Kelani Valley Plantations reports strong profit growth in 2006

Robust rubber prices have added bounce to the 2006 financial performance of Kelani Valley Plantations Limited (KVPL), the subsidiary of Dipped Products Limited (DPL), enabling the company to post a 92 per cent growth in pre-tax profit and a 68 per cent improvement in its bottom line.

In its annual report KVPL has reported that turnover grew 21 per cent to Rs. 2,330 million over the previous year, with increases of 11 per cent from tea and 44 per cent from rubber, despite drops in production in the last two months of the year as a result of trade union action over wage negotiations.

KVPL's profit before tax of Rs. 291 million was made possible by an increase in the average prices of rubber at the Colombo auctions in the year under review. Profit attributable to equity holders of the parent company grew 66 per cent to Rs. 256.6 million.

Mabroc Teas, an associate company engaged in marketing of tea, contributed Rs. 18.6 million to KVPL profits in line with its performance of the previous year.

On the basis of these results, the Board of Directors of KVPL has recommended a payment of a first and final dividend of 35 per cent, as against 20 per cent paid in 2005.