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Issuing a statement, Hayleys said overall growth stemmed from sustained performance growth in key sectors, driven primarily by Hand Protection and Transportation and Logistics sectors.
The Hand Protection sector recorded revenue of Rs. 7.2 b, up from Rs. 6.9 b in the corresponding period of the previous financial year. Contribution from the sector to Group PBT amounted to Rs. 712 million, compared to Rs. 520 million in 1H 2013/14.
Improved performance was supported by an increase in production volume from DPL Premier Gloves Ltd., a new production facility commissioned in the Biyagama Export Processing Zone in Q1 of 2014/15.
Transportation and Logistics continued to demonstrate commendable growth as profitability grew by 19% against 1H of 2013/14. Hayleys Free Zone was commissioned for operations during the quarter at a new facility located within Zone 1 of the Katunayake Export Processing Zone.
The first phase of the project, once fully developed, will offer a sprawling 170,000 sq. ft. warehouse for foreign and local companies to carry out entrepot trade, where merchandise can be imported and re-exported tax free.
The Purification Sector reported revenue of Rs. 5.2 b and PBT of Rs. 362 m for 1H 2014/15. The sector’s operations continued to be affected due to high raw material prices. A number of lean manufacturing practices have enabled the sector to mitigate the drop in margins, and the medium to long term outlook remains positive in spite of short term challenges.
The Group’s Fibre and Textiles sectors both continued to recover on the back of successful restructuring initiatives. Fibre reported a PBT of Rs. 70 m whilst Textiles posted a PBT of Rs. 42 m in the 1H months of 2013/14.
The Construction Materials Sector also reported a PBT of Rs. 252 m up from Rs. 242 m in the same period last year. Despite the competitive market conditions for construction materials, the Group considers the sector key to future performance.
The performance of both the Agriculture and Plantation sectors were challenged by adverse weather. Weak global rubber prices compounded this situation, affecting the plantation sector bottom line. The Plantation sector changed its financial reporting period to 31 March from 31 December; accordingly three additional months have been consolidated.
The Power and Energy Sector continued to perform well as the Industry Inputs segment posted an impressive profit growth of 94%. The Consumer Products sector saw diminished earnings during the period under review.
The Leisure and Aviation Sector recorded increased turnover to Rs. 2.4 b from Rs. 1.9 b against the same period in the preceding year assisted by an impressive performance of the Group’s city hotel, The Kingsbury. The Sector’s profitability increased to Rs. 230 m from Rs. 110 m.
Alufab PLC, a well-established aluminium fabrication company, was acquired by Hayleys PLC after the reporting period.
Chairman and Chief Executive Mohan Pandithage commenting on 1H results stated that the Group has overcome challenges faced in the previous year and speaking on the outlook for the next half of the financial year noted: “The expectation is for the Group to achieve outstanding performance by year end.”
The Board of Directors of Hayleys PLC comprises Mohan Pandithage (Chairman and Chief Executive), Dhammika Perera (Co-Chairman), Rizvi Zaheed, Nimal Perera, Sarath Ganegoda, Rajitha Kariyawasan, Dr. Harsha Cabral PC, Lalin Samarawickrama, Dr. Mahesha Ranasoma, Mangala Goonatileke, Ruwan Waidyaratne and Hardy Jamaldeen.
