KVPL posts nine-month net profit of Rs. 160 m

Monday, 1 November 2010 01:25 - - {{hitsCtrl.values.hits}}

The continuing buoyancy in the rubber market, coupled with stable prices for tea in its third quarter, has enabled Kelani Valley Plantations Plc (KVPL) to consolidate its turnaround from a loss-making 2009 and post healthy growth for the nine months ending 30 September 2010.

Profit before tax for the period at Rs. 173 million reflected an improvement of Rs. 388 million over the loss of Rs. 215 million for the corresponding nine months of last year, the Dipped Products Plc plantation subsidiary has reported in a filing with the Colombo Stock Exchange.

Net profit increased by Rs. 380 million to Rs. 160 million from a 3Q 2009 loss of Rs. 220 million, and turnover grew 52 per cent to Rs. 2.8 billion, the company said. Profit attributable to equity holders of the company amounted to Rs. 155.5 million.

KVPL’s earnings per share for the period stood at Rs. 4.57 from a loss of Rs 6.51 for the first nine months of last year.

Pointing out that 2009 had been an extraordinarily bad year for the plantation sector, KVPL Managing Director Kavi Seneviratne said the company’s gains in the first nine months of the current year represent a modest result in the context of KVPL’s potential and past results.

“Highly erratic weather patterns of this year have resulted in our rubber crop declining by 6 per cent in comparison with the previous season,” he said, noting that the rubber crop was the lowest ever for a nine-month period since privatisation.

“Fortunately, high prices generated a 98 per cent improvement in revenue from rubber despite the lower crop, while tea achieved increases of 24 per cent and 36 per cent respectively in volume and turnover,” Seneviratne said.

He also disclosed that KVPL’s profit growth was achieved despite a more than three-fold increase in lease rental paid to the State.

The final quarter of 2010 is expected to generate better results, enabling the company to end the year on a stronger note, Seneviratne added.

A member of the Hayleys Group, Kelani Valley Plantations manages 27 estates, over 13,000 hectares in extent, divided almost equally into tea and rubber. All of the company’s black tea producing factories are certified as HACCP and ISO 22000-2005 compliant with regard to product and quality standards, ensuring that the product meets the highest international food safety parameters.

The Board of Directors of Kelani Valley Plantations Plc comprises A. M. Pandithage (Chairman), J.A.G. Anandarajah, G.K. Seneviratne (Managing Director), B.P.W. Jayasekera, R. Seevaratnam, F. Mohideen, N. Y. Fernando, S. Siriwardena, S. C. Ganegoda (alternate S. T. Gunatilleke) and L. T. Samarawickrama.