Piramal Glass Ceylon ends highly successful year

Turnover up 17% to record Rs 6.7 b; PAT soars by 49% to Rs. 654 m

Piramal Glass Ceylon PLC (PGC) ended a very successful year with a record growth in turnover and profitability. The company recorded its highest-ever turnover this year of Rs. 6,755 m and a Profit After Tax (PAT) of Rs. 654 m.

With this achievement the Board of Directors has proposed a 35% dividend, maintaining its consistent policy of dividend pay-out ratio. 

Revenue achieved for the year was Rs. 6,755 m, depicting a growth of 17% as against Rs. 5,792 m of the previous year. The revenue growth was mainly contributed by domestic sales which saw a significant growth of 23% from Rs. 4,422 mto Rs. 5,436 m. The major portion of growth was backed by food and beverage segments.

The export market remained constant for the year under review as the focus was to service the growth in the domestic market. Some mid mass export orders were deferred to make available capacity for the domestic production. Yet amidst these constraints it was motivating to see several new products being designed and launched in the USA market. In the export portfolio, the USA is now amongst the top three exporting locations of PGC.

Piramal Glass Ceylon Board of Directors, from left: Ranjit Fernando, Vijay Shah (Chairman), Dr. Bandula Perera and Sanjay Tiwari. Samit Datta not in the picture

The F16 Q4 reflected a marked improvement against that of the similar quarter in F15 due to exceptional sales during the festive season. The total sales during the quarter grew by 18% from Rs. 1642 m to Rs. 1,938 m, of which the domestic sales and exports were up by 21% and 6% respectively.

During the year under review there were unforeseen interruptions in the production processes due to ageing furnace. However, the company serviced the increased domestic demand by stretching the production and temporarily resourcing through trading even though it is not economically attractive.  

The operational achievement was marred by the furnace oil rates which is still at the 200% above the international level. This has affected the exports of the company as there is no level playing field to compete in the international market. The company has made several representation to the relevant Government authorities to support the domestic industry which in turn will help in increasing the export revenue for the country.

Gross profit for the year was at Rs. 1,497 as against Rs. 1,117 of the previous year with a growth of 34% whilst the operating profit was Rs. 879 m as against Rs. 635 m of the previous year. The incremental profit is the outcome of the increased sales volumes.

The earning per share increased by 50% to Rs. 0.69 per share as against Rs. 0.46 per share during the previous year. Piramal Glass Ceylon CEO and Managing Director Sanjay Tiwari said: “The company’s furnace which was built in 2007 is due for rebuilding and relining during F2017. The relining together with enhancement of capacity from existing 250 tons per day to 300 tons per day and technological improvements to the existing machinery by adding further flexibility is scheduled to be carried at an investment of Rs. 3 billion during the second quarter of the current financial year. This upgraded facility will help the company to service the present and future increased demand in the domestic segment for all industries namely food and beverages, pharmaceuticals, agro chemicals, liquor the upcoming segment of virgin coconut oil. The new facility will also enable PGC to deliver more innovative designs in different sizes and colours. The company is also doubling the facility for producing colour bottles through colouring forehearth. This expansion also includes further investment in more sophisticated down-stream facilities.”