Higher margins for Sri Lanka’s Royal Ceramics larger tiles

ECONOMYNEXT – Sri Lanka’s Royal Ceramics group aims to expand production of larger format tiles, which has helped it make higher profit margins as demand grows with a construction boom amid high import tariff protection.

Managing Director Nimal Perera said the group had made investments in the modifications, enhancements, and ongoing development of squaring and glazing lines and polishing lines and expansion project.

The upgrades had been done in Royal Ceramics, and its subsidiaries Royal Porcelain and Rocell Bathware plants.

“Our decision to introduce large format tiles to the local market . . . have already proved to deliver higher margins, thereby growing both topline and bottomline, making for an impressive balance sheet,” he told shareholders in the company’s annual report.

The ceramic tile and sanitary ware industries have been positively impacted by global oil prices falling sharply since the last quarter of 2014, helping the company and the industry to bring down production costs.

Perera said Royal Porcelain aims to commence manufacturing of the largest floor tile of the size 600mm x 1200mm once its new press is operational.

High tariffs on imported ceramic tiles and sanitary ware help provide protection to the local industry, analysts said.
(Colombo/June 10 2016)

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