Finlays Colombo PLC expects trading conditions to continue to pose challenges in the second half of 2009 given the persistent recessionary economic environment, despite improved financial results for the first half of 2009 from last year.
In a statement on the 1H09 results, Finlays Chairman C.L.K.P. Jayasuriya said there was a 90% increase in profit before tax due to the strong performance by all three business categories, tea exports, temperature controlled logistics and agencies which was a marked improvement when compared with the corresponding period last year.
The company will continue to focus on driving productivity, product quality and market expansion. “We will also closely examine and gear ourselves to take advantage of the economic opportunities that are likely to emerge consequent to the end of the armed conflict in the North,” he said. According to the Chairman’s statement, the Beverage Packing Division exported 3.7 million km of tea in the first six months of the year. While the overall volume remained more or less unchanged from last year, focus on margin expansion through exports of high-value-added teas and productivity gains continued.
The Temperature Controlled Storage and Logistics business, which is a relatively new area of operations for the Group, has now stabilized and has been recognized by the industry as a premium cold storage facility. It achieved an average occupancy of about 76% in the first half of the year despite adverse macroeconomic conditions.
Mr. Jayasuriya stated that some of the company’s non-tea agency businesses such as General Sales Agency for Cathay Pacific, Environmental Services division, trading in teabag filter paper have been experiencing weak demand conditions mainly due to the recession. However, Insurance Brokering, Timber Treatment and Pest Control divisions have delivered strong results by expanding their customer base. Overall, the agency businesses recorded a moderate growth in profit compared to the first half of 2008. |
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