Hela Apparel marks impressive start to FY 23 with Rs. 354 m PAT in 1Q

Tuesday, 16 August 2022 01:27 - - {{hitsCtrl.values.hits}}

Chairman A.R. Rasiah

Group CEO Dilanka Jinadasa

Hela Apparel Holdings PLC has recorded an impressive start to the financial year, with revenue growing by 114% year-on-year to Rs. 24.5 billion in the first quarter.

The significant growth was partly driven by the depreciation of the rupee during this period, while the Group’s underlying US Dollar-denominated revenue also rose by 28%. This reflects the continuation of strong consumer demand conditions in Hela’s key export markets and the ramp-up in production at its newly established manufacturing facility in Egypt.

The organisation also posted a significant increase in profits, recording a Profit After Tax of Rs. 354 million in the first quarter, compared to Rs. 58 million in the same period of the previous financial year. This positive performance was a result of both the growth in Group revenue and improved profit margins.

Hela Apparel Holdings Chairman A.R. Rasiah said: “I’m pleased to see Hela continuing on its growth trajectory despite the extremely challenging operating environment during the first quarter. These results are a reflection of the company’s successful customer engagement strategies and the initial implementation of the management’s focused margin-improvement strategy. This strengthened Hela’s ability to absorb the continuation of significant external cost pressures and global supply chain disruptions during the quarter.”

Looking toward the remainder of the financial year, Hela will focus on navigating the volatile operating environment by continuing to implement its margin-improvement strategy across the Group. The company will also seek to continue delivering innovative apparel supply chain solutions to its customers, while proactively seeking opportunities to strengthen its value propositions.

“Hela has proved resilient during a challenging first quarter, though we feel there are opportunities to improve further,” said Group CEO Dilanka Jinadasa. “The biggest challenge ahead is the likelihood of a softening order-book due to a slowdown in consumer demand in our key markets. That said, the new customer relationships we have established over the past twelve months should help us to offset this drop and the continued ramp-up of our operations in Egypt will help to ensure the Group’s revenue remains resilient.

“The implementation of our strategic initiatives including the digitization drive powered by SAP S/4HANA will assist Hela in being more data-driven and agile, placing us in a stronger position to navigate the challenges ahead,” he added.

The organisation has a global presence with 11 manufacturing facilities across Sri Lanka, Kenya, Ethiopia, and Egypt, as well as design centres in Sri Lanka, the US, the UK, and France, providing direct employment to over 20,000 people.