Feb 13, Colombo: Strong top line performances across the Hayleys Group and the addition of recent strategic acquisitions resulted in a 37% YoY increase in turnover up to Rs. 112.3 billion during the nine months to 31st December 2017 while gross profits expanded by 29% YoY up to Rs. 24 billion.
Increases in raw material prices and adverse weather conditions impacted the operating profits of Group's manufacturing and agriculture sectors while the higher borrowing costs resulting from the Group's progressive investment strategy coupled with higher interest rates prevalent during the period in review contracted the group's Profit Before Tax (PBT) to Rs. 2.94 billion.
"It has been a challenging nine months for the Hayleys Group despite the remarkable growth and expansion displayed in the top line performances of all of our diverse business segments. Our continued growth drive, which we have strategically embarked upon, has reflected in an increase in the finance cost reported for the period."
"Although the higher finance costs have had a negative impact on group profits during the period, measures are already being implemented to realign the financial position in order to bolster profitability and recover momentum moving into the final quarter of the financial year, which is traditionally the strongest performing quarter for the group. Coupled with exponential gains from the investments entered into over the past year, we anticipate a strong growth outlook for the group moving forward," Hayleys PLC Chairman and Chief Executive, Mohan Pandithage stated.
Meanwhile, the group's consumer products segment - which also includes the recently acquired business of Singer (Sri Lanka) PLC - recorded a significant improvement in turnover, which stood at Rs. 19.9 billion as compared with a previous Rs.3.86 billion while profits in the segment rose from Rs. 90.18 million up to Rs. 965.7 million.
The group's hand protection segment also recorded a strong top line performance, increasing 11% YoY to Rs. 12.1 billion. However profitability was hampered by steep increases in global latex prices, which are the primary raw material in the manufacture of the segment's wide range of specialized rubber gloves for sale in export markets across the globe.
As one of Sri Lanka's oldest and most trusted consumer brands, the acquisition of Singer by Hayleys marks the group's re-entry into the domestic consumer and retail market. Standing as one of the largest single acquisitions in the history of the Colombo Stock Exchange, Hayleys aims to generate new business synergies while retooling Singer's retail concept to suit the changing tastes of an increasingly prosperous Sri Lankan market.
The period in review was also notable for the numerous accolades received by the Hayleys Group and its subsidiaries in recognition of its achievements across various fields, including its recent showing at the Energy Globe World Awards 2017 held in Iran, Hayleys Puritas Sathdiyawara was announced the World Winner in the category of Water ahead of thousands of other entries from 178 countries across the world.