Sri Lanka Bairaha Farms to spend Rs239mn more on feed mill silos
ECONOMYNEXT – Sri Lankan poultry firm Bairaha Farms said it will have to spend an extra Rs239 million to complete a project to expand feed mill storage facilities.
Work on the project, originally estimated to cost Rs1.45 billion, by Fortune Agro Industries, a joint venture feed mill company, began in June 2016, it said in a stock exchange filing.
Work on the feed mill silos and installation of equipment was ongoing, it said.
An extra cost of Rs239 million needs to be incurred to complete the project, the company said.
This is to cover cost overruns on the feed mill on account of civil works, land development, additional machinery and other ancillary non-budgeted machinery and other costs of Rs114 million.
Another Rs125 million needs to be spent on account of silos for maize and soya meal storage facilities for the second stage of the project, totalling Rs239 million.
The extra cost will be met through contributions of Rs80 million each from Bairaha Farms and Farm’s Pride, a joint venture partner, and Rs79 million from Fortune Agro Industries, the joint venture feed mill company, or from Fortuna GP Farms Lanka.
Any further cost overruns or new capital expenditure will be borne by Fortune Agro Industries from internally generated funds, Bairaha Farms said.
(COLOMBO, Jan 17, 2016)