Watawala Plantations turnover up 11% to Rs 3.16 billion

"The year 2007 Watawala Plantations AGM has been the most successful in ten years", said Director, CEO of Watawala Plantations Limited V. Govindasamy.

Watawala Plantations Limited (WPL), a subsidiary of Sunshine Holdings Limited is one of Sri Lanka's rapidly growing businesses.

Chairman of WPL G. Sathasivam said, "During the financial year, we recorded a turnover of Rs. 3.16 Bn increase in revenue compared to last year's close of Rs. 2.86 Bn, a growth of 11%.

We had a profit of Rs. 222 Mn with export revenue reaching a record high of Rs. 861 Mn, contributing 27% of the company's revenue in terms of capital expenditure, we have spent Rs. 276 Mn this year. This means that reinvesting our money on the company, with the majority of it allocated towards planting new tea, rubber and palm oil as well as improving the standard of our factories.

Tea continues to remain the major contributor with revenue of almost 53% of the total revenue. The FMCG business (retail marketing) has contributed 14% to the company's cost of production, it has recorded a 8.16% growth in Gross Profit. We have reported a profit of Rs. 331 Mn before interest and taxes this year."

Director, CEO of Watawala Plantations Limited V. Govindasamy said, "We are different from other plantation companies as we are a marketing oriented company. I don't think any other plantation company has developed a brand from scratch. Our strong brands have gained 25% of the market share within six years.

This truly is an achievement that we are extremely proud of. We have positioned ourselves as a premium brand with our flagship product Zesta which is continuing to win the trust and confidence of consumers by producing the finest quality tea blends. We also have Watawala Kahata, which is the company's most popular brand of tea.

The sales volume has doubled showing an accelerated growth in market share whilst rapidly making a tremendous impact in the branded tea market. This dramatic step was achieved through an aggressive marketing campaign launched for the Watawala Kahata brand, which also enabled us to consolidate our cumulative market share.

Our current market share in excess of 25% has made us the second biggest branded tea company, among local branded teas in just six years. These two brands have developed a good bottom line for us as a company."

The company's FMCG division also consists of Watawala Coconut oil, Zest bottled water and Ran Tea. These have progressed steadily, with a healthy contribution in improving rural penetration through marketing strategies.

It's total revenue is Rs. 428 Mn out of Rs. 3.16 Bn, while in terms of profits have gained Rs. 27 Mn out of Rs. 222 Mn, which is from the company's branded teas. This illustrates how successful WPL has been in building its brands.

WPL directly exports a total of Rs. 861 Mn worth of produce directly. The company has been successful in creating their own markets through its partnership with Tata Tea, whose presence in the international markets has been a strength to the company in its quest to expand into international markets, he said.