The firm said industry volumes fell 7.0 percent in which was the third consecutive year of declines "due to cautious spending and escalating prices in the fourth quarter".
Chevron said a "large percentage of vehicle owners had opted to stretch their service," though construction and power generation sectors were "reasonable."
"Competition in the market place ahs reached high levels with eight new player entering the already crowded market during the year," managing director Kishu Gomez told shareholders in the annual report.
The firm had cut prices by 10 percent as raw material prices fell in the first half of the year.
Though revenues fell to 8.69 billion rupees from 8.90 billion a year earlier, cost of sales fell faster to 5.59 billion rupees from 6.77 billion rupees allowing the firm to post profits of 1.49 billion rupees, up from 947.7 million rupees.
Chevron Sri Lanka exports to Bangladesh and Maldives also suffered.
"The economies of Maldives and Bangladesh underwent hardships during the year which in turn affected our export volumes," Gomez said.
The firm said a fall in tourist arrivals reduced demand and a foreign exchange shortage also dogged the tourist paradise.
The International Monetary Fund had advised Maldives not to print money if it wants to keep its exchange rate peg.
"Our volumes there recorded negative growth during he year while only marginal growth was recorded in Bangladesh, where depressed sentiment affected both the consumer and industrial segment."
The firm is however expecting stronger export demand in 2010 saying the outlook is "positive."
In Sri Lanka the end of the war in May 2009 had increased confidence by "tangible gains" had not been felt in 2009, the firm said.
But it is expecting markets in the former war zones in the North and the East to expand, with infrastructure being re-built.
"It is likely that the transport system too will grow in tandem with more investment in upgraded personal and commercial transport vehicles," Gomez said.
Last year the government had renewed it’s the lease on its blending plant for a further five years.
source - www.lbo.lk
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