KVPL posts Rs. 222 million pre-tax profit in nine months

With three quarters of fiscal 2007 behind it, Kelani Valley Plantations PLC (KVPL), the Hayleys Group plantation company, has begun reducing the impact of a huge crop loss the result of the estate strike of November-December 2006 - to improve on its first half performance.

According to figures released to the Colombo Stock Exchange this week, KVPL has increased its turnover for the nine months ending September 30, 2007 to Rs 1,888 million, an increase of 5 per cent over the corresponding period last year, through better prices for rubber and tea.

The company ended the first quarter of the year with its tea crop in deficit by a third, but had at the end of the review period reduced this to a fifth through a partial catching up in the third quarter.

However, weather-related crop losses in the review period take this figure to 962,000 kg, KVPL Managing Director Kavi Seneviratne said.

The partial recovery of the crop lost to trade union action combined with a 25 percent improvement in tea prices over the corresponding nine months resulted in turnover from tea growing by 2 percent to Rs 1,176 million.

A 3.6 percent increase in production and a 10.6 percent improvement in the net sales averages for rubber boosted turnover from that produce by 11 percent to Rs 725 million. As a result of these gains, KVPL's profit before tax of Rs 222 million for the first nine months of the current year represented a decline of 16 percent.

This compares favourably against the decline of 26 percent at the end of the first six months. Similarly, the reduction of 17 per cent in profit after tax as at September 30, 2007 reflected an improvement over the 29 percent reduction reported for the first half of the year.