Thursday, February 14, 2013

Discounting last year’s capital gains, Hayleys PLC profits up 85%

Hayleys PLC reported a net profit of Rs. 2.6 billion for the nine months period ending December 31, 2012, down 26 percent from Rs. 3.56 billion a year earlier, interim results filed with the stock exchange showed. However, discounting capital gains made the previous year, net profits rose 85 percent.

In 2011, group companies of Hayleys PLC disposed 6,874,584 ordinary shares in Hayleys PLC, resulting in a capital gain of Rs. 2.19 billion, which saw net profits soar 323 percent as at end December 2011 from the corresponding period of 2010.

Earnings per share fell to Rs. 18.19 as at December 31, 2012 from Rs. 31.22 a year earlier.

"Turnover for the nine months ending 31st December 2012 improved by 12 percent to Rs 52 billion, and profit before tax grew 63 percent to Rs 3.6 billion from Rs 2.2 billion before capital gains, reported in the corresponding period of the previous year. Net profit for the three quarters was Rs 2.6 billion as against Rs 1.4 billion excluding capital gains, at the end of the third quarter of 2011-12," the company said in a statement.

Hayleys Chairman Mohan Pandithage attributed these results to ‘strong growth in all core operations and efficient management of cost of sales. Performance in the December quarter was particularly noteworthy, with profit before tax growth of 116 per cent’, he disclosed in a statement.

"Despite a weak global economy, our export sectors performed well due to concerted efforts in product and market development, and streamlined operations," Pandithage noted. "Our manufacturing companies have continued to innovate and invest in research and development to ensure sustained demand for our products. As a result, sectors such as Hand Protection, Purification and Construction Materials have performed well."

Hand Protection (Rs 10.9 billion), Purification Products (Rs 8 billion), Plantations (Rs 6.4 billion), Agriculture (Rs 5 billion), Transportation & Logistics (Rs 4.9 billion) and Fibre (Rs 3.7 billion) were the leading contributors to the Group’s turnover in the period reviewed.

Pandithage said Agriculture faced challenges due to extremes of weather throughout the review period, with a drought followed by floods in the third quarter. Nonetheless, the Hayleys Agriculture and Plantations sectors had performed in a creditable manner during the first nine months of the year.

The Transportation & Logistics sector showed strong growth as did the Construction Materials sector and the Amaya Group. The Power and Energy sector also turned in a noteworthy performance in the first nine months.

The newly refurbished Ceylon Continental Hotel, rebranded as The Kingsbury, commenced operations in December and is expected to make a strong contribution to earnings in the future, Pandithage said.

The group’s net finance cost rose 80 percent during the nine month period to Rs.1.56 billion from Rs. 869 million a year ago.

"The group’s finance costs rose in 2012 as interest rates increased during the year. A number of strategies are being implemented to address this. However with lower interest rates anticipated in 2013, the finance cost burden is expected to ease," he said.

The Board of Directors of Hayleys PLC comprises Messrs Mohan Pandithage (Chairman and Chief Executive), Dhammika Perera (Deputy Chairman), Rizvi Zaheed, Johnpillai Anandarajah, Nimal Perera, Sarath Ganegoda, Rajitha Kariyawasan, Dr. Harsha Cabral PC, Dr. Mahesha Ranasoma, Mangala Goonatileke, Ranil Pathirana and Lalin Samarawickrama.

source -

No comments: