Regnis not in the red any more
Regnis (Lanka) Ltd, a subsidiary of the Singer Group, has posted a profit in 2007 for the first time in two years, owing to correcting its selling prices in consumer goods and an excise duty exemption.
"We posted Rs.53 million profit last year compared to a loss of Rs.77 million in 2006. We corrected our sales prices and obtained an excise duty benefit," a company official told The Sunday Times FT. He said in June last year, the government had announced an incentive for manufacturers, granting them an exemption from excise duty if the local value addition in their manufacturing processes were above 50 percent. "Ours was around 70 percent and we applied for this exemption to obtain the incentive, which contributed to our profit," he explained. Hemaka Amarasuriya, Chairman/ Managing Director Regnis in his annual review has said the company would have upped its capacity by a 100 percent in 2007 if the scheduled double shift operation started last year. "We plan to go into no-frost refrigerator manufacturing this year and we are negotiating with Ceylon Mercantile Industrial and General workers' Union (CMU) in order to work a double shift this year at our Borupana factory. The double shift will facilitate an increase in our volumes to 100,000 units per annum. This will bring down our cost per unit in manufacturing and also meet the demand," the Regnis official explained.
Amarasuriya said in the report that the government directive in the last budget to provide an incentive to traders to assemble refrigerators is a 'clear disincentive' to genuine manufacturers to expand their operations in the future.