Finlay to increase green tea exports
James Finlay (Colombo) Ltd plans to increase green tea production
following the success of a combined industry marketing effort to
build an image for the product in overseas markets.
to increase capacity by about 25 percent,” chairman Dickie
Juriansz said. “We’ve been successful, along with other
players, in establishing Sri Lankan green tea in the world market.
A few years ago it was unknown.”
has a green tea plant in Haldumulla with a capacity of 500,000 kg.
Demand for green tea is on the rise in the beverage market, partly
propelled by increasing awareness of its health benefits, and it
commands premium prices.
Juriansz described it as an elite product targeted at niche markets.
is one of the most integrated tea companies in the island with its
own plantations and warehousing, as well as doing blending, packaging
and value addition for export. It is also involved in insurance
brokering, airlines, general sales agency and industrial and agro-chemicals.
poor performance by the plantations sector dragged down group operating
profits by 39 percent to Rs. 126 million in the first half ended
30 June 2003 despite what Juriansz called a “robust performance”
in the non-tea sector. Group net profit before tax fell by half
to Rs. 60 million compared with the same 2002 period. Juriansz said
he expects better results in the second half, barring unforeseen
Both the plantation
firms under the Finlay group, Hapugastenne and Udapussellawa, incurred
losses in the first half, largely owing to the disruption caused
by the Iraq war and the cost of last year’s wage hike. Although
export volumes fell, the company’s strategy of increasing
value added exports, where margins are higher, resulted in a 64
percent growth in pre-tax profit. About 75 percent of Finlay’s
tea exports are branded products.
the company was also focusing on making higher value teas such as
flowery grades rather than producing the standards BOP varieties.
The firm's parent, James Finlay and Company, Glasgow, which owns
75 percent of James Finlay (Colombo), recently increased its stakes
in the plantation subsidiaries buying 5.2 million shares or an 11.36
percent stake in Hapugastenna Plantations for Rs. 14.75 each and
2.09 million shares or an 10.8 percent stake in Udapussellawa Plantations
at Rs. 10.25 each, held by the Treasury.
were by James Finlay Glasgow nominees Jaycey Trust Services Ltd.
James Finlay exports over six million kilos of tea annually and
is the fourth largest exporter of tea bags.
aims to be among top five Lankan firms
Hemas is aiming to be among the top five companies in Sri Lanka,
promised Husein Esufally, Chief Executive Officer, Hemas Holdings
Ltd, at last week's launch of its Initial Public Offering (IPO).
rupee issue opens on September 18. The company's consolidated revenues
and profit after tax for the year ended 31st March 2003 amounted
to Rs, 5.3 billion and Rs, 401 million respectively, while shareholders'
funds as at that date stood at Rs. 1.7 billion.
The share issue
is lead managed by the DFCC Bank and co-managed by the Hatton National
Bank and the issue of new shares, amounting to Rs. 400 million,
is fully underwritten by DFCC and HNB. Esufally said that the family
company was established in 1948 by Sheikh Hasannally Esufally, and
today is one of the leading conglomerates in Sri Lanka. Hemas Holdings
Ltd is the holding company of the group which comprises 20 active
subsidiaries and three associate companies.
He said that
when Hemas penetrated into personal care business it was dominated
by multinationals and had to face many obstacles. They went into
the market with several challenges but today have a market share
of 31 percent.
In the transport
section, the company deals with airline representation, travel agency
services, freight forwarding and logistics. It represents Emirates
Airlines, Malaysia Airlines and LTU Airways and off-line carriers
including British Midland Airlines, Island Aviation and Druk Air.
In the leisure
sector, Hemas is engaged in destination management services operation
of travel centres and ownership and management of hotels. The group
effectively controls Serendib Hotels Ltd, Sigiriya, Stafford Hotels
and Dolphin Hotel.
In healthcare, Hemas is the largest private sector distributor of
pharmaceuticals with a market share of 15 percent. (QP)
sector borrowing picks up gradually
The Central Bank has reported a gradual pick up in lending to the
private sector amid falling interest rates and reduced borrowing
by the government and state enterprises.
Bank said in its monthly monetary policy statement that it believes
its policy rates are at "appropriate levels" at present,
given current economic developments and prospects.
growth in credit to the private sector increased to 14 percent in
July, up from 13.4 percent in June 2003 and 7.6 percent in July
2002. "Credit expansion to the private sector was mainly due
to an increase in credit extended for export and import finance
and industrial, housing and consumption purposes," it said.
from the banking sector fell by around Rs. 18 billion during the
first seven months while credit to public corporations decreased
by around Rs. 7 billion.
during January - July 2003 has averaged around 13 percent, which
is broadly in line with the projections for 2003, the bank said.
The receipt of foreign loans and improved cash management by the
General Treasury enabled the government to reduce its liabilities
to the banking sector.
in domestic supply conditions, reduced pressure from import prices,
and the cautious monetary policy stance, which prevented the emergence
of demand pull inflation, have been instrumental in further moderating
inflation in 2003.
With exports on the rise, increasing faster than imports, the trade
gap has narrowed.
Cumulative exports for 2003 grew 18 percent in US dollar terms in
the first six months of 2003, while cumulative imports grew by seven
percent, resulting in a narrowing of the trade deficit to $ 700
million in the first half of 2003 from $ 863 million in the same
inflows in the services account, particularly from tourism and port
services, increased remittances and capital inflows in the form
of portfolio inflows, investments and loans have supported the reduction
in the trade deficit, to lead to a substantial surplus in the overall
balance of payments," the bank said.
the bank to buy $ 257 million from the market in the first eight
months of 2003. The country's gross official reserves have increased
to around $ 1.9 billion by end July, equivalent to around 3.7 months
international reserves increased to $ 2.8 billion, which is equivalent
to about 5.3 months of imports, at end July 2003. Along with the
increase in inflows, the foreign exchange market has remained stable.
"Despite the slight nominal appreciation of the rupee against
the US dollar internationally, Sri Lanka's external competitiveness
has improved, partly due to the decrease in inflation and partly
due to the depreciation of the rupee against other major currencies,"
the bank said.