Textile manufacturer Teejay Lanka PLC has ended 2019-20 on a strong note, despite its projected fourth quarter profit growth being eroded by production shutdowns at all plants in conformity with the lockdowns in Sri Lanka and India necessitated by the pandemic.
The company reported profit before tax of Rs 2.9 billion at Group level for the 12 months ending March 31, 2020, reflecting a growth of 29% over the preceding year, a remarkable achievement considering that pre-tax profit for the final quarter was down 24% over the corresponding three months of 2019-20, to Rs 542.1 million.
The Group posted a net profit of Rs 2.4 billion for the full year, an improvement of 28%, after paying income tax of Rs 528.7 million, which was up 33% over that of the previous year. Net profit for the quarter ending March 31, 2020, at Rs 421.7 million, reflected a decline of 30%.
Group revenue increased by 5% to Rs 33.3 billion, but was down by 21% to Rs 6.9 billion for the fourth quarter of 2019-20 on account of the suspension of production and sales in March, the company said in a filing with the Colombo Stock Exchange (CSE).
Teejay Lanka Chairman Bill Lam said that the unexpected decline in numbers in the fourth quarter was unfortunate as the Teejay Group was well in line to achieve its 10th consecutive quarter of growth in revenue and net profit had it not faced the unforeseen circumstance of the pandemic.
“However, the Group had a very successful financial year achieving remarkable milestones, which included its highest revenue, highest gross profit and highest net profit for a financial year,” he said.
He said that one of the highlights of the Covid-19 impacted fourth quarter was the generation of a considerable volume of orders from Nike and Uniqlo through the ‘Narrow & Deep’ strategy employed by Teejay, and the establishment of the footprint of these global brands on Teejay’s order book.
In a note to shareholders, Lam also said the Group had donated fabric with its existing capabilities for the production of 2 million face masks to protect medical staff and armed forces in Sri Lanka that are engaged in the battle against the spread of Covid-19.
Teejay has ventured into a new endeavour of producing Personal Protection Equipment (PPE) to cater to international markets to supply the unprecedented current demand for these products.