mono wrote:hayleys has actually done well. you guys should keep in mind that that MGT lost 600 million this quarter due to some fraud case. if you take that out. HAYL has actually done well.
Sri Lanka Hayleys Dec net down 68-pct
Feb 08, 2011 (LBO) - Net profit for the December 2010 quarter at Sri Lanka's Hayleys conglomerate fell 68 percent to 90 million rupees from a year ago as margins were squeezed by higher raw material prices, a statement said.
Sales rose 33 percent to 13.7 billion rupees but earnings per share fell to 1.20 rupees from 3.72 rupees during the period, according to the stock exchange filing.
The accounts showed that finance costs increased 39 percent to 248 million rupees as borrowings rose while there was a 65 percent rise in administrative expenses to 2.1 billion rupees.
Other income more than doubled to 133 million rupees from 2.3 million, mainly owing to gains from disposal of part of a stake in a newly acquired subsidiary.
During the third quarter, Hayleys acquired 1.9 million shares in Alutec Anodising & Machine Tools (Alumex Group) and subsequently sold of 700,000 shares, resulting in a gain of 133 million rupees. The Hayleys group continues to hold 60 percent of Alumex Group.
Chairman and chief executive Mohan Pandithage said higher raw material costs of manufacturing subsidiaries and increased provisioning at Hayleys MGT Knitting Mills eroded the bottom line.Hayleys MGT Knitting Mills performed a special audit verification on trade receivables and inventories during the third quarter, based on which an additional provision of 134 million and 235 million rupees were made.
"The quarter was a challenging one for the global markets and manufacturing sector of the group, with substantial increases in costs of most raw materials such as fibre, latex, coconut shells and cotton yarn used by these businesses, eroding profit margins," Pandithage said.
"Purification and hand protection sectors have continued to make substantial contribution, to the group’s operating profits for the reporting period (of) 502 million rupees and 433 million rupees, albeit less than the corresponding period of the preceding year."
The group's power and energy sector’s hydro power projects have yielded better results, Pandithage said.
"The newly formed aviation and leisure sector, which includes the previous resorts sector, too performed well in the period under review. These activities are poised to yield satisfactory results in the medium term."
The Hayleys group took total control in Mabroc Teas, a branded tea exporter, by acquiring the balance 60 percent of its equity in December 2010. "This will bring added synergies to the Group’s plantation sector," Pandithage said.
"With these investments and by consolidation of its core activities the group is expected to post improved results in the fourth quarter."
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