Kegalle Plantations PLC, a member of the Richard Pieris group and the country’s single largest rubber producer, had seen a dip in both turnover and profits in the year ended March 31, 2014 but has increased capital expenditure, the company’s annual report reveals.
Turnover was down 6.7% to Rs.2.4 billion while the profit after-tax was down 26.9% to Rs.346 million. Capital expenditure increased 16% to Rs.294.5 million.
The company’s Chairman, Dr. Sena Yaddehige, has told shareholders in the annual report that despite challenges, positive results have been achieved.
Kegalle with a 5,326 ha of rubber in its portfolio is the largest natural rubber producer in the country. Despite adverse weather, the company posted production of slightly over 4,000 mt of rubber almost par with production the previous year.
"This amounts to over 3% of the national rubber production in Sri Lanka. The average sale price of rubber declined this year to Rs.353.16 per kg compared with Rs.415.1 per kg in 2013," Yaddehige said.
High rubber prices in recent years enabled Kegalle to do very well but this has now reversed with Yaddehige saying that the company, which also manages over 1,370 ha of tea, had suffered from depressed rubber prices.
He said that they strictly adhered to the best agricultural practices with greater attention given to process and productivity improvements.
The year under review had seen the profits from rubber decreasing to Rs.322 million from Rs.607 million the previous year.
Revenue from tea was up to Rs.882 million from Rs.805 million the previous year while the revenue from rubber declined to Rs.1.39 billion from the previous year’s Rs.1.63 billion.
There had been a marginal decrease in revenue from coconut from Rs.55 million the previous year to Rs.45 million.
Yaddehige reported that the company had invested Rs.294 million capital expenditure replanting and maintaining 247 ha of rubber at a cost of Rs.226 million while 19 ha of tea was replanted and maintained at a cost of Rs.49 million.
Discussing the future, Yaddehige said that low cost borrowing opportunities that have now arisen have made them optimistic about the future. This would enable expansion of the plantation sector.
"The company is also looking forward to create and build important investment relationships with foreign partners in order to expand our plantations sector and we have even commenced discussions with the relevant regulatory bodies in these countries," he said.
While tea remained less volatile at present price levels, the forecast for rubber remained weak due to sluggish demand in the emerging countries and the availability of surplus stocks.
Turnover was down 6.7% to Rs.2.4 billion while the profit after-tax was down 26.9% to Rs.346 million. Capital expenditure increased 16% to Rs.294.5 million.
The company’s Chairman, Dr. Sena Yaddehige, has told shareholders in the annual report that despite challenges, positive results have been achieved.
Kegalle with a 5,326 ha of rubber in its portfolio is the largest natural rubber producer in the country. Despite adverse weather, the company posted production of slightly over 4,000 mt of rubber almost par with production the previous year.
"This amounts to over 3% of the national rubber production in Sri Lanka. The average sale price of rubber declined this year to Rs.353.16 per kg compared with Rs.415.1 per kg in 2013," Yaddehige said.
High rubber prices in recent years enabled Kegalle to do very well but this has now reversed with Yaddehige saying that the company, which also manages over 1,370 ha of tea, had suffered from depressed rubber prices.
He said that they strictly adhered to the best agricultural practices with greater attention given to process and productivity improvements.
The year under review had seen the profits from rubber decreasing to Rs.322 million from Rs.607 million the previous year.
Revenue from tea was up to Rs.882 million from Rs.805 million the previous year while the revenue from rubber declined to Rs.1.39 billion from the previous year’s Rs.1.63 billion.
There had been a marginal decrease in revenue from coconut from Rs.55 million the previous year to Rs.45 million.
Yaddehige reported that the company had invested Rs.294 million capital expenditure replanting and maintaining 247 ha of rubber at a cost of Rs.226 million while 19 ha of tea was replanted and maintained at a cost of Rs.49 million.
Discussing the future, Yaddehige said that low cost borrowing opportunities that have now arisen have made them optimistic about the future. This would enable expansion of the plantation sector.
"The company is also looking forward to create and build important investment relationships with foreign partners in order to expand our plantations sector and we have even commenced discussions with the relevant regulatory bodies in these countries," he said.
While tea remained less volatile at present price levels, the forecast for rubber remained weak due to sluggish demand in the emerging countries and the availability of surplus stocks.
Given that the cost of tea production here is the highest in the world, he expected the current year to be a challenging one for the company.
Kegalle has a stated capital of Rs.250 million, a general reserve of Rs.225 million and retained earnings of Rs.2.9 billion. Total assets ran at Rs.6.9 billion and total liabilities at Rs.3.6 billion.
RPC Plantation Management Services with 76.62% is the major shareholder of the company followed by J.B. Cocoshell (2.45%). All other shareholders own less than one percent.
Net assets per share have grown marginally to Rs.33.70 from Rs.33.48 the previous year. The Kegalle share traded at a high of Rs.121.90 and a low of Rs.90 during the year under review compared to a high of Rs.119.50 and a low of Rs.86.20 a year earlier.
The directors of the company are: Dr. Sena Yaddehige (Chairman), Mr. J.H.P. Ratnayeke (Deputy Chairman), Mr. S.S. Poholiyadde (CEO), Prof. R.C.W.M.R.A. Nugawela and Dr. S.S.B.D.G. Jayawardena.
www.island.lk
RPC Plantation Management Services with 76.62% is the major shareholder of the company followed by J.B. Cocoshell (2.45%). All other shareholders own less than one percent.
Net assets per share have grown marginally to Rs.33.70 from Rs.33.48 the previous year. The Kegalle share traded at a high of Rs.121.90 and a low of Rs.90 during the year under review compared to a high of Rs.119.50 and a low of Rs.86.20 a year earlier.
The directors of the company are: Dr. Sena Yaddehige (Chairman), Mr. J.H.P. Ratnayeke (Deputy Chairman), Mr. S.S. Poholiyadde (CEO), Prof. R.C.W.M.R.A. Nugawela and Dr. S.S.B.D.G. Jayawardena.
www.island.lk
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