Sri Lanka’s Teejay Lanka announces positive start to 2022-23 with revenue of Rs 23.9 billion
The Morning: Teejay Lanka PLC announced that it made a positive start to 2022-23 posting Group revenue of Rs 23.9 billion for the three months ending 30 June 2022.
Commenting on these results, Teejay Lanka Chairman Ajit Gunewardene said: “Our performance in the first quarter is extremely encouraging for all stakeholders, especially in the context of the continuing local and global challenges. The Group completed a $ 26 million expansion project at Teejay India, adding 20 tonnes a day to capacity. At the same time, India is viewed as an important strategic location positioning Teejay to gain from the anticipated growth in the apparel industries of countries like Bangladesh and Indonesia.”
The Group achieved nearly half its full-year revenue of 2021-22 in just the first quarter of the new financial year as a result of the low base of the previous financial year due to the impacts of Covi-19, the depreciation of the rupee, and the passing on of yarn price increases during the last quarter.
In a filing with the Colombo Stock Exchange (CSE), Teejay Lanka said it had also recorded significant growth in pre-tax and net profit at both Group and company level in the quarter reviewed.
According to interim financial statements, group profit before tax for the three months grew by more than Rs. 1 billion or 291% to Rs. 1.5 billion, while group net profit for the period was up 301% to Rs. 1.2 billion.
At a company level, revenue improved by 108% in the quarter under review to Rs. 12.9 billion, while profit before tax grew by 323% to Rs. 1.5 billion, and net profit increased by 311% to Rs. 1.3 billion.
Teejay Lanka PLC has notified the CSE that its Board of Directors has proposed the payment of a final dividend of Rs. 1.50 per share to the company’s shareholders for the year ending 31 March 2022.
Teejay Lanka CEO Pubudu De Silva added: “With the global increase in yarn prices coinciding with the depreciation of the rupee, Teejay had an opportunity to strategically capitalise on its status as a preferred supplier to several international markets to increase sales income. We also embarked on several strategic initiatives to expedite progress. We focussed on new product development and digitalisation, to modernise operations and embrace an environmental, social, and governance (ESG) framework. Headway was made in these aspects and progress was made in terms of expanding the Group’s synthetic footprint.”
Teejay Lanka was the first textile manufacturer in Sri Lanka to receive membership in the US Cotton Trust Protocol and is a publicly quoted company with 40% public ownership. The company is backed by Sri Lanka’s largest apparel exporter Brandix Lanka, which has a 32% stake. Pacific Textiles of Hong Kong, whose key shareholder is the Tokyo Stock Exchange-listed Toray Industries Inc., owns 27% of Teejay Lanka.
The company has been adjudged the “Best Textile Exporter in Sri Lanka” at the Presidential Export Awards presented by the Export Development Board (EDB) and has been named among the “100 Most Respected Companies in Sri Lanka” by LMD.
OSL take:
The revenue recorded by Sri Lanka’s Teejay Lanka PLC is a clear indication of the growing opportunities in the country’s apparel industry. Sri Lanka’s apparel industry is one of the key foreign exchange earners of the country. The many trade agreements and the trade concessions enjoyed by the country from the EU and US have helped boost apparel exports. The government of Sri Lanka is also looking at further uplifting the country’s apparel industry with the setting up of a dedicated fabric park in the Eastern Province to support the apparel exports sector. With the impressive revenue recorded by businesses engaged in the apparel industry in Sri Lanka and the steady growth in the industry’s business potential, foreign businesses/investors could explore the growing opportunities in the sector. Foreign businesses could also look at forming partnerships or joint ventures with local businesses engaged in the apparel industry for further expansion.
| Article Code : | VBS/AT/21092022/X_3 |