Friday 15 August 2014

Richard Pieris ups PAT by 106% in Q1 of 2014/2015

The Richard Pieris Group ended its first quarter on a strong note reporting a growth of 106% in its net profit when compared to the corresponding period of the previous year. The three months ended June 30, 2014 evidenced a steady performance in all its major sectors with a reported quarterly turnover of Rs.8.8bn, which is a 7% growth over and above last year. The reported profits represent business profits, and do not include any gains of a capital nature.

The Retail Sector of the Group comprises of Arpico Super centres and the network of Arpico outlets scattered islandwide. The sector had a dynamic first quarter as usual and the main focal point was the opening of its 16th large format retail outlet in Panadura.

The Plastics and Distribution Sector gained momentum during the period ended June 30, 2014 after a very quiet 2013/14. Several process improvements were made in the Furniture manufacturing business where the product quality and portfolio have been further enhanced. Several marketing activities were carried out to boost mattress sales which has yielded better margins and sales growth. During the period under review there was a significant increase in the sales volumes of water tanks and the sector also introduced Hybrid Water tanks into the market. The sales of rigifoam was adversely affected due to adverse weather conditions.

The Plantation Sector of the Group experienced a successful first quarter with a significant increase in operating profits.

The Richard Pieris Group owns three of the largest plantation companies in the country with diverse crops which includes high grown, mid grown and low grown tea, rubber, oil palm, coconut, cinnamon, cardamom, rambuttan and other crops contributing to more than 20% of Group turnover.

During the period under review the tyre sector continued to benefit from favourable raw material prices and savings in energy sources which were introduced last year which resulted in an overall increase in terms of profitability. Products introduced towards the latter part of the last financial year was gaining market acceptance and during the period under review Richard Pieris Tyre Company introduced a new tyre "Hida" which was targeted towards the mini trucks.

The Rubber Manufacturing Sector continued to prosper during the first quarter of 2014/15 in the back drop of a very successful 2013/14. The latex foam business continued to thrive and managed to reduce its debt levels during the quarter through improvements in working capital management.
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