Sri Lanka Textured Jersey September net up 7-pct
COLOMBO, Nov 04, 2014 (EconomyNext) – Textured Jersey Lanka’s net profit rose 7.2 percent to 282 million rupees in the September 2014 quarter from a year ago with the fabric maker saying it was growing strongly once again despite margins been eroded by rising costs.
Sales went up 6.9 percent to 3.5 billion rupees in the period with earnings per share rising to 43 cents from 40 cents the year before, the firm, a joint venture between Brandix and Hong Kong-based Pacific Textile Holdings, said in a stock exchange filing.
Textured Jersey Lanka chairman Bill Lam said the quarterly result marked "an emphatic recovery from the temporary setback suffered in the previous quarter, with sales up 29 percent and net profit up 72 percent on a quarter-on-quarter basis."
He said TJL was now "on a strong growth trajectory once again."
Gross profit for the quarter fell two percent to 339 million rupees from a year ago.
"This was mainly due to lower margins arising from a combination of factors which included changes in product mix, outsourcing and higher dyes and chemical costs," Lam said.
"However, the company managed to cut down its administrative and distribution expenses which resulted in the operating profit remaining at 249 million rupees, on par with the corresponding quarter last year."
TJL’s net profit margin for the six months to September 2014 fell to 7.27 percent from 8.25 percent, the accounts showed.
In the six months to September 2014, net profit fell 11 percent to 446 million rupees with sales stagnant at 6.1 billion rupees and EPS falling to 0.68 rupees from 0.77 rupees the previous year.
Lam said the construction of a multi-fuel co-generation boiler plant was completed during the quarter and test operations commenced.
"The plant will be fully operational in the coming quarters and is expected to generate substantial savings in energy costs," he said.
"Similarly, the recently added 10-12 percent capacity will be fully utilised during the coming quarters with US demand coming back on track."