Primal Glass posts Rs.110 m after-tax profit in 1Q

Investment of Rs. 3 billion on capacity enhancement 

Piramal Glass Ceylon Plc has announced its results for the first quarter of Fiscal Year 2017 with Rs. 1,656 million worth of revenue and Rs. 110 million of Profit after Tax. The total revenue during the first quarter of FY 2017 showed an overall growth of 11%.

The positive momentum achieved in the domestic market during the previous year continued this year too with quarterly growth depicting 9% against the FY16 Q1. The domestic sale of FY17 Q1 was Rs. 1,318 million compared to Rs. 1,207 million during the corresponding period of the previous year.

The export market sale was Rs. 338 million against the previous year’s Rs. 290 million, reflecting a growth of 16%. The actual growth potential had to be curtailed to facilitate domestic market requirements. During this quarter the company has mainly concentrated on high-value niche exports.

During this quarter the company’s main concentration was towards building stocks in preparation for the forthcoming closure of the factory in Q2 F17 for capacity enhancement and refurbishment. The strategy towards the same was to build in-house manufactured stocks for proprietary bottles and to import generic bottles.

During this quarter a substantial portion of the domestic sale was met through trading. The company’s objective was to ensure that the customer requirement would be catered to with the least disruption during the coming period. Thus in most cases the trading margins were not attractive. The major imports were done from its parent company Piramal Glass Ltd. India.

The Gross Profit margin for the period under review was 18% against 22% in the corresponding quarter of the previous year. This decrease was contributed to by the mentioned trading scenario and several unforeseen interruptions in the production processes due to an ageing furnace. 

Currently the relining of the furnace with an expansion in its capacity to 300 MT per day as well as refurbishment and repair work on the downstream facility is in progress. The company is investing Rs. 3 billion for this modernisation and expansion. 

Piramal Glass Ceylon CEO and Managing Director Sanjay Tiwari said: “We would be back in operation by end of the 2nd Quarter with enhanced capacity and are confident in giving our customers a better choice of bottles in more exciting designs and shapes.”