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| Sunday, 16 June 2002 |
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| News Business Features Editorial
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Hayleys hopes restructuring will sharpen market focus Hayleys Ltd. is in the process of restructuring its Inland Marketing departments, which got under way last September. According to the company's Annual Report for 2001-2002, the activities of 15 companies within the group were reviewed in terms of what they had achieved in the past and what they were likely to achieve in the future. These companies included Haychem, Hayleys Agrocare, Haytech Marketing, Agro Technica Group, Hayleys Electronics Group, Usha Industries, Hayleys Photoprint, Haycolour, Hayleys Textile Services, Coats Lanka and Hayleys Engineering. "We have decided to discontinue some of these activities and to rationalise and consolidate the activities that were to continue within three market-focused groupings - Agro, Consumer and Industrial Solutions. Three new companies - Hayleys Agro Products, Hayleys Consumer Products and Hayleys Industrial Solutions - have been formed and we will progressively transfer the activities that are now managed within each grouping, into these three companies. As part of this process, the two listed companies in this group - Hayleys Photoprint and Haytech Marketing - are now being de-listed," Chairman and Chief Executive of the Hayleys Group Sunil Mendis said in the annual report. Some companies engaged in Inland Marketing had fared poorly during the year. Chief among them were Hayleys Electronics, which registered a large loss with losses being contained in the second half of the year, and Hayleys Photoprint, which also recorded a large loss due to the poor performance of Printers' Requisites and Hayleys Docsolutions. The latter company engaged in marketing office equipment has ceased commercial operations due to non-viability and will be liquidated in due course. "The restructuring will sharpen our market focus and allow similar activities to be managed together, giving us the opportunity to reap the benefits that can flow therefrom, and allowing each company to become a significant force in the market place. It centralises accounting, marketing, logistics and information support systems for each of the three groupings, which used to be far more decentralised. The restructuring allows distribution strengths to be pooled and shared within the Agro and Consumer groupings and we have begun to see the benefits emerging, in terms of market coverage and business volumes. "It also reduces the number of management layers in the organisation and makes for more hands-on management. Staff numbers were reduced by about 160 - over 20 per cent - under a voluntary retirement scheme that was in place up to March 31 this year," Mendis said in the Chairman's Review. Hayleys has recorded a profit before tax of Rs. 1,029 million during the financial year ended March 31, 2002, which is 20 per cent lower than the Rs. 1,283 million reported during the corresponding period of the 2001 financial year. Profit after tax was Rs. 775 million, 23 per cent below the Rs. 1,010 million of the previous year. Profit attributable to the company was Rs. 437 million, 28 per cent lower than the 2000/01 level of Rs. 606 million. The Group recorded a turnover of Rs. 10,896 million, which was a one per cent growth over the Rs. 10,834 million of the previous year. The coir business was the main contributor to these results, supplemented by contributions from Haycarb, Dipped Products and Maritime Holdings. Rileys, Volanka Exports, Hayleys Exports, Ravi Industries and Toyo Cushion contributed substantially to the performance of the coir business. The Group invested Rs. 746 million on capital assets and long-term investments in companies other than subsidiaries during the year, taking the total investment over the last five years to Rs. 3,226 million. |
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