JAT Holdings PLC has achieved its highest-ever first-quarter revenuein FY 2022/23. The Group has also performed exceptionally well, across a range of other financial performance indicators, defying industry trends, amidst a highly challenging economic environment.
Total revenue for Q1 grew by 39% to Rs. 1.935 billion, against Rs. 1.396 billion in the corresponding quarter of the previous year, while Gross Profit in absolute terms rose by 37% to Rs. 525.6 million, against Rs. 382.6 million in Q1 of FY 2021/22. Gross Profit Margins were maintained unchanged at 27%, despite mounting domestic and external challenges such as Sri Lanka’s multiple crises of economy, energy and foreign exchange, compounded by a global scarcity of raw materials.
Operating profit grew by 50% during the period under review to Rs. 280.2 million, up from Rs. 186.75 million in the corresponding period. However, Operating Profit Margin growth was subdued, but still recorded an expansion to 14%, up from 13%. This was as a result of variouseconomic relief packages and facilities provided to employees making it the highest ever increase in salaries, coupled with rising inflation costs and exchange rate volatility. Profit Before Tax (PBT) grew by 18%, demonstrating a sustained momentum of recovery, to Rs. 198.8 million, compared with 168.9 million earlier, although Margins contracted slightly, from 12% in the corresponding period, to 10% during the period under review, as a result of the worsening economic environment.
CEO Nishal Ferdinando said, “Through foresight and experience, we anticipated the present crises, based on economic indicators and on-ground information. Thus, we immediately rallied our people and our supply chain partners to secure adequate raw material stocks for at least eight months, which we were able to achieve thanks to our strong financial position, which was further consolidated as a result of our IPO. In fact, the cash infusion from our IPO, has ensured low gearing, thus a reduction in financing costs, helping us to remain relatively unburdened amid a tightening monetary environment.”
Group Export Revenues dipped slightly during Q1, by 12%, as a result of reorganisation due to the commencement of operations at the Group’s manufacturing facility in Bangladesh, owned and operated through its fully-owned subsidiary, Asia Coatings (Pvt) Ltd. However, export revenues are forecasted to improve drastically as operations at the new facility get up to speed. Additionally, the Group has placed a strategic focus on developing its export operations, in order to further consolidate its financial and operating position over the rest of the year.
Revenues from the Group’s Sri Lankan operations expanded by 59% to Rs. 1.576 billion in Q1 of FY 2022/23, up from Rs. 989.3 million in the corresponding period. This was driven by increased sales, coupled with the effects of input price inflation.
All of the business sectors of JAT Holdings PLC recorded healthy to phenomenal gains in terms of revenue growth during the period under review. Its largest business sector, Wood Coatings, witnessed a 21% expansion in revenue, rising to Rs. 796 million this quarter, up from Rs. 658 million in the corresponding period.
White by JAT saw the largest growth in revenues, driven by growth in the emulsion sector, coupled with increased market share. The sector posted a phenomenal 206% revenue growth in the quarter under review, soaring to Rs. 203.1 million from Rs. 66.5 million in the corresponding period. Similarly, White by JAT’s online sales too posted a remarkable revenue expansion of 187%. The Group’s Brushes business also recorded revenue growth of 27% to Rs. 56.25 million this quarter, up from Rs. 44.3 million in the corresponding period.