Hayleys Group posted improvements in turnover, operating performances and overall profitability, during the second quarter of 2019/20, compared to the previous quarter.
This was supported by the strong performance of its export businesses. Meanwhile, the Group also recorded an improvement in turnover and operating profit for the 1H of 2019/20, although the overall profitability was pressured by an increase in finance costs and persistent industry challenges in the Retail and Leisure sectors. Figures for the six months ended September, shows a 17% decline in net profit from the previous year.
The Group posted a turnover of Rs 105.4 billion (+2%) during 1H2019/20, supported by top-line growth in Purification (+26%), Textiles (+32%), Hand Protection (+2%) and Industrial Inputs (+20%). Improvements in the core performance of key sectors, particularly in export-oriented business lines, are reflected by the 5% increase in Consolidated earnings before interest, tax, depreciation and amortization (EBITDA) to Rs 9.7 billion during the period.
Consolidated operating profits also grew by 5% to Rs 7.1 billion, driven primarily by the Purification (+70 percent), Eco Solutions (+41 percent) and Textiles (+169 percent) sectors. Haycarb PLC, the Group’s Purification Sector achieved strong growth is driven by the continued expansion of its value-added product portfolio as well as an ongoing focus on lean manufacturing and supply chain initiatives. Meanwhile, the Retail and Leisure Sectors continue to be adversely impacted by the unfavourable operating landscape and macro-economic challenges.
The Group’s 2Q performance improved in comparison to the corresponding period last year, with profits before tax increasing by 18 percent to Rs 1.2 billion and profit after tax increasing by 40 percent to Rs 714.3 million. Consolidated finance costs increased by 7 and to Rs.6.6 billion, resulting in the Group’s consolidated pre-tax profits to decline by 19 percent to Rs 1.5 billion.
The Group’s total assets amounted to Rs 238.5 billion by end-September 2019, an increase of 3% compared to end-March 2019. Chairman and Chief Executive Hayleys, Mohan Pandithage said, “We remain optimistic regarding the Group’s performance in the coming quarters, given the anticipated recovery of the country’s retail and tourism sectors, the expected reduction in finance costs and the continued growth of our export businesses.”
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