolidated financial statements
5454
Mytrah_AR_41_96_V1.indd 54 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012
1. General information
Mytrah Energy Limited (“MEL” or the “Company”) is a non-cellular company liability limited by shares incorporated on 13
August 2010 under the Companies (Guernsey) Law, 2008 and is listed on the Alternate Investment Market (‘AIM’) of the
London Stock Exchange. The address of the registered office is Anson Place, Mill Court, La Charroterie, St. Peter Port, Guernsey
GY1 1EJ. Mytrah Energy Limited has the following subsidiary undertakings, (together the “Group”), all of which are directly or
indirectly held by the Company, for which consolidated financial statements are being prepared, as set out below:
Subsidiary Country of
incorporation
or residence
Date of
Incorporation
Proportion
of ownership
interest
(percent)
Proportion of
voting power
(percent)
Activity Functional
currency
Bindu Vayu (Mauritius)
Limited (“BVML”)
Mauritius 29 March
2012
100 100 Holding
company
USD
Mytrah Energy (India)
Limited (“MEIL”)
India 11 November
2009
99.99 99.99 Operating
company
INR
Bindu Vayu Urja Private
Limited (“BVUPL”)
India 5 January
2011
99.99 99.99 Operating
company
INR
Mytrah Vayu (Pennar)
Private Limited (“MVPPL”)
India 21 December
2011
99.99 99.99 Operating
company
INR
Mytrah Vayu (Krishna)
Private Limited (“MVKPL”)
India 18 June 2012 99.99 99.99 Operating
company
INR
Mytrah Vayu (Manjira)
Private Limited (“MVMPL”)
India 18 June 2012 99.99 99.99 Operating
company
INR
Mytrah Vayu (Bhima) Private
Limited (“MVBPL”)
India 22 June 2012 99.99 99.99 Operating
company
INR
Mytrah Vayu (Indravati)
Private Limited (“MVIPL”)
India 22 June 2012 99.99 99.99 Operating
company
INR
Mytrah Engineering Private
Limited (“MEPL”)
India 30 March
2012
99.99 99.99 Operating
company
INR
Mytrah Infrastructure
Private Limited (“MIPL”)
India 29 March
2012
99.99 99.99 Operating
company
INR
The principal activity of the Company is to operate wind energy farms as a leading independent power producer, and to
engage in the sale of energy to the Indian market through the Company’s subsidiaries.
These financial statements are presented in US dollars (USD). Foreign operations are included in accordance with the
policies set out in note 3.
2. Adoption of new and revised accounting standards and interpretations
In the current period, the following new and revised standard and interpretation have been adopted by the Group, none of
which had a material impact on the current period or prior period reported results or financial position:
Standard or interpretation Effective for reporting
periods starting on or afterIAS 12 Income Taxes Limited scope amendment (recovery of underlying
assets)
Annual periods beginning on
or after 1 January 2012
5555Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 55 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
At the date of authorisation of the financial statements, the following standards and interpretations, have not been applied
in these financial statements, were in issue but not yet effective (and in some cases had not yet been endorsed by the EU).
Standard or interpretation Effective for reporting
periods starting on or afterIFRS 1 Severe hyperinflation and Removal of fixed dates for first-time
adopters
Annual periods beginning on
or after 1 January 2013IFRS 7 Amendments to IFRS 7 and IAS 32 – Offsetting Financial Assets and
Financial Liabilities
Annual period beginning on
or after 1 January 2013 and 1
January 2014IFRS 9 Financial Instruments Annual periods beginning on
or after 1 January 2015IFRS 10 Consolidated Financial Statements Annual periods beginning on
or after 1 January 2013IFRS 11 Joint Arrangements Annual periods beginning on
or after 1 January 2013IFRS 12 Disclosure of Interests in Other Entities Annual periods beginning on
or after 1 January 2013IFRS 13 Fair Value Measurement Annual periods beginning on
or after 1 January 2013IAS 1 Presentation of Financial Statements Amendments resulting from May
2010 Annual Improvements to IFRSs
Annual periods beginning on
or after 1 January 2013IAS 1 Presentation of Financial Statements Amendments to revise the way
other comprehensive income is presented
Annual periods beginning on
or after 1 July 2012IAS 19 Employee Benefits – Amended Standard resulting from the Post-
Employment Benefits and Termination Benefits projects
Annual periods beginning on
or after 1 January 2013IAS 27 Consolidated and Separate Financial Statements – Reissued as IAS 27
Separate Financial Statements (as amended in 2011)
Annual periods beginning on
or after 1 January 2013IAS 28 Investments in Associates – Reissued as IAS 28 Investments in
Associates and Joint Ventures (as amended in 2011)
Annual periods beginning on
or after 1 January 2013
Based on the Group’s current business model and accounting policies, Management does not expect that the adoption of
these standards or interpretations will have a material impact on the financial statements of the Group. The Group does not
intend to apply any of these pronouncements early.
3. Significant accounting policies
The Group accounting policies are summarized below:
Basis of accounting
These consolidated financial statements have been prepared in accordance with and comply with IFRS as adopted by the
European Union.
The consolidated financial statements have been prepared on the historical cost basis, except for the revaluation of certain
financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for assets.
The Directors have taken advantage of the exemption offered by Section 244 (5) of the Companies (Guernsey) Law, 2008
from preparation of individual financial statements of the Company as the Company is preparing and presenting consolidated
financial statements for the financial period ended 31 December 2012 and the year ended 31 March 2012.
Consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company (its subsidiaries) made up to 31 December (previously 31 March) each year. Control is achieved where the Company
has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities.
All intra-group transactions, balances, income and expenses are eliminated on consolidation.
5656
Mytrah_AR_41_96_V1.indd 56 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
Going concern
The Directors have considered the financial position of the Group, its cash position and forecast cash flows for the 12 months
period from the date of signing these financial statements when considering going concern. The Directors have, at the
time of approving the financial statements, a reasonable expectation that the Group have adequate resources to continue
in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in
preparing the financial statements. Further detail is contained in the Business Review on page 26.
Foreign currencies
The consolidated financial statements are presented in USD, which is the presentational currency of the Company, as the
financial statements will be used by international investors and other stakeholders because the Company’s shares are listed
on AIM. The functional currency of the parent company is sterling (“GBP”). The functional currency of the subsidiaries is
mentioned in note 1.
In preparing the financial statements of each individual group entity, transactions in currencies other than the entity’s
functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At
the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing
at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates
prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost
in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in income statement in the period. For the purposes of presenting
consolidated financial statements, the assets and liabilities of the Group’s foreign operations are translated into US dollars
(USD) using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at
the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case
the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in other
comprehensive income and accumulated in equity.
The USD: INR exchange rates used to translate the INR financial information into the presentation currency of USD were as
follows:
31 December 2012 31 March 2012Closing rate 54.6890 51.8521Average rate for the period/year 54.3772 48.1335
The GBP: USD exchange rates used to translate the GBP financial information into the presentation currency of USD were as
follows:
31 December 2012 31 March 2012Closing rate 1.6153 1.5987Average rate for the period/year 1.5895 1.5963
Revenue recognition
Revenue is recognised when it is probable that future economic benefits will flow to the entity and these benefits can be
measured reliably.
Sale of electricity
Revenue from the sale of electricity is recognised when earned on the basis of contractual arrangements and reflects the
number of units supplied in accordance with joint meter readings undertaken on a monthly basis by representatives of the
buyer and the Group at rates stated in the contract or as applicable, net of any actual or expected trade discounts.
Generation-based incentives
Revenue from generation-based incentives are recognised based on the number of units supplied, when registration under
the relevant programme has taken place and its eligibility criteria are met under the Indian Renewable Energy Development
Agency Limited - Generation Based Incentive scheme.
3. Significant accounting policies (continued)
5757Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 57 03/07/13 11:33 AM
Interest income
Interest income is recognised when it is probable that the economic benefits will flow to the Group and the amount of revenue
can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the
effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected
life of the financial asset to that asset’s net carrying amount on initial recognition.
Financial instruments
Financial instruments
Financial assets and financial liabilities are recognised in the consolidated statement of financial position when the Group
becomes a party to the contractual provisions of the instrument.
Financial assets
All financial assets are recognised and derecognised on trade date where the purchase or sale of a financial asset is under a
contract whose terms require delivery of the financial asset within the time frame established by the market concerned, and
are initially measured at fair value, plus transaction costs.
Financial assets within the scope of IAS 39 are classified into the following specified categories as:
• loans and receivables
• financial assets at fair value through profit or loss
• available-for-sale financial assets
• held-to-maturity investments
The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.
Following the disposal of investments classified as held to maturity during the period, management will not classify such
assets as held for this purpose in line with provisions of IAS 39.
Effective Interest Rate method
The effective interest rate method is a method of calculating the amortised cost of a financial asset held at amortised cost and
of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated
future cash receipts (including all fees on points paid or received that form an integral part of the effective interest rate,
transaction costs and other premiums or discounts) through the expected life of the debt instrument, or (where appropriate) a
shorter period, to the net carrying amount on initial recognition.
Investment income is recognised on an effective interest basis for debt instruments.
Loans and receivables (including cash and bank balances)
Cash and bank balances and trade and other receivables that have fixed or determinable payments that are not quoted in
an active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the
effective interest method, less any impairment. Interest income is recognised by applying the effective interest rate, except for
short-term receivables when the recognition of interest would be immaterial.
Cash and bank balances comprise cash in hand and cash at bank or deposits. Cash equivalents are short-term, highly liquid
investments that are readily convertible to known amounts of cash, which are subject to an insignificant risk of change in value.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets that are held for trading or are designated by the
entity to be carried at fair value through profit or loss upon initial recognition. Financial assets at fair value through profit and
loss are carried in the statement of financial position at fair value with gains or losses recognised in income statement.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
3. Significant accounting policies (continued)
5858
Mytrah_AR_41_96_V1.indd 58 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
Available-for-sale financial assets (“AFS”)
Investment in mutual funds held by the Group that are traded in an active market are classified as being AFS and are stated at
fair value. Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated
in fair value reserve with the exception of impairment losses, interest calculated using the effective interest method and
foreign exchange gains and losses on monetary assets, which are recognised directly in income statement.
Held-to-maturity investments (“HTM”)
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity.
Investments are classified as held-to-maturity if it is the positive intention and ability of Group’s management to hold them
until maturity. Held-to-maturity investments are subsequently measured at amortised cost using the effective interest method.
This method uses an effective interest rate that exactly discounts estimated future cash receipts through the expected life
of the financial asset to the net carrying amount of the financial asset. Gains and losses are recognised in the consolidated
statement of comprehensive income when the investments are derecognised or impaired, as well as through the amortisation
process. In addition, if there is objective evidence that the investment has been impaired, the financial asset is measured at
the present value of estimated cash flows. Any changes to the carrying amount of the investment are recognised in income
statement.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered
to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition
of the financial asset, the estimated future cash flows of the investment have been affected.
For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between the
asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original
effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception
of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is
considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written
off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in
income statement.
Derecognition of financial assets
The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it
transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group
neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset,
the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group
retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise
the financial asset and also recognises a collateralised borrowing for the proceeds received.
Financial liabilities and equity
Debt and equity instruments issued by a group entity are classified as either financial liabilities or as equity in accordance with
the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its
liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs.
Compound instruments
The component parts of compound instruments (convertible bonds) issued by the Group are classified separately as financial
liabilities and equity in accordance with the substance of the contractual arrangement. At the date of issue, the fair value of the
liability component is estimated using the prevailing market interest rate for a similar non-convertible instrument. This amount
3. Significant accounting policies (continued)
5959Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 59 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
3. Significant accounting policies (continued)
is recorded as a liability on an amortised costs basis using the effective interest method until extinguished upon conversion
or at the instruments’ maturity date. The equity component is determined by deducting the amount of the liability component
from the fair value of the compound instrument as a whole. This is recognised and included in equity, net of income tax effects,
and is not subsequently remeasured.
Financial liabilities
Financial liabilities are initially measured at fair value, net of transaction costs and subsequently measured at amortised cost
using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest
expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments
(including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and
other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the
net carrying amount on initial recognition.
Derecognition of financial liabilities
The Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they
expire.
Embedded derivatives
Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their
risks and characteristics are not closely related to those of the host contracts and the host contracts are not measured at fair
value through profit or loss.
An embedded derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the hybrid
instrument to which the embedded derivative relates is more than 12 months and is not expected to be realised or settled
within 12 months.
The Company has taken an accounting policy choice in accordance with IAS 32 and IAS 39 wherein the Company writes
options that give non-controlling shareholders right to put subsidiary’s shares to the Company in exchange for a variable
number of Company’s shares and the Company has an option to settle in cash when the non-controlling shareholders exercise
the options. Accordingly the preference share held by the non-controlling interest shareholders are classified as equity (
NCI) and the related put options are accounted for as a derivative liabilities under IAS 39 at fair value with changes therein
recognised in profit or loss.
Property, plant and equipment
Recognition and measurement
Property, plant and equipment are recognised as assets in the statement of financial position if it is probable that the Group
will derive future economic benefits from them and the cost of the asset can be reliably estimated.
Items of property, plant and equipment are stated at cost less accumulated depreciation and any provision for impairment.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets
include the cost of materials, direct labour and any other costs directly attributable to bringing the asset to a working condition
for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located.
Advances paid in respect of work that is yet to be performed is classified as an advanced payment within other non current
assets in the consolidated statement of financial position.
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items
(major components) of property, plant and equipment.
The cost of replacing part of an item of plant and equipment is recognised in the carrying amount of an item if it is probable
that the future economic benefits embodied within the part will flow to the group and its cost can be measured reliably.
6060
Mytrah_AR_41_96_V1.indd 60 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
3. Significant accounting policies (continued)
The cost of the day-to-day servicing of plant and equipment are recognised in income statement as incurred.
Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from
disposal with the carrying amount of property, plant and equipment and are recognised within “other gains and losses” in the
consolidated income statement.
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction and production of qualifying assets are capitalised as part
of the costs of those assets. Qualifying assets are those that take a substantial period of time to prepare for their intended use.
Capitalisation of borrowing costs continues up to the date when the assets are substantially ready for their use.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets
is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are expensed in the period in which they are incurred.
Depreciation
Depreciation is provided to write off the cost of property, plant and equipment over their estimated useful lives after taking
into account their estimated residual value, using the straight-line method as stated below:
Furniture and Fittings 5 years
Office Equipment 4-5 years
Computers 4 years
Vehicles 5 years
Plant and Machinery 5 to 50 years
Buildings 20 years
The Company has revised its estimated useful life of plant and machinery during the period ended 31 December 2012
and accordingly applied component based method of charging depreciation for plant and machinery. Refer note 35 for the
component-wise break-up of plant and machinery and its revised useful lives.
Lease acquisition costs and leasehold improvements are depreciated over the primary period of the lease or estimated useful
lives of the assets, whichever is less. Assets under construction are not depreciated, as they are not ready for use.
The depreciation methods, useful lives and residual value, are reviewed at each reporting date.
Impairment
At each reporting date, the Company reviews the carrying amounts of its tangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If the recoverable amount of an asset is estimated to be less than
its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised
as an expense immediately.
Intangible assets
Other intangible assets that are acquired by the Group and have finite useful lives are measured at costs less accumulated
amortization and accumulated impairment losses. Intangibles are amortised over its useful life using straight line method as
stated below:
Application Software 4 years
ERP software license 4 years
6161Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 61 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
3. Significant accounting policies (continued)
Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the period/year. Taxable profit differs from profit as reported in the
consolidated income statement because it excludes items of income or expense that are taxable or deductible in future years
and it further excludes items that are permanently exempt from tax or allowable as a tax deduction. The Company’s liability for
current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting date.
Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and
liabilities in the financial statements and the corresponding tax bases used in the computation of the taxable profit, and
is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be
available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the
temporary differences arise from the initial recognition of goodwill or from the initial recognition (other than in a business
combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Any deferred tax asset or liability arising from deductible or taxable temporary differences in respect of unrealised inter-
company profits are recognised using the tax rate of the jurisdiction of the company which owns the assets.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset
is realised on tax laws and rates that have been enacted at the balance sheet date. Deferred tax is charged in the income
statement, except when it relates to items charged or credited in other comprehensive income, in which case the deferred tax
is also dealt with in other comprehensive income.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to
settle its current tax assets and liabilities on a net basis.
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as operating leases.
Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another
systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation, as a result of past events, and it
is probable that an outflow of resources, that can be reliably estimated will be required to settle such an obligation. If the
effect of the time value of money is material, provisions are determined by discounting the expected future cash flows to net
present value using an appropriate pre-tax discount rate that reflects current market assessments of the time value of money
and, where appropriate, the risks specific to the liability. Unwinding of the discount is recognised in the consolidated income
statement as a finance cost. Provisions are reviewed at each balance sheet date and are adjusted to reflect the current best
estimate.
A contingent liability is disclosed where the existence of an obligation will only be confirmed by future events or where the
amount of the obligation cannot be measured reliably. Contingent assets are not recognised, but are disclosed where an
inflow of economic benefits is probable.
6262
Mytrah_AR_41_96_V1.indd 62 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
3. Significant accounting policies (continued)
Retirement benefit costs
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. Payments made to
state-managed retirement benefit schemes are dealt with as payments to defined contribution schemes where the group’s
obligations under the schemes are equivalent to those arising in a defined contribution retirement benefit scheme.
For defined benefit schemes, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial
valuations being carried out at each balance sheet date. Actuarial gains and losses are recognised in the consolidated income
statement in full in the period in which they occur.
Past service cost is recognised immediately to the extent that the benefits are already vested, and otherwise is amortised on
a straight-line basis over the average period until the benefits become vested.
The retirement benefit obligation recognised in the balance sheet represents the present value of the defined benefit
obligation as adjusted for unrecognised past service cost, and as reduced by the fair value of scheme assets. Any asset
resulting from this calculation is limited to past service cost, plus the present value of available refunds and reductions in the
future contributions to the scheme.
Earning per share
The Group presents basic and diluted earnings per share (“EPS”) data for its ordinary shares. Basic EPS is calculated by dividing
the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares
outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders
and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares, which
includes all stock options granted to employees.
Government grants
The Company recognizes government grants only when there is reasonable assurance that the conditions attached to them
will be complied with, and the grants will be received. Government grants received in relation to assets are presented as a
reduction to the carrying amount of the related asset. Grants related to income are recognized as a credit to the consolidated
income statement.
Share-based payments
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of
the equity instruments at the grant date. The fair value excludes the effect of non-market-based vesting conditions. Details
regarding the determination of the fair value of equity-settled share-based transactions are set out in note 33.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis
over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest. At each balance sheet
date, the Group revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-
market-based vesting conditions. The impact of the revision of the original estimates, if any, is recognised in income statement
such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to equity reserves.
Share options granted to employees are treated as cancelled when employees cease to contribute to the scheme. This results
in accelerated recognition of the expenses that would have arisen over the remainder of the original vesting period.
Finance income and expense
Finance income consists of interest income on funds invested (including available-for-sale financial assets), dividend income
and gains on the disposal of available-for-sale financial assets. Interest income is recognized as it accrues in income statement,
using the effective interest method. Dividend income is recognized in income statement on the date that the Company’s right
to receive payment is established. The associated cash flows are classified as investing activities in the statement of cash flows.
Finance expenses consist of interest expense on loans and borrowings. Borrowing costs are recognized in profit or loss using
the effective interest method. The associated cash flows are classified as financing activities in the statement of cash flows.
Foreign currency gains and losses are reported on a net basis.
6363Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 63 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
4. Critical accounting judgements and key sources of estimation uncertainty
In the application of the Group’s accounting policies, which are described in note 3, the Directors are required to make
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent
from other sources. The estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future
periods if the revision affects both current and future period.
Critical judgements and estimates in applying the Group’s accounting policies
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year are discussed below.
Useful life of depreciable assets
Management reviews the useful lives of depreciable assets at each reporting date, based on the expected utility of the assets
to the Group and any change in useful lives and methods of depreciation are adjusted prospectively if appropriate. Refer note
35 for further details on changes in the useful life of plant and machinery.
Classification of financial instruments as equity or liability
Significant judgement is required to apply the rules under IAS 32, Financial Instruments: Presentation and IAS 39: Financial
Instruments: Recognition and Measurement to assess whether an instrument is equity or a financial liability. Management has
exercised significant judgement to evaluate the terms and conditions of certain financial instruments with reference to the
applicability of contingent settlement provisions, evaluation of whether options under the contract will be derivative or a
non-derivative, assessing if certain settlement terms are within the control of the Company and if not whether the occurrence
of these events are extremely rare, highly abnormal and very unlikely, clarifications between the parties to the agreement
subsequent to the date of the agreement to conclude that the instruments be classified as an equity instrument.
Deferred tax assets
The assessment of the probability of future taxable income in which deferred tax assets can be utilised is based on the
Group’s latest approved budget forecast, which is adjusted for significant non-taxable income and expenses and specific limits
to the use of any unused tax loss or credit. The tax rules in India in which the Group operates are also carefully taken into
consideration. If a positive forecast of taxable income indicates the probable use of a deferred tax asset, especially when it can
be utilised without a time limit, that deferred tax asset is usually recognised in full. The recognition of deferred tax assets that
are subject to certain legal or economic limits or uncertainties is assessed individually by management based on the specific
facts and circumstances.
Recoverability of trade receivables
The Group analyses the historical payment patterns of customers, customer concentrations, customer creditworthiness and
current economic trends on an ongoing basis. If the financial condition of a customer deteriorates, additional provision is
made in the accounts.
Determination if the arrangement meets the definition of a service concession under IFRIC 12 Service Concession
Arrangements
Management has assessed applicability of IFRIC 12: Service Concession arrangements for certain arrangements. In assessing
the applicability, management has exercised significant judgement in relation to the underlying ownership of the assets, the
ability to enter into power purchase arrangements with any customer, ability to determine prices etc and concluded that the
arrangements do not meet the criteria for service concession arrangements.
6464
Mytrah_AR_41_96_V1.indd 64 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
5. Segment information
IFRS 8 establishes standards for the way to report information on operating segments and related disclosures about products
and services, geographic areas, and major customers. The Group operations predominantly relate to generation and sale of
electricity. The chief operating decision maker evaluates the Group performance and allocates resources based on an analysis
of various performance indicators at operational unit level. Accordingly there is only a single operating segment “generation
and sale of electricity”. Consequently no segment disclosures of the Group are presented.
The Group has all of its non-current assets located within India and earn its revenues from customers located in India.
6. Revenue
The Group’s revenue from continuing operations is as follows:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDSale of electricity 28,130,545 6,254,838Generation based incentive 2,741,371 719,122Sale of renewable energy certificates 50,780 -Total revenue 30,922,696 6,973,960Finance income (note 10) 409,624 1,296,425Other operating income 7,993,199 -Total income 39,325,519 8,270,385
Generation based incentive are recognised on fulfilment of eligibility criteria prescribed under Indian Renewable Energy
Development Agency Limited - Generation Based Incentives Scheme.
Other operating income represents liquidated damages claimed on certain project suppliers in relation to delays in the
execution, cancellation and downsizing of certain projects.
7. Expenses by nature
Profit/(loss) for the period/year has been arrived at after charging:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDContinuing operationsNet foreign exchange loss 44,953 14,517Amortisation of intangible assets (note 14) 89,567 12,511Depreciation of property, plant and equipment (note 15) 5,504,155 3,269,642Staff costs (note 9) 4,322,115 2,313,401
8. Auditor’s remuneration
The auditor’s remuneration is as follows:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDFees payable to the Company’s auditor and their associates for the: audit of the Company’s annual accounts 71,527 111,741 audit of the Company’s subsidiaries pursuant to legislation 60,203 47,668Total audit fees 131,730 159,409Audit related assurance services 23,843 44,696Total non-audit fees 23,843 44,696
6565Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 65 03/07/13 11:33 AM
9. Staff Costs
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDStaff other than Directors and key management personnel:Salaries 699,500 413,400Contribution to provident fund 69,613 55,660Staff welfare 126,035 64,953Gratuity and leave encashment (note 24) (37,049) 70,331Share based payment expense (note 33) 77,808 -
935,907 604,344Directors and key management personnel:Salaries 2,479,620 1,021,010Share based payment expense (note 33) 906,588 688,047
4,322,115 2,313,401
10. Finance income
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDInterest on investments in non-convertible debentures 65,713 75,379Loss on redemption of non-convertible debentures (note 17) (25,180) -Interest on fixed deposits 162,519 689,484Gain on derivative instruments within CCDs 365,226 39,921Loss on derivative instruments within CCPS (678,593) (323,715)Gain on disposal of available for sale investments (note 17) 519,939 815,356Total finance income 409,624 1,296,425
11. Finance costs
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDContinuing operations:Interest on borrowings (19,265,137) (9,134,476)Other borrowing costs (812,257) (167,263)Total interest expense (20,077,394) (9,301,739)Less: amounts included in the cost of qualifying assets 3,412,935 4,599,144Total finance cost recognised in the income statement (16,664,459) (4,702,595)
Amounts included in the cost of qualifying assets during the year arose on borrowings sanctioned for the purpose of financing
construction of a qualifying asset and it represents the actual borrowing costs incurred on those borrowings, calculated using
the effective interest rate method.
12. Taxation
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDContinuing operationsCurrent year tax charge 2,326,395 159,221Deferred tax (note 18) (1,131,812) (1,529,288)Taxation 1,194,583 (1,370,067)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
6666
Mytrah_AR_41_96_V1.indd 66 03/07/13 11:33 AM
The debit/(credit) for the period/ year can be reconciled to the profit/(loss) per the income statement as follows:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDProfit/(loss) before tax on continuing operations 13,220,877 (4,202,666)Enacted tax rates 32.45% 32.45%Computed expected tax (expense)/benefit (4,290,175) 1,363,765Effect of:Income not offered to tax 2,593,793 -Other permanent differences 501,799 6,302MAT charge (2,326,395) (159,221)MAT deferred tax credit 2,326,395 159,221Income tax (expense)/benefit (1,194,583) 1,370,067
The Company is exempt from Guernsey income tax under the Income Tax (Exempt bodies) (Guernsey) Ordinance, 1989 and
is subject to an annual fee of USD 962. As such, the Company’s tax liability is zero. However considering that the Company’s
operations are entirely based in India, the effective tax rate of the Group of 32.45% has been computed based on the current
tax rates prevailing in India.
Indian companies are subject to corporate income tax or Minimum Alternate Tax (“MAT”). If MAT is greater than corporate
income tax then MAT is levied. The Company has recognised MAT of USD 2,326,395 (31 March 2012: USD 159,221) as MAT is
greater than corporate income tax for the current period.
Income tax recognised directly in equity
In addition to the amount charged to the income statement, the following amounts relating to tax have been recognised
directly in equity:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDDeferred tax credit - 702,105Foreign exchange loss on deferred tax credit - (50,352)Total income tax recognised directly in equity - 651,753
Tax Liabilities
As at 31 December, 2012
USD
As at 31March 2012
USDCurrent tax liabilities 2,201,272 480,717Total current tax liabilities 2,201,272 480,717
13. Earnings per share
Basic earnings per share is calculated by dividing profit/(loss) attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during the period/year.
During the current period, there were no dilutive options for the computation of diluted earnings per share.
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDBasic and dilutedProfit/(loss) attributable to the equity holders of the Company 12,026,294 (2,832,599)Weighted average number of ordinary shares outstanding during the period/year 163,636,000 163,636,000Basic and diluted earnings/(loss) per share 0.0735 (0.0173)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
6767Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 67 03/07/13 11:33 AM
14. Intangible assets
Application software
USDCost as at 1 April 2011 -Additions 77,392Balance as at 31 March 2012 77,392
Amortisation As at 1 April 2011 -Charge for the year 13,478Exchange differences (967)As at 31 March 2012 12,511
Carrying amount As at 31 March 2012 64,881As at 31 March 2011 -Cost as at 1 April 2012 77,392Additions 726,800Disposals (4,015)Balance as at 31 December 2012 800,177
Amortisation As at 1 April 2012 12,511Charge for the year 89,567Exchange differences (1,160)As at 31 December 2012 100,918
Carrying amount As at 31 December 2012 699,259As at 31 March 2012 64,881
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
6868
Mytrah_AR_41_96_V1.indd 68 03/07/13 11:33 AM
NO
TES
TO T
HE
CON
SOLI
DAT
ED F
INAN
CIA
L ST
ATEM
ENTS
fo
r the
per
iod
ende
d 31
Dec
embe
r 201
2 (c
onti
nued
)
15. P
rope
rty,
pla
nt a
nd e
quip
men
t
Furn
itur
e an
d fi
ttin
gsU
SD
Offi
ce
equi
pmen
tU
SD
Land
and
bu
ildi
ngs
USD
Plan
t and
m
achi
nery
USD
Com
pute
rsU
SDVe
hicl
esU
SDLe
aseh
old
impr
ovem
ents
USD
Win
d fa
rm a
sset
s un
der
cour
se o
f co
nstr
ucti
onU
SD
Tota
lU
SD
Ope
ning
cos
t as
at 1
Apr
il 2
011
4,15
116
,907
--
28,8
5059
,688
51,3
3528
,142
,189
28,3
03,1
20Ad
diti
ons
68,1
6142
,392
579,
108
-13
4,43
327
4,84
618
9,70
734
4,69
3,91
534
5,98
2,56
2Tr
ansf
ers
--
-20
3,39
7,15
8-
--
(203
,397
,158
)-
Exch
ange
diff
eren
ce(5
26)
(2,1
42)
--
(3,6
54)
(7,5
59)
(6,5
01)
-(2
0,38
2)Ba
lanc
e at
31
Mar
ch 2
012
71,7
8657
,157
579,
108
203,
397,
158
159,
629
326,
975
234,
541
169,
438,
946
374,
265,
300
Acc
umul
ated
dep
reci
atio
n as
at
1 A
pril
201
11,
850
3,94
8-
-6,
556
4,56
43,
134
-20
,052
Dep
reci
atio
n ex
pens
e11
,956
8,25
416
,032
3,14
5,16
628
,895
40,7
4118
,598
-3,
269,
642
Exch
ange
diff
eren
ce(1
,093
)(1
,093
)(1
,150
)(2
25,5
57)
(2,8
29)
(3,5
00)
(1,7
31)
-(2
36,9
53)
Bala
nce
as a
t 31
Mar
ch 2
012
12,7
1311
,109
14,8
822,
919,
609
32,6
2241
,805
20,0
01-
3,05
2,74
1
Net
boo
k va
lue
as a
t 31
Mar
ch
2012
59,0
7346
,048
564,
226
200,
477,
549
127,
007
285,
170
214,
540
169,
438,
946
371,
212,
559
Ope
ning
cos
t as
at 1
Apr
il 2
012
71,7
8657
,157
579,
108
203,
397,
158
159,
629
326,
975
234,
541
169,
438,
946
374,
265,
300
Addi
tion
s75
,356
50,6
081,
696,
179
123,
837,
844
125,
702
113,
521
9,41
626
,796
,143
152
,704
,769
Tran
sfer
s-
--
--
--
(123
,837
,844
)(1
23,8
37,8
44)
Retu
rns
--
--
--
-(2
5,95
7,80
5)(2
5,95
7,80
5)D
ispo
sals
-(2
19)
--
-(7
,825
)-
-(8
,044
)Ex
chan
ge d
iffer
ence
(3,7
23)
(2,9
65)
(30,
039)
(10,
550,
886)
(7,9
21)
(16,
960)
(12,
167)
-(1
0,62
4,66
1)Ba
lanc
e as
at 3
1 D
ecem
ber
2012
143,
419
104,
581
2,24
5,24
831
6,68
4,11
627
7,41
041
5,71
123
1,79
046
,439
,440
366,
541,
715
Acc
umul
ated
dep
reci
atio
n as
at
1 A
pril
201
212
,713
11,1
0914
,882
2,91
9,60
932
,622
41,8
0520
,001
-3,
052,
741
Dep
reci
atio
n ex
pens
e16
,705
14,2
0125
,018
5,31
9,59
743
,313
58,7
6826
,553
-5,
504,
155
Exch
ange
diff
eren
ce(7
54)
(546
)(9
15)
(181
,779
)(2
,023
)(2
,503
)(1
,189
)-
(189
,709
)Ba
lanc
e as
at 3
1 D
ecem
ber
2012
28,6
6424
,764
38,9
858,
057,
427
73,9
1298
,070
45,3
65-
8,36
7,18
7N
et b
ook
valu
e as
at
31 D
ecem
ber
2012
114,
755
79,8
172,
206,
263
308,
626,
689
203,
498
317,
641
186,
425
46,4
39,4
4035
8,17
4,52
8
An a
mou
nt o
f USD
3,4
12,9
35 (3
1 M
arch
201
2: U
SD 4
,599
,144
) per
tain
ing
to in
tere
st o
n bo
rrow
ings
was
cap
ital
ised
as
the
fund
s w
ere
used
for t
he c
onst
ruct
ion
of q
ualif
ying
ass
ets
(ref
er n
ote
11).
Refe
r Not
e 35
on
the
chan
ge in
the
usef
ul li
ves
and
resi
dual
val
ues
of th
e pl
ant a
nd m
achi
nery
.
Retu
rns
amou
ntin
g to
USD
25,
957,
805
repr
esen
ts w
ind
farm
ass
ets
unde
r cou
rse
of c
onst
ruct
ion
retu
rned
bac
k to
the
supp
lier o
n ac
coun
t of c
ance
llati
on o
f cer
tain
pro
ject
s.
6969Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 69 03/07/13 11:33 AM
16. Other non-current assets
As at 31 December 2012
USD
As at 31 March 2012
USDDeposits 675,684 414,755Captial advances 38,054,081 41,491,882Prepayments 5,966,471 5,079,820Total other non-current assets 44,696,236 46,986,457
Capital advances represent advance payments made to third parties for the construction of wind farm assets, as part of long-
term construction service contracts.
17. Other investments
Current Non-currentAs at
31 December 2012
USD
As at 31 March
2012USD
As at 31 December
2012USD
As at 31 March
2012USD
Available-for-sale investments carried at fair value –
mutual funds
3,191,023 4,787,630 - -
Held-to-maturity investments carried at amortised cost - - - 964,281Total other investments 3,191,023 4,787,630 - 964,281
The Group has investments amounting to USD 3,191,023 (31 March 2012: USD 4,787,630) in mutual fund units of Industrial
Development Finance Corporation (“IDFC”) which are quoted on the Indian stock markets. The Group has invested in 176,622
units (31 March 2012 190,235 units) of IDFC cash fund – Super Inst Plan C growth. The fair value of the quoted units is
determined by reference to published data. Investments in mutual funds represent investments in growth funds with an
average return of 8.75% (2011-12: 8.75%). During the year, disposals resulted in a gain of USD 519,939 (31 March 2012:
USD 815,356) (note 10).
Following the disposal of investments classified as held to maturity during the period, management will not classify such
assets as held for this purpose in line with provisions of IAS 39.
18. Deferred tax
The following are the major deferred tax liabilities and assets recognised by the Group and movements thereon during the
current period.
As at 31 March 2012
USD
Recognisedin income
statementUSD
Foreign Ex-change
USD
As at 31 De-cember
2012USD
Property, plant and equipment (2,323,810) (3,504,083) 140,522 (5,687,371) Provisions 19,361 (4,239) (980) 14,142Share issue costs 651,753 (207,476) (32,625) 411,652MAT credit 159,221 2,326,395 (32,350) 2,453,266Unrealised inter-group profits 1,498,322 688,068 (81,646) 2,104,744 Tax losses 2,077,940 1,833,147 (118,241) 3,792,846Net deferred tax asset 2,082,787 1,131,812 (125,320) 3,089,279
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7070
Mytrah_AR_41_96_V1.indd 70 03/07/13 11:33 AM
Deferred tax assets and liabilities are offset where the Group has a legally enforceable right to do so. The following is the
analysis of the deferred tax balances (after offset) for financial reporting purposes:
As at 31 December 2012
USD
As at 31 March 2012
USDDeferred tax assets 8,776,650 4,406,597Deferred tax liabilities (5,687,371) (2,323,810)Deferred tax asset, net 3,089,279 2,082,787
19. Trade receivables
As at 31 December 2012
USD
As at 31 March 2012
USDTrade receivables 7,187,329 1,779,129Trade receivables 7,187,329 1,779,129
Trade receivables disclosed above are classified as loans and receivables in accordance with IAS 32 and are therefore measured
at amortised cost. Total trade receivables held by the Group at 31 December 2012 amounted to USD 7,187,329 (31 March
2012: USD 1,779,129) and are non-interest bearing receivables. During the period ended 31 December 2012 and year ended
31 March 2012; no trade receivables were collectively impaired or written off.
The Group does not hold any collateral or other credit enhancements over any of its trade receivables nor does it have the
legal right of offset against any amounts owed by the Group to the counterparty.
Trade receivables include amounts which are past due at the reporting date but against which the Group has not recognised
any allowance for doubtful receivables because there has not been a significant change in credit quality and the amounts
are still recoverable. The average age of the receivables was 49 days during the period ending 31 December 2012 (31 March
2012: 75 days)
The maximum exposure to credit risk at the reporting date is the carrying value of each customer.
Ageing of past due but not impaired receivables is as follows:
As at 31 December 2012
USD
As at 31 March 2012
USD0-30 days 2,999,557 296,96831-60 days 539,928 263,07061-90 days 1,723,164 377,73591-180 days 265,905 497,101More than 180 days 210,005 -Total 5,738,559 1,434,874
The fair value of trade receivables approximates their carrying amounts largely due to the short-term maturities of these
instruments hence Management consider the carrying amount of trade receivables to be approximately equal to their fair
value.
As at 31 December 2012, the Group has five customers (31 March 2012: two customers)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7171Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 71 03/07/13 11:33 AM
20. Other current assets
As at 31 December 2012
USD
As at 31 March 2012
USDDeposits 319,901 112,890Accrued interest 49,422 71,424Prepayments 459,765 1,773,681Accrued income 2,178,338 4,928,516Other receivables 1,222,699 348,749Total other current assets 4,230,125 7,235,260
Prepayments primarily relate to amounts paid in advance for lease rentals.
Accrued income represents amounts receivable from the customer on the sale of electricity and the amount recoverable
from the Indian Renewable Energy Development Authority (“IREDA”) as generation based incentive but not billed for as at 31
December 2012.
21. Cash and bank balances
As at 31 December 2012
USD
As at 31 March 2012
USD
Cash on hand 176 -Bank balances 2,185,016 1,937,945Cash and cash equivalent 2,185,192 1,937,945Bank deposits 7,283,914 1,214,030Total cash and bank balances 9,469,106 3,151,975
22. Borrowings
As at 31 December 2012
USD
As at 31 March 2012
USDSecured borrowings at amortised costCompulsorily convertible debentures liability 45,523,216 29,536,738Other borrowings 222,915,776 123,137,269Total borrowings 268,438,992 152,674,007
Amounts due for settlement within 12 months - USD 16,402,362 (31 March 2012: USD 2,281,959)
Amounts due for settlement after 12 months - USD 252,036,630 (31 March 2012: USD 150,392,048)
During the current period, the Company’s subsidiary MEIL has issued 3,333,333 compulsory convertible debentures (“CCDs”) at
Rs. 300 (~ USD 5.71) each to PTC India Financial Services Limited (PTC) including any of its affiliates (the “Investor”) amounting
to USD 18,285,211 under an agreement between the Group and PTC. The purpose of this is to fund the capital projects of the
Group. The following are the significant terms in relation to the CCDs:
• The CCDs carry a fixed rate of interest payable quarterly in arrears on the principal amount of the CCDs outstanding.
• The CCDs, along with unpaid interest, if any, mandatorily convert into such number of equity shares of Mytrah Energy
(India) Limited (“MEIL” or subsidiary of the Company) at the end of 49 months from the date of initial disbursement so as
to provide the investor a stated rate of return.
• The CCDs will be secured by collateral support in the form of pledge of 49% shares of Bindu Vayu Urja Private Limited
(“BVUPL”, subsidiary of MEIL) held by MEIL.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7272
Mytrah_AR_41_96_V1.indd 72 03/07/13 11:33 AM
Further, MEIL has entered into an option agreement with PTC on the same date whereby PTC can put the CCDs (the “put
option”) or alternatively, the Group can call the CCDs (the “call option”) in exchange for cash providing PTC a stated rate of
return. The call option can be exercised any time from the date of issue whereas the put option can be exercised over a period
beginning from 41 months to 47 months from the date of issue of CCDs.
The Group has drawn down the term loan facility with banks and financial institutions to finance the construction of wind
farm assets. The carrying amount of the liability measured at amortised cost is USD 222,915,776 (2012: USD 123,137,269).
In compliance with the terms of the loan agreement MEIL has created a charge on all project movable, immovable properties,
cash flows, receivables and revenues in favour of banks and financial institutions. The term loans are also secured by collateral
support in the form of pledge of 51% shares of Bindu Vayu (Mauritius) Limited (“BVML”) held by MEL. The effective interest
rate on the term loan is 13.4%. The term loans are for a period of 12 to 14 years.
During the previous year MEIL had issued 5,000,000 compulsory convertible debentures (“CCDs”) at Rs. 300 (~ USD 6) each to
IDFC including any of its affiliates (the “Investor”) under an agreement between the Group and IDFC. The purpose of this is to
fund the capital projects of the Group. The following are the significant terms in relation to the CCDs:
• The CCDs carry a fixed rate of interest payable quarterly in arrears on the principal amount of the CCDs outstanding.
• The CCDs, along with unpaid interest, if any, mandatorily convert into such number of equity shares of MEIL at the end of
48 months from the date of issue so as to provide the investor a stated rate of return.
• The CCDs will be secured by collateral support in the form of pledge of Bindu Urja Capital Inc. (which Ravi Kailas controls)
shareholding, certain non-disposal undertakings by the Company and an irrevocable and unconditional corporate
guarantee by the Company to IDFC.
Further, the Company has entered into an option agreement with IDFC on the same date whereby IDFC can put the CCDs (the
“put option”) or alternatively, the Group can call the CCDs (the “call option”) in exchange for cash providing IDFC a stated rate
of return. The call option can be exercised any time after 18 months from the date of issue whereas the put option can be
exercised over a period beginning from 36 months to 48 months from the date of issue of CCDs.
Consistent with IAS 32, Financial Instruments: Presentation, and IAS 39 Financial Instruments: Measurement, on initial
recognition, the issue proceeds have been segregated in the financial statements between the financial liability and the
derivative portion. Accordingly, the options were subsequently measured at fair value through profit and loss, and the financial
liability is subsequently measured at amortised cost. The period end balance of the options was USD (400,995) (2012: USD
39,921) (see consolidated statement of financial position) and the CCD financial liability was USD 27,238,005 (31 March 2012
USD 29,536,738). Since the CCDs holder is not subject to residual interest no equity component is recognised.
23. Trade and other payables
As at 31 December 2012
USD
As at 31 March 2012
USDTrade payables 583,108 3,045,405Other payables 26,525,560 156,179,079Total trade and other payables 27,108,668 159,224,484
Trade creditors relate to amounts outstanding for trade purchases and ongoing costs.
Other payables include payables for purchase of fixed assets amounting to USD 24,177,085 (31 March 2012: USD 153,601,045).
The Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit
terms.
The fair value of trade and other payables approximates their carrying amounts largely due to the short-term maturities of
these instruments hence management consider that the carrying amount of trade and other payables to be approximately
equal to their fair value.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7373Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 73 03/07/13 11:33 AM
24. Retirement benefit obligations
Defined contribution plan
Provident fund:
The Group makes contributions to a defined contribution retirement benefit plan for qualifying employees. Under the scheme,
the Group is required to contribute a specified percentage of the qualified employees’ pay to fund the benefits. These
contributions are made to a fund administered and managed by the Government of India. The Group’s monthly contributions
are charged to the consolidated income statement in the period they are incurred.
The total cost charged to income of USD 69,613 (31 March 2012: USD 55,660) represents contributions payable to these
schemes by the Group at rates specified in the rules of the plan. As at 31 December 2012, contributions of USD 6,606 (31
March 2012: USD 19,353) were due in respect of the current reporting period had not been paid over to the scheme.
Defined benefit plan
(a) Gratuity
In accordance with the Payment of Gratuity Act 1972 of India, the Group provides for gratuity, a defined benefit retirement
plan (the ‘Gratuity Plan’) covering eligible employees. The Group makes annual contributions under the Gratuity Plan to Life
Insurance Corporation of India. No other post-retirement benefits are provided. The scheme is a funded scheme.
The present value of the defined benefit obligation, the related current service cost and past service cost was measured using
the projected unit cost method.
The projected unit cost method is an accrued benefits valuation method in which the scheme liabilities make allowance for
projected earnings. The accumulated benefit obligation (ABO) is an actuarial measure of the present value for service already
rendered but differs from the projected unit cost method in that it includes no assumption for future salary increases. At the
balance sheet date the gross ABO was USD (5,465) (31 March 2012: USD 38,659).
Movements in the present value of the benefit obligation were as follows:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDChange in benefit obligation Projected benefit obligation at the beginning of the period/year 38,659 -Benefit paid (20,246) -Current service cost 7,706 13,630Interest cost 2,949 -Actuarial (gain)/ loss (32,655) 28,014Translation adjustment (1,878) (2,985)Projected benefit obligation at the end of the period/year (5,465) 38,659
Cost of employee benefits for the period/yearCurrent service cost 7,706 13,630Interest cost 2,949 -Net actuarial (gain)/ loss recognised in the period/year (32,655) 28,014Net (gain)/cost recognised in the consolidated income statement (22,000) 41,644
Key assumptions used:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDDiscount rate (%) 8.00% 8.00%Long-term rate of compensation increase (%) 7.00% 7.00%Attrition (%) 6.00% 6.00%Mortality table LIC (1994 -96) LIC (1994 -96)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7474
Mytrah_AR_41_96_V1.indd 74 03/07/13 11:33 AM
(b) Leave Encashment
The Group also provides for leave encashment (the “leave encashment plan”), a defined benefit plan covering eligible
employees. Under the leave encashment plan, employees are entitled to future payments upon termination of service with
the Company, whether it be by death during service or upon reaching retirement age.
The present value of the defined benefit obligation and the related current service cost was measured using the projected
unit credit method.
The projected unit cost method is an accrued benefits valuation method in which the scheme liabilities make allowance for
projected earnings. The accumulated benefit obligation (ABO) is an actuarial measure of the present value for service already
rendered but differs from the projected unit credit method in that it includes no assumption for future salary increases. At the
balance sheet date the ABO was USD 10,921 (31 March 2012: USD 27,302).
Movements in the present value of the benefit obligation were as follows:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDChange in benefit obligation Projected benefit obligation at the beginning of the period/year 27,302 -Interest cost 2,082 -Current service cost 4,572 8,136Actuarial loss (21,704) 20,551Translation adjustment (1,331) (1,385)Projected benefit obligation at the end of the period/year 10,921 27,302
Cost of employee benefits for the period/yearInterest cost 2,082 -Current service cost 4,572 8,136Net actuarial loss recognised in the period/year (21,704) 20,551Net cost recognised in the income statement (15,050) 28,687
Key assumptions used:
Period ended 31 December 2012
USD
Year ended 31 March 2012
USDActuarial assumptions for long-term compensated absencesDiscount rate 8.00% 8.00%Mortality table LIC (1994-96) LIC (1994-96)Long-term rate of compensation increase (%) 7.00% 7.00%Attrition 6.00% 6.00%
25. Compulsory convertible preference shares
During the previous year, the Group issued 11,666,566 Series A CCPS at Rs. 300 (~USD 6) each to IIF under an Investment
Agreement between the Group, IIF and Mr Ravi Kailas. The following are the salient features of the CCPS:
• IIF is entitled to receive a preference dividend before any dividends are declared to the ordinary shareholders. These carry
a step-up dividend which is cumulative.
• The CCPS convert into equity shares of MEIL at a fixed price of Rs. 300 (~USD 6) per share, for a fixed number of shares, at
the end of six years if the call and put options are not exercised by either of the parties.
• As part of the investment agreement, IIF were issued with 100 ordinary shares in MEIL (see note 29).
Further, the Company entered into an option agreement with IIF on the same date whereby the Company can call the CCPS
(the “call option”) or alternatively, IIF can put the CCPS (the “put option”) in exchange for cash or a variable number of shares
in the Company providing IIF a stated rate of return. The call option can be exercised at any time after four years three months
and the put option can be exercised at any time after five years three months from the date of issue.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7575Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 75 03/07/13 11:33 AM
In accordance with IAS 32, Financial Instruments: Presentation and IAS 39 Financial Instruments: Measurement, upon initial
recognition, the issue proceeds has been segregated in the financial statements as mentioned below:
The issue proceeds of USD 69,932,181 (net of issue costs of USD 1,891,056) were first attributed to the embedded derivatives,
with the fair value of the options amounting to USD 2,670,325. As the instrument entitles the holder to a fixed number of
shares the remaining value of the proceeds are bifurcated such that there is a liability component and an equity component.
The liability component, being USD 11,866,684 was estimated by discounting the mandatory preference share dividend of six
year cash flows using an interest rate from an equivalent instrument without a conversion feature, with the residual value of
USD 55,395,172 representing equity. The effective interest rate on the financial liability is 5.6%.
The options are subsequently measured at fair value through profit or loss, and the financial liability is subsequently measured
at amortised cost. The period end balance of the options was USD 3,348,025 (see consolidated statement of financial position),
the liability component of the preference shares was USD 11,298,416 (31 March 2012: USD 11,435,270) and the equity
component of the CCPS was USD 55,395,172 (31 March 2012: USD 55,395,172) (See note 29).
26. Share capital
As at 31 December 2012
USD
As at 31 March 2012
USDIssued and fully paid up share capital of the Company163,636,000 ordinary shares with no par value 72,858,278 72,858,278
After its incorporation on 13 August 2010 MEL acquired 119,999,999 shares in BVML, from its existing shareholders namely,
Esrano Overseas Ltd, Bindu Urja Investments Inc. (formerly Mytrah Energy Investments Inc.), Bindu Urja Holding Inc. (formerly
Mytrah Energy Holdings Inc.), Bindu Urja Capital Inc. (Mytrah Energy Capital Inc.) and Sila Energy Inc. In consideration of the
said transfer the Company issued shares of the Company at no par value in its capital. Subsequently the Company issued
43,636,000 shares of no par value through listing of its shares on AIM.
The issued share capital refers to ordinary share capital, which carries voting rights with entitlement to an equal share in
dividends authorised by the Board and in the distribution of the surplus assets of the Company.
27. Retained earnings
As at 31 December 2012
USD
As at 31 March 2012
USDBalance at beginning of the period/year (4,583,064) (1,750,465)Profit/(loss) for the period/year from continuing operations 12,026,294 (2,832,599)Balance at end of the period/year 7,443,230 (4,583,064)
28. Other reserves
(a) Equity-settled employee benefits reserve:
The equity-settled employee benefits reserve relates to the share options granted to employees under the employee share
option plan. Further information about share-based payments is set out in note 33.
As at 31 December 2012
USD
As at 31 March 2012
USDBalance at beginning of the period/year 857,819 169,772Additional cost during the period/year 984,396 688,047Balance at end of the period/year 1,842,215 857,819
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
7676
Mytrah_AR_41_96_V1.indd 76 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
(b) Foreign currency translation reserve
As at 31 December 2012
USD
As at 31 March 2012
USD
Balance at beginning of the period/year (12,954,978) (933,080)Foreign currency translation adjustments (5,867,292) (12,021,898)Balance at end of the period/year (18,822,270) (12,954,978)
Foreign currency translation reserve comprises foreign currency differences arising from the translation of the financial
statements of foreign operations from their functional currency into the Group’s presentational currency.
(c) Fair value reserve
As at 31 December 2012
USD
As at 31 March 2012
USD
Balance at beginning of the period/year 31,656 -Change in the fair value of available for sale financial instruments (11,230) 31,656Balance at end of the period/year 20,426 31,656
The fair value reserve comprises the cumulative net change in the fair value of available-for-sale financial assets until the
assets are derecognised or impaired.
29. Non-controlling interests
As at 31 December 2012
USD
As at 31 March 2012
USDBalance at beginning of the period/year 55,395,172 -Share of profit for the year - -Non-controlling interest arising through issue of CCPS by MEIL (note 25) - 57,937,332Share issue costs - (1,891,056)Deferred tax on share issue costs (note 18 and 25) - (651,753)Non-controlling interest arising through issue of 100 ordinary shares by MEIL to IIF (note 25)
- 649
Balance at the end of the period/year 55,395,172 55,395,172
30. Commitments
(a) Capital commitments
As at 31 December 2012
USD
As at 31 March 2012
USDCapital commitments 208,313,149 63,851,182
The capital expenditures authorised and contracted relate to the provision of wind farm assets, which have not been provided
for in the accounts. This is net of advances paid of USD 38,054,081 (2012: USD 41,491,882) (see note 16).
7777Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 77 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
(b) Operating leases
The Group leases office premises under non-cancellable operating lease agreements with a term of three years. The lease
arrangement contains a renewal clause providing the Company with the option of extending the lease for a further period of
three years and four years at the prevailing market rates.
Total operating lease expense recognised in the consolidated income statement as administrative expenses was USD 497,198
(31 March 2012 USD 540,039).
Minimum lease payments
At the balance sheet date, the Group had no outstanding commitments for future minimum lease payments under non-
cancellable operating leases, which fall due as follows:
As at 31 December 2012
USD
As at 31 March 2012
USDWithin 1 year - 52,821Later than 1 year and within 5 years - -Total future minimum lease payments - 52,821
31. Financial instruments
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising
the return to stakeholders through its optimisation of the debt and equity balance.
The capital structure of the Group consists of net debt, which includes the borrowings disclosed in note 22 after deducting
cash and cash equivalents, equity attributable to equity holders of the parent, comprising issued capital and reserves and
retained earnings as disclosed in notes below.
The Group’s risk management Committee reviews the capital structure on a semi-annual basis. As part of this review, the
Committee considers the cost of capital and the risks associated with each class of capital.
The gearing ratio at the year end is as follows:
As at 31 December 2012
USDDebt (note 22) 268,438,992Cash and cash equivalents (note 21) (9,469,106)Net debt 258,969,886Equity 118,737,051Equity and net debt 377,706,937Net debt to equity ratio 69%
Debt is defined as long and short-term borrowings (excluding derivatives) as detailed in note 22. Equity includes all capital
and reserves of the Group that are managed as capital, including non-controlling interests of the Company.
Details of the significant accounting policies and methods adopted (including the criteria for recognition, the basis of
measurement and the basis for recognition of income and expenses) for each class of financial asset, financial liability and
equity instrument are disclosed in note 3.
7878
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
Capital management policies
The group’s objective when managing capital is to safeguard the group’s ability to continue as a going concern in order
to provide returns for shareholders and benefits for stakeholders. The group also proposes to maintain an optimal capital
structure to reduce the cost of capital. Hence, the group may adjust any dividend payments, return capital to shareholders or
issue new shares. Total capital is the equity as shown in the consolidated statement of financial position. Currently, the group
primarily monitors its capital structure in terms of evaluating the funding of wind farm projects. Management is continuously
evolving strategies to optimise the returns and reduce the risks. It includes plans to optimise the financial leverage of the
group.
Equity comprises all components of equity and includes the non controlling interests.
Categories of financial instruments
The accounting classification of each category of financial instruments and their carrying amounts has been tabulated below:
Carrying amount as at
31 December 2012
USD
Fair values as at
31 December 2012
USD
Carrying amount
as at31 March 2012
USD
Fair values as at
31 March 2012USD
Financial assetsLoans and receivables (including cash and
bank balances)Cash and bank balances (note 21) 9,469,106 9,469,106 3,151,975 3,151,975 Other current assets (note 20) 3,770,360 3,770,360 5,461,579 5,461,579Other non current assets (note 16) 675,684 675,684 414,771 414,771 Trade receivables (note 19) 7,187,329 7,187,329 1,779,129 1,779,129 Other investments (note 17) 3,191,023 3,191,023 4,787,630 4,787,630Held to maturity financial asset (note 17) - 964,281 964,281Total financial assets 24,293,502 24,293,502 16,559,365 16,559,365
Financial liabilitiesAmortised costsLong term borrowings (note 22) 252,036,630 252,036,630 150,392,048 150,392,048 Current portion of long term borrowings (note 22)
16,402,362 16,402,362 2,281,959 2,281,959
Liability component of CCPS (note 25) 11,298,416 11,298,416 11,435,270 11,435,270Trade and other payables (note 23) 27,108,668 27,108,668 159,224,484 159,224,484Fair Value Derivative instruments not designated as hedge 2,947,030 2,947,030 2,779,637 2,779,637Total financial liabilities 309,793,106 309,793,106 326,113,398 326,113,398
The fair value of the financial assets and liabilities are estimated at the amount at which the instrument could be exchanged
in a current transaction between willing parties, other than in a forced or liquidation sale. The fair value of the financial
instruments approximates their carrying amounts largely due to the short-term maturities or nature of these instruments.
Financial risk management:
The Company’s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The
Company’s primary risk management focus is to minimize potential adverse effects of market risk on its financial performance.
The Company’s risk management assessment and policies and processes are established to identify and analyze the risks
faced by the Company, to set appropriate risk limits and controls, and to monitor such risks and compliance with the same.
Risk assessment and management policies and processes are reviewed regularly to reflect changes in market conditions and
the Company’s activities. The Board of Directors and the Audit Committee is responsible for overseeing the Company’s risk
assessment and management policies and processes.
7979Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 79 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
(i) Currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in foreign exchange rate. The Group’s presentation currency is the US dollar. The Group’s exposure to foreign currency
arises in part when the Group holds financial assets and liabilities denominated in a currency different from the functional
currency of the entity. Based on the current profile of the Group, the net liability held in foreign currency is USD Nil (31 March
2012: USD 38,251) and as such the Group’s exposure to currency risk is limited.
(ii) Interest rate risk
Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates. The
Group is exposed to interest rate risk on its cash and bank balances. Cash and bank balances expose the company to cash flow
interest rate risk. However, the Group does not carry any fixed interest bearing financial liabilities that are designated at fair
value through profit or loss except for the derivative financial instruments embedded in the CCPS and CCDs. Hence, the Group
is exposed to the fair value interest rate risk on such derivative financial instruments.
The average interest rate on short-term bank deposits during the year was 8.22% (2012: 9.71%).
Interest rate risk management
The primary goal of the Group’s investment strategy is to ensure risk free returns are earned on surplus funds. Market price
risk arises from cash and bank balances held by the Group. The Group monitors its investment portfolio based on market
expectations and creditworthiness. Material investments within the portfolio are managed on an individual basis.
The Group’s exposure to interest rates on financial instruments is detailed below:
As at 31 December 2012
USD
As at 31 March 2012
USDFinancial assetsCash and bank balances (note 21) 9,469,106 3,151,975Total interest rate dependent financial assets 9,469,106 3,151,975
Financial liabilitiesBorrowings (note 22) 268,438,992 152,674,007Total interest rate dependent financial liabilities 268,438,992 152,674,007
The amounts included above for interest rate dependent financial assets are subject to change if changes in variable interest
rates differ from those estimates of interest rates determined at the reporting date.
If interest rates had been 100 basis points higher/lower and all other variables were held constant, the Group’s total
comprehensive income for the year would increase/decrease by USD 16,881 (2012: USD 7,649).
If interest rate on INR denominated borrowings had been 100 basis points higher/lower with all other variables held constant,
post tax income for the period ended 31 December 2012 would have been higher/lower by USD 1,201,318 (2012: USD
43,870).
(iii) Price risk
The Group is exposed to mutual funds price (net asset value – ‘NAV’) risk because of investments in debt-based mutual fund
units held by the Group and classified on the statement of financial position as available-for-sale financial assets. The Group
is not exposed to any commodity price risk. In order to manage its price risk arising from investment in mutual fund units, the
Group diversifies its portfolio; in accordance with the limits set by the Group risk management policies.
As the Group invests in mutual fund units which in turn invest in short-term (in the range 30-90 days) debt instruments with
low yield and hence carry a very minimal mark-to-market risk. Moreover, the accruals earned by the said units are distributed
on a daily basis; which mainly represents the interest accruals rather than the fair value movements. Hence, any reasonable
movement in interest yields are not expected to have any impact on the NAV of the said units.
8080
Mytrah_AR_41_96_V1.indd 80 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
(iv) Liquidity risk
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has established an appropriate
liquidity risk management framework for the management of the Group’s short, medium and long-term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve
borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of
financial assets and liabilities. Details of additional undrawn facilities that the Group has at its disposal to reduce further
liquidity risk are set out below.
The following table details the Group’s remaining contractual maturity for its financial liabilities with agreed repayment
periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest
date on which the Group can be required to pay as at 31 December 2012 and 31 March 2012:
As at 31 December 2012:
2013USD
2014USD
2015USD
2016USD
ThereafterUSD
TotalUSD
Financial liabilities - amortised cost Borrowings 16,402,362 12,440,124 58,814,898 14,635,603 166,146,005 268,438,992Trade and other payables 27,108,668 - - - - 27,108,668Liability component of CCPS
- - - - 11,298,416 11,298,416
Financial liabilities - fair value through profit or lossDerivative instruments not designated as hedge
- - - 2,947,030 - 2,947,030
Total financial liabilities 43,511,030 12,440,124 58,814,898 17,582,633 177,444,421 309,793,106
As at 31 March 2012:
2013USD
2014USD
2015USD
2016USD
ThereafterUSD
TotalUSD
Financial liabilities - amortised cost Borrowings 2,281,959 7,316,771 7,397,829 36,959,702 98,717,745 152,674,007Trade and other payables 159,224,484 - - - - 159,224,484Liability component of CCPS
- - - - 11,435,270 11,435,270
Financial liabilities - fair value through profit or lossDerivative instruments not designated as hedge
- - - - 2,779,637 2,779,637
Total financial liabilities 161,506,443 7,316,771 7,397,829 36,959,702 112,932,652 326,113,398
8181Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 81 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
The Group has access to financing facilities as described below, of which USD 63,048,327 (2012: USD 130,003,587) were
unused at the balance sheet date. The Group expects to meet its other obligations from operating cash flows and proceeds of
maturing financial assets.
As at 31 December 2012
USD
As at 31 March 2012
USDUnsecured bank facility – maturing 15 September 2024Amount used 209,401,342 126,688,042Amount unused 63,048,327 130,003,587Total unsecured bank facility 272,449,669 256,691,629
(v) Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The group’s credit risk arises from accounts receivable balances on the sale of electricity. The Indian entities
have entered into purchase power agreements with transmission companies incorporated by the Indian State Government and
other electricity transmission and trading companies to export the electricity generated. The Group is therefore committed
to sell power to these customers and regards any potential risk of default as being predominantly a governmental one. The
group is paid monthly by the transmission companies for the electricity it supplies. The Group assesses the credit quality of
the purchaser based on its financial position and other information.
Financial assets that potentially expose the Company to credit risk consist principally of cash and bank balances, which are
held with institutions with a minimum credit rating of AA. The fair value of financial assets represents the maximum credit
exposure.
The Group is reliant on a small number of suppliers and customers.
The industry currently benefits supports from the Indian Government. Changes in the Government policy could impact tariff/
taxes which could have an impact on the revenue and the profit of the Group.
Fair value estimation
IFRS 7, Financial Instruments: Disclosures, requires entities to classify fair value measurements for financial instruments
measured at fair value in the statement of financial position, using a three level fair value hierarchy that reflects the significance
of inputs used in the measurements. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for
identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements). The
three levels of the fair value hierarchy under IFRS 7 are described below:
Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2: Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar
assets or liabilities in active markets; inputs other than quoted prices that are observable for the asset or the liability; or inputs
that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3: Unobservable inputs reflecting the Company’s own assumptions incorporated in valuation techniques used to
determine the fair value. These assumptions are required to be consistent with market participant assumptions that are
reasonably available.
8282
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as at
31 December 2012:
Level 1USD
Level 2USD
Level 3USD
TotalUSD
Financial instrumentsAvailable for sale investments 3,191,023 - - 3,191,023Derivative financial instruments not designated as hedge - 2,947,030 - 2,947,030
The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as at
31 March 2012:
Level 1USD
Level 2USD
Level 3USD
TotalUSD
Financial instrumentsAvailable for sale investments 4,787,630 - - 4,787,630Held-to-maturity financial asset 964,281 - - 964,281Derivative financial instruments not designated as hedge - 2,779,637 - 2,779,637
32. Related party transactions
Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been
eliminated and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed
below.
The Directors of the Company during the period who are also considered to be the key management personnel are:
1. Mr Ravi Kailas - CEO, Managing Director and Chairman (from 18th August 2011)2. Mr Vikram Kailas - Chief Financial Officer and Director(until 8th November 2012)3. Mr Rohit Phansalkar - Non-Executive Director4. Mr Alastair Cade - Executive Director(until 8th November 2012) 5. Mr Philip Swatman - Non-Executive Director(until 8th November 2012)6. Mr Peter Neville - Non-Executive Director (until 8th November 2012)7. Mr Russell Walls - Non-Executive Director
The entities where certain key management personnel have significant influence are:
1. Bindu Urja Holding Inc. - Mr Ravi Kailas 2. Bindu Urja Investments Inc. - Mr Ravi Kailas 3. Bindu Urja Inc. - Mr Ravi Kailas 4. RKP Capital Inc. - Mr Rohit Phansalkar 5. Chakas Investments UK Limited - Mr Alastair Cade6. Sila Energy Inc. - Mr Ravi Kailas 7. Bindu Urja Infrastructure Limited - Mr Ravi Kailas 8. Mytrah Wind Developers Private Limited - Mr Ravi Kailas
The following amounts were transactions for the period/year ended 31 December 2012:
Period ended
31 December 2012
USD
Year ended
31 March 2012
USDAdvisory services fees to RKP Capital Inc. - 69,838Reimbursement of expenses to Chakas Investments UK Limited - 42,546Advances given to Bindu Urja Infrastructure Limited 1,252,537 -Advance given to Mytrah Wind Developers Private Limited 486,520 -
8383Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 83 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
The following balances were outstanding at the end of the reporting period:
Period ended
31 December 2012
USD
Year ended
31 March 2012
USDPayable to Chakas Investments UK Limited 8,000 8,000Advance recoverable from Bindu Urja Infrastructure Limited 1,252,537 -Advance recoverable from Mytrah Wind Developers Private Limited 486,520 -
Remuneration of key management personnel:
The remuneration of Directors, who are the key management personnel of the Group, is set out below for each of the categories
specified in IAS 24 Related Party Disclosures. Further information about the remuneration of the individual Directors is provided
in the Directors’ Report on page 38.
Period ended
31 December 2012
USD
Year ended
31 March 2012
USDSalaries and fees 1,049,071 1,022,043Share-based payments 906,588 688,047Total remuneration of key management personnel 1,955,659 1,710,090
As per the CCPS investment agreement (note 25), for a period of one year from the completion date or commissioning of a
cumulative 400 MW capacity, whichever is later, Mr Ravi Kailas without prior consent of IIF shall not sell or dispose, directly or
indirectly his shareholding in Mytrah Energy Limited.
The Directors do not consider that there were any other related party transactions that have not been disclosed in these
financial statements.
33. Share-based payments
The Company has an equity-settled share option scheme for certain Directors of the Company and employees in the Group. All
options have a vesting period of three years. Each share option converts into one ordinary share of the Company on exercise.
No amounts are paid or payable by the recipient on receipt of the option. The options carry neither rights to dividends nor
voting rights. Options may be exercised at any time from the date of vesting to the date of the expiry. Options lapse if the
employee leaves the Company before the options vest. Details of the share options outstanding during the period are as
follows.
Period/year ended 31 December 2012 31 March 2012Number of
share optionsWeighted
average exercise price
(GBP)
Number of share options
Weighted average
exercise price(GBP)
Outstanding at beginning of period/year 14,708,689 1.14 4,877,400 1.15Granted during the period/year 250,910 0.94 9,831,289 1.14Outstanding at the end of the period/year 14,959,599 1.13 14,708,689 1.14
There were no share options forfeited, exercised, or expired during the period ended 31 December 2012 and year ended 31
March 2012. There were no share options exercisable as at 31 December 2012 and 31 March 2012. The options outstanding
as at 31 December 2012 had a weighted average exercise price of GBP 1.14, and a weighted average remaining contractual
life of 9 years.
8484
Mytrah_AR_41_96_V1.indd 84 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
Details of the share options granted during the period are as follows:
Director/Employees Shares granted during
the period
Expiry date Exercise price (GBP) Fair value at
grant date (GBP)Employees within the Group 250,910 28.02.2015 0.94 0.71
The aggregate fair value of the share options granted during the previous year was USD 2,787,207.
Weighted average share price (GBP) 1.01Weighted average exercise price (GBP) 1.14Expected volatility 36.20%Expected life 3 yearsRisk-free interest rate 0.72%
Expected volatility was determined by calculating the historical volatility of the Group’s share price from the date of listing on
12 October 2010 to the date of issue of options. The expected life use in the model has been adjusted, based on Management’s
best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations.
The Group recognised total expenses of USD 984,396 (31 March 2012: USD 688,047) related to equity-settled share-based
payment transactions in the current period.
34. Change in the financial year
The Company has changed its annual balance sheet date from 31 March to 31 December on account of the change in its
financial year and accordingly presented the current period financials for nine months period ended 31 December 2012.
Accordingly, the comparative amounts for the income statement, statement of changes in equity, cash flow statement and
related notes are not entirely comparable.
35. Change in the useful life and residual value
As a result of the review of useful lives of fixed assets, the estimated useful lives of fixed assets have been revised prospectively,
as detailed below, with effect from 1 April 2012.
Category of fixed asset Useful life as estimated till
31 March 2012
Revised estimated useful life from
1 April 2012Plant and machinery 5-20 years 5-50 years
Further, the Company has adopted component accounting of depreciation for the plant and machinery class of the fixed asset
and accordingly revised the useful lives of the different components of the plant and machinery as mentioned below:
Particulars Revised useful lifeNacelles 25Blades 30Towers 50Transformers 25Erection and commissioning 25Civil Works, electrical lines and evacuation facilities 50
Further, the Company has estimated the residual value of the Plant and Machinery at 20% of its cost.
Consequently, the annual depreciation charge thereon has been prospectively revised downwards for current and future
years. As a result, the depreciation charge for the current period is lower by USD 4,276,602 and the net profit, net fixed assets,
and reserves and surplus are higher by a similar amount.
8585Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 85 03/07/13 11:33 AM
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSfor the period ended 31 December 2012 (continued)
36. Transfer of employees
In the month of September 2012, the Company proposed for the redeployment of certain employees, working under related
projects from Mytrah Energy (India) Limited to Bindu Urja Infrastructure Limited (“Bindu”), which became effective on 1
November 2012. Bindu will be obligated to pay employee benefits and related liability considering the continuation of service
of the respective employees. However, in accordance with IAS 19 Employee benefits, the Group has not recognised for any
provision on account the transfer of employees, as there were no curtailment and settlement losses/gains.
37. Contingent liabilities
The Group has provided bank guarantees. Where there are such arrangements they are considered to be insurance arrangements
and accounts for them as such. Guarantees are treated as contingent liabilities until such a time as it becomes probable that
the company will be required to make a payment under the guarantee.
38. Ultimate controlling party
The Directors do not consider there to be an ultimate controlling party as there is a relationship agreement between the
Company and the controlling shareholders (namely Bindu Urja Investments Inc., Bindu Urja Holdings Inc., Bindu Urja Capital
Inc., Mr Ravi Kailas, Sila Energy Limited and Esrano Overseas Limited and Mr Angad Paul) whereby those shareholders
undertake to the Company not to exercise their voting rights to take control of the Board of the Company and to conduct all
transactions and relationships between them (and any of their associates or certain parties) and the Company on terms which
allow the Company to carry on its business independently, at arm’s length and on a normal commercial basis.
8686
Mytrah_AR_41_96_V1.indd 86 03/07/13 11:33 AM
Notice of Annual General MeetingMytrah Energy Limited
(Incorporated and registered in Guernsey with company number 52284)
If you have sold or otherwise transferred all of your Ordinary
Shares in Mytrah Energy Limited, please immediately forward
this document and the accompanying Form of Proxy to the
purchaser or transferee or to the stockbroker, bank or other
agent through whom the sale or transfer was effected for
onward transmission to the purchaser or transferee. However,
such documents should not be forwarded or transmitted in
or into any jurisdiction in which such act would constitute a
violation of the relevant laws in such jurisdictions. Therefore,
persons into whose possession this document comes should
inform themselves about and observe any such laws and
restrictions in any such jurisdictions. Any failure to comply
with these restrictions may constitute the violation of
the security laws of such jurisdictions. If you have sold or
transferred only part of your holding of Ordinary Shares in
Mytrah Energy Limited you should retain these documents.
Notice is hereby given that the 2013 Annual General Meeting
(“AGM”) of the shareholders of Mytrah Energy Limited (the
“Company”) will be held at Anson Place, Mill Court, La
Charroterie, St Peter Port, Guernsey, GY1 1EJ, Channel Islands
on 31 July 2013 at 12.00 noon to consider and, if thought fit,
pass the following resolutions.
Resolutions 1 to 9 will be proposed as ordinary resolutions
and resolution 10 will be proposed as a special resolution.
Ordinary resolutions1. To receive the Annual Report and Accounts of the
Company for the financial period ended 31 December 2012, together with the Reports of the Directors and Auditors thereon.
2. To approve the Directors’ Remuneration Report set out in the Annual Report and Accounts for the financial period ended 31 December 2012.
3. To appoint KPMG LLC as Auditors of the Company, to hold office until the conclusion of the next AGM to be held in 2014.
4. To authorise the Directors to determine the remuneration of the Auditors of the Company.
5. To re-elect as a Director Mr Ravi Kailas, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
6. To re-elect as a Director Mr Rohit Phansalkar, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
7. To re-elect Mr John Russell Fotheringham Walls, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
8. That the Directors of the Company be and are hereby authorised to exercise all powers of the Company to issue or grant equity securities (as defined in the Articles of Incorporation of the Company) in the capital of the Company in accordance with Article 4.3 of the Articles of Incorporation of the Company:
(A) up to a maximum number of 54,545,333 Ordinary Shares (equal to approximately one third of the number of Ordinary Shares in issue as at the date of publication of this notice) and after giving effect to the exercise of any warrants, options or other convertible shares outstanding at the date of the passing of this Resolution (such number to be reduced by any issue or grants made under paragraph (B) below in excess of any equivalent number); and
(B) up to a maximum number of 109,090,666 Ordinary Shares (equal to approximately two- thirds of the number of Ordinary Shares in issue as at the date of publication of this notice) and after giving effect to the exercise of any warrants, options or other convertible shares outstanding as at the date of the passing of this Resolution (such number to be reduced by any issues or grants made under paragraph (A) above) solely in connection with an offer by way of a rights issue:
(i) to Ordinary Shareholders in proportion (as nearly
as may be practicable) to their existing holdings;
and
(ii) to holders of other shares or securities, as required
by the rights of those securities or as the Directors
of the Company otherwise consider necessary,
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of
this document or as to the action you should take, you are recommended immediately to seek your own financial advice from
your stockbroker, bank manager, solicitor, accountant or other independent financial adviser duly authorised pursuant to the
Financial Services and Markets Act 2000.
8787Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 87 03/07/13 11:33 AM
and so that the Directors of the Company may impose any limits or restrictions and make any arrangements which it considers necessary or appropriate to deal with treasury shares, fractional entitlements, legal, regulatory or practical problems in, or under the laws of, any territory or any other matter,
such authorities to expire at the end of the AGM of the
Company to be held in 2014 or, if earlier, at the close of
business on the date falling 15 months from the date of
passing of this Resolution (unless previously renewed,
revoked or varied by the Company by ordinary resolution),
but, in each case, during this period the Company may make
offers, and enter into agreements, which would, or might,
require equity securities to be issued or granted after the
authority given to the Directors of the Company pursuant
to this Resolution ends and the Directors of the Company
may issue or grant equity securities under any such offer or
agreement as if the authority given to the Directors of the
Company pursuant to this Resolution had not ended. This
Resolution revokes and replaces all unexercised authorities
previously granted to the Directors of the Company to issue
or grant securities but without prejudice to any issue of
shares or grant of rights already made, offered or agreed to
be made pursuant to such authorities.
9. THAT the Company be and is hereby generally authorised in accordance with section 315 of The Companies (Guernsey) Law, 2008 (as amended) (the “Companies Law”), conditional on ordinary shares of the Company (“Ordinary Shares”) remaining listed on AIM, a market operated by the London Stock Exchange, to make one or more market acquisitions (within the meaning of section 316 of the Companies Law) of Ordinary Shares (which following their acquisition may be cancelled or, to the extent permitted by the Companies Law, be held in treasury), provided that:
(A) the maximum aggregate number of Ordinary Shares that may be purchased under this authority is 32,727,200 (equal to approximately 20 per cent. of the number of Ordinary Shares in issue as at the date of publication of this notice);
(B) the minimum price (exclusive of expenses) which may be paid for an Ordinary Share is £0.01 per Ordinary Share;
(C) the maximum price (exclusive of expenses) which may be paid for an Ordinary Share is 150% of the highest independent bid made (i) on the day on which that Ordinary Share is acquired and (ii) on the trading platform where the purchase is carried out; and
(D) the authority hereby conferred shall (unless it is previously renewed, revoked or varied by the Company by ordinary resolution) expire at the
conclusion of the AGM of the Company held in 2014 or, if earlier, at the close of business on 30 December 2014, save that the Company may make a contract to acquire Ordinary Shares under this authority before its expiry which will or may be executed wholly or partly after its expiration and the Company may make an acquisition of Ordinary Shares pursuant to such a contract, and the general authority previously granted pursuant to section 315 of the Companies Law at the annual general meeting of the Company held on 8th November 2012 be and is hereby revoked.
Special Resolution10. THAT, if Resolution 8 (being the proposed ordinary
resolution of the Company numbered 8 in this notice of AGM) is passed, the Directors of the Company be and are hereby authorised to exercise all powers of the Company to issue or grant equity securities (as defined in the Articles of Incorporation of the Company) in the capital of the Company wholly for cash pursuant to the issue or grant referred to in Resolution 8 (being the proposed ordinary resolution of the Company numbered 8 in this notice of AGM) as if the pre-emption rights contained in article 4.13 of the Articles of Incorporation of the Company did not apply to such issue or grant, this power being limited to:
(A) the issue or grant of equity securities in connection with an offer of such securities by way of rights (including without limitation, under a rights issue, open offer or similar arrangement) to holders of equity securities in proportion (as nearly as may be practicable) to their respective holdings of such securities, but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient to deal with fractional entitlements, record dates or any other legal or practical problems under the laws of any territory, or the requirements of any regulatory authority or stock exchange; and
(B) the issue or grant of equity securities up to a maximum number of 54,545,333 Ordinary Shares (equal to approximately one-third of the number of Ordinary Shares in issue as at the date of publication of this notice) and after giving effect to the exercise of any warrants, options or other convertible securities outstanding as at the date of this Resolution,
such authorities to expire at the end of the AGM of the Company to be held in 2014 or, if earlier, at the close of business on the date falling 15 months from the date of the passing of this Resolution (unless previously renewed, revoked or varied by the Company by special resolution) save that the Company may before such expiry make an offer or agreement which would or might require equity securities to be issued or granted
8888
Mytrah_AR_41_96_V1.indd 88 03/07/13 11:33 AM
after such expiry and the Directors may issue or grant equity securities in pursuance of such an offer or agreement as if the authority conferred by the above resolution had not expired. This resolution revokes and replaces all unexercised authorities previously granted to the Directors of the Company to issue or grant equity securities in the capital of the Company wholly for cash as if the pre-emption rights contained in article 4.13 of the Article of Incorporation of the Company did not apply to such issue or grant but without prejudice to any issue of shares or grant of rights already made, offered or agreed to be made pursuant to such authorities.
By order of the Board
Dean Clarke
Company Secretary
Registered Office:
Anson Place
Mill Court
La Charroterie
St Peter Port
Guernsey GY1 1EJ
Registered in Guernsey with registered number 52284
Dated: 30 June 2013
Notes:
1. A member entitled to attend and vote at the AGM is entitled to appoint one or more proxies to speak and vote instead of them. A proxy need not be a member of the Company. Completion and return of the Form of Proxy will not preclude members from attending or voting at the AGM if they so wish.
2. More than one proxy may be appointed provided each proxy is appointed to exercise the rights attached to different shares.
3. In accordance with the provisions of the UK Corporate Governance Code it should be noted that a vote withheld is not a vote in law and will not be counted in the calculation of the proportion of the votes for and against each resolution.
4. A Form of Proxy is enclosed for use at the AGM. The Form of Proxy should be completed in accordance with the instructions set out therein and sent, together with the power of attorney or other authority, if any, under which it is signed, or a notarially certified copy of such power or authority, so as to reach the Company’s agent, for this purpose being, Computershare Investor Services (Guernsey) Limited, C/o the Pavilions, Bridgwater Road, Bristol, BS99 6ZY not less than 48 hours before the time for holding the AGM.
5. All persons recorded on the register of shareholders as holding shares in the Company as at 12.00 noon on 29 July 2013 or, if the AGM is adjourned, as at 48 hours before the time of any adjourned AGM, shall be entitled to attend and vote (either in person or by proxy) at the AGM and shall be entitled to one vote per share held.
6. If the AGM falls to be adjourned because it is not quorate, it will be adjourned to the same time and place five business days later or to such other day and/or time and/or place as the Directors of the Company may
determine, whereupon those shareholders then present in person, by their representative or by proxy, shall form the quorum. In the event of any such adjournment the Company will announce the adjournment via a regulatory information service but no notification will be sent directly to shareholders.
7. Where there are joint registered holders of any shares such persons shall not have the right of voting individually in respect of such shares but shall elect one of their number to represent them and to vote whether in person or by proxy in their name. In default of such election the person whose name stands first on the register of shareholders shall alone be entitled to vote.
8. On a poll votes may be given either personally or by proxy and a shareholder entitled to more than one vote need not use all their votes or cast all the votes they use in the same way.
9. Any corporation which is a shareholder may by resolution of its Board of Directors or other governing body authorise such person as it thinks fit to act as its representative at the AGM. Any person so authorised shall be entitled to exercise on behalf of the corporation which he represents the same powers (other than to appoint a proxy) as that corporation could exercise if it were an individual shareholder.
10. As at 21 June 2013 (the latest practicable date prior to the printing of this notice) the Company’s issued share capital consisted of 163,636,000 Ordinary Shares of no par value, all carrying one vote each per share. No Ordinary Shares are held in treasury.
11. Copies of the following documents are available for inspection at the registered office of the Company during usual business hours on any weekday (weekends and public holidays excluded) and will be available for inspection at the place of the AGM for 15 minutes before and during the AGM itself:
8989Mytrah Energy Limited31 December 2012Financial Statements
Mytrah_AR_41_96_V1.indd 89 03/07/13 11:33 AM
(a) a copy of the Company’s Annual Report and Accounts for the financial period ended 31 December 2012; and
(b) copies of the service contract for Ravi Kailas and the Non-Executive Directors’ appointment letters.
Explanatory notes to the Notice of Annual General MeetingAt the AGM there are 10 Resolutions which shareholders
will be asked to consider and, if thought fit, approve. An
explanation of each of these Resolutions is given below.
Resolutions 1 to 9 (inclusive) are proposed as ordinary
resolutions. An ordinary resolution requires more than 50%
of votes cast at the AGM relating to that resolution to be in
favour of it for the resolution to be passed. Resolution 10
is proposed as a special resolution, which requires at least
75% of votes cast at the AGM relating to that resolution to
be in favour of it for the resolution to be passed.
Ordinary ResolutionsResolution 1: Annual report and accounts
For each financial year the Directors are required to present
the Directors’ Report, the audited accounts and the auditors’
reports to shareholders at a general meeting. Shareholders
are asked to receive the annual report and accounts of the
Company for the financial period ended 31 December 2012.
The Companies (Guernsey) Law, 2008 (as amended) required
that the report and accounts are laid before the AGM.
Resolution 2: Report on Directors’ remuneration
The Annual Report and Accounts for the financial period
ended 31 December 2012 contains a Report on Directors’
Remuneration, which sets out the remuneration policy for the
Company and reports on the remuneration arrangements in
place for its Directors. The shareholder vote will be advisory
only, but the Directors of the Company will take the outcome
of the vote into consideration when reviewing and setting
the Company’s remuneration policy.
Resolutions 3 and 4: Appointment and remuneration of the
Auditors
Auditors appointed to by the Board to fill a casual vacancy shall
hold office until the first AGM following their appointment.
KPMG LLC have indicated that they are willing to continue to
be the Company’s Auditors for the next year. You are asked to
approve their reappointment and to authorise the Directors
of the Company to determine their remuneration.
Resolutions 5 to 7 (inclusive): Election of Directors
in accordance with the recommendations of the UK Corporate
Governance Code, Ravi Kailas, Russell Walls and Rohit
Phansalkar, have resolved to voluntarily submit themselves
for re-election by the shareholders at the AGM.
Having considered the performance and contribution made
by each of the Directors, the Board believes that each of
them continue to perform effectively and with commit to
their roles and, as such, recommends their re-election. Brief
biographical details of the Directors seeking re-election can
be found in the Annual Report and Accounts.
Resolution 8: Authority to issue shares
Paragraph (A) of this Resolution would give the Directors the
authority to issue shares or grant rights to subscribe for, or
convert any securities into, shares up to a maximum number
of 54,545,333 Ordinary Shares in the Company. This amount
represents approximately one-third of the issued Ordinary
Share capital of the Company as at the date of publication
of this notice.
In line with guidance issued by the Association of British
Insurers (‘ABI’), paragraph (B) of this Resolution would
give the Directors authority to issue shares or grant rights
to subscribe for, or convert any securities into, shares in
connection with a rights issue in favour of shareholders up
to a maximum number of 109,090,666 Ordinary Shares in
the Company. This amount (before any reduction) represents
approximately two-thirds of the issued Ordinary Share capital
of the Company as at the date of publication of this notice.
In order to ensure that the maximum amount of shares
issuable under Resolution 8 is in total never more than an
amount equal to approximately two-thirds of the issued
Ordinary Share capital, deductions will be made from (A) or
(B) to ensure that this remains the case, whether or not the
Company issues shares under (A) or (B) first.
Without prejudice to the Company’s business strategy
(which may involve future issues of shares), the Directors
have no specific present intention to exercise either of the
authorities sought under this Resolution. However, if they do
exercise the authorities, the Directors intend to follow ABI
recommendations concerning their use (including as regards
the Directors standing for re-election in certain cases).
The authorities sought under paragraphs (A) and (B) of this
Resolution will expire at the conclusion of the AGM of the
Company to be held in 2014, or, if earlier, 15 months after
the date of the AGM.
Resolution 9: Authority to purchase own shares
The Company has previously granted authority to make
market acquisitions of its Ordinary Shares to address, among
other things, any imbalance in the supply of, and demand for,
Ordinary Shares. The current authority expires at the end of
the AGM.
This Resolution proposes to renew the authority of the
Company to make market acquisitions of up to a maximum
9090
Mytrah_AR_41_96_V1.indd 90 03/07/13 11:33 AM
number of 32,727,200 Ordinary Shares in the Company.
This amount represents approximately 20% of the issued
Ordinary Shares capital of the Company as at the date of
publication of this notice.
The Directors will exercise this power only when, in the light
of market conditions prevailing at the time, they believe that
the effect of such purchases will be in the best interests of
the Company and of its shareholders generally and when
the Directors believe, after careful consideration, that such
a purchase would be expected to result in an increase in
adjusted earnings per share. The Directors consider it to
be desirable for this general authority to be available to
provide flexibility in the management of the Company’s
capital resources and to satisfy the exercise of employee
share options under the Mytrah Employee and Mytrah
Executive Share Option Schemes. The Company may hold
in treasury any of its own shares that it purchases pursuant
to the authority conferred by this Resolution, subject to a
maximum limit of 10% of issued share capital as set out
in the Companies (Guernsey) Law, 2008 (as amended) (the
“Law”).
In accordance with the Law, the Company may only make
market purchases of its Ordinary Shares provided it satisfies
the ‘solvency test’ (as detailed in the Law) if (i) it is able to
pay its debts as they become due; and (ii) the value of its
assets is greater than the value of its liabilities. In connection
with any purchase of the Company’s Ordinary Shares, the
Directors will therefore need to confirm that the solvency
test will be satisfied immediately following such purchase
being made.
The minimum price which may be paid for an Ordinary Share
is £0.01. Given the volatility of the share price and limited
liquidity, the maximum price which may be paid for an Ordinary
Share has been set at 150% of the highest independent bid
made (i) on the day on which that Ordinary Share is acquired
and (ii) on the trading platform where the purchase is carried
out.However, the Board will seek at all times to comply, where
practicable, with best practice guidance which recommends
that the maximum price, exclusive of expenses, which may
be paid for an Ordinary Share is the higher of: (i) an amount
equal to 5% above the average market value for an Ordinary
Share for the five business days immediately preceding the
date of the purchase; and (ii) the higher of the price of the
last independent trade and the highest current independent
bid on the trading venues where the purchase is carried out.
Any Ordinary Shares purchased under the renewed authority
will either be cancelled or held in treasury (subject to the
maximum number of shares that may be held in treasury of
10% of the issued Ordinary shares of the Company, as set
out in section 317 of the Companies Law), which may be
re-issued to satisfy the exercise of employee share options
under the Mytrah Employee and Mytrah Executive Share
Option Schemes.
As at the date of publication of this notice, no Ordinary
Shares are held by the Company in treasury and options and
other rights to subscribe for shares were outstanding over a
total of 14,959,599 Ordinary Shares.
The authority sought under this Resolution will expire at the
end of the AGM to be held in 2014, or, if earlier, 30 December
2014.
Special ResolutionResolution 10: Disapplication of pre-emption rights
Article 4.13 of the Articles of Incorporation requires that
where Ordinary Shares are issued, or rights to subscribe for,
or convert any securities into, Ordinary Shares are granted,
wholly for cash, or where Ordinary Shares are sold out of
treasury wholly for cash, either shareholder approval must
be sought to make a non-pre-emptive offer or a pre-emptive
offer must be made to all existing shareholders (but allowing
the Directors to make such provision as they think fit in
relation to fractional entitlements and/or certain overseas
shareholders and/or any other matters). The Board believes
that the ability to issue new Ordinary Shares on a non-pre-
emptive basis is in the best interests of the Company as this
affords considerable flexibility and a significant reduction in
time and costs in effecting fundraisings.
If approved, the disapplication authority will allow the Board
to issue up to a maximum number of 54,545,333 Ordinary
Shares (equal to approximately one-third of the total number
of Ordinary Shares in issue as at the date of publication of
this notice).
The authority sought under this Resolution will expire at the
end of the AGM of the Company to be held in 2014 or, if
earlier, 15 months after the date of the AGM.
9191Mytrah Energy Limited31 December 2012Financial Statements
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NOTES
9292
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NOTES
9393Mytrah Energy Limited31 December 2012Financial Statements
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NOTES
9494
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MYTRAH ENERGY LIMITED(Incorporated and registered in Guernsey with company number 52284)
FORM OF PROXYPlease read the notice of Annual General Meeting and the explanatory notes below before completing this form.
For use by holders of Ordinary Shares at the Annual General Meeting of Mytrah Energy Limited (the “Company”) convened for 31st July 2013 at 12 noon at Anson Place, Mill Court, La Charroterie, St Peter Port, Guernsey GY1 1EJ and at any adjournment thereof:
I/We .............................................................................................................................................................................................................................................................................................................. (Block Capitals)
Of ................................................................................................................................................................................................................................................................................................................... (Block Capitals)
being (a) shareholder(s) of the Company hereby appoint the Chairman of the meeting
or ......................................................................................................................................................................................................................................................................................................................................................
as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company (the “AGM”) to be held on 31st July 2013 at 12 noon and at any adjournment thereof.
I/WE direct the proxy to vote on the Resolutions as follows:
Ordinary Resolutions FOR AGAINST WITHHELD
1. TO receive the Annual Report and Accounts of the Company for the financial period ended 31 December 2012, together with the Report of the Directors and Auditors thereon.
2. TO approve the Directors’ Remuneration Report set out in the Annual Report and Accounts for the financial period ended 31 December 2012.
3. TO reappoint KPMG LLC as Auditors of the Company, to hold office until the conclusion of the next Annual General Meeting of the Company to be held in 2014.
4. TO authorise the Directors to determine the remuneration of the Auditors of the Company.
5. TO re-elect as a Director Mr Ravi Shankar Kailas, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
6. TO re-elect as a Director Mr Rohit Phansalkar, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
7. TO re-elect as a Director Mr John Russell Fotheringham Walls, who voluntarily retires in accordance with the recommendations of the UK Corporate Governance Code.
8. TO authorise the Directors to issue Ordinary Shares.
9. TO authorise the Company to make market purchases of its own shares which may be cancelled or held as treasury shares.
Special Resolution FOR AGAINST WITHHELD
10. TO disapply pre-emption rights under Article 4.13 of the Articles of Incorporation.
Please indicate with an X in the appropriate space how you wish your vote to be cast. On receipt of the form duly executed and in the absence of a specific direction, your proxy will vote or abstain as he or she thinks fit on the resolutions.
Signed: .………………………….......……… Date ………………..……….2013
Notes:
1. If it is desired to appoint as proxy any person other than the Chairman of the AGM, his/her name and address should be inserted in the relevant place and reference to the Chairman of the meeting deleted and the alteration initialled.
2. If the shareholder is a corporation, this form must be executed under its common seal or under the hand of its duly authorised officer or attorney.
3. In the case of joint registered holders of any shares, such persons shall not have the right of voting individually in respect of such shares but shall elect one of their number to represent them and to vote whether in person or by proxy in their name. In default of such election the person whose name stands first on the register of shareholders shall alone be entitled to vote.
4. Any alterations to this Form of Proxy should be initialled by the person who signs it.
5. The Form of Proxy should be completed in accordance with the instructions set out therein and sent, together with the power of attorney or other authority, if any, under which it is signed, or a notarially certified copy of such power or authority, so as to reach the Company’s agent, for this purpose being, Computershare Investor Services (Guernsey) Limited, C/o the Pavilions, Bridgwater Road, Bristol, BS99 6ZY not less than 48 hours before the time for holding the Meeting.
6. Completing and returning a Form of Proxy will not prevent a member from attending in person at the meeting and voting should he or she so wish.
7. In the event that a Form of Proxy is returned without an indication as to how the proxy shall vote on the resolutions, the proxy will exercise his discretion as to whether and, if so, how he votes.
8. A shareholder entitled to exercise more than one vote need not cast all his or her votes in the same way.
9. In accordance with the provisions of the UK Code of Corporate Governance it should be noted that a vote withheld is not a vote in law and will not be counted in the calculation of the proportion of the votes for and against each resolution.
9595Mytrah Energy Limited31 December 2012Financial Statements
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9696
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ContentsCompany Information .............................................................................................................................................01
Directors’ Biographies .............................................................................................................................................14
Chairman and CEO’s Statement .........................................................................................................................22
Directors’ Report ........................................................................................................................................................38
Corporate Governance Report ............................................................................................................................40
Independent Auditor’s Report to the members of Mytrah Energy Limited .................................49
Consolidated Income Statement .......................................................................................................................50
Consolidated Statement of Comprehensive Income ..............................................................................51
Consolidated Statement of Financial Position ...........................................................................................52
Consolidated Statement of Changes in Equity ..........................................................................................53
Consolidated Statement of Cash Flow ...........................................................................................................54
Notes to the Consolidated Financial Statements .....................................................................................55 A product
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