Richard Pieris Group posts Rs 2b operating profit
The Richard Pieris Group ended its first nine month's performance
with a Group revenue of Rs 25.9 billion and Group operating profit of
Rs. 2 billion.

Richard Pieris Group
ChairmanDr. Sena Yaddeyige |
The profits were adversely affected mainly due to the plantation
sector with the increase in wages, reduction of rubber prices and
adverse weather conditions resulting in a decline when compared to the
corresponding period of the previous year.
"The third quarter was the busiest period for the Retail sector with
the seasonal peak in business in December 2013 and the opening of its
15th supercentre in Matara. The turnover was similar to that of the
previous period but the profitability was affected due to the imposition
of VAT of 12.5 percent on the retail sector. The company continued to
focus heavily on managing overheads and inventory."
The Plastic and Distribution sector was adversely affected due to
difficulties faced by the dealers especially in the outstations. The
sector reported only a marginal decline when compared to the previous
year.
Each of the Sector's SBU's continued to search for market
opportunities and many initiatives were undertaken during the quarter.
Aggressive dealer promotions were carried out to ensure that the edge
over the competitors was maintained. New marketing strategies were
introduced and this is expected to deliver positive results in the
fourth quarter.
The sector focused on reducing overheads to enhance profitability
levels, and focused on minimum working capital investments to optimise
costs.
The impact of the wage increase for plantation sector employees had
its impact on the results which in turn affected the overall
profitability of the Group. The drop in rubber prices, poor crop due to
adverse weather conditions affected the sector's performance negatively.
However, there was a significant increase in crop and prices for palm
oil. The reduction in profitability in this sector adversely affected
Group results.
The tyre sector of the Group reported an increase in profits when
compared with the results of previous year, where the sector continued
to benefit from low material prices. Several process improvements helped
to improve overall profitability.
The export sector performed best out of all the Group companies
recording exports of Rs. 2.1 billion. |