Greetings,
  

With immense pleasure, as Chairman & Managing Director of Allcargo Global Logistics Limited, I present before you the annual performance summary along with major milestones achieved by your company in the Year 2009. Few other epochs in world history have seen such financial chaos and global crisis like the one in previous years. But 2009 was the year of consolidation where global economies, led by emerging markets, slowly traversed back to the path of recovery and consolidation. The first half of 2009 saw commodity prices bottoming out and further weakening of the economic data from across the globe. Contraction in the developed economies impacted India's growth and EXIM trade unfavorably. Inspite of this trying economic environment, your company undertook significant steps towards preserving and enhancing the value of your investments. This period of uncertainty surrounding global economy notwithstanding, I am proud to inform you that the net income of your company has grown by 15% to INR 140.7 Cr from INR 121.6 Cr at the consolidated level.

Volatile times demand pervasive upgradation and flexibility in operations which can withstand both test of times and testing times. I am confident to proclaim that we have done well to weather these testing times to a large extent. Thanks to the wonderful performance of our people and confidence from customers, the company's overall financial performance has been stable in this period. The performance of Projects and Equipment divisions has been quite good. Our volumes at CFSs have remained steady, despite the drop in the global trade volumes, a trend evident in the financial crisis. However; the volumes started to slowly pick-up further since late last-year. I am also glad to inform that the overall performance of our global NVOCC business has been satisfactory even in the backdrop of a struggling container shipping industry.

Gradually, confidence is returning in the business world and the global economy has shown robust signs of recovery. Northeast Asia is acquiring enormous economic power with Korea and China influencing the trade flows. With our international presence, we are in a position to capitalize on these global opportunities. We, at Allcargo, had identified this prospect of geographical diversification to become leaner in operations well ahead of time, and have implemented our strategies in line with our long-term vision to capture these. Our core values of trust, leadership and team-spirit underlie our increasingly global and yet nimble business strategy, which has enabled us to leverage these opportunities towards sustainable growth of your company.


New Services
    
Your company, Allcargo, has added Third Party Logistics (3PL) to its offerings in line with our long-term strategy to provide full-service play in the logistics space. Customers can now benefit from an integrated network of warehouses that will seamlessly connect cargo from the warehouse to ICD/CFS to the closest gateway port. The commencement of the 3PL division enables Allcargo to offer full service end-to-end-logistics through in-house expertise and facilities for freight forwarding, customs clearance, transport, warehousing and distribution services. With warehouses in Mumbai (Bhiwandi) and Goa (Verna) already operational and plans afoot for facilities in Indore, Hyderabad, Nagpur and Bangalore, we are on a steady expansion mode.


Strategic Initiatives
    
We are focused on technology initiatives to extend our capabilities to serve our customers and to ensure better data-driven decision-making. To extend our ERP implementation process started last year, we are implementing the ERPs in Equipment and NVOCC divisions and changing the underlying financial system for the organisation. Your company will have these systems in place by the time you are reading this message.


People
    
We value the importance of our people in the realisation of our corporate vision. The readiness of people to commit to a vision depends in part on the quality of organisational leadership and interpersonal skills. Consequently, we are spending considerable time and effort in providing strategic coaching to our business leaders and motivating high-performers. We are developing a culture that emphasizes on leading and facilitating rather than directing and controlling; a culture in which managers add value by assisting and supporting their people, while also maintaining accountability.


Awards and Honour
    
Your company has been chosen as the "Company of the year in the logistics category" at the prestigious "Business Leadership Awards-2009" organized by NDTV-Profit. This is a true recognition of consistency, performance and ability to serve our customers better. I believe that we will continue to take the lead in incorporating new ideas in our approach & business processes and redefine the benchmarks of success and excellence to create continuous value to you, our shareholders.

I am also happy to inform you that I have been conferred with E&Y Entrepreneur of the Year award in 'Service category' this year. I would like to express my gratitude to the stakeholders, customers, employees, who have shown faith in the company over the years. It would not have been possible without the constant trust and belief shown by you in the company.

In another noteworthy achievement, your company Allcargo has been the finalist for the esteemed "Lloyd's list global logistics company awards" last year. This further underscores our contribution to the global logistics landscape.

We are continuously striving to build an organization that exceeds the expectations of all our stakeholders through sustained business growth, creating more value for your investment and maintaining supreme standards of corporate governance. We are committed to guard our business through increased offering to our existing customers and also through expanding our customer base in new business areas by penetrating unexplored geographies in sync with our long-term vision.

Opportunities are unfolding in the global landscape; and with our growth-oriented strategies complemented by superiority in execution, I am confident that Allcargo is well prepared to tackle any challenge towards our pursuit of excellence in providing unparalleled services to our customers and strong growth in the value of investments.

On this note of optimism, I take this opportunity to thank you for the trust bestowed on the organization.

We are off to a very good start in the year 2010 and are confident of sustaining this growth momentum in the coming quarters.


Thank you

Shashi Kiran Shetty