Friday, May 14, 2010

Dipped Products pre-tax profit up 20% to Rs. 738 mn

Strong gains from performance enhancing initiatives in local operations in the face of subdued market conditions and robust contributions from overseas manufacturing and marketing operations have generated noteworthy profit growth in 2009-10 for Dipped Products PLC, a global leader in hand protection.

According to figures filed with the Colombo Stock Exchange , the Hayleys Group’s globally-ranked rubber gloves business achieved a profit before tax of Rs 738 million for the year ending 31st March 2010, a growth of 20 percent over the previous year.

Profit after tax grew 12 percent to Rs 564 million, while profit attributable to equity holders of the company improved by 33 percent to Rs 481 million. Turnover for the year was almost flat at Rs 11.8 billion.

Sri Lankan operations posted a pre-tax profit of Rs 412 million registering a 36 percent growth despite revenue dropping by 8 percent to Rs 5,062 million.

Outstanding contributions to revenue and profit came from Dipped Products (Thailand) Limited (DPTL), the Group’s medical glove manufacturing business and ICOGUANTI S.p.A., its Italian marketing company.

DPTL improved its turnover by 16 percent to Rs 1,582 million and converted a loss of Rs 159 million in 2008 to a profit of Rs 101 million in the year reviewed. ICOGUANTI S.p.A. increased sales by 4 percent to Rs. 3,154 million and grew profits by 39 percent to Rs. 258 million, benefitting from favourable Euro – US Dollar parity.

The Group’s plantation company Kelani Valley Plantations PLC (KVPL) and its subsidiaries recorded an 8 percent drop in turnover from Rs. 3,109 million to Rs. 2,860 million. KVPL ended the year with a net loss before tax of Rs. 28 million compared to a profit of Rs. 300 million in the previous year.

Commenting on the overall results, Hayleys Group Chairman Mohan Pandithage said DPL’s performance in a year of sluggish demand following the global recession was particularly pleasing because much of it was achieved by management initiatives such as tighter control of working capital, closer management of foreign exchange exposure and efforts to minimize cost and consumption of energy. The Group also reduced its net finance costs by 65 percent to Rs 115 million by trimming borrowings and benefitting from lower interest rates.

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