Teejay Lanka PLC has begun 2023-24 with a strong balance sheet, closing an extremely challenging first quarter with cash and cash equivalents of Rs 9.6 billion, despite a decline in earnings.
The company has reported revenue of Rs 14 billion for the three months ending June 30, reflecting a reduction of 41% over the corresponding quarter of the previous year.
The Group posted a gross profit of Rs 283 million for the period, which it said is a demonstration of its resiliencein a period where industries were challenged with volatilities. Teejay’s gross profit margin reduced to 2% for the period, in contrast to the 6.9% reported at the end of the fourth quarter of 2022-23.
In a filing with the Colombo Stock Exchange (CSE), the Group reporteda pre-tax loss of Rs 701 million and a net loss of Rs 853 million for the three months reviewed, attributing the downturn to a drop in sales, the appreciation of the Rupee, fluctuating raw materialprices, capacity underutilisation and costs associated with inventories.
Teejay experienced a reduction in inventories during the quarter and is now at low levels, which is a positive sign as the entire supply chain has lowered its inventory levels.
Teejay Lanka Chairman Ajit Gunewardene said the Group is confident that it has deployed resources to remain resilient and is on the path to recovery.
Teejay Lanka CEO Pubudu De Silva said that digitalisation, setting and implementing a strong ESG framework, reduction of costs, new product development to improve revenue, improving synthetic capacity, and the upliftment and empowerment of human capital, thus enhancing resourcefulness, are considered the Group’s priorities, going forward.