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					ACL Cables PLC   Annual Report 2010/11
Our Vision
To be the preferred brand of electric cables in the region, whilst strengthening the
dominant position in Sri Lanka.




Our Mission
   To expand our range of products and services in the fields of electrification.


   To be the most competitive in chosen global markets and to achieve continuous
   growth.


   To create an environment that will inculcate a feeling of ownership in our people
   and their families.


   To create a company that will be in the forefront of technology and win the
   admiration of our customers, suppliers, shareholders and the community.
                                                                       ACL Cables PLC          Annual Report 2010/11




                                                                     Contents

                                                               3     Group Financial Highlights
                                                               5

Our Values
                                                                     Chairman’s Review
                                                               9     Managing Director’s Review
                                                               12    Board of Directors
We strive to do our best for our stakeholders in the           16    Senior Management Team
following ways;                                                18    Group Structure
                                                               20    Risk Management
Our Customers
                                                               23    Corporate Governance
    We reach out to our customers and give them a fair
                                                               30    Corporate Social Responsibility
    deal.
                                                               35    Awards
    We build enduring customer relationships without
    trying to maximize short term profits.
    We always make it easier for customers to do               Financial Information
    business with us.                                          38    Report of the Directors
    We communicate regularly with our customers.               41    Directors’ Responsibility for Financial Reporting
    We never forget to say thank you.                          42    Audit Committee Report
                                                               44    Remuneration Committee Report
Our People
                                                               45    Independent Auditor’s Report
    We respect each other as individuals and motivate
                                                               46    Income Statement
    our people to work as a team.
                                                               47    Balance Sheet
    We provide opportunities for personal and
                                                               48    Statement of Changes in Equity
    professional development.
    We recognize and reward individual initiative and          49    Cash Flow Statement
    performance of our people.                                 50    Notes to the Financial Statements
    We inculcate family culture and togetherness.              82    Information to Shareholders
                                                               84    Five Year Summary - Group
Our Suppliers                                                  85    Glossary of Financial Terms
    We treat our suppliers as valuable business partners       87    Milestones
    and maintain a mutually beneficial relationship.
                                                               89    Notice of Meeting
                                                               90    Notes
Our Shareholders
                                                               91    Form of Proxy
    We ensure superior returns to our shareholders
    through sustained growth of profitability.
                                                               IBC   Corporate Information


Our Community
    We carry out our activities in an environment-
    friendly manner, contributing towards a safer and
    healthier community.
    We maintain ethical standards.




                                                           1
ACL Cables PLC   Annual Report 2010/11




  Group Revenue


  Rs.9.6                           bn

  32% growth



  Group Profit


  Rs.286.7                               mn

  420% growth

                                         2
                                                                       ACL Cables PLC         Annual Report 2010/11




Group Financial Highlights

                                                                                2011               2010
                                                                              Rs. Mn             Rs. Mn

    Operations
    Turnover                                                                  9,569.8            7,242.9
    Gross Profit                                                              1,289.0            1,144.7
    Finance Cost                                                                226.8              270.1
    Profit Before Tax                                                           449.7              196.3
    Profit After Tax                                                            286.7               55.1
    Total Equity                                                              4,517.1            4,168.8

    Key Financial Indicators
    Gross Profit Margin                                                         13.5%              15.8%
    Net Profit Margin Before Tax                                                 4.7%               2.7%
    Interest Cover (Times)                                                       2.98               1.70
    Return on Equity                                                             6.3%               1.3%
    Current Ratio (Times)                                                          1.7               1.8


                              Revenue                              Net Profit before Tax
                     for the year ended 31st March            for the year ended 31st March
                Rs. Mn.                                  Rs. Mn.
               10,000                                    1,600


                8,000
                                                         1,200

                6,000
                                                           800
                4,000

                                                           400
                2,000


                     0                                        0
                          07 08 09 10 11                            07 08 09 10 11


                        Market Value per Share                     Net Assets per Share
                            as at 31st March                          as at 31st March
                    Rs.                                      Rs.
                  160                                        80


                  120                                        60


                    80                                       40


                    40                                       20


                     0                                        0
                          07 08 09 10 11                            07 08 09 10 11


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                                                                      ACL Cables PLC       Annual Report 2010/11




Chairman's Review


   Against this vibrant economic backdrop, the turnover
   of the Group increased to Rs. 9.6 Bn from Rs. 7.2 Bn in
   the previous year, an increase of 32%.


   On behalf of the Board of Directors I am happy to welcome you to the Forty-Ninth Annual General
   Meeting of ACL Cables PLC and to present the annual report and audited financial statements for
   the year ended 31st March 2011.


   Bright Prospects for Local Economy
   The Sri Lankan economy recorded a growth of 8% as per the Central Bank of Sri Lanka (CBSL)’s
   2010 annual report. This is the second highest growth rate recorded since Sri Lanka gained
   independence in 1948. The year 2010 was the first full year of peace for the country after a 30-
   year protracted war.


   Undoubtedly, greater economic activity is visible island-wide. Post-war growth and development
   activities in the form of new highways, repairs to existing roads, port expansions, improvement
   of the power sector and expansion of transmission and distribution of power, will serve to
   strengthen the country’s infrastructure, which has been neglected over the past few decades.


   Commendable Group Performance
   Against this vibrant economic backdrop, the turnover of the Group increased to Rs. 9.6 Bn from
   Rs. 7.2 Bn in the previous year, an increase of 32%. The Profit before Tax of the Group increased to
   Rs. 450 Mn from Rs. 196 Mn in the previous year, marking an increase of 129%.


   Meanwhile, the finance costs of the Group declined slightly in the year under review to Rs. 226
   million from Rs. 270 million in 2009/10, largely due to reduced borrowing costs. I am happy to
   report that all our subsidiary companies contributed substantially to this exceptional financial
   performance.


   The Group has been successful in maintaining its dominant position in the industry despite stiff
   competition. In a positive development, our new head office building at No. 60 Rodney Street,
   Colombo 08 was completed after the year under review and has been occupied by our staff to
   commence operations in June 2011. However, since the head office was occupied after the balance
   sheet date, it has not been capitalised as yet in the financial statements.


   Furthermore, the Company purchased land in extent approximately 2 and 2/3 Acres adjoining the
   Piliyandala factory for a sum of Rs. 55 Mn in July 2010. This land has been earmarked for future
   expansions of the Group.

                                                    5
ACL Cables PLC     Annual Report 2010/11




Chairman's Review

       Challenges Facing the Industry
       The industry is at the cross-roads today as it is unable to derive much benefit from the rapid
       infrastructure reconstruction in the country. Currently, all infrastructure projects, whether funded
       by foreign grants or on a loan basis, have been negotiated in such a manner that no local material
       or local labour is used at any stage of construction. This is a tremendous blow to the development
       of the local manufacturing industry and will only serve to stunt the growth of the industry.


       Even in the case of a local manufacturer selected as a supplier to an infrastructure project, the
       procedure that the selected manufacturer has to undergo to obtain facilities is equivalent to those
       of a foreign supplier.


       For most Ceylon Electricity Board (CEB) projects, the qualification criteria calls for overseas
       experience in excess of 15 years for the supply of cables and conductors. This, we believe, is an
       important parameter when evaluating an unknown overseas supplier, especially from countries
       that are notorious for poor quality material.


       However, we are hopeful that in the near future the CEB will relax this requirement for reputed
       local suppliers who can provide adequate proof of their expertise and know-how.


       ACL has already supplied many projects with high tension conductors and has completed more
       than 11 projects in Australia. But the contractors bidding for CEB tenders are hesitant to include
       ACL conductors, fearing that a local company would not be acceptable to the CEB. Given a chance
       on a level playing field, local companies can make an immense contribution to the national GDP.


       Appointments
       I am delighted to inform you that Mr. Hemaka Amarasuriya has accepted our invitation to join
       the Board of ACL Cables PLC as a Non-Executive Director with effect from 2nd August 2010.
       Considered one of the leading lights of the private sector, we look forward to a prosperous future
       in consultation with his erudite opinions in steering the Company ahead.


       Unfortunately, we have to bid goodbye to Mr. Hemantha Perera, who resigned from the Board with
       effect from 31st March 2011, and we wish to thank him for his valuable contribution during his
       tenure of service.




        The Profit before Tax of the Group increased to
        Rs. 434 Mn from Rs. 196 Mn in the previous year,
        marking an increase of 121%.

                                                         6
                                                                   ACL Cables PLC        Annual Report 2010/11




In Appreciation
I wish to take this opportunity to thank all our foreign and local customers for their support.
My gratitude also goes to our entire staff for their dedication and to our shareholders for the
confidence they continue to place in us. The ACL Group is also extremely grateful to the CEB for
their continued patronage and we hope our bonds would strengthen further over the years.


ACL Cables PLC looks forward to deriving maximum benefit from the evolving economic climate
and is confident that all Group companies will consolidate their financial and operational
performance in the upcoming financial year.




Mr. U. G. Madanayake
Chairman


25th August 2011




                                                 7
ACL Cables PLC
AC Cables
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ACL Cables PLC   Annual Report 2010/11




                                         8
                                                                     ACL Cables PLC        Annual Report 2010/11




Managing Director's Review


   ACL Cables PLC performed exceedingly well to
   record a turnover of Rs. 5.18 Bn in 2011 as compared
   to Rs. 3.49 Bn in 2010. The Company's Profits before
   Tax recorded Rs. 33.9 Mn in 2011 after registering a
   loss of Rs. 146.8 Mn in the previous year.


   I am pleased to report that ACL Cables PLC performed exceedingly well to record a turnover of
   Rs. 5.18 Bn in 2010/11 as compared to Rs. 3.49 Bn in 2009/10. The Company’s Profits before tax
   recorded Rs. 33.9 Mn in 2010/11 after registering a loss of Rs. 146.9 Mn in the previous year.
   Meanwhile, ACL Cables PLC Group’s Profits before tax moved significantly upwards from Rs. 196
   Mn previously to Rs. 449.7 Mn in the period under review.


   As a result of this commendable performance by the Group companies, the ACL Group market
   share increased significantly. This performance was achieved despite a sharp increase in the cost
   of raw materials in our manufacturing process, particularly, copper and aluminum. Prices for
   copper averaged USD 8,140 per Tonne in the year under review in contrast to an average price of
   USD 6,101 per Tonne in 2009/10.


   Factors Supporting Our Growth
   One of the most favourable developments during the year to have directly contributed to our
   performance has been the expansion of rural electrification efforts by the Ceylon Electricity Board
   (CEB). As one of our main clients, this increase constituted an upsurge in demand for our products,
   thereby contributing to our improved turnover. Accelerated infrastructural and economic
   development in the north and east will boost the economy further and in turn benefit ACL. Most of
   these newly developed regions will witness enhanced CEB activity and have a trickle-down effect
   on our Company’s operations in the future. As a result of this flurry of development, we expect
   households and institutions in the north and east to become our retail clients over time.


   The stellar performance by the ACL Group has been meticulously mapped out and some of the
   salient reasons for this performance are a focus on production efficiency, which leveraged on
   improved debtor control, inventory control and advanced production best practices. Furthermore,
   the decrease in interest rates in the market had a far reaching impact on our Group performance.


   The year 2010/11 was memorable for the Company as we were successful in achieving our
   objective to increase ACL brand presence in the market whilst also positioning it as a preferred
   brand. As a result of these strategic sales and marketing efforts, the brand increased its market
   share during the year, consequently strengthening its dominant status in the industry. The ACL


                                                    9
ACL Cables PLC     Annual Report 2010/11




Managing Director's Review

       Group was able to establish a distinct identity for its portfolio of brands as a direct result of being
       one of two companies to offer fire rated cables for all building wires, thereby offering unmatched
       safety and protection.


       ACL continued its pursuit of new markets throughout the year under review, which contributed
       to our enhanced business volumes. The favourable economic climate prevalent in the country
       presently is stimulating greater construction activity, which will have beneficial consequences in
       the form of enhanced sales of our products.


       Product Innovation
       The Company invested in launching new products and applied innovation throughout 2010/11,
       and implemented technology improvements along with the installation of new equipment in a
       concerted effort in the year under review.


       ACL Cables PLC has always maintained strong ties with its consumers and pre-empted evolving
       customer demands. In keeping with our customer-centric philosophy, customized products to suit
       individual customer needs were introduced during the year, which further heightened the visibility
       of ACL cables in the market.


       Industry Challenges
       While we are optimistic about future prospects for the economy, there are certain macro economic
       challenges that could impact the industry adversely. The future course of government policies,
       taxes, legislation, etc., could impact the business in the months and years ahead. The government
       policy regarding the granting of duty-free facilities to the CEB for import of cables for foreign
       contractors has the potential to become a serious threat to the local industry, as this deters our
       competitiveness as foreign contractors offer lower prices. This policy is skewing the level playing
       field unfavourably and we sincerely hope that authorities take note of this status quo.


       The government should instead support the local industry in terms of including local materials and
       labour on contract projects. In this manner, even if contracts are awarded to foreign contractors,




       ACL Cables PLC has always maintained strong ties
       with its consumers and pre-empted evolving customer
       demands. In keeping with our customer centric
       philosophy, customized products to suit individual
       customer needs were introduced during the year.


                                                         10
                                                                   ACL Cables PLC       Annual Report 2010/11




conditions should be such that a certain percentage of material and labour should be sourced
from within the local industry.


Future Outlook
The copper rod manufacturing plant becoming operational during the 2011/12 financial year
heightens the possibility of improved future operational margins. This backward integration will
ensure that quality is controlled along the supply chain at ACL.


Further, the reduction in corporate tax rates by 7% to 28% is a positive move by the government
and will serve to enhance our growth potential in the near future.


Looking ahead, we plan to drive down costs and place an emphasis on deriving cost efficiencies
in our operations. Our endeavor will be to improve production efficiencies through innovative
methodology. We are upbeat about the future as any improvement in the contribution margin will
directly increase profits for the Group.


Moreover, we have our sights trained on new export markets, with plans to penetrate markets
in which we already have a presence, which are Australia, New Zealand and East Africa.
The government’s renewed commitment to infrastructure development will have positive
repercussions for our business, as we possess the capacity to supply large volumes of wiring for
road lighting, etc. The thriving tourism industry and the slew of upcoming hotel projects will fuel
our business growth further.


Acknowledgements
I would like to express my appreciation to the Board of Directors for their sound guidance and
encouragement. Further, our employees have contributed significantly to the Group’s exceptional
performance during the year. In conclusion, I would also like to thank the CEB and our other loyal
customers for their continued patronage.


The future prospects for the ACL Cables PLC Group are bright and we plan to leverage on all the
strategic initiatives undertaken during this financial year to achieve an even more prosperous
2011/12.




Mr. Suren Madanayake
Managing Director


25th August 2011




                                                11
ACL Cables PLC     Annual Report 2010/11




Board of Directors

                                                       Mr. U. G. Madanayake
                                                       Chairman

                                                       Mr. U.G. Madanayake had his early education at
                                                       Ananda College, Colombo. He graduated from
                                                       the University of Cambridge - England in 1958,
                                                       and had his M.A. (Cantab) conferred on him in
                                                       1962. He is a Barrister at-law (Lincoln’s Inn) and an
                                                       Attorney-at-law of the Supreme Court of Sri Lanka.
                                                       He started his working life managing family-owned
                                                       plantations until most of the lands were taken over
                                                       by the State under the Land Reform Law of 1972.
                                                       He still continues to have an active interest in
                                                       agriculture.

                                                     He joined the Board of Associated Motorways Ltd,
                                                     and subsequently became the Deputy Chairman of
       the Company. He became a Director of ACL Cables PLC (then Associated Cables Ltd.) in January
       1963, its Managing Director in July 1978 and Chairman cum Managing Director in May 1990.
       He relinquished his duties as Managing Director in September 2005 after appointing Mr. Suren
       Madanayake as Managing Director. With the acquisition of Kelani Cables PLC. by the ACL Group in
       October 1999, he was appointed Chairman of Kelani Cables PLC.

       Mr. Madanayake is also the Chairman of Fab Foods (Pvt.) Ltd., Ceylon Tapioca Ltd, ACL Plastics
       PLC., ACL Metals & Alloys (Pvt.) Ltd., ACL Polymers (Pvt.) Ltd. and ACL-Kelani Magnet Wire (Pvt.)
       Ltd. He is a Director of Ceylon Bulbs & Electricals Limited. He has over 40 years experience in the
       cable Industry.



                                                       Mr. Suren Madanayake
                                                       Managing Director

                                                       Mr. Suren Madanayake had his education at Royal
                                                       College, Colombo and qualified as a Mechanical
                                                       Engineer from the University of Texas at Austin,
                                                       USA. He was appointed to the Board of ACL Cables
                                                       PLC., in June 1991 and appointed as Managing
                                                       Director in September 2005. When Kelani Cables
                                                       PLC was acquired in October 1999, he was
                                                       appointed as Managing Director of KCL and Lanka
                                                       Olex Cables (Private) Ltd. which is the holding
                                                       Company of KCL. In 2003 he was appointed as
                                                       Deputy Chairman of KCL.

                                                        He also serves as the Managing Director of Ceylon
                                                        Bulbs and Electricals Ltd., ACL Plastics PLC and
       Director of ACL Metals & Alloys (Pvt.) Ltd., ACL Polymers (Pvt.) Ltd., ACL-Kelani Magnet Wire
       (Pvt.) Ltd., Fab Foods (Pvt.) Ltd. and Ceylon Tapioca Limited. He also serves as Chairman of CCC
       Foundation of Sri Lanka, which is an approved charity.




                                                       12
                                                                ACL Cables PLC        Annual Report 2010/11




Dr. S. K. Madanayake
Director

Dr. S. K. Madanayake had his early education at Trinity College, Kandy and Royal College,
Colombo. He qualified himself as a Doctor of Medicine at Liverpool University in the U.K., after
which he practiced as a physician in Sri Lanka and in England. He was appointed to the Board of
Directors of ACL Cables PLC (then Associated Cables Ltd.) in May 1980, Lanka Olex Cables (Pvt.)
Ltd. in October 1999 and was a Director of ACL Plastics PLC., from its inception in 1991. Dr.
Madanayake retired from practicing medicine and lives in Sri Lanka permanently.



                                              Mrs. N. C. Madanayake
                                              Director

                                              Mrs. N.C. Madanayake was appointed to the Board
                                              of ACL Cables PLC in July 1980.

                                              She is also a Director of Kelani Cables PLC, ACL
                                              Plastics PLC, Ceylon Bulbs and Electricals Ltd. and
                                              Ceylon Tapioca Limited. Mrs. Madanayake is a
                                              pioneering Director of Fab Foods (Pvt.) Ltd. and
                                              now serves as Managing Director of the Company.




                                              Mr. Hemantha Perera
                                              Director


                                              Mr. Hemantha Perera had his education at Royal
                                              College, Colombo and began his career in 1984
                                              working for John Keells Holdings Limited, as a
                                              Trainee Executive in the Tea Department. He later
                                              moved to Keells Aquariams, where he went on to
                                              become Director, Sales and Marketing. Mr. Perera
                                              was appointed to the Board of Directors of ACL
                                              Cables PLC. and ACL-Kelani Magnet Wire (Private)
                                              Limited in 2001 and was appointed as Managing
                                              Director of Kelani Cables PLC. in 2003. Mr. Perera
                                              holds a Masters Degree in Business Administration
                                              and is a member of the Sri Lanka Institute of
                                              Directors.




                                               13
ACL Cables PLC     Annual Report 2010/11




Board of Directors

                                                       Mr. Ajit Jayaratne
                                                       Director

                                                      Mr. Ajit M. de S. Jayaratne had his education
                                                      at Royal College, Colombo. He holds a B.Sc.
                                                      (Economics) Degree from Southampton University
                                                      and is a fellow member of the Institute of
                                                      Chartered Accountants, England & Wales and also
                                                      a fellow member of the Institute of Chartered
                                                      Accountants, Sri Lanka. Mr. Jayaratne was the
                                                      Chairman of Forbes & Walker Limited, The
                                                      Colombo Stock Exchange, The Ceylon Chamber
                                                      of Commerce and The Finance Commission. Mr.
                                                      Jayaratne also served as the High Commissioner of
                                                      Sri Lanka in Singapore sometime ago. He is now a
                                                      Director of Singer Sri Lanka Ltd, Singer Industries
                                                      Ltd., Colombo Fort Land & Building Co. Ltd.,
       Colonial Motors Ltd., Overseas Realty (Ceylon) Ltd. and C.W. Mackie & Co. Ltd. Mr. Jayaratne was
       appointed to the Board of Directors of ACL Cables PLC in November 2005.


                                                       Mr. Hemaka Amarasuriya
                                                       Director

                                                       Mr. Hemaka Amarasuriya is currently the Chairman
                                                       of the Singer Group of Companies in Sri Lanka
                                                       and a Senior Vice President of Retail Holdings Ltd.,
                                                       U.S.A., Singer’s parent company. He is a fellow
                                                       member of the Institute of Chartered Accountants
                                                       of Sri Lanka and of the Chartered Institute of
                                                       Management Accountants, U.K. He also holds a
                                                       Honorary Fellowship from the Chartered Institute
                                                       of Marketing, U.K. and a Diploma in Marketing
                                                       Strategy from the University of New York.

                                                       He is on the Directorate of other listed companies
                                                       such as NDB Bank PLC, C.W. Mackie PLC and non-
                                                       listed companies such as Bata Shoe Co. Ceylon,
       Equill Ltd, TNL Radio Network (Pvt) Limited, Amariya Resorts (Pvt) Ltd., Micro Cars (Pvt) Ltd. &
       NDB Capital Bangladesh. Since holding the Chair of the Singer Group in Sri Lanka, he built this
       institution to regularly be among LMD’s top 20 Corporates in Sri Lanka for an unbroken sequence
       of 12 years, while earning the status for Singer as the “Most Powerful Brand in Sri Lanka” and the
       vote as the “Most Popular Brand” for 5 consecutive years by Peoples Choice.

       He was recognized by the Asia Retails Congress 2007 with the “Retail Leadership Award” for his
       contribution to retailing in Asia and by the Chartered Institute of Marketing U.K. as a “Visionary
       Business Leader” for his invaluable contribution to the Marketing Profession in initiating
       revolutionary changes in the Consumer Market.




                                                       14
                                                                ACL Cables PLC       Annual Report 2010/11




His association with local industry goes back to 1992 from which time he has chaired the Regional
Industry Service Committee – Southern Province of the Ministry of Industrial Development,
responsible for developing Industrial Estates in the Southern Province outside of the Board of
Investment, Sri Lanka.

He is a former Chairman of the Employer’s Federation of Ceylon and was previously responsible
for the Human Resource Development Function of Singer Asia and for the procurement function
of Singer Global and also chaired the Singer Worldwide Business Council which is the policy
implementation body of one of the oldest multinationals.


                                              Mr. Daya Wahalatantiri
                                              Director

                                              Mr. Daya Wahalatantiri had his early education at
                                              Holy Cross College, Kalutara and Royal College,
                                              Colombo. In 1990, he obtained his Masters in
                                              Business Administration from the University of Sri
                                              Jayawardenapura. He is a Graduate in Chemistry
                                              (Special) from the University of Ceylon, Peradeniya.
                                              Having gained sufficient exposure in marketing
                                              of industrial products to institutional customers,
                                              he joined ACL Cables PLC as its first Marketing
                                              Manager in 1982. He was appointed to the Board of
                                              Directors of ACL Cables PLC in November 2005.




                                              Mr. Rajiv Casie Chitty
                                              Director

                                              Mr. Rajiv Casie Chitty had his education at Royal
                                              College, Colombo. He became a fellow of the
                                              Association of Chartered Certified Accountants
                                              (ACCA), UK and Associate Member of the Chartered
                                              Institute of Management Accountants (CIMA),
                                              UK and a Chartered Financial Analyst, USA. He
                                              obtained his Masters in Economics from the
                                              University of Colombo and won the Janashakthi
                                              Gold at the 2006 CIMA Pinnacle Awards. Mr. Casie
                                              Chitty was appointed a Director of ACL Cables PLC
                                              in November 2005. He is currently an Executive
                                              Director of Ceylon Ceramics PLC, Managing
                                              Director / CEO of CT Plantations Limited & Horana
                                              Plantations PLC and also the Managing Director of
                                              Uni Dil Packaging Limited.




                                              15
ACL Cables PLC     Annual Report 2010/11




Senior Management Team




       Left to Right
       Manohara De Zoysa - Group Logistics Manager, A. G. U. K. Abeynayake - Electrical Engineer,
       D. C. Weerasinghe - Production Manager-Copper Cable Factory, Chrishanthi Weerawarna
       - Deputy General Manager (HR & Technical Services), G. B. Karunaratne - Assistant Production
       Manager - Dealer Range Factory




       Left to Right
       Indunil Perera - Security Manager, Quintus Seimon - General Manager Operations,
       Padmana Wijesundara - Quality Assurance Manager, Helen De Fonseka - Systems Manager,
       Chamara Liyanage - Assistant Logistics Manager



                                                    16
                                                              ACL Cables PLC      Annual Report 2010/11




Left to Right
Lalith Ranatunga - Marketing Manager Institutional, Champika Coomasaru - Group Financial
Controller, Lakshman Bandaranayake - Marketing Manager Distribution, Senila Rupasinghe -
Import/Export Manager, Bandula Warnakulasooriya - General Manager Administration




Left to Right
Roshitha Amarasekera - Deputy General Manager (Production), R. Nandakumara - Mechanical
Engineer, Christie Gunathilake - Resident Manager, N. K. W. Gallage - Production Manager
- Rod Mill, Sarath Weerasinghe - Assistant Production Manager - Aluminum Cable Factory,
Shyamalee De Silva - Credit Control Manager

                                              17
ACL Cables PLC       Annual Report 2010/11




Group Structure

Group Structure                              ACL Cables PLC            ACL Plastics PLC         Ceylon Bulbs &
                                                                                                Electricals Ltd
Registration Number                          PQ 102                    PQ 87                    PBS 352
Date of Incorporation                        10.03.1962                17.07.1991               16.10.1957
Corporate Status                             Public Limited Company    Public Limited Company   Limited Company


ACL Cables PLC’s Effective                    Parent Company            65.20%                   95.30%
Shareholding in the Company
Directors                                    U. G. Madanayake          U.G.Madanayake           U.G.Madanayake
                                             - Chairman                - Chairman               - Director

                                             Suren Madanayake          Suren Madanayake         Suren Madanayake
                                             - Managing Director       - Managing Director      - Director

                                             Mrs. N. C. Madanayake     Mrs. N. C. Madanayake    Mrs. N. C. Madanayake
                                             - Director                - Director               - Director

                                             Dr. S. K. Madanayake      Dr. S. K. Madanayake     S. E. C. Gardiner
                                             - Director                - Director               - Director

                                             Hemantha Perera
                                             - Director

                                             Ajit Jayaratne
                                             - Director

                                             Hemaka Amarasuriya
                                             - Director

                                             Daya Wahalatantiri
                                             - Director

                                             Rajiv Casie Chitty
                                             - Director
Principal Activity                           Manufacturers and         Manufacturing Cable      Trading
                                             Selling of Power          grade PVC Compound.
                                             Cables & Conductors,
                                             Armoured Cables, Aerial
                                             Bundled Cables, Control
                                             Cables, Telephone
                                             Cables & Auto Cables.
Total Number of Employees                    600                       44                       None
as at 31st March 2011




                                                              18
                                                                            ACL Cables PLC    Annual Report 2010/11




Lanka Olex Cables       Kelani Cables PLC        ACL Kelani Magnet     ACL Polymers (Pvt)     ACL Metals & Alloys
(Pvt) Ltd                                        Wire (Pvt) Ltd        Ltd                    (Pvt) Ltd
N (PVS) 10596           PQ 117                   N (PVS) 26361         N (PVS) 43085          N (PVS) 43084
22.02.1993              18.12.1972               29.06.2000            06.09.2005             05.09.2005
Private Limited         Public Limited           Private Limited       Private Limited        Private Limited
Company                 Company                  Company               Company                Company
100%                    79.30%                   93.79%                65.20%                 100%


U. G. Madanayake        U. G. Madanayake         U. G. Madanayake      U. G. Madanayake       U. G. Madanayake
- Chairman              - Chairman               - Chairman            - Chairman             - Director

Suren Madanayake        Suren Madanayake         Suren Madanayake      Suren Madanayake       Suren Madanayake
- Managing Director     - Deputy Chairman        - Managing Director   - Managing Director    - Director

Mrs. N. C. Madanayake   Hemantha Perera          Hemantha Perera
- Director              - Managing Director      - Director

Dr. S. K. Madanayake    Mrs. N. C. Madanayake    Mrs. Maya Weerapura
- Director              - Director               - Director

                        Dr. C. T. S. B. Perera
                        - Director

                        Dr. L. J. R. Cabral
                        - Director




Investing Company       Manufacturing            Manufacturing and     Manufacturing of PVC   Manufacturing and
                        and selling of           export of Enamelled   compounds              Selling Aluminium
                        Power Cables,            Winding Wires                                rods, Alloys of
                        Telecommunication                                                     Aluminium and Other
                        Cables & Enamelled                                                    Metals
                        Winding Wires


None                    407                      59                    14                     25




                                                          19
ACL Cables PLC     Annual Report 2010/11




Risk Management

       ACL Cables PLC has given due consideration to its risk management process in order to progress
       towards achievement of its goals and objectives. Risk management under the two forms of risks,
       namely Financial and Business, are regularly reviewed to ensure the related risks are minimized
       where the complete elimination is not possible.


        Risk Exposure             Company Objectives            Company Initiatives
        Financial Risk Management
        1. Liquidity & Cash
        Management                    position.                    of trade debts, planning production
                                                                   and utilization of short term
                                                                   borrowing facilities.

                                                                   offer as collateral for future funding
                                                                   requirements.

                                                                   to adequately manage liquid
                                                                   position through several financial
                                                                   institutions.
        2. Interest Rate Risk
                                      effects of interest rate      mitigate the high cost and to avoid
                                      volatility.                  adverse fluctuations in local interest
                                                                   rates.
        3. Currency Risk
                                      to fluctuations in            payments wherever possible.
                                      foreign currency rates
                                      of foreign currency
                                      receipts and payments.
        Business Risk Management
        1. Credit Risk
                                      associated with debtors      credit and advance TT remittances
                                      defaults.                    as much as possible.

                                                                   from local distributors.

                                                                   in local market and monitor the
                                                                   exposure levels of distributors
                                                                   regularly.

                                                                   the exposure.

                                                                   to ensure credit worthiness of
                                                                   customers.

                                                                   comprehensive policy to adequately
                                                                   review and provide for doubtful
                                                                   debts.




                                                         20
                                                            ACL Cables PLC         Annual Report 2010/11




Risk Exposure          Company Objectives            Company Initiatives
2. Asset Risk
                          caused by machine             covers for plant and machinery.
                          breakdown and
                          damages from fire or           maintenance programs.
                          theft.
3. Internal Controls
                          system of internal            by an independent firm.
                          controls to safeguard
                          company assets.
4. Human Resources
                          turnover.                     scheme to reward them.

                          of operations without         relationship with employees at all
                          interruptions.                levels through joint consultative
                                                        committees.
                          through training and
                          adopting best practices.      through the Welfare Committee.

                                                        wherever necessary.
5. Technological and
Quality related risk      current technological         replace existing machines with
                          developments and              technologically advanced machines.
                          quality standards to
                          avoid obsolescence.           authorities and ensure products
                                                        comply with most of the local and
                          of stocks that do not         international standards.
                          meet the standards.
                                                        test the quality of products are in
                                                        place.
6. Inventory
Management Risk           situations.                   on budgets and sales forecasts at
                                                        production planning meetings held
                          accumulation of slow          monthly.
                          moving stocks.
                                                        reduce slow moving stocks.
                          on obsolete stocks.
                                                        different stages to verify the quality
                          standard material being       and ensure this until the product is
                          received.                     delivered.

                          days.                         are separated and disposed as scrap.

                                                        systems to identify non-moving
                                                        stocks.




                                          21
ACL Cables PLC    Annual Report 2010/11




Risk Management

        Risk Exposure              Company Objectives           Company Initiatives
        7. Risk of Competition
                                      market share from            are met.
                                      imported low quality
                                      products.                    various advertising and promotional
                                                                   campaigns.

                                                                   various parts of the country.
        8. Investment in Capital
                                      loss in present and          planned and made on timely basis.
                                      future investments.
                                                                   possible.
        9. Information Systems
                                      risks associated             and stored in outside locations.
                                      with data security,
                                      hardware, software           data.
                                      and communication
                                      systems.                     services and maintenance.

                                                                   firewalls and software.
        10. Environmental
        Issues                        impact of operations to      the relevant authorities and ensure
                                      the environment.             the compliance.
        11. Legal and Regulatory
        Issues                        losses arising from          statutory and regulatory bodies.
                                      non-compliance
                                      with statutory               Federation when necessary.
                                      and regulatory
                                      requirements.

                                      counter measures to
                                      reduce the impact
                                      arising from changes to
                                      regulatory issues.




                                                      22
                                                                      ACL Cables PLC         Annual Report 2010/11




Corporate Governance

   ACL Cables PLC is committed to best practices in the area of Corporate Governance. Corporate
   Governance is an internal system encompassing policies, processes and people, which serves the
   needs of shareholders and other stakeholders. Good governance facilitates effective management
   and control of the business, while maintaining a high level of business ethics and optimizing
   the value for all stakeholders. Sound Corporate Governance is reliant on external market place
   commitment and legislation plus a healthy Board culture which safeguards policies and processes.
   Further, an important element of Corporate Governance is to ensure the accountability of certain
   individuals in an organization through mechanisms that try to reduce or eliminate the dilemma of
   principal-agent.


   The Corporate Governance Report, together with the Audit Committee Report & the Directors
   Remuneration Report, provides a description of the manner and extent to which ACL Cables
   PLC complies with the code of Best Practice in Corporate Governance issued by the Institute of
   Chartered Accountants of Sri Lanka and the Listing Rules of the Colombo Stock Exchange.


   The Board of Directors
   The Board is collectively responsible for the success of the Company. Its role is to provide
   entrepreneurial leadership to the Company within a framework of prudent and effective controls
   which enables risk to be assessed and managed. The Board sets the Company’s strategic aims,
   ensures that the necessary financial and human resources are in place for the Company to meet
   its objectives, and reviews management performance. It also sets the Company’s values and
   standards and ensures that its obligations to its shareholders and others are understood and met.
   Specific responsibilities reserved to the Board include:




   The Board comprises of nine Directors out of whom six are Non-Executive Directors. The names
   and profiles of the Directors are given on pages 12 to 15 of this report. The Board recognizes the
   need for a clear division of responsibilities in running the Board and Executive responsibilities of
   running the Company business. Accordingly, the positions of Chairman and Managing Director
   have been separated.




                                                    23
ACL Cables PLC     Annual Report 2010/11




Corporate Governance

       The Board Balance
       The composition of the Executive and Non-Executive Directors satisfies the requirements laid
       down in the Listing Rules of the Colombo Stock Exchange. The Board consists of six Non-Executive
       Directors and three of them are Independent Non-Executive Directors. The Board has determined
       that the three independent Non-Executive Directors satisfy the criteria for “Independence” set out
       in the Listing Rules.


       Directors’ attendance record
       The attendance of Directors at relevant meetings of the Board and of the Audit & Remuneration
       Committees held during 2010/2011 was as follows.


        Name of Director                                  Board            Audit         Remuneration
                                                      (12 Meetings)     Committee         Committee
                                                                       (4 meetings )      (1 meeting)
        Executive Directors
        Mr. U. G Madanayake – Chairman                      11
        Mr. Suren Madanayake – Managing Director            12
        Mr. Daya Wahalatantiri – Director Export            11
        Non-Executive Directors
        Dr. S. K Madanayake                                 Nil
        Mrs. N. C Madanayake                                09
        Mr. Hemantha Perera*                                12
        Independent Non-Executive Directors
        Mr. Ajit Jayaratne                                  12               04                 01
        Mr. H. Amarasuriya **                              7/8
        Mr. Rajiv Casie Chitty                              10               04                 01

       * Mr. Hemantha Perera resigned as a director with effect from 31/03/2011.
       ** Mr. H. Amarasuriya was appointed as a Director in August 2010.


       Dedication of Adequate Time & Effort
       Every Director should dedicate adequate time and effort to matters of the Board and the Company.
       Adequate time is devoted at every meeting to ensure that the Board’s responsibilities are
       discharged satisfactorily.


       In addition, the Executive Directors of the Board have regular meetings with the Management
       when required.


       Training for the Directors
       Every Director should receive appropriate training on the first occasion that he or she is appointed
       to the Board of a listed Company and subsequently as necessary. The policy on Directors training
       is, to provide adequate opportunities for continuous development subject to requirements and
       relevance for each Director.



                                                      24
                                                                  ACL Cables PLC         Annual Report 2010/11




Re- Election of Directors
All directors should be required to submit themselves for re-election at regular intervals and at
least every three years. According to the Articles of Association, Directors Mrs. N.C. Madanayake
and Mr. Daya Wahalatantiri retire by rotation and are required to stand for re-election by
shareholders at the Annual General Meeting.


Availability of a Nomination Committee
A Nomination Committee should be established to make recommendations to the Board on all
new Board appointments. In the absence of a Nomination Committee, the Board as a whole should
annually assess Board composition to ascertain whether the combined knowledge and experience
of the Board matches the strategic demands facing the Company.


The Company has not formed a specified Nomination Committee. However, performance of the
Board and its composition are being evaluated annually.


Accountability and Audit
The Board should present a balanced and understandable assessment of the Company’s position
and prospectus.


The Quarterly and Annual Financial statements, prepared and presented in conformity with Sri
Lanka Accounting Standards, comply with the requirements of the Companies Act No. 07 of 2007.


The Report of the Directors is provided on pages 38 to 40 of this report. The Statements of
Directors’ Responsibility for financial reporting and report of the Auditors are stated on pages 41
and 45 respectively. The Going Concern Declaration by the Board of Directors in this regard is
presented in the report of Directors on page 38 of this Annual Report.


Internal Control
The Board acknowledges its overall responsibility for maintaining a sound system of internal
controls to safeguard shareholders’ investments and the Company’s assets. The Board’s policy
is to have systems in place which optimize the Group’s ability to manage risk in an effective
and appropriate manner. The Board has delegated to the Audit Committee responsibility for
identifying, evaluating and monitoring the risks facing the Group and for deciding how these are
to be managed. In addition to a quarterly internal audit carried out by an external professional
body, members of the Audit Committee are expected to report to the Board as necessary the
occurrence of any material control issues, serious accidents or events that have had a major
commercial impact, or any significant new risks which have been identified.




                                                25
ACL Cables PLC      Annual Report 2010/11




Corporate Governance

       A summary of those risks which could have a material impact on the performance of the Group is
       given within the Risk Management section in the Annual Report. The objective of the Group’s risk
       management process is to ensure the sustainable development of ACL Cables PLC through the
       conduct of its business in a way which:




       The Group’s systems and procedures are designed to identify, manage and where practicable,
       reduce and mitigate effects of the risk of failure to achieve business objectives. They are not
       designed to eliminate such risk, recognizing that any system can only provide reasonable and not
       absolute assurance against material misstatement or loss.


       Remuneration Committee
       The Remuneration Committee should consist exclusively of Non-Executive Directors who are
       Independent of Management. The members of the Remuneration Committee should be listed
       each year in the Board’s remuneration report to the shareholders. The Remuneration Committee
       comprises of the following two Independent Non-Executive Directors.




       Further details of the Remuneration Committee are given in their report on page 44.


       Audit Committee
       The Audit Committee shall comprise of a minimum of two Independent Non-Executive Directors
       or of Non-Executive Directors, a majority of whom shall be independent, whichever is higher.
       One Non-Executive Director shall be appointed as Chairman of the committee by the Board of
       Directors.


       The Audit Committee comprises of the following two Independent Non-Executive Directors.




       Further details of the Audit Committee are given in their report on page 42 & 43.




                                                       26
                                                                 ACL Cables PLC        Annual Report 2010/11




Code of Business Conduct and Ethics
The Company has adopted a Code of Business Conduct and Ethics for the Directors and members
of the senior management.


The table below indicates the manner and extent to which ACL Cables PLC complies with the Code
of Best Practice in Corporate Governance issued by the Institute of Chartered Accountants of Sri
Lanka and the Listing Rules of the Colombo Stock Exchange.


Corporate Governance Check List

CSE Rule      Subject         Applicable requirement        Compliance Applicable section
No.                           Status                                   in the Annual Report
7.10.1(a)     Non-Executive   2 or at least 1/3 of the                     Corporate Governance
              Directors       total number of Directors
              (NED)           should be NEDs.
7.10.2 (a)    Independent     2 or 1/3 of NEDs,                            Corporate Governance
                              whichever is higher,
                              should be independent.
7.10.2 (b)    Independent     Each NED should                              Corporate Governance
                              submit a declaration of
                              independence.
7.10.3 (a)    Disclosure                                                   Corporate Governance
              relating            annually determine
                                  the Independence or
                                  otherwise of the NEDs.

                                  disclosed in the Annual
                                  Report (AR).
7.10.3 (b)    Disclosure      The basis for the Board’s                    Corporate Governance
              relating        determination of ID,
                              if criteria specified for
                              independence is not met
7.10.3 (c)    Disclosure      A brief résumé of                            Board of Directors
              relating        each Director should                         (profile) section in the
              to Directors    be included in the AR                        Annual Report
                              including the Director’s
                              areas of expertise.
7.10.3 (d)    Disclosure      Provide a brief résumé of                    Corporate Governance
              relating to     new Directors appointed
              Directors       to the Board with details
                              specified in 7.10.3(a), (b)
                              and (c) to the CSE.
7.10.4 (a-h) Determination    Requirements for meeting                     Corporate Governance
             of               criteria.
             Independence




                                               27
ACL Cables PLC       Annual Report 2010/11




Corporate Governance

        CSE Rule       Subject         Applicable requirement          Compliance Applicable section
        No.                            Status                                     in the Annual Report
        7.10.5         Remuneration    A listed company shall                      Corporate Governance
                       Committee       have a RC.
                       (RC)
        7.10.5 (a)     Composition     Shall comprise of NEDs, a                   Corporate Governance
                       of              majority of whom will be
                       Remuneration    independent.
                       Committee
        7.10.5 (b)     Functions of    The RC shall recommend                      Corporate Governance
                       Remuneration    the remuneration of the
                       Committee       Managing Director (MD)
                                       and EDs.
        7.10.5 (a)     Disclosure in         Names of Directors                    Corporate Governance
                       the Annual            comprising the RC.                    and the Board
                       Report                                                      Committee Reports
                       relating to           Remuneration Policy
                       Remuneration
                       Committee             remuneration paid to
                                             EDs and NEDs.
        7.10.6         Audit           The Company shall have                      Corporate Governance
                       Committee       an AC.
                       (AC)
        7.10.6 (a)     Composition           Shall Comprise of NEDs                Corporate Governance
                       of                    a majority of whom will               and the Board
                       Audit                 be independent.                       Committee Reports
                       Committee
                                             appointed as the
                                             Chairman of the
                                             Committee.

                                             Controller(GFC) should
                                             attend AC meetings.

                                             or one member should
                                             be a member of a
                                             professional accounting
                                             body.


        7.10.6(b)      Audit           Overseeing of the –                         Corporate Governance
                       Committee             Preparation,                          and the Board
                       Functions             presentation                          Committee Reports
                                             and adequacy of
                                             disclosures in the
                                             financial statements
                                             in accordance with
                                             Sri Lanka Accounting
                                             Standards.



                                                          28
                                                                ACL Cables PLC    Annual Report 2010/11




CSE Rule     Subject           Applicable requirement       Compliance Applicable section
No.                            Status                                  in the Annual Report


                                 financial reporting
                                 requirements,
                                 information
                                 requirements of
                                 the Companies Act
                                 and other relevant
                                 financial reporting
                                 related regulations and
                                 requirements.

                                 that the internal
                                 controls and risk
                                 management are
                                 adequate to meet the
                                 requirements of the
                                 Sri Lanka Auditing
                                 Standards.

                                 independence and
                                 performance of the
                                 external auditors.

                                 to the Board pertaining
                                 to appointment,
                                 re-appointment and
                                 removal of external
                                 auditors, and approve
                                 the remuneration and
                                 terms of engagement of
                                 the external auditor.
7.10.6 (c)   Disclosure                                                 Board Committee
             in Annual           comprising the AC.                     Reports
             Report relating
             to Audit            determination of the
             Committee           independence of the
                                 Auditors and disclose
                                 the basis for such
                                 determination.

                                 Report of the AC setting
                                 out the manner of
                                 compliance with their
                                 functions.




                                              29
ACL Cables PLC     Annual Report 2010/11




Corporate Social Responsibility

       ACL has been the pioneer in the Sri Lankan cable manufacturing sector since its humble
       beginnings in 1962. Over the past few decades, it has grown to become the leading manufacturer
       of cables in the country, with significant market share as a Company and a commanding market
       share as a Group. During the past year, ACL has taken giant strides in gaining market share to
       achieve and consolidate the dominant position held in the market today.


       We take great pride in being a good corporate citizen of Sri Lanka, where all our business activities
       affect various stakeholders in many different ways. As such, we constantly strive to take initiatives
       to nurture and add value to the community around us, so that as they develop, it would in turn
       benefit the country as well as our Company. These ideologies are ingrained in the ACL Vision,
       Mission and Values, which have guided ACL to become a stalwart in the cable manufacturing
       industry.


       Our Customers
       ACL aims to enhance customer satisfaction through the provision of high quality and safe cables.
       This is done through constant dialogue with our customers via many communication channels,
       so that we can identify their needs and innovate to meet their requirements. Thus, we are able


       promotional activities during year. Further, we assess and verify our activities by monitoring
       reaction from customers as well as through self-assessment of customer satisfaction related
       matters, and by utilizing and applying the feedback we derive from the membership of an



       The ‘ACL Power Pack Electrician’s Club’ is the leading electrician’s club in Sri Lanka, which was
       founded with the objectives of providing skills, knowledge and other required guidance and
       improving living conditions of key stakeholders of the industry. We endeavour to serve the needs
       of all electricians, but especially those of our members, by implementing and practicing the ‘Eight
       Betterments’ concepts which encompass many aspects of our business activities.


       Divimaga Balaya – Members are given information regarding the latest technological
       developments in the electrical industry and training on the safe usage of electrical wiring and
       equipment. Training programs were conducted in locations such as Polonnaruwa, Bibila, Ampara,
       etc.




       Seminar conducted for electricians.

                                                        30
                                                                 ACL Cables PLC        Annual Report 2010/11




Divimaga Sariya – Visits and educational tours are organized providing an opportunity for
members to visit the ACL Cables factory. In August 2010, the children of ACL employees too, were
given the opportunity to observe cable manufacturing.


Divimaga Danuma – An educational magazine is published bi-monthly containing articles on the
safe use of cables, energy conversion, unique features of ACL cables, and more.


Divimaga Rekuma – Members of the club are covered by a comprehensive insurance policy
to the value of Rs. 625,000/- for life and accident cover, the premium of which is borne by the
Company. A Life insurance payment was made during the year consequent to the unfortunate
demise of one of our members due to a work-related accident. His dependents had a safety net
due to our initiative.




Insurance payment being handed over to the late electrician’s widow.


Divimaga Surakuma – For the first time in Sri Lanka, a Pension Scheme has been introduced for
electricians by the ACL Power Pack Electrician’s Club.


Divimaga Thorathuru – A dedicated Hotline Mobile Service operates 24 hours for electricians to
communicate with the Company.


Divimaga Lakunu – A Gift Scheme available for members whose active participation earns them
points which in turn entitles them to valuable gifts.


Divimaga Dakuma – Recognizing that good eyesight is a critical asset for an electrician, the
Company has reimbursed the costs of clinic visits and spectacles for our members, with a view to
helping our electricians function efficiently and effectively.


Our People
At ACL, we consistently focus on continuous development of our human resources and the
creation of an environment which is conducive for employees to develop and better themselves.
Our success has been built on the collective skills, knowledge and quality of our human capital.


year on year. As part of the human resource development initiative, a consultant has been


                                                 31
ACL Cables PLC        Annual Report 2010/11




Corporate Social Responsibility

       appointed to better develop and train our staff. Additionally, English classes are held for various
       employee categories so that they are groomed and geared to be our driving force in the future
       too.


       During the year under review, the Company continued to offer opportunities for employees’
       career development, and the improvement of their skills and attitudes. There are numerous
       potential benefits to be gained by modern businesses and individuals from systematic, well-
       planned training and development programs. As such, Interactive Workshops and Seminars have
       been conducted during the year. Furthermore, the Company accepts and acknowledges the
       responsibility for continuous professional development of staff members, and in this light, offers
       its employees opportunities to participate in special training programs and conferences conducted
       by professional organizations.


       We also recognize that it is essential for various social activities to be encouraged and organized
       in order to create an atmosphere of togetherness amongst members of the ACL family, as stated
       in our value statement. With that in mind we have integrated a number of social activities into our
       yearly schedule, which includes an annual trip, the ACL Night, and New Year festival activities.




       ACL Factory staff participating in traditional ‘Kotta pora’ and ‘Tug of War’ events at the New Year
       festivities.

       An annual awards ceremony is held for ACL Sales Promotion officers as a means of recognizing
       and rewarding the employees who have contributed most to the continued success of ACL.




       Sales promotion team with award winners
       and their awards in the foreground.


                                                       32
                                                                  ACL Cables PLC        Annual Report 2010/11




In order to improve the benefits offered to employees, medical facilities provided to the staff were
streamlined and enhanced. In addition, to recognize their loyalty and dedication, employees who
had served the Company for 25 years were presented with Gold Coins at the New Year celebration
on 1st January 2011.


ACL takes justifiable pride in caring for our employees and their dependents. Thus we have an
initiative named “ACL Nena Thilina,” which is a program where we grant scholarships to children
of employees who excel at the examinations. The top three children passing the A/Ls, O/Ls and
Grade 5 Scholarship exams are given monetary prizes by ACL at an award ceremony so that these
children are recognized for their achievements and are encouraged to develop further. Employees
take great pride in their children being recognized for their academic achievements.


An Art Competition was held in connection with the annual Poson Bakthi Geetha program, where
children of the employees took part, and prizes were awarded to the winners in each category.


Further, a pack of stationery is given to every employee’s child who is currently attending school.
This distribution is done at the beginning of every year.


Our Community
ACL strives to understand and respect the cultural values and laws wherever we operate. We actively
support important initiatives in those communities where our employees live and work. This
commitment is evident from our contributions of equipment and financial and volunteer support.


ACL supports various community charity causes, such as donating funds to the Cancer Hospital at
Maharagama. ACL also continuously provides financial support for the betterment of society and
the surrounding communities, which improves the socio-economic background so that society
benefits from it.


ACL conducts annual cultural events such as New Year festivals, Poson Bakthi Geetha, and the Aloka
Poojawa at Ridi Viharaya. These are conducted to enrich the lives of those in the neighbouring
communities. This also creates a platform from which ACL employees can interact with the
surrounding communities and engage themselves in activities other than just their routine work.




The Chairman switching on the lights for the         The Managing Director switching on the lights
Aloka Pooja at Ridi Viharaya.                        for the Aloka Pooja at Ridi Viharaya.

                                                33
ACL Cables PLC     Annual Report 2010/11




Corporate Social Responsibility

       Environmental Responsibility
       Environmental sustainability at ACL begins with our pledge to provide innovative and high quality
       cables which are manufactured under guidance of best practices and in an energy efficient
       manner. ACL employees are encouraged to be committed towards creating and maintaining a
       cleaner and safer working environment within the factory premises so that all employees are able
       to work in more habitable surroundings.


       We continuously follow the strategy of training employees across the office and factory premises
       of the Company on the Japanese 5S concept, promoting it as a basic and compulsory productivity
       improvement standard to be implemented throughout the Company. Further, 5S audits were
       carried out during the year to ensure the effectiveness of the program.


       The Company also falls in line with the environmental laws of the country through compliance
       licensing in our other operational areas.


       The Company invests in new technology which is more energy efficient and less harmful to


       initiatives which have enabled ACL to become a shining example in the Cables manufacturing
       sector in Sri Lanka.


       Our environmental initiative was the compelling reason for ACL to come forward as the Principal
       Sponsor of the “Earth Hour” in Sri Lanka. ACL donated a sum of Rs. 600,000/- towards the event,
       and management personnel participated in the organizing of the event in order to make it the
       overwhelming success that it was. The ceremony included many spectacular cultural pageants
       such as ‘Gini Sisila,’ ‘Pandam Paliya,’ ‘Dekona Wilakkuwa’ and traditional Drum-beating events.
       Interesting speeches and lectures were also held, but the core event during the ceremony was
       the switching off of non-essential lights of the area from 8.30 to 9.30 pm. During this hour the
       premises was lit with copra lamps, which is a non-fossil fuel.




       ‘Earth Hour’ sponsorship funds being handed          Children singing the National Anthem at the
       over.                                                ‘Earth Hour’ ceremony.




                                                       34
                                                        ACL Cables PLC      Annual Report 2010/11




Awards




   Crystal Award 2009                            Asia Pacific Quality Award 2008
   Award for the Winner of the Gold              Won the highest award, beating
   Awards over three Consecutive Years           participants from 46 countries, and
   by the Ceylon National Chamber of             ACL recognized as a world-class
   Industries.                                   company.




   “Provincial Productivity Awards -             National Quality Award Winner
    st
   1 Place” 2007                                 2007
   organized by the National Productivity
   Secretariat.




                                            35
ACL Cables PLC   Annual Report 2010/11




       Financial Information




                                         36
                  ACL Cables PLC          Annual Report 2010/11




38    Report of the Directors
41                                                   g
42    Audit Committee Report
44    Remuneration Committee Report
45                                t
46    Income Statement
47    Balance Sheet
48    Statement of Changes in Equity
49    Cash Flow Statement
50    Notes to the Financial Statements


 37
ACL Cables PLC       Annual Report 2010/11




Report of the Directors

       The Directors have pleasure in presenting their 49th Annual Report together with the Audited
       Balance Sheet, Income Statement and Consolidated Financial Statements of the Group for the year
       ended 31st March 2011.


       Review of the Year
       The Chairman’s Statement and Managing Director’s Review set out the state of affairs and
       performance of the Company during the year.


       Principal Activities of the Group
       Description of the nature of the operations and principal activities of the Company and its
       subsidiaries are given on pages 18 to 19.


       Independent Auditor’s Report
       The Independent Auditors’ Report on the Financial Statements is given on page 45 in this Report.


       Financial Statements
       The Financial Statements prepared in compliance with the requirements of Section 151 of the
       Companies Act No. 7 of 2007 are given on pages 46 to 81 in this Annual Report.


       Accounting Policies
       The Accounting Policies adopted in preparation of the Financial Statements are given on pages 50
       to 57. There were no changes in the Accounting Policies adopted by the Company during the year.


       Directors’ Responsibilities for Financial Statements
       The Statement of the Directors’ Responsibilities for Financial Statements is given on page 41.


       Going Concern
       The Board is satisfied that the Company will continue its operations in the foreseeable future. For
       this reason, the Company continues to adopt the going concern basis in preparing the Financial
       Statements.


       Stated Capital
       The Stated Capital of the Company on 31st March 2011 was Rs.299, 488,400/= and was
       unchanged during the year.


       Events Occuring After The Balance Sheet Date
       No circumstance have arisen since the Balance Sheet date which would require adjustments to
       or disclosure in the Financial Statements other than those disclosed in Note 37 to the Financial
       Statements.




                                                       38
                                                                  ACL Cables PLC        Annual Report 2010/11




Statutory Payments
All known statutory payments have been made or provided for by the Company.


Directors
Directors of the Company are listed on pages 12 to 15 and their respective shareholdings are
given below.
                                               No of                 No of
                                              Shares % Holding      Shares % Holding
                                                As at      As at      As at      As at
                                          31.03.2011 31.03.2011 31.03.2010 31.03.2010
U. G. Madanayake - Chairman                22,642,116         37.80%     22,642,116           37.80%
Suren Madanayake - Managing Director       13,302,396         22.21%     13,302,396           22.21%
Dr. S. K. Madanayake                          165,072           0.28%       165,072            0.28%
Mrs. N. C. Madanayake                       1,032,100           1.72%     1,032,100            1.72%
Hemantha Perera *                                     -              -              -                -
A. M. S. De S. Jayaratne                              -              -              -                -
Hemaka Amarasuriya **                                 -              -              -                -
D. D. Wahalatantiri                                   -              -              -                -
P. S. R. Casie Chitty                                 -              -              -                -

* - Resigned with effect from 31.03.2011
** - Appointed with effect from 02.08.2010


Interest Register
The Interest Register is maintained by the Company, as per the Companies Act No. 7 of 2007. All
Directors have made declarations in accordance with the aforesaid Act. The Interest Register is
available for inspection as required by the Companies Act.


Directors’ Interest in Contracts
Directors’ interests in contracts of the Company are disclosed in Note 35 to the Financial
Statements and no Director of the Company is directly or indirectly interested in any other
contracts with the Company. The Directors retiring by rotation in terms of Article 85 will be Mrs.
N. C. Madanayake & Mr. Daya Wahalatantiri, who being eligible are recommended for re-election.


Directors’ Remuneration
Remuneration received by the Directors is set out in Note 35 to the Financial Statements.


Directors Meetings
The details of Directors’ meetings are set out on pages 23 to 25 under the Corporate Governance
of the Annual Report.




                                                39
ACL Cables PLC       Annual Report 2010/11




Report of the Directors

       Dividends
       The Board of Directors have decided not to declare a dividend for the year 2010/2011.


       Donations
       Donations amounting to Rs. 1,450,445 (Group Amount) were made during the year under review.


       Appointment of Auditors
       1) Messrs. PricewaterhouseCoopers, have expressed their willingness to continue in office as
           Auditors of the Company for the year ending 31st March 2012. A resolution pertaining to their
           reappointment and authorizing the Directors to determine their remuneration will be proposed
           at the Annual General Meeting.



       By Order of the Board



       (Sgd.)
       Corporate Affairs (Private) Limited
       Secretaries


       25th August 2011




                                                     40
                                                                       ACL Cables PLC         Annual Report 2010/11




Directors' Responsibility for Financial Reporting

    The Board accepts responsibility for the preparation and fair presentation of Financial Statements
    in accordance with Sri Lanka Accounting Standards. This responsibility includes: designing,
    implementing and maintaining internal controls relevant to the preparation and fair presentation
    of Financial Statements that are free from material misstatement whether due to fraud or error;
    selecting and applying appropriate accounting policies; and making accounting estimates that are
    reasonable in the circumstances.


    In discharging this responsibility, the Directors have instituted a system of internal financial
    controls and a system for monitoring its effectiveness. The system of controls provide reasonable
    and not absolute assurance of safeguarding of Company’s assets, maintenance of proper
    accounting records and the reliability of financial information.


    The Financial Statements reflect a true and fair view of the state of affairs of the Company and the
    Group as at 31st March 2011 and provide the information required by the Companies Act No. 7
    of 2007. The Financial Statements have been prepared on the going concern basis as the Board is
    satisfied that the Company will continue its operations in the foreseeable future.


    Approval of Financial Statements
    The Directors’ Report and the Financial Statements of the Company and of the Group were
    approved by the Board of Directors on 25th August 2011



    By Order of the Board



    (Sgd.)
    Corporate Affairs (Private) Limited
    Secretaries


    25th August 2011




                                                     41
ACL Cables PLC       Annual Report 2010/11




Audit Committee Report

       The Audit Committee consists of following two Independent Non-Executive Directors, biographical
       details of whom are set out within ’Profiles of the Directors’ section.




       The above members have significant recent and relevant financial experience as required by the
       Code of Best Practice in Corporate Governance, issued by the Institute of Chartered Accountants of
       Sri Lanka and the Listing Rules of the Colombo Stock Exchange.


       Role
       The primary role of the Audit Committee, which reports its findings to the Board of Directors,
       is to ensure the integrity of the financial reporting and audit processes and the maintenance of
       sound internal controls and risk management system. The Committees` responsibilities include
       monitoring and reviewing the following:



           contained in them.




           independence, fees and provision of non-audit services.


           Directors on the appointment of the external auditors.


       In the performance of its duties, the Committee has independent access to the services of Internal
       Audit and to the External Auditors, and may obtain outside professional advice as necessary.
       Comprehensive briefing papers are circulated to Committee members in advance of each meeting
       and made available to other Directors.


       Meetings & attendance
       The Committee met on four occasions in 2010/2011 timed to coincide with the financial and
       reporting cycles of the Company. Members’ attendance at these meetings is set out in the
       Corporate Governance Report. The Chairman, Managing Director & Group Financial Controller are
       invited to attend meetings whenever required.


       Financial Reporting
       The Audit Committee considered a wide range of financial reporting and related matters in respect
       of the 2010/2011 published Financial Statements. For quarterly statements, the Committee
       reviewed any significant areas of judgment that materially impacted reported results, key points of
       disclosure and presentation to ensure adequacy, clarity and completeness of the Interim Financial
       Statements.




                                                        42
                                                                 ACL Cables PLC        Annual Report 2010/11




External Auditors
The Audit Committee is responsible for the development, implementation and monitoring of
the Company’s policies on external audit. The policies, designed to maintain the objectivity and
independence of the external auditors, regulate the appointment of former employees of the
external audit firm to positions in the Group and set out the approach to be taken when using the
external auditors for non-audit work.


As a general principle, the external auditors are excluded from consultancy work and cannot
be engaged by ACL Cables PLC for other non-audit work unless there are compelling reasons to
do so. Any proposal to use the external auditors for non-audit work must be submitted to the
Managing Director, via the Group Financial Controller, for approval prior to appointment.


The Audit Committee, having evaluated the performance of the external auditors,
decided to recommend to the Board of ACL Cables PLC, the re-appointment of Messrs.
PricewaterhouseCoopers as auditors of the Company, subject to the approval of the shareholders
at the Annual General Meeting. Details of the fees payable to external auditors for 2010/2011 can
be found in Note 5 to the financial statements.


Internal Control System
In 2010/2011 the Committee reviewed the results of the audits undertaken by Internal Auditors,
Messrs. Ernst & Young Advisory Services (Pvt) Ltd., and considered the adequacy of management’s
response to the matters raised, including the implementation of any recommendations made.


On behalf of the Committee


(Sgd.)
Mr. Ajit Jayaratne
Chairman of the Audit Committee


25th August 2011




                                                 43
ACL Cables PLC    Annual Report 2010/11




Remuneration Committee Report

       The Remuneration Committee comprises of the two Non-Executive Directors, namely




       The members of the Committee and the chairman of the Committee shall be appointed from time
       to time by a resolution of the Board, from amongst the Non-Executive Directors. The Remuneration
       Committee formally met once in the last financial year.

       Role
       The Remuneration Committee formulates the Group’s policy for the remuneration of the Executive
       Directors of ACL Cables PLC. It reviews the policy annually and recommends any changes to the
       Board for formal approval. The Group policy on remuneration packages is to attract and retain the
       best professional and managerial talent to the Group and also to motivate and encourage them to
       perform at the highest possible level. The Group has a structured and professional methodology in
       evaluating the performance of employees.

       The Remuneration Committee determines the Company’s Remuneration Policy of Executive
       Directors, with regard to performance standard and existing industry practice. No Executive
       Director is involved in deciding his own remuneration package.

       Activities
       The Committee considered a range of issues including,




       Members’ attendance at meetings of the Remuneration Committee in 2010/2011 is set out in the
       table in the Corporate Governance Report.

       Executive Directors
       ACL’s remuneration policy for executive directors is designed to attract, retain and motivate
       executives of the high caliber required to ensure that the Group is managed successfully to the
       benefit of shareholders. To achieve this, a competitive package of incentives and rewards linked
       to performance is provided.

       In setting remuneration levels, the Committee takes into consideration the remuneration practices
       found in other leading companies and also ensures that the remuneration arrangements for
       executive directors are compatible with those for executives throughout the Group.

       In conclusion, my sincere thanks to Mr. Rajiv Casie Chitty, member of the committee for his
       valuable contribution to the work of the Committee.

       On behalf of the Committee



       (Sgd.)
       Mr. Ajit Jayaratne
       Chairman of the Remuneration Committee

       25th August 2011


                                                      44
                                                                              ACL Cables PLC           Annual Report 2010/11




Independent Auditor's Report



   To the Members of ACL Cables PLC
   Report on the financial statements
   1.   We have audited the accompanying financial statements of ACL Cables PLC (the Company), the consolidated
        financial statements of ACL Cables PLC and its subsidiaries (the Group) which comprise the balance sheets as at
        31 March 2011, and the income statements, statements of changes in equity and cash flow statements for the
        year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on
        pages 46 to 81.

   Management’s Responsibility for the Financial Statements
   2.   Management is responsible for the preparation and fair presentation of these financial statements in accordance
        with Sri Lanka Accounting Standards. This responsibility includes: designing, implementing and maintaining
        internal control relevant to the preparation and fair presentation of financial statements that are free from
        material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies;
        and making accounting estimates that are reasonable in the circumstances.

   Scope of Audit and Basis of Opinion
   3.   Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
        audit in accordance with Sri Lanka Auditing Standards. Those standards require that we plan and perform the
        audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

        An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
        statements. An audit also includes assessing the accounting principles used and significant estimates made by
        management, as well as evaluating the overall financial statement presentation.

        We have obtained all the information and explanations which to the best of our knowledge and belief were
        necessary for the purposes of our audit. We therefore believe that our audit provides a reasonable basis for our
        opinion.

   Opinion
   4.   In our opinion, so far as appears from our examination, the Company maintained proper accounting records for
        the year ended 31 March 2011 and the financial statements give a true and fair view of the Company’s state of
        affairs as at 31 March 2011 and of its profit and cash flows for the year then ended in accordance with Sri Lanka
        Accounting Standards.

   5.   In our opinion, the consolidated financial statements give a true and fair view of the state of affairs as at 31
        March 2011 and of the consolidated profit and cash flows for the year then ended in accordance with Sri Lanka
        Accounting Standards, of the Group dealt with thereby, so far as concerns the shareholders of the Company.

   Report on Other Legal and Regulatory Requirements
   6.   These financial statements also comply with the requirements of Section 153 (2) to 153 (7) of the Companies
        Act, No. 07 of 2007.




   CHARTERED ACCOUNTANTS

   Colombo
   26th August 2011




                                                         45
ACL Cables PLC           Annual Report 2010/11




Income Statement

(All amounts in Sri Lanka Rupees)

                                                                    Group                           Company
                                                                  Year Ended                       Year Ended
                                                                   31 March                         31 March

                                   Notes                  2011                 2010              2011              2010


Revenue                                 3        9,569,771,115       7,242,947,358      5,181,843,384     3,495,236,520
Cost of sales                                    (8,280,809,137)     (6,098,280,574)    (4,744,692,707)   (3,172,153,423)
Gross profit                                  1,288,961,978          1,144,666,784        437,150,676       323,083,098
Other income                            4           50,413,970          13,096,703         45,812,335        40,666,873
Distribution cost                                 (403,216,624)       (425,496,678)      (180,312,634)     (183,931,252)
Administration cost                               (259,704,013)       (265,836,132)       (96,552,545)     (122,570,818)
Operating profit                         5         676,455,312         466,430,677        206,097,832        57,247,901
Net finance cost                         7         (226,755,191)       (270,145,662)      (172,203,829)     (204,101,165)
Profit/ (loss) before tax                          449,700,121         196,285,015         33,894,003      (146,853,263)
Income tax                              8         (162,959,908)       (141,203,109)        (25,322,096)      36,980,638
Profit/ (loss) for the year                        286,740,213          55,081,906          8,571,907      (109,872,625)
Share of (profit)/ loss
  attributable to minority                         (54,193,370)         (59,870,523)                 -                 -
Net profit/ (loss) attributable to
  equity holders of the Company                   232,546,843           (4,788,617)        8,571,907      (109,872,625)


Earning/ (loss) per share               9                  3.88                (0.08)             0.14            (1.83)


Dividend per share                     10                     -                     -                -                 -



The notes on pages 50 to 81 form an integral part of these financial statements.




                                                             46
                                                                                         ACL Cables PLC           Annual Report 2010/11




Balance Sheet
(All amounts in Sri Lanka Rupees)

                                                                         Group                                    Company
                                                                     As at 31 March                             As at 31 March
                                        Notes                   2011                    2010                   2011                   2010

ASSETS
Non current assets
Property, plant and equipment               11         1,943,594,120          1,854,664,461             815,995,717            795,182,706
Work in progress                            12           133,225,619            102,233,873             106,399,394             41,081,510
Investment property                         13           125,000,000            120,000,000                       -                      -
Intangible assets                           14             5,993,702              5,993,702                       -                      -
Leasehold properties                        15             1,798,444              1,820,647                       -                      -
Investment in subsidiaries                  16                     -                      -             538,247,906            538,247,906
Investment in other companies               17            25,816,147             23,398,646              20,246,349              8,010,872
                                                       2,235,428,032          2,108,111,329           1,480,889,366          1,382,522,992

Current assets
Inventories                                 18         3,414,661,009          2,781,361,513           1,988,601,341         1,504,369,218
Receivables and prepayments                 19         2,913,902,476          2,261,421,544           1,924,712,841         1,306,009,247
Leasehold properties                        15                22,203                 21,935                       -                     -
Cash and cash equivalents                   20           382,091,877            884,882,123             233,369,068           559,183,594
                                                       6,710,677,565          5,927,687,115           4,146,683,250         3,369,562,060
Total assets                                          8,946,105,597          8,035,798,444           5,627,572,616         4,752,085,051

EQUITY AND LIABILITIES
Capital and reserves
Stated capital                              30           299,488,400            299,488,400             299,488,400            299,488,400
Capital reserve                             31           863,319,519            799,786,664             330,855,735            330,855,735
General reserve                             32         1,123,825,080          1,123,825,080             680,265,800            680,265,800
Retained earnings                                      1,723,107,434          1,490,573,407             895,876,906            887,304,997
Total equity attributable to equity
  holders of the Company                               4,009,740,433          3,713,673,551           2,206,486,840          2,197,914,932
Minority interest                                        507,317,610            455,172,627                       -                      -
Total equity                                           4,517,058,043          4,168,846,178           2,206,486,840          2,197,914,932

Non current liabilities
Provision for payment in lieu of
  employee share issue scheme               25             2,775,329                2,920,369                     -                      -
Defined benefit obligations                   26           144,798,835              124,859,610            99,735,854             86,970,681
Deferred tax liability                      27            53,493,462               52,482,993             7,748,410              3,110,592
Borrowings                                  22           300,000,000              400,000,000           300,000,000            400,000,000
Finance lease obligation                    23               540,061                  980,695               540,061                980,695
                                                         501,607,686              581,243,667           408,024,325            491,061,968

Current liabilities
Trade and other payables                    21         1,204,204,402            525,001,723           1,375,542,569           459,860,446
Income tax payable                          24           137,819,611            240,785,758              72,514,020            51,829,742
Finance lease obligation                    23               776,110                489,095                 776,110               489,095
Dividend payable                                           4,746,426              4,698,207                       -                     -
Borrowings                                  22         2,579,893,318          2,514,733,816           1,564,228,751         1,550,928,868
                                                       3,927,439,867          3,285,708,599           3,013,061,451         2,063,108,151
Total liabilities                                      4,429,047,554          3,866,952,266           3,421,085,775         2,554,170,119
Total equity and liabilities                          8,946,105,597          8,035,798,444           5,627,572,616         4,752,085,051

It is certified that these financial statements have been prepared in compliance with the requirements of the Companies Act, No. 7 of 2007.


Champika Coomasaru
Group Financial Controller

The Board of Directors is responsible for the preparation and presentation of these financial statements. These financial statements were
authorised for issue by the Board of Directors on 25th August 2011.



U. G. Madanayake                                                       Suren Madanayake
Chairman                                                               Managing Director
The notes on pages 50 to 81 form an integral part of these financial statements.

                                                                    47
ACL Cables PLC              Annual Report 2010/11




Statement of Changes in Equity

(All amounts in Sri Lanka Rupees)
Group
                                               Stated        Capital       General      Retained          Minority
                                  Notes        capital      reserve        reserve      earnings          interest           Total


Balance at 1 April 2009                    299,488,400   441,223,100 1,123,825,080 1,501,308,728      426,976,320 3,792,821,628
Net (loss)/ profit                                    -             -              -    (4,788,618)     59,870,523       55,081,906
Rights issues acquired by
  minority interest                                  -             -              -              -         354,700        354,700
Revaluation surplus                   31             -   367,340,918              -              -                -    367,340,918
Deferred tax on revaluation surplus                  -    (8,191,605)             -              -                -     (8,191,605)
Transfer from revaluation reserve     31             -      (908,490)             -       908,490                 -              -
Deferred tax on transfer              31             -      322,741               -              -                -       322,741
Acquisition of shares by parent                      -             -              -              -     (21,670,983)    (21,670,983)
Dividend paid                                        -             -              -              -      (9,904,040)     (9,904,040)
Balance at 31 March 2010
  - Previously stated                      299,488,400   799,786,664 1,123,825,080 1,497,428,600      455,626,521 4,176,155,265
Deferred income tax charge in
  relation to prior year              36             -             -              -    (6,855,193)        (453,894)     (7,309,087)
Balance at 31 March 2010
  - As restated                            299,488,400   799,786,664 1,123,825,080 1,490,573,407      455,172,627 4,168,846,178
Balance at 1 April 2010                    299,488,400   799,786,664 1,123,825,080 1,490,573,407      455,172,627 4,168,846,178
Net profit                                            -             -              -   232,546,843      54,193,370      286,740,213
Purchase of own shares by
  subsidiaries                                       -             -              -      (921,306)         (82,094)     (1,003,400)
Revaluation surplus                   31             -    67,305,675              -              -       4,456,426      71,762,101
Deferred tax on revaluation           31             -    (3,030,183)             -              -         540,257      (2,489,926)
Transfer from revaluation reserve     31                    (908,490)             -       908,490                 -              -
Deferred tax on transfer              31             -      165,854               -              -          88,523        254,377
Dividend paid                                        -             -              -              -      (7,051,500)     (7,051,500)
Balance at 31 March 2011                   299,488,400   863,319,519 1,123,825,080 1,723,107,434      507,317,610 4,517,058,043


Company
                                               Stated        Capital       General      Retained
                                               capital      reserve        reserve      earnings             Total


Balance at 1 April 2009                    299,488,400   330,855,735    680,265,800   997,177,623     2,307,787,558
Net loss                                             -             -              -   (109,872,625)    (109,872,625)
Balance at 31 March 2010                   299,488,400   330,855,735    680,265,800   887,304,997 2,197,914,932
Balance at 1 April 2010                    299,488,400   330,855,735    680,265,800   887,304,997     2,197,914,932
Net profit                                            -             -              -     8,571,907        8,571,907
Balance at 31 March 2011                   299,488,400   330,855,735    680,265,800   895,876,906 2,206,486,840


The notes on pages 50 to 81 form an integral part of these financial statements.



                                                                48
                                                                          ACL Cables PLC     Annual Report 2010/11




Cash Flow Statement

(All amounts in Sri Lanka Rupees)
                                                            Group                           Company
                                                    Year ended 31st March             Year ended 31st March

                                  Notes             2011                2010               2011            2010

Operating activities
Cash generated from/ (used in)
  operations                           33     178,674,533         (94,722,781)       35,686,945      138,588,095
Interest paid                           7    (243,348,683)      (281,051,647)      (180,037,797)    (207,827,579)
Gratuity paid                          26      (8,777,182)         (5,221,054)       (3,950,896)      (3,514,540)
Payment in lieu of employee
  share issue scheme                   25        (145,040)           (178,511)                -                -
Income tax paid less refund received   24    (263,354,901)      (111,436,077)                 -      (65,328,732)
WHT on dividend paid by subsidiary      8      (3,796,234)         (4,835,536)                -                -
Net cash used in
  operating activities                      (340,747,507)      (497,445,606)      (148,301,749)    (138,082,756)

Investing activities
Interest received                    7        16,593,492          11,244,423          8,127,299        3,726,414
Purchase and construction
  of property, plant and
  equipment                    11 & 12       (165,756,725)       (83,628,687)      (131,843,685)     (45,516,614)
Dividend received                    4            944,772          1,971,295         30,578,782       39,923,684
Investment in other companies                 (17,726,179)       (15,619,635)       (17,641,509)         (74,160)
Investments in subsidiary companies                     -                  -                   -     (15,405,885)
Proceeds on disposal of investments            45,665,048                   -        19,846,232                -
Proceeds on disposal of property,
  plant and equipment                           1,285,871            35,715             413,550                -
Net cash used in investing activities       (118,993,722)       (85,996,889)       (90,519,331)     (17,346,561)

Financing activities
Lease installment paid                           (153,619)          (293,330)          (293,330)        (293,330)
Proceeds from share issue of subsidiary                  -           354,700                   -               -
Purchase of own shares by subsidiaries         (1,003,400)                  -                  -               -
Short term borrowings net of payments         183,741,958        437,049,658         56,920,015     (105,303,213)
Long term borrowings net of payments         (100,000,000)       378,728,523       (100,000,000)     389,208,335
Dividend paid by subsidiary to minorities      (7,051,500)        (9,904,040)                  -               -
Net cash generated from/ (used in)
  financing activities                        75,533,439         805,935,511        (43,373,315)    283,611,792
(Decrease) / increase in cash and
  cash equivalents                          (384,207,789)       222,493,016       (282,194,394)    128,182,475



Movement in cash and cash equivalents
At the beginning of the year                   99,857,658       (122,635,358)       170,182,511      42,000,036
(Decrease) / increase                        (384,207,789)       222,493,016       (282,194,394)    128,182,475
At the end of the year          20          (284,350,131)        99,857,658       (112,011,883)    170,182,511



The notes on pages 50 to 81 form an integral part of these financial statements.



                                                        49
ACL Cables PLC       Annual Report 2010/11




Notes to the Financial Statements

       (In the notes all amounts are shown in Sri Lanka Rupees unless otherwise stated)


       1.      General Information
       ACL Cables PLC was incorporated on 1 March 1962 under the Companies Ordinance No. 51 of
       1938 as Associated Cables Ltd and on 8 January 1991 the name was changed to ACL Cables
       Limited and the Company was re-registered under the Companies Act No. 7 of 2007. At present,
       ACL Cables PLC is a Public Limited Liability Company listed on the Colombo Stock Exchange and
       domiciled in Sri Lanka. The registered office and the principal place of business of the Company is
       located at No. 60, Rodney Street, Colombo 08.


       The principal activities of ACL Cables PLC are manufacturing cables and conductors.



       2.      Summary of Significant Accounting Policies
       2.1     Basis of Preparation
       The consolidated financial statements are prepared in accordance with and comply with Sri Lanka
       Accounting Standards. The consolidated financial statements are prepared under the historical
       cost convention except that land, buildings and investment property is carried at fair value.


       2.2     Consolidation
       Subsidiary undertakings, which are those companies in which the Group, directly or indirectly,
       has an interest of more than one half of the voting rights or otherwise has power to exercise
       control over the operations, have been consolidated. Subsidiaries are consolidated from the date
       on which effective control is transferred to the Group and are no longer consolidated from the
       date of disposal. All inter company transactions, balances and unrealised surplus and deficits
       on transactions between Group companies have been eliminated in the preparation of financial
       statements.


       2.3     New Accounting Standards Issued but not Effective as at the Balance Sheet Date
       The Institute of Chartered Accountants of Sri Lanka (ICASL) has issued the new Accounting
       Standards given below, which become effective for annual periods beginning on or after 1 January
       2012. These standards have not been applied in preparing these financial statements as they were
       not effective for the year ended 31 March 2011.


             LKAS 32 - Financial Instruments : Presentation
             LKAS 39 - Financial Instruments : Recognition and Measurement
             SLFRS 1 - First-time Adoption of Sri Lanka Accounting Standards
             SLFRS 7 - Financial Instruments : Disclosure


       Disclosure requirements under SLAS 10.30 (b) and 10.31 have been exempted by the ICASL and
       therefore all differences and impacts arising from the new Accounting Standards are not presented
       in these financial statements.




                                                       50
                                                                    ACL Cables PLC         Annual Report 2010/11




2.4      Foreign Currency Transactions
Foreign currency transactions are accounted for at the exchange rates prevailing at the date of
the transactions. Gains and losses resulting from the settlement of such transactions and from the
translation of monetary assets and liabilities denominated in foreign currencies, are recognised in
the income statement. Such balances are translated at exchange rates prevailing at balance sheet
date unless hedged by forward foreign exchange contracts, in which case the rates specified in
such forward contracts are used.


2.5      Taxation
2.5.1    Provision for income tax is based on the elements of income and expenditure as reported
in the financial statements and is computed in accordance with the provisions of the relevant tax
statutes.


2.5.2    Deferred income tax is provided in full, using the balance sheet liability method, for all
the temporary differences arising between the tax bases of assets and liabilities and their carrying
amounts in financial statements. The principal temporary differences arise from depreciation on
property, plant and equipment, provisions for retirement benefit obligations and tax losses carried
forward.


Tax rates enacted or substantively enacted by the balance sheet date are used to determine
deferred income tax.


2.5.3    Deferred tax assets relating to the carry forward of unused tax losses are recognised to
the extent that it is probable that future taxable profit will be available against which the unused
tax losses can be utilised.


2.6      Valuation of Assets and their Bases of Measurement
2.6.1    Property, plant and equipment is stated at cost or fair value less accumulated depreciation
and any impairment in value.


All items of property, plant and equipment are initially recorded at cost. Where items of property,
plant and equipment are subsequently revalued, the entire class of such assets are revalued at fair
value.


When an asset is revalued, any increase in the carrying amount is credited directly to a revaluation
reserve, except that it is credited to the income statement to the extent that it reverses a previous
deficit recognised as an expense. Any revaluation deficit that offsets previous surplus in the same
asset is directly offset against the surplus in the revaluation reserve and any excess recognised
as an expense. Upon disposal, any revaluation reserve relating to the asset sold is transferred to
retained earnings. The difference between depreciation based on the asset’s original cost and the
depreciation based on the revalued amount is transferred from revaluation reserve to retained
earnings.




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ACL Cables PLC     Annual Report 2010/11




Notes to the Financial Statements

       Provision for depreciation is calculated by using a straight-line method on the cost or valuation
       of all property, plant and equipment, other than freehold land, in order to write off such amounts
       over the estimated useful economic life of such assets.


       The estimated useful lives of the assets are as follows;


       Asset                                            Years
       Factory buildings                               25 - 40
       Plant, machinery and accessories                 8 - 10
       Factory equipment                                8 - 10
       Electrical fittings                               8 - 10
       Furniture, fixtures and fittings                   4 - 10
       Office equipment                                   4 - 10
       Motor vehicles                                   4 - 5
       Tools and implements                             4 - 10


       The Group’s policy up to 31.03.2006 was not to provide depreciation on property, plant and
       equipment purchased during the year while the full year’s depreciation was charged in the year of
       disposal.


       Commencing from 1st April 2006, depreciation is provided on all property, plant and equipment
       from the month the assets are available for use up to the month of disposal.


       The useful life and residual value of assets are reviewed and adjusted if required, at the end of
       each financial year.


       2.6.2   Leases where the Company assumes substantially all the benefits and risks of ownership
       are classified as finance leases. Finance leases are capitalised at the estimated present value of
       the underlying lease payments. Each lease payment is allocated between the liability and finance
       charges so as to achieve a constant rate on the finance balance outstanding. The corresponding
       rental obligations, net of finance charges are included in other long term payables. The interest
       element of the finance charge is charged to the income statement over the lease period. The
       property, plant and equipment acquired under finance leasing contracts is depreciated over the
       useful life of the asset.


       Leases of assets under which all the risks and benefits of ownership are effectively retained by the
       lessor are classified as operating leases. Payments made under operating leases are charged to the
       income statement on a straight line basis over the period of the lease.




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                                                                    ACL Cables PLC        Annual Report 2010/11




2.6.3     Properties held to earn rental income or properties held for capital appreciation or both
and is not occupied substantially for the supply of goods or services or in administration, and
is not intended for sale in the ordinary course of business have been classified as investment
property. Investment properties are initially recognized at cost. Subsequent to initial recognition
the investment properties are stated at fair value, which reflects market conditions as at balance
sheet date.


Gains or losses arising from changes in fair value are included in the income statement in the year
in which they arise.


Investment properties are de-recognized when disposed, or permanently withdrawn from use
because no future economic benefits are expected. Any gains or losses on retirement or disposal
are recognized in the income statement in the year of retirement or disposal.


Where the Company occupies a significant portion of the investment property, such investment
properties are treated as property, plant and equipment in the financial statements and accounted
for as per SLAS - 18 (Revised 2005), Property, Plant and Equipment.


2.6.4     Goodwill represents the excess or the cost of an acquisition over the fair value of the


Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill acquired in a
business combination is tested annually or more frequently if events or changes in circumstances
indicate that the carrying value may be impaired and carried at cost less accumulated impairment
losses.


Negative goodwill arising on an acquisition represents the excess of the fair value of the net
assets acquired over the cost of acquisition. Negative goodwill is recognized immediately in the
income statement.


2.6.5     All quoted and un-quoted securities, which are held as non-current investments, are
valued at cost less impairment losses. The cost of investment is the cost of acquisition inclusive of
brokerage and costs of transaction. The carrying amounts of long term investments are reduced
to recognise a decline which is considered other than temporary, in the value of investments,
determined on an individual investment basis.


In the Company’s financial statements, investments in subsidiaries have been accounted for at
cost, net of any impairment losses which are charged to the income statement. Income from these
investments is recognized only to the extent of dividends received.




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ACL Cables PLC     Annual Report 2010/11




Notes to the Financial Statements

       2.6.6   The Group assesses at each reporting date whether there is an indication that an asset
       may be impaired. If any such indication exists, or when annual impairment testing for an asset is
       required, the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable
       amount is the higher of an asset’s or cash generating unit’s fair value less costs to sell and its
       value in use and is determined for an individual asset, unless the asset does not generate cash
       inflows that are largely independent of those from other assets or groups of assets. Where the
       carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired
       and is written down to its recoverable amount. In assessing value in use, the estimated future
       cash flows are discounted to their present value using a pre-tax discount rate that reflects current
       market assessments of the time value of money and the risks specific to the asset. Impairment
       losses recognized in prior periods are assessed at each reporting date for any indications that the
       loss has decreased or no longer exists. An impairment loss is reversed if there has been a change
       in the estimates used to determine the recoverable amount. An impairment loss is reversed only to
       the extent that the asset’s carrying amount does not exceed the carrying amount that would have
       been determined, net of depreciation or amortization, if no impairment loss had been recognized.


       An assessment is made at each reporting date as to whether there is any indication that previously
       recognized impairment losses may no longer exist or may have decreased. Previously recognized
       impairment losses, are reversed only if there has been an increase in the recoverable amount of
       the asset. Such increase is recognized to the extent of the carrying amount had no impairment
       losses been recognized previously.


       For goodwill, recoverable amount is estimated at each balance sheet date or as and when an
       indication of impairment is identified.


       Impairment losses are recognized in respect of subsidiaries acquired, are allocated first to reduce
       the carrying amount of any goodwill allocated to the entity and then to reduce the carrying
       amount of the other assets in the entity on a pro-rata basis.


       Impairment losses are recognized in the income statement.


       2.6.7   Inventories are stated at the lower of cost and net realisable value. Cost is determined by
       the weighted average method. The cost of the inventory comprises purchase price, taxes (other
       than those subsequently recoverable by the Company from the tax authorities), and transport,
       handling and other costs directly attributable to the acquisition of finished goods. It excludes the
       borrowing costs. Trade discounts, rebates and other similar items are deducted in determining the
       costs of purchase. Net realisable value is the estimate of the selling price in the ordinary course of
       business, less the costs of completion and selling expenses.


       2.6.8   Trade and other receivables are stated at the amounts estimated to realize, net of
       provision for bad and doubtful debts.


       Amounts due from related Companies are stated at cost.




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                                                                     ACL Cables PLC         Annual Report 2010/11




2.6.9     Cash and cash equivalents comprise cash and bank balances. Bank overdrafts that are
repayable on demand and form an integral part of the Group’s cash management are included as a
component of cash and cash equivalents for the purpose of the statement of cash flows.


2.7       Liabilities and Provisions
Liabilities are recognized in the balance sheet when there is a present obligation arising from a
past event, the settlement of which is expected to result in an outflow of resources embodying
economic benefits. Obligations payable at the demand of the creditor or within one year of the
balance sheet date are treated as current liabilities in the balance sheet. Liabilities payable after
one year from the balance sheet date are treated as non-current liabilities in the balance sheet.


2.7.1     Defined Benefit Plan – Gratuity
Provision has been made in the financial statements for retiring gratuities. This has been based on
an actuarial valuation carried out on a Projected Unit Credit (PUC) method as recommended by Sri
Lanka Accounting Standard No. 16 “Employee Benefits“. The actuarial valuation was carried out by
a professionally qualified firm of actuaries as at 31 March 2011. The Group expects to carry out
actuarial valuation once a year.


The actuarial valuation involves making assumptions about discount rate, salary increment
rate and balance service period of employees. Due to the long – term nature of the plan such,
estimates are subject to significant uncertainty.


However, according to the Payment of Gratuity Act No. 12 of 1983, the liability for payment to an
employee arises only after the completion of 5 years continued service.


Based on the revised Sri Lanka Accounting Standard 16 (SLAS16) which became effective from
the financial year commencing after July 01, 2007, the Group has adopted the actuarial valuation
method from April 01, 2008.


The liability is not externally funded.


2.7.2     Defined Contribution Plans
All employees are eligible for Employees’ Provident Fund Contributions and Employees’ Trust
Fund Contributions in line with respective statutes and regulations. The Company and Group
contributes 12% of gross emoluments of employees to an approved Employees’ Provident Fund
and 3% of gross emoluments of employees to the Employees’ Trust Fund which are externally
funded.




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ACL Cables PLC       Annual Report 2010/11




Notes to the Financial Statements

       2.7.3   Provisions, Contingent Assets and Contingent Liabilities
       Provisions are made for all obligations existing as at the Balance Sheet date when it is probable
       that such an obligation will result in an outflow of resources and reliable estimate can be made of
       the quantum of the outflow.


       All contingent liabilities are disclosed as a note to the financial statements unless the outflow of
       resources is remote.


       All contingent assets are disclosed where inflow of economic benefits is probable.


       2.8     Revenue Recognition
       Revenue is recognized to the extent that it is probable that the economic benefits will flow to the
       Group and the revenue and associated costs incurred or to be incurred can be reliably measured.
       Revenue is measured at the fair value of the consideration received or receivable, net of value
       added taxes. The following specific criteria are used for recognition of revenue.


       Revenue from the sale of goods is recognized when the significant risks and rewards of ownership
       of the goods have passed to the buyer with the Group retaining neither a continuing managerial
       involvement to the degree usually associated with ownership, nor an effective control over the
       goods sold.


       Interest income is recognized on an accrual basis.




       Net gains and losses of a revenue nature arising from the disposal of property, plant and
       equipment and other non-current assets, including investments, are accounted for in the income
       statement, after deducting from the proceeds on disposal, the carrying amount of such assets
       and the related selling expenses. Gains and losses arising from activities incidental to the main
       revenue generating activities and those arising from a group of similar transactions which are not
       material are aggregated, reported and presented on a net basis.


       Other income is recognized on an accrual basis.


       2.9     Borrowing Costs
       Borrowing costs are recognized as an expense in the period in which they are incurred, except
       to the extent that they are directly attributable to the acquisition, construction or production of a
       qualifying asset, in which case it is capitalized as part of the cost of the asset.




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                                                                  ACL Cables PLC        Annual Report 2010/11




2.10    Comparatives
Where necessary, comparative figures have been adjusted to conform with changes in
presentation in the current year.


2.11    Segment Reporting
A segment is a distinguishable component of Group that is engaged either in providing products
or services (business / industry segment), or in providing products or services within a particular
economic environment (geographical segment), which is subject to risks and rewards that are
different from those of other segments.


The segment information has been prepared in accordance with the accounting policies adopted
for preparing and presenting the financial statements.


2.12    Earnings Per Share
The Group presents basic earnings per share (EPS) for its ordinary shares. Basic EPS is calculated
by dividing the profit attributable to ordinary shareholders of the Group by the weighted average
number of ordinary shares outstanding during the year.




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ACL Cables PLC         Annual Report 2010/11




Notes to the Financial Statements

                                                              Group                           Company
                                                       Year ended 31 March              Year ended 31 March

                                                       2011             2010              2011              2010


3.       Revenue
Gross revenue                                  9,572,182,649     7,245,829,606     5,183,839,346     3,497,576,080
Turnover Tax                                        (411,900)       (1,618,235)                -        (1,075,547)
Nation Building Tax                               (1,999,634)       (1,264,012)       (1,995,963)       (1,264,012)
Net revenue                                9,569,771,115        7,242,947,358     5,181,843,384     3,495,236,520


3. (i) Geographical segment turnover
Local                                          7,827,392,968     6,312,037,722     4,627,000,271     3,106,677,560
Export                                         1,744,789,681      933,791,884       556,839,075       390,898,520
                                           9,572,182,649        7,245,829,606     5,183,839,346     3,497,576,080



4.       Other income
Dividend income                                     944,772         1,971,295        30,578,782        39,923,684
Profit on disposal of property,
  plant and equipment                             1,285,871            35,714           413,550                  -
Profit on sale of shares                          30,356,369                  -       14,440,202                  -
Change in fair value of investment
  property (Note 13)                              5,000,000                  -                 -                 -
Sundry income                                    12,826,958         4,824,596           379,800           743,189
Negative goodwill (Note 14)                                -        6,265,098                  -                 -
                                                50,413,970        13,096,703        45,812,335        40,666,873




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                                                                           ACL Cables PLC     Annual Report 2010/11




5.      Operating profit
The following items have been charged/ (credited) in arriving at operating profit:

                                                               Group                          Company
                                                        Year ended 31 March             Year ended 31 March

                                                        2011             2010               2011            2010

Directors’ emoluments                              26,063,333      20,557,667         16,900,000       13,440,000
Auditors’ remuneration
  - audit                                           1,812,595       1,735,280           550,000           500,000
  - non-audit                                          65,000         152,859                 -                 -
Legal fees                                            649,715       1,937,479           649,715         1,937,479
Depreciation on property, plant
  and equipment (Note 11)                        117,597,500      121,110,337        45,712,789       50,964,385
Donations                                          1,450,445          994,710         1,450,445          492,970
Net foreign exchange (gain)/ loss                 (6,862,785)       4,492,895        (6,862,785)       3,332,660
Amortization of leasehold properties (Note 15)        21,935           21,935                 -                -
Bad debts written off                                 347,002        8,613,696                 -                -
Staff cost (Note 6)                               630,919,226      538,423,557       360,037,760      302,316,598
Change in fair value of investment
  property (Note 13)                               (5,000,000)                -                -                 -



6.      Staff cost
Salaries, wages and related cost                  556,069,620     468,137,628        317,095,923     257,412,850
Defined contribution plan                           46,133,199      41,108,057         26,225,767      23,428,136
Defined benefit plan (Note 26)                       28,716,407      29,177,872         16,716,070      21,475,613
                                                 630,919,226     538,423,557        360,037,760     302,316,598

Average number of employees during the year             1,149            1,075               600              581



7.      Net finance cost
Interest income                                   (16,593,492)    (11,244,423)        (8,127,299)     (3,726,414)
Interest expense                                  243,348,683     281,051,647        180,331,128     207,827,579
Lease interest                                               -        338,438                   -              -
                                                 226,755,191     270,145,662        172,203,829     204,101,165



8.      Income tax
Current tax                                      156,193,922      175,014,780         20,684,278                 -
Under/ (over) provision in respect
  of prior years                                    4,194,832        (359,961)                 -                -
Deferred tax (release)/ charge (Note 27)           (1,225,080)    (38,287,246)         4,637,818      (36,980,638)
WHT on dividend paid by subsidiaries                3,796,234       4,835,536                  -                -
                                                 162,959,908     141,203,109         25,322,096      (36,980,638)



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ACL Cables PLC           Annual Report 2010/11




Notes to the Financial Statements

8.       Income tax (Contd.)


arise using the effective tax rate applicable to profits of the Company and Group as follows:

                                                                  Group                          Company
                                                           Year ended 31 March             Year ended 31 March

                                                           2011            2010               2011                2010

Profit/ (loss) before tax                            449,700,121     196,285,015         33,894,003        (146,853,263)

Tax calculated at effective tax rate of 35.525%      159,755,968      69,730,252         12,040,845         (52,169,622)
Tax effect of income liable at
  concessionary rate                                 (12,137,339)     (6,777,645)        (2,156,984)                 -
Tax effect of income not subject to tax               (69,836,597)    (29,269,544)       (16,589,290)       (15,770,715)
Tax effect of expenses not deductible                  76,195,039      54,268,779         44,326,666          7,962,169
Utilisation of previously unrecognized tax losses    (11,822,153)     24,995,491        (12,299,141)        22,997,530
Adjustments in respect of prior years                  4,194,832        (359,961)                 -                  -
WHT on dividends paid by subsidiaries                  3,796,234       4,835,535                  -                  -
Tax effect of adjustments on consolidation            12,813,924      23,780,202                    -                    -
Tax charge                                          162,959,908     141,203,109        25,322,096         (36,980,638)



9.       Earning/ (loss) per share
Basic earnings per share is calculated by dividing the net profit/ (loss) attributable to shareholders by the weighted
average number of ordinary shares in issue during the year.

                                                                  Group                          Company
                                                           Year ended 31 March             Year ended 31 March

                                                           2011            2010               2011                2010

Net profit/ (loss) attributable
 to shareholders                                    232,546,843       (4,788,617)         8,571,907       (109,872,625)
Weighted average number of ordinary
 shares in issue                                     59,893,680      59,893,680         59,893,680          59,893,680
Basic earning/ (loss) per share                            3.88           (0.08)               0.14              (1.83)



10.      Dividend per share
Dividend paid                                                  -                 -                 -                    -
Weighted average number of ordinary
  shares in issue                                    59,893,680      59,893,680         59,893,680          59,893,680
Dividend per share                                             -                 -                  -                   -




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                                                                                         ACL Cables PLC       Annual Report 2010/11




11.         Property, plant and equipment
(a) Group
                                                                                    Furniture, fittings
                                    Land and Plant, machinery Equipment, tools              and office          Motor
                                    buildings and accessories and implements               equipment        vehicles             Total


At 31 March 2009
Cost / valuation                 1,090,542,294    1,271,215,207     95,244,558             88,374,906     71,311,513     2,616,688,478
Accumulated depreciation          (58,021,050)    (876,467,255)    (56,539,262)           (58,631,310)   (47,205,365)   (1,096,864,242)
Net book amount                 1,032,521,244     394,747,952      38,705,296             29,743,596     24,106,148     1,519,824,236


Year ended 31 March 2010
Opening net book amount          1,032,521,244     394,747,952      38,705,296             29,743,596     24,106,148     1,519,824,236
Additions                             986,243        49,281,626      4,486,069              2,934,283      3,796,339        61,484,560
Revaluation surplus               367,340,918                  -                -                    -              -     367,340,918
Disposal - cost                              -                 -        (156,522)                    -              -        (156,522)
         - depreciation                      -                 -         156,522                     -              -          156,522
Transfer from WIP (Note 12)           790,748        26,334,336                 -                    -              -       27,125,084
Depreciation charge (Note 5)      (23,695,119)     (73,247,908)     (5,348,095)           (10,042,879)    (8,776,336)    (121,110,337)
Closing net book amount 1,377,944,034             397,116,006      37,843,270             22,635,000     19,126,151     1,854,664,461


At 31 March 2010
Cost / valuation                 1,459,660,203    1,346,831,169     99,574,105             91,309,189     75,107,852     3,072,482,518
Accumulated depreciation          (81,716,169)    (949,715,163)    (61,730,835)           (68,674,189)   (55,981,701)   (1,217,818,057)
Net book amount                 1,377,944,034     397,116,006      37,843,270             22,635,000     19,126,151     1,854,664,461


Year ended 31 March 2011
Opening net book amount          1,377,944,034     397,116,006      37,843,270             22,635,000     19,126,151     1,854,664,461
Additions                          61,727,985        34,148,962      3,621,057              9,434,259        424,106      109,356,369
Revaluation surplus                71,762,099                  -                -                    -              -       71,762,099
Transfer from WIP (Note 12)                  -       25,408,611                 -                    -              -       25,408,611
Disposal - cost                              -                 -                -                    -    (2,010,678)       (2,010,678)
         - depreciation                      -                 -                -                    -     2,010,678         2,010,678
Depreciation charge (note 05)     (25,269,586)     (72,587,543)     (2,570,607)            (8,544,401)    (8,625,282)    (117,597,420)
Closing net book amount 1,486,164,532             384,086,035      38,893,721             23,524,858     10,924,975     1,943,594,120


At 31 March 2011
Cost / valuation                 1,593,150,287    1,406,388,742    103,195,162            100,743,448     73,521,280     3,276,998,919
Accumulated depreciation         (106,985,755)   (1,022,302,706)   (64,301,442)           (77,218,590)   (62,596,305)   (1,333,404,799)
Net book amount                 1,486,164,532     384,086,035      38,893,721             23,524,858     10,924,975     1,943,594,120




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Notes to the Financial Statements

11.         Property, plant and equipment (Contd.)
(b) Company
                                                                                   Furniture, fittings
                                   Land and Plant, machinery Equipment, tools              and office          Motor
                                   buildings and accessories and implements               equipment        vehicles           Total


At 31 March 2009
Cost / valuation                 630,294,000     669,103,402        9,732,481             52,187,403     38,768,486    1,400,085,772
Accumulated depreciation         (17,668,584)   (499,661,737)      (7,866,713)           (34,157,416)   (23,854,152)   (583,208,602)
Net book amount                 612,625,416     169,441,665        1,865,768             18,029,987     14,914,334     816,877,170


Year ended 31 March 2010
Opening net book amount          612,625,416     169,441,665        1,865,768             18,029,987     14,914,334     816,877,170
Additions                                   -        26,995,268                -           1,842,653        432,000      29,269,921
Depreciation charge (note 05)    (11,345,306)    (25,884,703)          (266,430)          (8,503,348)    (4,964,598)    (50,964,385)
Closing net book amount         601,280,110     170,552,230        1,599,338             11,369,292     10,381,736     795,182,706


At 31 March 2010
Cost / valuation                 630,294,000     696,098,670        9,732,481             54,030,056     39,200,486    1,429,355,693
Accumulated depreciation         (29,013,890)   (525,546,440)      (8,133,143)           (42,660,764)   (28,818,750)   (634,172,987)
Net book amount                 601,280,110     170,552,230        1,599,338             11,369,292     10,381,736     795,182,706


Year ended 31 March 2011
Opening net book amount          601,280,110     170,552,230        1,599,338             11,369,292     10,381,736     795,182,706
Additions                         57,719,000          5,363,115         136,362            3,208,218         99,106      66,525,801
Disposals - cost                            -                 -                -                    -     (715,000)        (715,000)
            - depreciation                  -                 -                -                    -       715,000         715,000
Depreciation charge (note 05)    (11,345,306)    (25,196,880)          (207,357)          (3,957,728)    (5,005,518)    (45,712,789)
Closing net book amount         647,653,804     150,718,465        1,528,343             10,619,781      5,475,324     815,995,717


At 31 March 2011
Cost / valuation                 688,013,000     701,461,785        9,868,843             57,238,274     38,584,592    1,495,166,494
Accumulated depreciation         (40,359,196)   (550,743,320)      (8,340,500)           (46,618,492)   (33,109,268)   (679,170,776)
Net book amount                 647,653,804     150,718,465        1,528,343             10,619,781      5,475,324     815,995,717




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                                                                      ACL Cables PLC         Annual Report 2010/11




11.     Property, plant and equipment (Contd.)
(c) Property, plant and equipment include assets at valuation as follows.
Company
Assets                                 Valued on              Name of the valuer                Valued amount
Land                                   1 September 2007       Mr. J. M. Senanayaka Bandara          236,962,350
Buildings                              1 September 2007       Mr. J. M. Senanayaka Bandara          271,087,650
Plant and equipment                    30 June 1977                                                   1,542,100

Group
Assets                                 Valued on              Name of the valuer                Valued amount
Land
ACL Cables PLC                         1 September 2007       Mr. J. M. Senanayaka Bandara          236,962,350
Kelani Cables PLC                      31 March 2007          Mr. H. W. Wimalasena                   76,900,000
ACL Plastics PLC                       20 March 2009          Mr. J. M. Senanayaka Bandara           44,975,000
Ceylon Bulbs and Electricals Limited   25 July 1988           Mr. B. G. Jayathilake                  13,674,500
Ceylon Bulbs and Electricals Limited   6 September 2009       Mr. J. M. Senanayaka Bandara          338,125,000
Kelani Cables PLC                      31 March 2010          Mr. H. W. Wimalasena                  114,500,000
ACL Kelani Magnet Wire (Pvt) Ltd       01 June 2011           Mr. J. M. Senanayaka Bandara           63,562,500
Buildings
ACL Cables PLC                         1 September 2007       Mr. J. M. Senanayaka Bandara          271,087,650
Kelani Cables PLC                      31 March 2007          Mr. H. W. Wimalasena                   75,100,000
ACL Plastics PLC                       20 March 2009          Mr. J. M. Senanayaka Bandara           58,025,000
Kelani Cables PLC                      31 March 2010          Mr. H. W. Wimalasena                   88,500,000
ACL Kelani Magnet Wire (Pvt) Ltd       01 June 2011           Mr. J. M. Senanayaka Bandara          103,944,881
Plant and Machinery
ACL Cables PLC                         30 June 1977                                                   1,542,100

(d) If revalued assets were stated on the historical cost basis, the amounts would be as follows:
Company
                                                   Cost     Accumulated depreciation             Net book value
                                       at 31 March 2011            at 31 March 2011           at 31 March 2011

Asset
Land                                           33,367,145                             -              33,367,145
Buildings                                      85,322,918                   48,847,576               36,475,342




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Notes to the Financial Statements

11.     Property, plant and equipment (Contd.)
Group
                                                       Cost                                     Net book value
                                             As at 31 March    Accumulated depreciation         As at 31 March
                                                       2011        As at 31 March 2011                    2011
 Land
 ACL Cables PLC                                  33,367,145                            -            33,367,145
 Kelani Cables PLC                                8,530,505                            -             8,530,505
 ACL Plastics PLC                                 3,478,925                            -             3,478,925
 Ceylon Bulbs and Electricals Limited            13,970,450                            -            13,970,450
 Kelani Cables PLC                               63,298,505                            -            63,298,505
 ACL Kelani Magnet Wire (Pvt) Ltd                38,227,530                            -            38,227,530
 Buildings
 ACL Cables PLC                                  85,322,918                   48,847,576            36,475,342
 Kelani Cables PLC                               28,397,188                   14,026,461            14,370,727
 ACL Plastics PLC                                35,312,748                   17,493,989            17,818,759
 Kelani Cables PLC                               33,594,356                   14,288,919            19,305,437
 ACL Kelani Magnet Wire (Pvt) Ltd                57,517,751                   11,440,913            46,076,838


(e) The initial costs of fully depreciated property, plant and equipment which are still in use at the
balance sheet date are as follows;
                                                              As at 31 March 2011          As at 31 March 2010
 ACL Cables PLC                                                       476,876,145                  452,489,518
 ACL Plastics PLC                                                      57,351,806                   54,092,407
 Kelani Cables PLC                                                    257,625,814                  233,911,659
 Ceylon Bulbs & Electricals Limited                                    14,064,546                   14,064,546
 ACL Kelani Magnet Wire (Pvt) Limited                                     537,818                      397,420


(f) Group motor vehicles include the following amounts where the Group is a lessee under a finance lease.
                                                              As at 31 March 2011          As at 31 March 2010
 Cost - Capitalized finance lease                                        2,000,000                    2,000,000
 Accumulated depreciation                                              (1,100,000)                   (700,000)
 Net book amount                                                         900,000                    1,300,000




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                                                                          ACL Cables PLC       Annual Report 2010/11




12.     Work in progress
                                                             Group                            Company
                                                         As at 31 March                     As at 31 March

                                                       2011             2010                2011              2010


Balance at 1 April                            102,233,873        107,214,830          41,081,510         24,834,814
Cost incurred during the year                  56,400,357         22,144,127          65,317,884         16,246,696
Amount transferred to property,
  plant and equipment (Note 11)               (25,408,611)       (27,125,084)                    -                -
Balance at 31 March                          133,225,619        102,233,873        106,399,394          41,081,510



13.     Investment property
                                                                                                Group
                                                                                            As at 31 March

                                                                                            2011              2010


Balance at 1 April                                                                  120,000,000        120,000,000
Change in fair value of investment property (Note 5)                                   5,000,000                  -
Balance at 31 March                                                                125,000,000        120,000,000


Investment property represents the land owned by the Group and situated in Ekala. The value was determined on fair
value basis using market evidence.


A valuation was carried out by an independent professional valuer, Mr H. W. Wimalasena, an Associate Member of
Valuers of Sri Lanka, as at 31 March 2011. The change in fair value of investment property of Rs. 5,000,000 was
credited to income statement. The fair value of investment property as at 31 March 2011 is Rs. 125,000,000.



14.     Intangible assets
                                                                                                Group
                                                                                            As at 31 March

                                                                                            2011              2010


Balance at 1 April                                                                    38,945,423         38,945,423
Balance at 31 March                                                                  38,945,423         38,945,423


Accumulated amortization
Balance at 1 April                                                                    32,951,721         32,951,721
Balance at 31 March                                                                   32,951,721         32,951,721
Net book amount                                                                       5,993,702          5,993,702




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Notes to the Financial Statements

14.     Intangible assets (Contd.)
Goodwill arising on consolidation of subsidiaries is as follows;
 Year                Subsidiary Company                                               Goodwill on consolidation
 1994/95             ACL Plastics PLC                                                                    6,090,495
 1995/96             Lanka Olex Cables (Private) Limited and Kelani Cables PLC                          26,035,049
 1997/98             Ceylon Bulbs and Electricals Limited                                                  459,455
 2004/05             ACL Kelani Magnet Wire (Private) Limited                                              916,805
 2006/07             Ceylon Bulbs and Electricals Limited                                                5,441,533
 2007/08             Ceylon Bulbs and Electricals Limited                                                        2,086

Goodwill arising from business combinations after 1 June 2005, is no longer amortized but tested for impairment
annually as per SLAS 25 (Revised 2005).

Negative goodwill arising on consolidation of subsidiaries is as follows;
 Year                Subsidiary Company                                                     Negative goodwill on
                                                                                                   consolidation

 1998/99             ACL Plastics PLC                                                                    5,127,592
 1999/00             Lanka Olex Cables (Private) Limited and Kelani Cables PLC                          17,502,019
 1999/00             Ceylon Bulbs and Electricals Limited                                                        1,738
 2009/10             Ceylon Bulbs and Electricals Limited                                                6,265,098

Negative goodwill arising from business combinations after 1 June 2005, is no longer amortized but credited to
Income Statement fully in the year of acquisition.



15.     Leasehold properties
                                                                                                Group
                                                                                            As at 31 March

                                                                                           2011                  2010


Balance at 1 April                                                                     1,842,582         1,864,517
Amortisation during the year (Note 5)                                                    (21,935)           (21,935)
Balance at 31 March                                                                   1,820,647          1,842,582


Amount to be amortised within one year                                                    22,203             21,935
Amount to be amortised after one year                                                  1,798,444         1,820,647
                                                                                      1,820,647          1,842,582

Property on operating lease   : Victoria Golf Course and Country Resort in Kandy
Land extent                   : R 01 - P9
Lease period                  : 92 years from 24 January 2002
Lease rentals
  from 2002 to 2011           : Rs 21,935 per annum
  from 2012 to 2094           : Rs 22,203 per annum


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                                                                             ACL Cables PLC        Annual Report 2010/11




16.     Investment in subsidiaries
Company
                                           As at 31 March 2011                         As at 31 March 2010
                                  Number of           Cost         Market     Number of             Cost           Market
                                     Shares                         Value        Shares                             Value
Quoted
ACL Plastics PLC                   2,746,969     33,300,217 447,755,947         2,746,969     33,300,217 323,455,600
Kelani Cables PLC                   933,756      10,752,498     88,986,947        933,756     10,752,498 106,915,062
Total investment in quoted
 companies                                       44,052,715 536,742,894                       44,052,715 430,370,662
Unquoted
Ceylon Bulbs and Electricals
                                   1,051,345     58,514,700                     1,051,345     58,514,700
 Limited
Lanka Olex Cables (Private)
 Limited
                                           99                                           99
 “A” Class ordinary shares
                                   3,065,610    291,180,491                     3,065,610    291,180,491
 “B” Class ordinary shares
 Preference shares                  161,818                                       161,818
ACL Kelani Magnet Wire
 (Private) Limited                11,950,000 119,500,000                      11,950,000 119,500,000
ACL Metals and Alloys
 (Private) Limited                 2,500,000     25,000,000                     2,500,000     25,000,000
Total investment in un-
 quoted companies                               494,195,191                                  494,195,191
Total cost of investments in
 subsidiaries                                   538,247,906                                  538,247,906

ACL Cables PLC acquired the controlling interest in Lanka Olex Cables (Private) Limited in October 1999. Kelani Cables
PLC and Kelani Electrical Accessories (Private) Limited are subsidiaries of Lanka Olex Cables (Private) Limited.

The percentages of ownership held by the Company in each quoted and un-quoted subsidiary as at balance sheet date
are as follows;
                                                                                   As at 31 March      As at 31 March
                                                                                             2011                2010
 Quoted
 ACL Plastics PLC                                                                            65.20%                65.20%
 Kelani Cables PLC                                                                           79.30%                79.30%
 Unquoted
 Ceylon Bulbs and Electricals Limited                                                        95.30%                94.87%
 Lanka Olex Cables (Private) Limited
      “A” Class ordinary shares                                                                  99%                 99%
      “B” Class ordinary shares                                                                100%                 100%
      Preference shares                                                                        100%                 100%
 ACL Kelani Magnet Wire (Private) Limited                                                    93.79%                93.79%
 ACL Metals and Alloys (Private) Limited                                                       100%                 100%



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ACL Cables PLC        Annual Report 2010/11




Notes to the Financial Statements

17.     Investment in other companies
Company
                                         As at 31 March 2011                      As at 31 March 2010
                                   Number              Cost       Market    Number of       Cost        Market
                                  of shares                        Value       shares                    Value
Banking finance and
 insurance
Merchant Bank of Sri Lanka PLC       18,379        1,546,083     849,110       18,379   1,546,083       358,391
Nations Trust Bank PLC                 4,653        450,173     1,406,362      18,613    221,215        642,149
      -Share warrants - 2010                  -            -            -       4,653     46,530         37,224
      -Share warrants - 2011                  -            -            -       2,326     23,260         18,608
Chemicals and
 pharmaceuticals
Chemical Industries                           -            -            -         432      2,976         29,376
 (Colombo) PLC
Land and properties
Kelsey Development PLC                        -            -            -       1,687     29,163         21,931
Colombo Fort Land and
 Building Co. PLC                             -            -            -          14        252           924
Beverage, food and
 tobacco
Ceylon Tobacco Co. PLC                        -            -            -       1,862     39,585        465,966
Footwear and textiles
Asian Cotton Mills PLC                        -            -            -          67      1,938          2,546
Manufacturing
Chevron Lubricants Lanka PLC                  -            -            -      55,200   5,236,144    9,273,600
Telecommunication
Dialog Telekom PLC                  390,000        4,142,633    4,095,000           -           -             -
Diversified holdings
John Keells Holdings PLC             11,819         857,542     3,375,506      11,819    857,542     2,174,696
Walker and Greig PLC                130,700       13,249,918   10,103,110           -           -             -
Trading
Singer (Sri Lanka) PLC                        -            -            -         332      6,185          6,284
Motors
United Motors (Lanka) PLC                 71               -      10,806           71           -         6,284
Total cost of investments by
 the Company                                      20,246,349   18,990,784               8,010,872   13,037,979




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                                                                             ACL Cables PLC     Annual Report 2010/11




17.     Investment in other companies (Contd.)
Investments by subsidiary companies
                                           As at 31 March 2011                       As at 31 March 2010
                                     Number             Cost       Market     Number of          Cost       Market
                                    of shares                       Value      of shares                     Value
Banking, finance and
 insurance
NDB Bank PLC                                 -              -            -        22,500     4,005,229    4,725,000
Asia Capital PLC                             -              -            -        20,000       294,112      260,000
Nations Trust Bank PLC                  25,592       512,005     1,952,670        23,266       407,335      814,310
   - Share warrants - 2011                   -              -            -         2,326        23,260       81,410
DFCC Bank PLC                              13          2,300        2,233            13          2,000         2,346
Plantation
Maskeliya Plantations PLC                8,200       374,258      230,420          8,200       374,258      243,950
Watawala Plantations PLC                20,000     1,252,041      500,000         20,000     1,252,041    3,520,000
Hapugastenna Plantations PLC                 -              -            -         5,000       233,275      190,000
Kegalle Plantations PLC                      -              -            -        20,000     1,014,000      940,000
Kotagala Plantations PLC                10,000       476,580     1,680,000        10,000       476,580      447,500
Diversified holdings
Hayleys PLC                             38,907     2,952,614    14,866,365        96,268     7,305,684   21,660,300
Total cost of investments by
 subsidiaries                                      5,569,798    19,231,688                 15,387,774    32,884,816
Total cost of investment
 by Group                                        25,816,147 38,222,473                     23,398,646 45,922,793


18.     Inventories
                                                              Group                             Company
                                                          As at 31 March                      As at 31 March

                                                       2011              2010                 2011             2010


Raw materials                                1,130,219,311        734,693,742        783,833,295         500,269,937
Work-in-progress                                 685,720,660      519,956,056        431,191,229         256,232,439
Finished goods                               1,325,414,628       1,279,377,259       724,879,432         717,963,243
Goods in transit                                 176,768,141      174,917,236              157,483                 -
Other stocks                                     163,653,465      134,798,868         78,539,902          59,903,600
                                            3,481,776,206       2,843,743,161     2,018,601,341      1,534,369,218
Provision for obsolete stock [18.(i)]            (67,115,197)      (62,381,648)       (30,000,000)       (30,000,000)
Net book amount                             3,414,661,009       2,781,361,513     1,988,601,341      1,504,369,218


18. (i) Provision for obsolete stock
Balance at 1 April                                62,381,648        56,810,372        30,000,000          30,000,000
Provision during the year                          4,733,549         5,571,276                   -                 -
Balance at 31st March                            67,115,197        62,381,648        30,000,000          30,000,000



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Notes to the Financial Statements

19.     Receivables and pre-payments
                                                                Group                           Company
                                                            As at 31 March                    As at 31 March

                                                         2011              2010              2011                2010


Trade receivables                                2,325,033,941     1,759,754,057     1,310,789,146       857,267,049
Provision for doubtful debts [Note 19 (i)]        (130,219,913)     (118,325,227)      (79,994,761)       (70,000,000)
                                                 2,194,814,028     1,641,428,830     1,230,794,385       787,267,049
Receivable from related
  companies [Note 35.9 (b)]                                  -                 -      139,832,144          64,527,999
Loan given to related
  companies [Note 35.9 (c)]                                  -                 -       32,075,221          63,259,924
Advance and pre-payments                           33,384,949        26,129,250        19,075,072          18,834,652
Other receivables                                 685,703,499       593,863,464       502,936,019        372,119,623
                                             2,913,902,476        2,261,421,544     1,924,712,841      1,306,009,247


Value of book debts of ACL Cables PLC and Kelani Cables PLC have been pledged as security for bank facilities obtained.

                                                                Group                           Company
                                                            As at 31 March                    As at 31 March

                                                         2011              2010              2011                2010


19. (i) Provision for doubtful debts
Balance at 1 April                                118,325,227        66,003,054        70,000,000          40,000,000
Provision for the year                             13,622,914        52,322,173          9,994,761         30,000,000
Debts written-off                                    (1,728,228)                -                   -                  -
Balance at 31 March                              130,219,913       118,325,227        79,994,761          70,000,000



20.     Cash and cash equivalents
Cash at bank and in hand                          304,862,658       340,753,935        26,460,900          22,022,707
Short term deposits                                77,229,219       544,128,188       206,908,168        537,160,888
                                                 382,091,877       884,882,123       233,369,068        559,183,594


For the purposes of the cash flow statement, the year end cash and cash equivalents comprise the following:

                                                                Group                           Company
                                                            As at 31 March                    As at 31 March

                                                         2011              2010              2011                2010


Cash and cash equivalents                         382,091,877       884,882,123       233,369,068        559,183,594
Bank overdraft (Note 22)                          (666,442,008)     (785,024,465)     (345,380,951)      (389,001,083)
                                                 (284,350,131)      99,857,658       (112,011,883)      170,182,511



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21.     Trade and other payables
                                                                Group                               Company
                                                            As at 31 March                        As at 31 March

                                                        2011                 2010                 2011                2010


Trade payables                                  987,799,650          357,814,248          563,151,521           13,990,991
Payables to related parties [Note 35.9 (a)]                  -                    -       577,837,162         223,584,975
Loans from related parties [Note 35.9 (d)]                   -                    -       123,193,100         123,193,100
Accrued expenses and other payable              216,404,752          167,187,475          111,360,786           99,091,380
                                              1,204,204,402         525,001,723        1,375,542,569         459,860,446



22.     Borrowings
Long term borrowings
Interest bearing loans                          300,000,000          400,000,000          300,000,000         400,000,000
                                               300,000,000          400,000,000          300,000,000         400,000,000


Short term borrowings
Bank borrowings                                 366,666,667          457,590,152          366,666,667         222,884,147
Short term loans                               1,546,784,643       1,272,119,199          852,181,134         939,043,638
Bank overdraft (Note 20)                        666,442,008          785,024,465          345,380,951         389,001,083
                                              2,579,893,318       2,514,733,816        1,564,228,751       1,550,928,868


Group long term borrowings are secured by a fixed deposit amounting to USD 260,000.



23.     Finance lease obligation
Lease liabilities are effectively secured as the rights to the leased assets revert to the lessor in the event of default.

                                                                Group                               Company
                                                            As at 31 March                        As at 31 March

                                                        2011                 2010                 2011                2010


Gross finance lease liabilities                     1,947,935            1,947,935            1,947,935           1,947,935
Future finance charge on finance lease                 (631,764)           (478,145)            (631,764)            (478,145)
Present value of finance lease liabilities          1,316,171            1,469,790            1,316,171           1,469,790


Present value of finance lease liabilities
No later than 1 year                                 776,110              489,095              776,110             489,095
Later than 1 year                                    540,061              980,695              540,061             980,695
                                                  1,316,171            1,469,790            1,316,171           1,469,790




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Notes to the Financial Statements

24.     Income tax payable
                                                            Group                            Company
                                                        As at 31 March                     As at 31 March

                                                     2011              2010               2011               2010


Balance at 1 April                            240,785,758       177,567,016         51,829,742        117,158,474
Provision for the current year (Note 8)       156,193,922       175,014,780         20,684,278                      -
Under/ (over) provision in respect
  of previous years (Note 8)                    4,194,832           (359,961)                  -                    -
                                              401,174,512       352,221,835         72,514,020        117,158,474
Payments made during the year                 (263,354,901)    (111,436,077)                   -      (65,328,732)
Balance at 31 March                           137,819,611      240,785,758         72,514,020         51,829,742



25.     Provision for payment in lieu of employee share issue scheme
                                                            Group
                                                        As at 31 March

                                                     2011              2010


Balance at 1 April                              2,920,369         3,098,880
Payments made during the year                     (145,040)         (178,511)
Balance at 31 March                             2,775,329        2,920,369


In view of the transfer of ownership from Pacific Dunlop Cables Group to ACL Group, the employees were allocated a
fixed sum as compensation for the share ownership scheme which was proposed earlier. The employees who were in
employment as at 11 September 1999 are eligible for the payment which will be made at the time of resignation or
retirement.




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                                                                           ACL Cables PLC        Annual Report 2010/11




26.     Defined benefit obligations
The amounts recognized in the balance sheet are determined as follows:
                                                            Group                               Company
                                                       As at 31 March                         As at 31 March

                                                     2011                2010                2011                2010


Balance at 1 April                            124,859,610         100,902,792          86,970,681          69,009,608
Current service cost/(reversal of
  excess provision) (Note 6)                   28,716,407          29,177,872          16,716,070          21,475,613
                                              153,576,017         130,080,664         103,686,751          90,485,221
Payments made during the year                   (8,777,182)         (5,221,054)         (3,950,896)        (3,514,540)
Balance at 31 March                           144,798,835         124,859,610         99,735,854          86,970,681


The Company maintains a non-contributory defined benefit plan providing for gratuity benefits payable to employees
expressed in term of final monthly salary and service.


As at 31 March 2011, the gratuity liability was actuarially valued under the Projected Unit Credit (PUC) method by a
professionally qualified actuary firm, Actuarial & Management Consultants (Private) Limited.


The key assumptions used by the actuary include the following :

                                                        Group/ Company
                                                         As at 31 March

                                                     2011                2010


Rate of discount                                        11%                12%
Salary increment rate                                   10%                10%
Retirement age                                     55 years            55 years



27.     Deferred income tax
Deferred income taxes are calculated on temporary differences under the liability method using a principal tax rate of
28% (2010 - 35%).
                                                             Group                              Company
                                                         As at 31 March                       As at 31 March

                                                     2011                2010                2011                2010


Deferred tax liability
Balance at 1 April                             52,482,993          82,901,375            3,110,592         40,091,230
Charge /(reversal) during the year (Note 8)     (1,225,080)        (38,287,246)          4,637,818        (36,980,638)
Tax effect on surplus on revaluation reserve      2,489,926           8,191,605                    -                    -
Deferred tax on transfer from
  retained earnings                               (254,377)           (322,741)                   -                    -
Balance on 31 March                            53,493,462          52,482,993           7,748,410          3,110,592

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Notes to the Financial Statements

28.     Contingent Liabilities
Company
The Company has guaranteed a credit facility of Rs 24 Mn obtained by Ceylon Bulbs and Electricals Limited from
Hatton National Bank PLC.


The Company has guaranteed a credit facility of USD 2 Mn obtained by ACL Kelani Magnet Wire (Pvt) Ltd from
Standard Chartered Bank.


The Company has guaranteed a credit facility of Rs 375 Mn obtained by ACL Metal and Alloys (Private) Limited from
Standard Chartered Bank.


Group
Kelani Cables PLC has given guarantees to third parties amounting to Rs. 106.5 Mn.



29.     Commitments
Financial commitments
There were no material financial commitments outstanding at the balance sheet date.


Capital commitments
There were no material capital commitments outstanding at the balance sheet date.



30.     Stated capital
                                                            Group                            Company
                                                        As at 31 March                     As at 31 March

                                                    2011               2010                2011              2010


Number of ordinary shares issued
  and fully paid
Balance at 31 March                           59,893,680         59,893,680           59,893,680       59,893,680


Stated capital
Balance at 1 April                           299,488,400        299,488,400          299,488,400      299,488,400
Balance at 31 March                          299,488,400       299,488,400           299,488,400     299,488,400




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                                                                             ACL Cables PLC     Annual Report 2010/11




31.     Capital reserve
Capital reserve comprises profit on sale of property, plant, equipment and investments, Capital Redemption Reserve
Fund (CRRF) created consequent to redemption of shares and revaluation surplus arising from net surplus on
revaluation of property, plant and equipment.

                                                              Group                             Company
                                                          As at 31 March                      As at 31 March

                                                      2011                  2010              2011             2010


Balance at 1 April 2010                         799,786,664        441,223,100       330,855,735       330,855,735
Revaluations during the year                     67,305,675        367,340,918                   -                  -
Deferred tax on revaluation                      (3,030,183)         (8,191,605)                 -                  -
Transfer to retained earnings from
  revaluation reserve                              (908,490)           (908,490)                 -                  -
Deferred tax on transfer                           165,854             322,741                   -                  -
Balance on 31 March 2011                     863,319,519          799,786,664       330,855,735       330,855,735


Group capital reserve as at balance sheet date consists of the following;

                                                              Group
                                                          As at 31 March

                                                      2011                  2010


Capital redemption reserve fund                   2,625,000          2,625,000
Surplus on revaluation of property, plant
  and equipment                                 858,883,999        795,351,146
Profit on sale of property, plant,
  equipment and investments                       1,810,518          1,810,518
                                             863,319,517          799,786,664



32.     General reserve
General reserve consists of such amounts that have been from time to time transferred from retained earnings as
resolved at General Meetings of the Company/ Group for general applications.

                                                              Group                             Company
                                                          As at 31 March                      As at 31 March

                                                      2011                  2010              2011             2010


Balance at 1 April                           1,123,825,080       1,123,825,080       680,265,800       680,265,800
Transferred from retained earnings                         -                   -                 -                  -
Balance at 31 March                         1,123,825,080      1,123,825,080        680,265,800       680,265,800




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Notes to the Financial Statements

33.     Cash generated from/ (used in) operations
Reconciliation of profit/ (loss) before tax to cash generated from/ (used in) operations:

                                                             Group                                 Company
                                                      Year ended 31 March                    Year ended 31 March

                                                      2011                2010                  2011           2010

Profit/ (loss) before tax                       449,700,121         196,285,015             33,894,003   (146,853,263)
Adjustments for:
Depreciation of property, plant
  and equipment (Note 11)                      117,597,420         121,110,337          45,712,789       50,964,385
Dividend income (Note 4)                          (944,772)         (1,971,295)        (30,578,782)     (39,923,684)
Interest expense                               243,348,683         281,051,647         180,331,128      207,827,579
Interest income (Note 7)                       (16,593,492)        (11,244,423)         (8,127,299)      (3,726,414)
Negative goodwill on acquisition of
  minority shares (Note 4)                                 -         (6,265,098)                    -              -
Change in fair value of investment
  property (Note 13)                             (5,000,000)                   -                    -              -
Profit on disposal of property, plant
  and equipment (Note 4)                        (1,285,871)             (35,714)          (413,550)                -
Profit on disposal of investment (Note 4)       (30,356,369)                   -        (14,440,202)                -
Amortization of leasehold
  properties (Note 15)                               21,935              21,935                     -              -

Changes in working capital:
 Inventories                                  (633,299,496)       (700,142,380)       (484,232,122)     (271,108,093)
 Receivables and pre-payments                 (652,480,931)        145,493,342        (618,703,594)      284,518,235
 Trade and other payables                      679,202,679        (148,204,018)        915,528,504        35,413,739
 Dividend payable                                   48,220                    -                   -                -
Defined benefit obligations (Note 26)             28,716,407          29,177,872          16,716,070        21,475,613
Cash generated from/ (used in)
  operations                                  178,674,533         (94,722,781)         35,686,945       138,588,095




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                                                                                ACL Cables PLC          Annual Report 2010/11




34.        Segment information
34. (a) Business segment information

                                            Manufacturing Manufacturing       Manufacturing              Total             Total
                                                  Cables PVC Compounds                Rods
                                                     2011            2011              2011              2011              2010


Revenue
Total revenue                                9,611,650,110    843,079,352       249,118,306     10,703,847,768     8,573,755,218
Inter-segment sales                           (131,203,263)   (753,755,084)     (249,118,306)   (1,134,076,653)   (1,330,807,860)
External sales                              9,480,446,847     89,324,268                   -    9,569,771,115     7,242,947,358


Results
Profit before other income and finance cost     413,892,077     105,516,463       106,632,802       626,041,342       436,199,346
Other income                                   33,725,627      16,688,343                  -       50,413,970        19,262,615
Finance cost                                  (219,684,644)        362,542        (7,433,089)     (226,755,191)     (263,773,049)
Taxation                                      (111,825,229)    (47,257,584)       (3,877,095)     (162,959,908)     (136,607,006)
Profit after taxation                                                                             286,740,213        55,081,906


Assets
Segment assets                               8,174,818,328    290,824,822       116,264,075      8,581,907,225     7,699,558,274
Un-allocated corporate assets                                                                     364,198,372       336,240,170
Total assets                                                                                    8,946,105,597     8,035,798,444


Liabilities
Segment liabilities                          4,057,424,153    281,076,383        83,046,039      4,421,546,575     3,496,608,692
Un-allocated corporate liabilities                                                                   7,500,981      370,343,574
Total liabilities                                                                               4,429,047,556     3,866,952,266


Capital expenditure
Segment capital expenditure                   157,510,496       1,827,636         6,418,594       165,756,725       230,947,485
Total capital expenditure                                                                        165,756,725       230,947,485


Depreciation and amortization
Segment depreciation                          102,228,292       8,811,496         6,557,632       117,597,420       121,110,337
Total depreciation and amortization                                                              117,597,420       121,110,337



34. (b) Geographical segment information
Geographical segment turnover is given in note 3.(i).




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Notes to the Financial Statements

35.    Directors’ interests in contracts and related party transactions
35.1   Mr. U. G. Madanayake, Mr. Suren Madanayake, Dr. S. K. Madanayake and Mrs. N. C. Madanayake who are
       Directors of the Company, are also Directors of ACL Plastics PLC which is a 65.2% owned subsidiary of ACL
       Cables PLC.


35.2   Mr. U. G. Madanayake, Mr. Suren Madanayake, Dr. S. K. Madanayake and Mrs. N. C. Madanayake who are
       Directors of the Company are also the Directors of Lanka Olex Cables (Private) Limited which is a 100% owned
       subsidiary of ACL Cables PLC.


35.3   Mr. U. G. Madanayake, Mr. Suren Madanayake, Dr. S. K.Madanayake, Mrs. N. C. Madanayake and Mr. Hemantha
       Perera who are Directors of the Company are also the Directors of Kelani Cables PLC which is a 79.2% owned
       subsidiary of ACL Cables PLC.


35.4   Mr. U. G. Madanayake, Mr. Suren Madanayake and Mr. Hemantha Perera who are Directors of the Company
       are also the Directors of ACL Kelani Magnet Wire (Private) Limited which is a 93.79% owned subsidiary of ACL
       Cables PLC.


35.5   Mr. U. G. Madanayake and Mr. Suren Madanayake who are Directors of the Company are also the Directors of
       ACL Metals and Alloys (Private) Limited which is a 100% owned subsidiary of ACL Cables PLC.


35.6   Mr. U. G. Madanayake and Mr. Suren Madanayake who are Directors of the Company are also the Directors of
       ACL Polymers (Private) Limited which is a 65.2% owned subsidiary of ACL Cables PLC.


35.7   Mr U. G. Madanayake, Mr. Suren Madanayake and Mrs. N. C. Madanayake who are Directors of the Company
       are also the directors of Ceylon Bulbs and Electricals Limited which is a 95.3% owned subsidiary of ACL Cables
       PLC.




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                                                                        ACL Cables PLC       Annual Report 2010/11




35.8   The Company had the following business transactions in the ordinary course of business during the year:

                                                                                             Company
                                                                                       Year Ended 31 March

                                                                                          2011              2010


(a) Sales of goods
Kelani Cables PLC                                                                   93,777,845         62,695,342
ACL Metal and Alloys (Private) Limited                                              10,257,088         15,430,641
ACL Plastics PLC                                                                        41,476                   -
                                                                                  104,076,409         78,125,983


(b) Purchase of goods & services
ACL Plastics PLC                                                                   503,577,684       325,028,498
Kelani Cables PLC                                                                   47,345,863         20,002,400
Ceylon Bulbs and Electricals Limited                                                 1,371,429          1,498,844
ACL Metal and Alloys (Private) Limited                                             249,118,306       551,693,323
                                                                                  801,413,282       898,223,065


(c) Loans to / (settlement by) related party
ACL Metal and Alloys (Private) Limited                                             (31,184,703)                  -
                                                                                  (31,184,703)                   -


(d) Loans from related party
ACL Plastics PLC                                                                               -       16,000,000
                                                                                               -      16,000,000


(e) Interest on loans from related party
ACL Plastics PLC                                                                     4,304,912          3,939,425
Kelani Cables PLC                                                                    3,232,170          4,541,154
ACL Polymers (Private) Limited                                                       1,930,625          1,863,360
                                                                                    9,467,707         10,343,939


(f) Key management compensation
                                                          Group                              Company
                                                   Year ended 31 March                 Year ended 31 March

                                                   2011               2010                2011              2010


Short term benefits                           26,063,333          20,557,667         16,900,000         13,440,000
                                            26,063,333          20,557,667         16,900,000         13,440,000




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Notes to the Financial Statements

35.9   Balances arising from the above related party transactions as at the balance sheet date are as follows;

                                                                                               Company
                                                                                             As at 31 March

                                                                                             2011                  2010


(a) Payable to related parties
Kelani Cables PLC                                                                      33,685,621           5,336,508
ACL Metal and Alloys (Private) Limited                                                252,098,010        150,542,580
ACL Polymers (Private) Limited                                                            452,500                503,757
ACL Plastics PLC                                                                      291,601,031         66,822,870
Ceylon Bulbs and Electricals Limited                                                              -              379,260
                                                                                    577,837,162         223,584,975


(b) Receivable from related parties
Kelani Cables PLC                                                                      63,758,412         27,266,288
ACL Kelani Magnet Wire (Private) Limited                                               62,872,974         21,394,522
Ceylon Bulbs and Electricals Limited                                                    7,283,066           7,253,730
ACL Plastics PLC                                                                        3,521,481           2,662,161
ACL Metal and Alloys (Private) Limited                                                  2,396,210           5,951,298
                                                                                    139,832,144          64,527,999


(c) Receivable on loans
ACL Metal and Alloys (Private) Limited                                                            -       31,184,703
ACL Kelani Magnet Wire (Private) Limited                                               32,075,221         32,075,221
                                                                                      32,075,221         63,259,924


(d) Payable on loans
Kelani Cables PLC                                                                      41,854,000         41,854,000
ACL Plastics PLC                                                                       55,745,056         55,745,056
ACL Polymers (Private) Limited                                                         25,000,000         25,000,000
Lanka Olex Cables (Private) Limited                                                       594,044                594,044
                                                                                    123,193,100         123,193,100


There were no other related parties or related party transactions during the year ended 31 March 2011 other than
those disclosed above.




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                                                                          ACL Cables PLC       Annual Report 2010/11




36.    Comparative information
Comparative information in financial statements have been restated as follows.


   (a) Recognition of previously unrecognized deferred tax liability amounting to Rs. 7,309,087 of ACL Kelani Magnet
      Wire (Private) Limited. Liability was allocated as follows:
      - Retained earnings (Rs)      6,855,193
      - Minority interest (Rs)         453,894



37.    Post balance sheet events
No circumstances have arisen since the balance sheet date, which would require adjustments to, or disclosure in the
financial statements.




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ACL Cables PLC       Annual Report 2010/11




Information to Shareholders

       (a) Distribution of shareholders as at 31st March 2011.
                                               Number of             Number of             % of
               Share range                   shareholders       ordinary shares         holding


               01      to   1,000                   1,655               575,871           0.96%
           1,001       to   5,000                     555             1,440,385           2.41%
           5,001       to   10,000                    130             1,031,232           1.72%
         10,001        to   50,000                    121             2,665,897           4.45%
         50,001        to   100,000                       27          2,008,029           3.35%
        100,001        to   500,000                       27          5,445,222           9.09%
        500,001        to   1,000,000                     3           2,059,420           3.44%
                    Over 1,000,000                        8          44,667,624          74.58%
       Total                                       2,526             59,893,680        100.00%



       (b) Analysis report of shareholders as at 31st March 2011.
                                                               Number of shares    % of holding


       Institutional                                                 13,859,356          23.14%
       Individuals                                                   46,034,324          76.86%
       Total                                                         59,893,680        100.00%



       (c) Market and other information.
                                                                 31 March 2011    31 March 2010

       Company
       a) Earnings per share (Rs.)                                         0.14            (1.83)
       b) Dividends per share (Rs.)                                           -                 -
       c) Net assets value per share (Rs.)                                36.97            36.83
       d) Market value per share
           - Highest value (Rs.)                                          97.00            86.25
           - Lowest value (Rs.)                                           85.50            75.00
           - Value as at the end of financial year (Rs.)                   94.00            75.00
       e) Number of trades                                                1,866            4,445
       f) Total number of shares traded                               3,375,700        6,019,300
       g) Total turnover (Rs.)                                      308,833,870      485,738,050
       h) Percentage of shares held by the public                        36.70%           36.70%
       i) Number of foreign shareholders                                     41               51

       Consolidated
       a) Earnings per share (Rs.)                                         3.88            (0.08)
       b) Net assets value per share (Rs.)                                75.68            69.85




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                                                         ACL Cables PLC   Annual Report 2010/11




(d) Twenty largest share holders list as at 31 March 2011.

Share Holder Name                           As at 31/03/2011      As at 31/03/2010
                                           No. Shares      %      No. Shares       %


1.   Madanayake U. G.                      22,642,116   37.80     22,642,116   37.80
2.   Madanayake H. A. S.                   13,302,396   22.21     13,302,396   22.21
3.   Employees Provident Fund               2,769,612    4.62      3,228,712    5.39
4.   Sri Lanka Insurance
       Corporation Ltd-Life Fund            2,423,800    4.05      2,188,900    3.65
5.   National Savings Bank                  1,276,200    2.13        495,300    2.28
6.   Employees Trust Fund Board             1,221,400    2.04      1,366,000    1.72
7.   Madanayake N. C.                       1,032,100    1.72      1,032,100    1.28
8.   Fab Foods (Private) Limited              767,520    1.28        767,520    1.28
9.   Deutsche Bank AG
       National Equity Fund                   750,000    1.25        325,000    0.54
10. Bank of Ceylon - No2 A/C                  541,900    0.90        364,000    0.74
11. Deutsche Bank AG as
       Trustee for Namal Acuity               500,000    0.83        500,000    0.83
12. David Peiris Motor Company Ltd.           353,000    0.59              -        -
13. Perera R. D. M.                           350,932    0.59        350,932    0.59
14. Sir Cyril De Zoysa Trust                  341,036    0.57        341,036    0.54
15. Commercial Bank of Ceylon PLC/
       Mr. G. Ramanan                         303,300    0.51              -    0.00
16. Seylan Bank Ltd/ G. Ramanan               286,000    0.48              -    0.00
17. Waldock Mackenzie Ltd -
       Line Trading (Pvt) Ltd #2037           247,600    0.41              -    0.00
18. AVIVA NDB Insurance A/c No 7              228,100    0.38              -    0.00
19. Waldock Mackenzie Ltd-Hi Line Towers      209,500    0.35              -    0.00
20. AVIVA NDB Insurance A/c No 3              200,600    0.33        192,600    0.32




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ACL Cables PLC      Annual Report 2010/11




Five Year Summary - Group

       Trading Results
       Year Ended                 31st March 31st March 31st March 31st March                 31st March
                                            2011        2010          2009          2008           2007
                                      Rs.'000         Rs.'000       Rs.'000       Rs.'000        Rs.'000


       Turnover                     9,569,771       7,242,947     7,838,591     8,773,581      7,820,083
       Profit before tax               449,700         196,285       161,408       524,295      1,368,196
       Taxation                      (162,960)       (141,203)        (3,348)    (200,293)      (484,293)
       Profit after tax                286,740          55,082       158,060       324,002        883,903



       Balance Sheet
       As At                      31st March 31st March 31st March 31st March                 31st March
                                            2011        2010          2009          2008           2007
                                      Rs.'000         Rs.'000       Rs.'000       Rs.'000        Rs.'000


       Stated capital                 299,488         299,488       299,488       299,488        299,488
       Capital reserve                863,320         799,787       441,223       404,712        151,048
       Revenue reserve              2,846,933       2,621,254     2,625,133     2,524,758      2,336,043
                                    4,009,741       3,720,529     3,365,844     3,228,958      2,786,579
       Minority interest              507,317         455,626       426,976       386,796        374,917
       Non-current liabilities        501,608         573,934       202,317       327,748        350,649
                                   5,018,666        4,750,089     3,995,137     3,943,502      3,512,145


       Property, plant &
         equipment                  1,943,594       1,854,665     1,519,824     1,359,273        918,058
       Leasehold properties
         - pre-payments                     1,798       1,820         1,842         1,864          1,886
       Capital work in progress       133,226         102,235       107,215        65,842        152,147
       Intangible assets                    5,993       5,993         5,993         5,993          5,993
       Investment property            125,000         120,000       120,000       104,000        104,000
       Investments                     25,816          23,398        23,185        23,732         23,499
       Current assets               6,710,678       5,927,687     5,096,844     6,356,635      5,214,013
       Current liabilities          (3,927,440)     (3,285,709)   (2,879,766)   (3,973,837)    (2,907,450)
       Capital employed            5,018,666        4,750,089     3,995,137     3,943,502      3,512,145




                                                        84
                                                                        ACL Cables PLC        Annual Report 2010/11




Glossary of Financial Terms

   Accounting Policies                                    Corporate Governance
   The specific principles, bases, conventions,            The process by which corporate entities
   rules and practices adopted by an enterprise           are governed. It is concerned with the
   in preparing and presenting Financial                  way in which power is exercised over the
   Statements.                                            management and direction of the entity,
                                                          the supervision of executive action and
   Amortization                                           accountability to owners and others.
   The systematic allocation of the depreciable
   amount of an intangible asset over its useful          Current Ratio
   life.                                                  Current assets divided by current liabilities. A
                                                          measure of liquidity.
   Basic Earnings Per Share
   Profits attributable to ordinary shareholders           Debt /Equity
   divided by the weighted average number of              Debt as a percentage of total equity less
   ordinary shares in issue during the year.              minority interest if any.


   Borrowings                                             Deferred Taxation
   All interest bearing liabilities.                      The tax effect of temporary differences
                                                          deferred to/from another period, which
   Capital Employed                                       would only qualify for inclusion on a tax
   Total equity, minority interest and interest           return at a future date.
   bearing borrowings.
                                                          Earnings Per Ordinary Share (EPS)
   Capital Reserves                                       Profits attributable to ordinary shareholders
   Reserves identified for specific purposes and            divided by the weighted average number of
   considered not available for distribution.             ordinary shares in issue during the year.


   Cash Equivalents                                       Effective Tax Rate
   Liquid investments with original maturity              Income tax expenses divided by profit from
   period of three months or less.                        ordinary activities before tax.


   Contingent Liability                                   Equity
   A possible obligation that arises from past            Shareholders’ funds.
   events and whose existence will be confirmed
   only by the occurrence or non-occurrence               Dividends
   of one or more uncertain future events not             Distribution of profits to holders of equity
   wholly within control of the enterprise.               investment.


   Credit Rating                                          Dividend Cover
   An evaluation of a corporate’s ability to              Profit attributable to ordinary shareholders
   repair its obligations or the likelihood of not        divided by dividend. Measures the number
   defaulting, carried out by an independent              of times dividend is covered by distributable
   rating agency.                                         profit.




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ACL Cables PLC      Annual Report 2010/11




Glossary of Financial Terms

       Dividend Yield                                        Related Parties
       Dividend per share as a percentage of                 Parties who could control or significantly
       the market price. A measure of return on              influence the financial and operating policies
       investment                                            of the business.


       Gearing                                               Return on Equity
       Proportion of total interest bearing                  Profit before tax divided by total equity less
       borrowings to capital employed.                       minority interest if any.


       Interest Cover                                        Return on Total Assets
       Profit before tax plus net finance cost divided         Profit before tax plus finance cost divided by
       by net finance cost. Measure of an entity’s            total average assets.
       debt service ability.


       Market Capitalization                                 Revenue Reserves
       Number of shares in issue multiplied by the           Reserves considered as being available for
       market value of a share at the report date.           distribution and investments.


       Net Assets Per Share                                  Segments
       Shareholders’ funds divided by the weighted           Constituent business units grouped in terms
       average number of ordinary shares in issue. A         of similarity of operations.
       basis of share valuation.
                                                             Stated Capital
       Net Worth                                             The total amount received by the Company or
       Total equity less minority interest if any.           due and payable to the Company in respect
                                                             of issue and calls of shares are referred to as
       Operating Profit                                       stated capital.
       Profit before tax, share of profit of associates
       and net finance cost.                                  Value Addition
                                                             The quantum of wealth generated by the
       Price Earnings Ratio                                  activities of the Group measured as the
       Market price of a share divided by earnings           difference between turnover and the cost of
       per share as reported at that date.                   material and services bought in.


       Prudence                                              Working Capital
       Inclusion of a degree of caution in the               Capital required to finance day-to-day
       exercise of judgment needed in making                 operations computed as the excess of current
       the estimates required under conditions of            assets over current liabilities.
       uncertainty, such that assets or income are
       not overstated and liabilities or expenses are
       not understated.




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                                                                    ACL Cables PLC       Annual Report 2010/11




Milestones

   1962
   In March 1962, Associated Motorways Ltd (AMW) incorporated Associated Cables Ltd as a
   Subsidiary for the manufacture of electric cables.



   1963
   Within a period of one year, manufacture of electric cables commenced in Sri Lanka for the first
   time with Japanese technical assistance within the AMW Industrial complex at Kalutara.



   1976
   The Company became a public quoted company under the rules of Colombo Brokers Association.



   1978
   Facilities for drawing of Copper wires were added.



   1980
   The Company moved out of AMW Group.

   Aluminum Conductor plant was set up for the manufacture of AAC and ACSR.


   1981
   Joint Venture with Aluminum Industries Ltd, India for the manufacture of 1400 M/Ts of Aluminium
   conductors.


   1982
   Establishment of own distribution network island wide.



   1986
   Production of Armoured cable commenced at Piliyandala Factory.



   1988
   Company entered into a technical collaboration agreement with Nokia Cables Finland, for
   manufacturing of Aerial Bundled Cables and XLPE Insulated Cables.



   1990
   The name of the Company was changed from Associated Cables Ltd. to ACL Cables Ltd, in order to
   establish an independent identity for the Company.




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Milestones

       1991
       ACL Plastics Limited was incorporated for the manufacture of PVC compound.



       1993
       Second technical collaboration agreement with NOKIA Cables of Finland for drawing and ageing
       Aluminum Alloy conductors.

       Commenced manufacturing of PVC compound at ACL Plastics Ltd, Ekala.



       1995
       Export of Cables commenced to Bangladesh and Maldives.

       Acquisition of Ceylon Bulbs & Electricals Ltd.


       1999
       Acquisition of Kelani Cables Ltd.

       Introduction of Power - X and Flexi cables.



       2006
       Incorporation of ACL Metals & Alloys (Private) Ltd and ACL Polymers (Private) Ltd.

       Introduction of Fireguard and other fire rated range of Products.


       2007
       Winning the Achievers Gold Award for Performance Excellence awarded by the Ceylon National
       Chamber of Industries, Sri Lanka, National Quality Award and Taiki Akimoto Award on 5S.



       2008
       ACL Cables PLC awarded the highest award of Asia Pacific Quality Organization beating
       participants from 46 countries. Recognized as a world-class company.

       Awarded Super Brand status for the ACL brand.




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                                                                      ACL Cables PLC          Annual Report 2010/11




Notice of Meeting

    NOTICE IS HEREBY GIVEN that the Forty Ninth Annual General Meeting of ACL Cables PLC will be
    held at the Auditorium of ACL Cables PLC, No. 60, Rodney Street, Colombo - 08, on Wednesday the
    28th September 2011, at 10.00am for the following purposes.


    01. To receive and adopt the Report of the Directors and the Statement of Accounts for the year
         ended 31st March 2011 with the report of the Auditors thereon.


    02. To re–elect as Directors Mrs. N. C. Madanayake and Mr. Daya Wahalatantiri who retire by
         rotation in terms of article No. 85 of the Articles of Association of the Company.


    03. To re–appoint Messrs. PricewaterhouseCoopers, as Auditors of the Company and authorize
         the Directors to determine their remuneration.


    04. To consider and if thought fit to pass the following Ordinary Resolution, of which special
         notice has been given by a Shareholder of the Company.
         (a)   “ that Mr. U. G. Madanayake, who has passed the age of 70 years in May 2006, be and is
               hereby appointed a Director of the Company and that the age limit of 70 years referred
               to in Section 210 of Companies Act No. 07 of 2007 shall not apply to him”

         (b)   “ that Dr. S. K. Madanayake, who has passed the age of 70 years in February 1999, be
               and is hereby appointed a Director of the Company and that the age limit of 70 years
               referred to in Section 210 of Companies Act No. 07 of 2007 shall not apply to him”

         (c)   “that Mr. Ajit Jayaratne, who has passed the age of 70 years in April 2010, be and is
               hereby appointed a Director of the Company and that the age limit of 70 years referred
               to in Section 210 of Companies Act No. 07 of 2007 shall not apply to him”


    05. To authorize the Directors to determine donations to charities.


    BY ORDER OF THE BOARD



    (Sgd.)
    Corporate Affairs (Private) Limited
    Secretaries


    25th August 2011


    Note:
    (a) A shareholder is entitled to appoint a Proxy to attend and vote in his stead and a Form of
        Proxy is attached to this Report for that purpose. A Proxy need not be a Shareholder of the
        Company.
    (b) Shareholders are kindly requested to bring the duly perfected and signed Attendance Slip
        along with them when attending the Meeting and hand over same for registration.



                                                    89
ACL Cables PLC        Annual Report 2010/11




Notes

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                                                                     90
                                                                                                           ACL Cables PLC                    Annual Report 2010/11




Form of Proxy

ACL CABLES PLC


I/We .................................................................................................... of ……………………………………………………………........
being a Shareholder/ Shareholders of the above Company hereby appoint …………………….........……....……..............………….
or failing him/ her ………………………………………………….............… of………………………………….………………………...………
as my/ our Proxy to vote for me/ us on my/ our behalf at the Annual General Meeting of the Company to be held on 28th of
September 2011 at 10.00 a.m. and at any adjournment thereof.
                                                                                                IN             NOT IN
                                                                                              FAVOUR          FAVOUR
01. To receive and adopt the Report of the Directors and the
      Statement of Accounts for the year ended 31st March 2011
      with the report of the Auditors thereon.


02. (a) To re–elect as Director Mr. Daya Wahalatantiri who retires by rotation

      (b) To re–elect as Director Mrs. N. C. Madanayake who retires by rotation


03. To re-appoint Messrs. PricewaterhouseCoopers as Auditors of the Company
      and authorize the Directors to determine their remuneration.


04. (a) Ordinary Resolution (a) relating to the appointment of Mr. U. G. Madanayake

      (b) Ordinary Resolution (b) relating to the appointment of Dr. S. K. Madanayake

      (c) Ordinary Resolution (c) relating to the appointment of Mr. Ajit Jayaratne


05. To authorized the Directors to determine donations to charities.

Signed this ………………………………… day of ……………………………………….........….2011



………………………….
Signature



                         ACL CABLES PLC – ATTENDANCE AT ANNUAL GENERAL MEETING

I/We hereby record my/our presence at the Forty Ninth Annual General meeting of ACL CABLES PLC
01. Name of Share Holder                               : .....................................................................................................................
      Name of Proxy (If Applicable)                    : .....................................................................................................................


02. Shareholder’s NIC Number                           : .....................................................................................................................
      Proxy’s NIC Number (If Applicable) : .....................................................................................................................


03. Signature of Shareholder                           : .....................................................................................................................
      Signature of Proxy (If Applicable)               : .....................................................................................................................

Shareholders are Kindly Requested to Bring this Attendance Slip with Them When Attending The Meeting and Hand Over same for Registration.


                                                                               91
ACL Cables PLC   Annual Report 2010/11




                                   INSTRUCTIONS FOR COMPLETION


                           1. The instrument appointing a Proxy shall in
                               the case of an individual be signed by the
                               appointer or by his Attorney and in the case of
                               a Corporation be either under its Common Seal
                               or signed by its Attorney or by an Officer on
                               behalf of the Corporation.


                           2. A Proxy need not be a Shareholder of the
                               Company.


                           3. The full name and address of the Proxy and the
                               Shareholder appointing the Proxy should be
                               entered legibly in the Form of Proxy.


                           4. The completed Form of Proxy should be
                               deposited at No.60, Rodney Street, Colombo
                               08, not less than 48 hours before the scheduled
                               starting time of the Meeting.




                                                   92
Corporate Information

COMPANY NAME                                                       AUDITORS
ACL Cables PLC                                                     Messrs. PricewaterhouseCoopers
                                                                   Chartered Accountants
REGISTRATION NUMBER                                                100, Braybrooke Place, Colombo 02.
PQ 102
                                                                   BANKERS
BOARD OF DIRECTORS                                                 Citi Bank
U. G. Madanayake - Chairman                                        Commercial Bank of Ceylon PLC
Suren Madanayake - Managing Director                               Deutsche Bank
Dr. S. K. Madanayake                                               Hatton National Bank PLC
Mrs. N. C. Madanayake                                              Hongkong & Shanghai Banking Corporation
Hemantha Perera                                                    National Development Bank PLC
A. M. S. De S. Jayaratne                                           Nations Trust Bank PLC
Hemaka Amarasuriya                                                 People’s Bank
D. D. Wahalatantiri                                                Sampath Bank PLC
P. S. R. Casie Chitty                                              Standard Chartered Bank

SECRETARIES
Messrs. Corporate Affairs (Private) Limited
No. 68/1, Dawson Street, Colombo 02


GROUP FINANCIAL CONTROLLER
Champika Coomasaru


REGISTERED OFFICE
60, Rodney Street, Colombo 08. (1/6/2011 onwards)


Contact Details
Tel: +94 11 2697652
Fax: +94 11 2699503
E-mail: info@acl.lk
Website: www.acl.lk




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