Solid wooden flooring back in portfolio
Swisstek (Ceylon) PLC., a member of the Lanka Wall Tiles group whose ultimate parent is the Dhammika Perera controlled Vallibel One PLC., has profited from growth in the construction industry enabling higher market share for Swisstek branded products – tile mortar, tile grout, skim coat, decorative pebbles and aluminium, during the year ended March 31, 2015.
"The re-introduction of solid wood flooring under the Swissparkett (Swisstek is the successor to Parquet Ceylon PLC.) under the Swissparkett brand name is expected to show future growth in this area of business as well," the Swisstek annual report said.
The company’s chairman, Mr. Nimal Perera, has reported that economic growth in the country had a positive effect on the construction industry, paving the way for a substantial boost in the performance of the Swisstek group.
"Whilst the turnover of your company grew by 5.9% to record Rs. 339 mn. ( Rs. 320 mn. the previous year), the turnover of the subsidiary, Swisstek Aluminium Ltd., (SAL) increased by 29.3% to record Rs. 1.52 bn., (Rs. 1.18 bn. in the previous year) for the year under review," Perera said.
"These increases together with strong bottom line contributions of Rs. 91.89 mn. (Rs. 49.66 mn. the previous year) and Rs. 157.36 mn., (Rs. 70.72 mn. in the previous year) respectively from the two companies, resulted in encouraging year-on-year increase in post tax profits of 113.3% of the group."
He said that this was indeed commendable and demonstrates very significant future prospects for both companies.
After a long lapse, Swisstek paid a dividend of Rs. 0.50 to shareholders last October. Perera expressed his belief that continuing growth in profits will enable them to have a sustainable dividend policy in the future to benefit all shareholders.
In recent months, the Swisstek share has been gaining substantially on the Colombo Stock Exchange (CSE). It closed the year under review at Rs. 41.90, up from Rs. 20.40 a year earlier. It traded last week at Rs. 58.
Perera said that they have been investing on upgrading technology, systems and procedures to bring greater efficiencies, at all levels of operations. Group investments totaled Rs. 16 million for the year which he said will bring rich benefits in coming years.
The company’s Managing Director, Mr. J A P M Jayasekera, said that group turnover, had grown 25% during the year under review to Rs. 1.86 bn. while the post tax profit had better than doubled to Rs. 251 mn. from Rs. 118 mn. a year earlier.
The company too has done well, with a topline growth of 6% to Rs. 339 mn while the bottom line grew by 85% to Rs. 92 mn.
"The main contribution to the profit came via increased commission income from sales at the factory outlet, a gain of Rs. 9 mn on fair value of investment property and a one-off gain of Rs. 24 mn from the land acquired by the government for road expansion," he said.
"The subsidiary company, Swisstek Aluminium Ltd., also performed very commendably. Turnover increased by 29.3% to Rs. 1.53 bn, and profit increased by 123% to Rs. 157 mn."
Jayasekera reported that many steps had been taken during the year to optimize capacity utilization at the factory alongside on-going efforts to streamline operational processes, and improve efficiencies at the tile grout and tile mortar, manufacturing unit. The products’ technical and functional specifications had been further improved to offer a superior product to the market.
Lanka Tiles with 47.8 % and Lanka Walltiles with 11.4% are the controlling shareholders of Swisstek.
The directors of the company are Messrs. W D N H Perera (Chairman), Mahendra Jayasekera (MD), K Y Choy, Nalaka Ratnayake, J K A Sirinatha and Ms. K C Silva.
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