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2018 Annual Report 2017 | 2018 2017 Annual ReportAnnual United Motors Lanka PLC Annual Report 2017 | 2018 At United Motors, we remain driven by our ambitious vision to become one of the best companies by diversifying our interests whilst upholding our place as a leader in the transport industry. The past year saw us expand into new horizons to deliver greater value to our shareholders. These were our focal points during the period in focus. We’ve moved into the distribution of earthmoving machinery with JCB, concrete mixing equipment with LiuGong and 3D printers with Novabeans. The aforesaid initiatives are representative of the importance we place on diversification and on optimising our resources to propel UML towards a higher state of performance. We embarked on all this in the past year because what matters to you has always been what matters to us. Greater prospects await us in the year ahead with the platforms we have established to serve our existing customers better, further our sustainability-oriented goals and create sustainable value for our valued stakeholders, both now and into the future. Contents Review of the Business Vision and Mission 04 Our Beginning 05 Our Journey Thus Far 06 Operational and Financial Highlights 10 Events of the Year 12 Group Structure 16 Chairman’s Message 18 Group Chief Executive Officer’s Review of Operations 22 Board of Directors 26 Senior Management Team 32 Management Review Value Creation Model 40 Stakeholder Engagement 42 Engaging With Our Stakeholders 42 Operating Environment 44 Business Review 47 Financial Capital 50 Social and Relationship Capital 52 Natural Capital 65 Human Capital 67 Intellectual Capital 79 Manufactured Capital 80 Governance How We Govern 84 Audit Committee Report 102 Remuneration Committee Report 106 Nomination Committee Report 109 Related Party Transactions Review Committee Report 111 Enterprise Risk Management 113 Directors’ Statement on Internal Controls 121 Annual Report of the Board of Directors 123 Financial Information Financial Calendar 133 Statement of Directors’ Responsibility 134 CEO and CFO’s Responsibility Statement 136 Independent Auditor’s Report 137 Statement of Profit or Loss and Other Comprehensive Income 142 Statement of Financial Position 143 Statement of Changes in Equity 144 Statement of Cash Flows 146 Notes to the Financial Statements 147 Supplementary Information Share Information 211 Ten year summary - Group 215 Investor Information 216 Glossary of Financial Terms 217 Notice of Meeting 219 Proxy Form 223 Corporate Information IBC United Motors Lanka PLC Annual Report 2017 | 2018 Vision and Mission Vision To be the best company in Sri Lanka through diversification whilst maintaining the leadership position in the transport industry. Mission To delight and make lifelong relationships with our customers by providing high quality products, services and transport solutions using state-of-the-art technology and developing a team of people who are committed to excellence with the highest level of integrity through a corporate culture that encourages participative management to create a socially responsible corporate entity, whilst ensuring optimum returns to shareholders. 04 United Motors Lanka PLC Annual Report 2017 | 2018 BUSINESS REVIEW OF THE EVIEW In 1985, the Company Company the 1985, In entered into a distributor agreement with Mitsubishi Motors Corporation, Japan and and Japan Corporation, has since then been been then since has the sole distributor for for the sole distributor brand new Mitsubishi brand newMitsubishi vehicles in Sri Lanka. Sri in vehicles Our Beginning R ENT M E ag N A M E C N A N R GOVE in Sri Lanka today. remarkable andisaleadingblue-chip Motors hasachieved results United company Liability Limited Company, aPublic becoming Since MotorsLankaas United PLC. 07of2007 Act No. underthenewCompanies reregistered was 2007, theCompany On30August Liability Limited Company. asaPublic andincorporated Limited MotorsLanka asUnited renamed was 1989,theCompany on9May Accordingly, amongstthepublic. itsownership ofbroadening withtheintention ‘Peoplisation’ for venture in Sri Lanka. selected was asthe firstGovernment In 1989,theCompany newMitsubishi brand vehicles for thenbeenthesoledistributor Japan andhassince withMitsubishi Motors Corporation, agreement adistributor into entered Company OwnedGovernment BusinessUndertaking In 1985,the Motors. ofUnited (GOBU) asthe 1972and carried on8March onoperations withtheGovernment vested was It Liability Limited Company. in1945 as aPrivate incorporated was Company The AL I TION C N A rma 05 IN F NFO I Y ar TION ENT M E rma ppl NFO I U S United Motors Lanka PLC Annual Report 2017 | 2018 Our Journey Thus Far 1945 1999 2009 Incorporation of United Motors Limited July December as a Private Limited Liability Company. The Orugodawatte Workshop Complex UEL opened a local assembly facility within was opened. the Orugodawatte Workshop Complex to 1972 assemble the Zotye Nomad SUV. Vested in the Government on 8 March, 2002 commenced as a Government Owned March 2010 Business Undertaking. The Valvoline brand from USA was December 1985 launched by UML. The Company increased the number of shares by way of a share split on the basis Entered into a distributor agreement with 2003 of two new ordinary shares for every Mitsubishi Motors Corporation (MMC), April exciting issued ordinary share. Japan. UML acquired 50% interest in TVS Lanka 2011 1989 (Pvt) Ltd. February May 2004 OMCL added the DFSK Mini truck brand to United Motors Lanka Limited was September its product portfolio. incorporated as a Public Limited Liability Company with an authorised share The Yokohama brand from Japan was December capital (now referred to as stated capital) launched by UEL. of Rs. 100,000,000 The Company was awarded a citation for 2006 order intake development from Mitsubishi 1992 January Fuso Truck and Bus Corporation, Japan for the Fuso brand. Incorporation of a subsidiary - Orient UEL launched Mudan range of Chinese Motor Company Limited (OMCL) to vehicles. 2012 import, distribute, hire vehicles and to provide related services. 2007 March March The Group achieved its highest ever profit 1993 in the financial year. TVS Lanka (Pvt) Ltd. signed a distributor Incorporation of a subsidiary - UML agreement with Bharat Petroleum 2013 Property Developments Ltd., for the Corporation of India. construction of a warehouse complex on October a five acre land at Orugodawatte. June UML was ranked amongst the top 100 JMC brand from China was launched by Corporates in Sri Lanka across all industries 1994 UEL. in 2012/13 by LMD. Incorporation of a subsidiary - Unimo Enterprises Limited (UEL) to import and August September distribute vehicles and to provide related The Fuso Heavy Duty Trucks was launced The Company was re-registered as services. by UML. United Motors Lanka PLC (UML). 1995 November December September UML was ranked among the top 25 Zotye brand from China was launched companies in Sri Lanka across all industries United Motors Lanka Limited (UMLL) by UEL. celebrated 50 years of excellence. by Business Today, in 2012/13. 2008 1997 2014 March November March Incorporation of TVS Automotives (Pvt) UEL opened its assembly plant in Ranala. Perodua brand from Malaysia was Ltd as a fully owned subsidiary of TVS launched by UEL. Lanka (Pvt) Ltd. The legendary brand MG launched by UEL. 06 United Motors Lanka PLC Annual Report 2017 | 2018 November September A dedicated workshop for Mitsubishi UML was ranked among the top 25 UML won the special achievement award passenger vehicles and Fuso Truck and companies in Sri Lanka across all “Significant sales volume increase for Bus was opened in Matara. industries by Business Today, in 2013/14. excellent Marketing Campaign” for the Fuso brand at the “Daimler Trucks Asia UEL added Yokohama GO15 Tyre to its Valvoline was awarded for its Outstanding Distributor Awards 2016” product portfolio. Sales Performance in South East Asia at BUSINESS REVIEW OF THE the Valvoline South East Asia Conference October September in Mumbai. UEL added Z100 to its product portfolio. UML Heavy Equipment Ltd added JCB earth moving equipment and power 2015 November generators to its product portfolio. February OMCL added DFSK Crew Cab to its EVIEW The Simoniz brand from United Kingdom product portfolio. November R (UK) was launched by UML. UML added LiuGong which is into ENT M December Concrete Mixing Equipment to its E May ag A dedicated workshop for Mitsubishi and product portfolio. N A The Brilliance brand from China was Perodua passenger vehicles and Fuso M launched by UEL. Truck and Bus was opened at Ratmalana. 2018 January September 2017 Valvoline was awarded for its outstanding E UEL added DFSK Glory Diesel to its C February sales performance for the fourth N product portfolio. A consecutive year in South East Asia at the N UEL added Perodua Axia Facelift to its R Distributor Conference in Malaysia. October product portfolio. UML was ranked amongst the top GOVE UEL added DFSK Glory Petrol to its Valvoline was awarded the Momentum 100 corporates in Sri Lanka across all product portfolio. Award in South East Asia at the Valvoline industries in 2014/15 by LMD. Asia Distributor Conference in Malaysia. June Valvoline was awarded for its outstanding Valvoline was awarded the Manchester UEL added the Perodua Bezza to its sales performance for the second City Distributor Incentive Programme AL I consecutive year in South East Asia at the product portfolio. TION Award in South East Asia at the Valvoline C Valvoline South East Asia Conference in
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