Talawakelle Tea Estates PLC, the Hayleys Group’s plantation subsidiary and one of the leading plantation companies in Sri Lanka, has made a noteworthy return to profitability in 2010.
Ranked No.1 at the Colombo Tea Auction for prices amongst the Regional Plantation Companies in the high and low grown elevations during the year, the Company and its subsidiaries improved turnover by 8.3 per cent to Rs. 3 billion and converted a post-tax loss of Rs 30.4 million in 2009 to a net profit of Rs 164.5 million in 2010.
According to a filing with the Colombo Stock Exchange, profit attributable to equity holders of the Company amounted to Rs 147.4 million for the period reviewed, from an attributable loss of Rs 22 million in the previous year.
Earnings per share for the 12 months amounted to Rs 6.21 from a negative 0.94 cents for 2009.
On the basis of these results, the Board of Directors of Talawakelle Tea Estates PLC has proposed payment of a final dividend of Rs 2.50 per share to shareholders.
Reviewing the Company’s performance, Hayleys Group and Talawakelle Tea Estates Chairman Mohan Pandithage attributed the return to profitability to “resilience, consistency and unwavering focus on strategy.”
“A confluence of factors such as our persistent emphasis on quality that entailed remunerative prices at the Colombo tea auctions and the relatively favourable weather for tea crop, contributed to the better performance during the year,” Mr. Pandithage said.
An increase in tea production to 6.8 million kg, and a significant reduction in borrowings and finance cost also positively impacted the year’s results.
Mr. Pandithage disclosed that the total capital expenditure incurred by the Company during the year on field and non-field activities as Rs 198.4 million, taking the cumulative investment since privatization to Rs 3,031.5 million.
He expressed concern however, about the impending revision of the workers’ wage agreement. “These negotiations unless dealt with caution can again push us back to red in 2011,” Mr. Pandithage warned.“We expect the wage expectations to be lower in this instance, with the Government successfully containing inflation to single digit from double digit levels of the past. The wage increases in the recent past have amounted to over 30 per cent with last revision at 42.5 per cent. It is paramount that all parties including the policymakers recognize that international competitiveness is a prerequisite for the future stability of the industry.”
Talawakelle Tea Estates PLC produces high-quality tea in 17 tea gardens situated in the best tea country of the land. Twelve of these estates, nestled in the Dimbula region manufacture high-grown teas while the rest, situated on the verdant planes of the South bring forth the low-growns that satisfy tea connoisseurs around the world.
The Board of Directors of Talawakelle Tea Estates PLC comprises of Messrs A M Pandithage (Chairman), Merrill J Fernando, Malik J Fernando, S T Gunatilleke, M M M De Silva, Prof. Uditha Liyanage, Dr S S S B D G Jayawardena, L N De S Wijeyeratne, J A G Anandarajah and G K Seneviratne.
