Financial Times - ACL Cables reports highest ever quarterly results

ACL Cables has recorded its highest ever quarterly profit of Rs.273.9 million for first quarter 2007, a massive increase from its corresponding 2006 quarter.

Stock market analysts said copper prices increased considerably during the period, and ACL increased its product prices in order to leverage its dominant market share (together with subsidiary Kelani Cables, the group accounts for almost 70 percent of the country’s cabling market) and price inelasticity nature of demand. Copper prices have increased by approximately 75 percent in 2006 amidst increased demand from China, speculative fund buying and concerns over supply shortages. On average, three month copper prices increased 122.2 percent year on year to US$7,142 per tonne during the first quarter of 2007.

Analysts said that the share price has fallen recently on foreign selling, but upward re-rating is likely amidst strong results.