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| Tuesday, 6 July 2004 |
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Richard Pieris net assets grow 17% to Rs. 2.5 billion Richard Pieris and Company Ltd recorded a Rs. 571,597 million net profit before tax for the financial year ended March 31, 2004. The increase in profits corresponds to a 206% growth compared to the previous year while net assets grew to Rs. 2.5 billion, an increase of 17%. Chairman of Richard Pieris and Company Henry A. Pieris described this significant achievement as a "remarkable feat for the Group." The company attributes substantial restructuring management changes, merging of units, and factory expansion as key factors for growth. Pieris in his review on the annual performance said that group turnover exceeded the Rs. 5 billion mark for the first time. Most impressively net profit before tax improved to over Rs. 571 million from Rs. 186 million in the previous year, an increase of over 206%. In addition consequent to acquisitions made during the year, the net assets grew to Rs. 2.5 billion, an increase of 17% compared to the previous year. Our market capitalisation rose by over 100% to Rs. 5.47 billion, a remarkable feat for our Group. "The most successful division of our company was our retail and distribution sector, which operates the Arpico Supercentres and Arpico Showrooms as well as our redistribution operations, which achieved a turnover of almost Rs. 3 billion, an increase of 25% over the previous year. Richard Pieris Natural Foams Ltd. which manufactures natural latex rubber mattresses and pillow cores was our most successful export company, achieving a turnover of Rs. 584 million, an increase of 23% over the previous year," he said. "We also completed the purchase of all non-Richard Pieris owned shares in RPK Management Services (Pvt) Ltd., a company that has management rights and effective control of two publicly listed plantation companies, Kegalle Plantations Ltd. and Maskeliya Plantations Ltd. The opening of a new food court adjoining the Hyde Park Arpico Supercentre was ideally timed to coincide with heightened sales during the Christmas and New Year season. It has proven to be a success with some of the highest profile names in the fast food sector in Sri Lanka operating outlets at this venue," he said. The sale of our shares in Asia Capital was timely, and contributed very significantly to our bottom line. It has enabled us to focus on and expand our core businesses. I would like to outline some of the more significant initiatives planned for the coming year, commencing with the conversion of our Nawinna showroom into a new Supercentre this year. This project will replicate the highly successful model used in developing the three Supercentres currently in operation. "We have completed the construction of a new factory in Seethawaka, which will commence operations in the first quarter of the coming year, to manufacture natural latex mattresses and pillows for the export market. In the tyre division we plan to enter a new market segment - the remanufacture of radial tyres. Chief Executive Officer of the Group Sena Yaddehige said "We have embarked on two exciting new ventures. Firstly, we will be importing new tyres contract manufactured to our specifications under our own 'Yata' logo. In addition, plans are well advanced to open a factory which will remanufacture radial tyres to the specifications of the new tyres. Our plastics sector has been pioneers in Sri Lanka and has attained market leadership in all of their main product categories. The installation of new state-of-the-art machinery, one in particular which is unique in this country, promises to have a strong impact on revenue during the coming year. In addition, we plan to introduce a large range of new products to supplement our existing product lines. "The Group's rubber sector manufactures products for local and export markets. This sector had a relatively disappointing year due to strong competition and rises in raw material costs. However, positive signs were emerging as the year ended. We were able to penetrate new markets in the Asia-Pacific region, giving us the impetus to increase sales in this region. During the year, we acquired a strategic minority stake in International Grocers Alliance (Pvt) Ltd., which was set up to acquire a 40% stake and manage Sathosa Retail Ltd., a government owned retail chain comprising 150 outlets throughout the island. Our aim is to fast track the Group's growth in the retail sector by targeting customers in a different market segment without competing with Arpico Supercentres," he said. (SP) |
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