Hayleys profit after tax grows 41% to Rs. 955 million

3Q turnover tops Rs. 21 billion :

The Blue chip Hayleys Group has posted a profit after tax of Rs 955 million at the end of the third quarter of 2006-07, a growth of 41 per cent that reflects a notably improved nine-month financial performance this year, despite an unexpected slower third quarter.

In results released to the Colombo Stock Exchange, the Sri Lankan multinational reported pre tax profits of Rs 1.3 billion, up 24 per cent over the corresponding nine months of 2005-06, and a growth of 31 per cent in profit attributable to equity holders, from Rs 386 million to Rs 505 million.

Group turnover grew 22 per cent in the period reviewed, to Rs 21.1 billion. Commenting on these results, Hayleys Chairman N. G. Wickremeratne said the Group was nevertheless not completely satisfied with the rates of growth achieved in the context of its potential. "We expect the results for the whole year to be better than the results of last year, but below our expectations," he said. "Many initiatives are on-going to move performance closer to levels that reflect the true potential of Hayleys."

Analysing the sectoral performance of the Group, Wickremeratne said 'Global Markets and Manufacturing,' the grouping covering the Group's businesses in Hand Protection, Textiles, Purification Products and Fibre had performed better than in the previous year, with the Hand Protection sector and the Hayleys associate company in the Textiles sector Hayleys MGT Knitting Mills registering particularly noteworthy results.

However, overall results were impacted by substantial losses incurred by Onril, a Fibre sector company. DPL Thailand too continued to be affected by volatile rubber prices and the appreciation of the Thai Baht.

The transportation business continued to perform strongly, despite the decline in ship charter rates in the recent past. The Group said that the Transportation sector had recently secured important contracts to provide logistics services in Sri Lanka and India to large and prestigious client organisations and this is likely to have a favourable impact on future earnings.

In the 'Agriculture and Agribusiness' grouping encompassing companies in agriculture, agri- inputs and plantations, Plantations performed strongly in the nine months to September 30, which were consolidated in the Group's financials. The Agri- inputs business however came under some pressure due to difficult weather conditions.