The Hayleys Group delivered a record profit in the first six months of FY 2020/21, with pre-tax profit nearly tripling to Rs. 5.52 billion compared to the corresponding period of last year.
The period under review reflects the strongest six months performance in the Group’s operating history and is underpinned by solid improvements in the core performance of the Group’s export-oriented businesses and proactive efforts on driving cost efficiencies through the ‘Haysmart’ programme.
Despite numerous challenges stemming from the outbreak of the COVID-19 pandemic the Group ensured continuity of its businesses while operating under strict guidelines of the relevant authorities and ensuring continued value creation to its employees, suppliers, and other stakeholders.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) recorded strong growth of 38% to Rs. 13.32 billion. Improved profitability in the Purification and Hand Protection sectors was underpinned by capacity expansions, better product mix, effective supply chain management and ongoing cost efficiencies.
The Group’s Consumer & Retail business recorded a growth, supported by an aggressive sales drive and ongoing cost efficiencies.
The Agriculture and Textiles sectors also delivered strong performances, while the Plantation sector’s profitability was upheld by significant growth in the tea exports arm.
Understandably, the Leisure Sector continues to be in the red and proactive measures have been implemented to reduce overheads and optimise resource utilisation. Meanwhile, Consolidated Earnings before Interest and Tax (EBIT) increased by 39% to Rs.9.83 billion during the year.
Overall profitability was also supported by a near 15% decline in finance costs, as the Group successfully negotiated favourable terms with banks to maximise the benefit of reductions in market interest rates.
Resultantly, the Group’s pre-tax profit more than tripled to Rs. 5.52 billion while profit after tax amounted to Rs. 3.82 billion compared to Rs. 640.86 million the previous year.
Strong earnings of key businesses led to a significant increase in the share prices and trading activity of Haycarb PLC, Dipped Products PLC, Singer (Sri Lanka) PLC and Hayleys PLC signalling positive investor sentiments and strong upside potential of these shares.
“We anticipate our export-oriented businesses to maintain the current growth momentum and are confident of delivering significant earnings growth in the ensuing quarters” said Mohan Pandithage, Chairman and Chief Executive of Hayleys PLC.