Editorial

Security

Politics

World

Letters

Sports

Obituaries

Archives

Watawala Plantations, the manufacturer of 'Zesta' tea, has achieved a turnover of Rs. 1.46 billion for 2001-2002 but recorded a substantial drop in profits in what the company describes as the worst year a business could encounter.

In its first annual report since the company switched to an April - March financial year, Watawala Plantations Chairman, G. Sathasivam reports that crop losses arising out of work stoppages and go-slows, high interest costs, power cuts, increased fuel and power costs and low productivity contributed adversely to the company's financial results.

These factors, combined with a mid-term revision in the wages formulae which resulted in the company unexpectedly incurring an additional Rs. 50 million on worker wages, saw profits dip to Rs. 12.33 million from Rs. 127.32 million for the previously assessed 15 month period of January 2000 to March 2001. A company spokesman said the unaudited pre-and post-tax profit figures for the preceding 12 months was Rs. 80 million.

However in his review of the year, Mr. Sathasivam expresses a deep sense of satisfaction and a feeling of a job well done, commenting that "The strength of the company enabled it to withstand the many problems it had to face."

He also points out that the company invested Rs. 255.06 million in field development, factory modernisation and the improvement of estate infrastructure facilities, from company generated funds and local short-term borrowing, since long-term credit was not available.

According to Watawala Plantations CEO Vish Govindasamy, the company's turnover was helped by higher rupee prices for tea and a higher volume output of palm oil in the year under review. He said the year had seen several positive developments such as continuing capital investment, the development of oil palm, modernisation of factories, and a committed effort to create a better awareness of quality. The company had also invested about Rs. 20 million in building its flagship brand "Zesta" into a household name in the local market and in several export markets, he said.

Watawala Plantations has declared a first and final dividend of five per cent for the year under review. Since the dividend is a distribution of profits relate to agricultural activities, it is taxable at a maximum of 10 per cent in the hands of individuals.

News | Business | Features | Editorial | Security
Politics | World | Letters | Sports | Obituaries

Produced by Lake House
Copyright 2001 The Associated Newspapers of Ceylon Ltd.
Comments and suggestions to :Web Manager