Although few Auctions were cancelled during the month of March 2020, the Online Tea Auction commenced in April 2020 with a promising turn around in Tea prices, which resulted in a favorable and positive outlook of the Tea Industry and thereby Kotagala Plantations were able to raise the required working capital to meet its ends during these months.
The future of the Tea Industry too looks lucrative as a result of the steep increase in prices during the last two months, the company said in a stock exchange notification.
“Moreover, turnover for the Company for the fourth quarter and the year ended March 31, 2020 are approximately Rs. 637 million and Rs. 2,643 million respectively.
However we are in the process of finalizing Group turnover for the same period,” the statement said. Commencing mid-March 2020, the crop intake and the production as well drastically declined with the outbreak of COVID-l9, mainly due to restrictions on working days and social distancing as well.
However normal operations resumed under essential service being declared by the Government.
The Government’s relief package under CBSL circular No. 5 with regard to 6 months loan moratorium greatly helped the cash flows of the Company which will continue until the month of September 2020.
The Company also applied for the working capital facility under Central Bank direction which if granted will be of great help to meet pending financial commitments.
The Company expects the precarious feel of the COVID-I9 pandemic to continue in future as well until a proper medicinal or vaccine preventive cure is introduced. The Company has already planned to introduce, mechanical plucking operations to improve on the quality and quantity of Tea production, which will yield savings on cost of production and thereby increase in turnover and profitability. As a result of lifting the ban on Glyphosate after three and a half years, proper application of fertilizer could be resumed at low cost including the other connected agricultural practices as programmed and thereby a significant improvement could be expected in crop and yield. (IH)
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