Chairman and Chief Executive Mohan Pandithage (left) and Co-Chairman Dhammika Perera
Building on a strong momentum gathered over the final quarter of FY 2017/18, Sri Lanka’s leading diversified conglomerate Hayleys PLC announced a record breaking top-line performance, as revenue expanded by 47% Year-on-Year to Rs. 163.2 billion during the 12 months to 31 March 2018.
Supported by the addition of 6 months of operations from its recently acquired subsidiary, Singer (Sri Lanka) PLC, the conclusion of the financial year marked two important milestones for the Hayleys Group, as it became the first listed entity in the country to surpass annual turnover of US$ 1 billion, while celebrating its 140th year of business in Sri Lanka.
During the year in review, the Hayleys Group made numerous bold new investments across the sectors which the diversified conglomerate operates in, with a view to repositioning its subsidiaries to capitalise on new growth opportunities over the medium-long term.
The Group posted strong operating profits which expanded by 18% YoY to Rs.11.4billion. However, increased borrowings, combined with the prevalence of higher interest rate conditions throughout the financial year, resulted in net finance costs increasing to Rs. 5.93 billion, leading to a reduction in profit before tax (PBT) by 18% to Rs. 5.76 billion during the period in review. Post-tax profit was down 25% to Rs. 3.27 billion and net profit attributable to ordinary shareholders was lower by 63% to Rs. 1.02 billion.
Commenting on the performance of the group over the past year, Hayleys PLC Chairman and Chief Executive Mohan Pandithage commended the determined efforts of all of the group’s subsidiaries in achieving the US$ 1 billion revenue milestone, and outlined plans to leverage investments made during the period in review to generate new growth opportunities over the coming financial year.
Pandithage continued: “At the outset, I wish to commend the strong performances across Hayleys, which has enabled our group to emerge in its 140th year of operations as the first listed Sri Lankan entity to surpass the US$ 1 billion turnover milestone. This is truly a remarkable milestone that serves to highlight the scale of our operations, and the vital contributions that Hayleys continues to make, as an engine of growth and innovation in the Sri Lankan economy. I would also like to thank Co-Chairman Dhammika Perera, the Board of Directors and the Group Management Committee in achieving this milestone.
“The past year bore witness to several bold new investments across Hayleys that are designed to place the group on a stable but aggressive growth trajectory over the medium-long term. Nevertheless, we remain cognizant of the higher finance costs arising from increased investments over the past year. Moving forward, the group will move to rapidly reduce gearing and re-align capital structures with a view to bolstering the bottom line.”
In that regard, Pandithage made special note of the highly encouraging performance of the Hayleys group over the final quarter of FY18, during which time turnover expanded by a significant 74% YoY up to Rs. 50.9 billion, while operating profits surged up 33% YoY to Rs. 4.7 billion.
Leading segmental performance during the year was the group’s transportation and logistics business, which posted substantially improved revenue and operating profits of Rs. 35.7 billion and Rs. 2.95 billion respectively.
Increased raw material costs hampered profitability within the group’s purification products and hand protection segments, both of which posted improved turnover but weaker operating profits. Purification segment recorded a turnover of Rs.15.5billion with an operating profit of Rs.1.1billion, while hand protection segment revenue was Rs.15.9billion while operating profits reduced to Rs.464 million.
Boosted by the introduction of new revenue from Singer, the group’s consumer products segment also posted impressive growth in turnover, closing the year with revenue of Rs. 35.9 billion while operating profits increased to Rs. 2 billion during the period in review.
The Group’s Agriculture and Plantations segments, though affected by weather conditions in the earlier part of the financial year, contributed substantially towards group revenue and profitability.
Hayleys also announced a First and Final dividend of Rs.5.00 per share. XD: 02/07/2018; PD: 10/07/2018.
The Board of Directors of Hayleys PLC comprises Chairman and Chief Executive Mohan Pandithage, Co-Chairman Dhammika Perera, Sarath Ganegoda, Rajitha Kariyawasan, Dr. Harsha Cabral PC, Dr. Mahesha Ranasoma, Lalin Samarawickrama, Ruwan Waidyaratne, Hisham Jamaldeen, Aravinda Perera, Noel Joseph and Jayanthi Dharmasena.