Sri Lanka’s Hayleys profits up on exports in Dec quarter

ECONOMYNEXT – Profits of Sri Lanka’s Hayleys Plc, which has interests in export manufacturing, retail, logistic and leisure, 54 percent from a year earlier to 678 million rupees in the December 2019 quarter interim accounts showed.

Profits grew from a “broad-based improvements in the operating performance of the Group’s export-oriented businesses,’ the group said in a note to shareholders.

In 2018 Sri Lanka’s rupee collapsed from 153 to 182 to the US dollar, helping export businesses with lower real salaries and as well as utility tariff, which was not revised upwards after the currency collapse.

Hayleys reported earnings of 9.05 rupees per share for the quarter. For the nine months to December Hayleys reported earnings 1.85 rupees per share on total profits of 138 million rupees.

Revenues fell 7 percent to 55.2 billion rupees in the December quarter, cost of sales fell at a faster 12 percent to 40.5 billion rupees and gross profits grew 8 percent to 14.2 billion rupees.

Finance costs were flat at 2.7 billion rupees, as interest rates fell. A fall in the rupee can bring in forex profits.

“The recently announced tax concessions are likely to result in improved consumer and investor sentiments presenting upside potential for the Group,” Chairman Mohan Pandithage told shareholders.

“Additionally, we are confident that the continued growth of our export businesses, coupled with the reduction in lending rates will support the Group’s earnings growth in the coming months.”

In the nine months turnover fell slightly to 160.6 billion rupees, due to fall in Leisure, Transportation and Consumer & Retail segments while other sectors including Purification (activated carbon) grew 23 percent, textiles 15 percent and gloves 48 percent, the company said. (Colombo/Feb17/2020)

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