Sri Lanka’s Watawala Plantations June net up helped by tea
Aug 05, 2017 08:04 AM GMT+0530 | 0 Comment(s)
ECONOMYNEXT - Sri Lanka’s Watawala Plantations said June 2017 quarter net profit rose 58% to Rs379 million from a year ago mainly because of a turnaround in the tea business and the sustained profitability in palm oil.
Sales of the group rose 20% to almost Rs2 billion, according to interim results. June quarter earnings per
share were Rs1.59 compared with EPS of Rs1.01 a year ago. The stock last traded at Rs34.40
Watawala Plantations Managing Director Vish Govindasamy said the increased profits were “mainly
attributable to turnaround in the tea segment and the sustained profitability in palm oil segment.”
Profitability of the palm oil segment continued despite a 9% reduction compared to the same period last year,
he said in a stateemnt.
The palm oil segment made a profit of Rs267 million, down from a profit of Rs294 million the previous year.
“ . . . the decline is primarily attributable to the lower Net Sale Average as a result of the import duty
reduction by the government in 4QFY16/17,” Govindasamy said.
The tea segment saw a turnaround with a profit of Rs90 million compared to a loss of Rs79 million in the
same period last year, he said.
“This was mainly attributable to the quality focus strategy, cost reduction measures, and continued favourable
market conditions. The company realised Net Sale Average ( NSA) above the market average, due to higher
quality standards maintained by all tea factories.”
The group’s export sector profitability dropped due to less orders received from overseas buyers compared
to the previous period, Govindasamy said.
Watawala Plantations has proposed separating its tea and palm oil businesses.
(COLOMBO, August 05, 2017)