Dipped Products turnover tops Rs. 3 billion

The Dipped Products Groups (DPL) has recorded turnover of Rs. 3.364 billion for the six months ended September 30, 2005, a growth of 17 per cent over the corresponding period last year.

The Group has reported that income from the hand protection segment grew 14.5 per cent to Rs. 2.538 billion in the first half of the year, while the plantations sector's turnover grew 23.8 per cent to Rs. 965.2 million.

A notable feature of the Group's performance in the six months reviewed was its ability to maintain gross profit margins in the hand protection business despite a near 50 per cent increase in the prices of rubber, its main raw material.

The price of rubber represents half the cost of production of rubber gloves.

A company spokesman said gross profit margins were maintained by increasing the value of sales. Profits from the plantation sector were affected by higher wages costs, he said.

In results released to the Colombo Stock Exchange last week, DPL reported that consolidated gross profit was up 9 per cent to Rs. 815.5 million in the period under review, and operating profit up 3 per cent.

However profit after tax and minority interest for the period was down 40 per cent to Rs. 121.4 million over the first half of last year.

This was attributable to a huge increase in interest charges incurred on a higher level of borrowing to fund capital expenditure for expansion projects in Thailand and Sri Lanka, and the effects of higher interest rates and the adverse impact of the exchange rate following the appreciation of the Rupee.

According to the spokesman, half of the finance cost for the period was attributable to the prevailing exchange rate.

The Board of Directors of Dipped Products Limited comprises Messrs R. Yatawara (Chairman), N.G. Wickremeratne (Managing Director) H.A. Peiris, R.W. Soysa, J.A.G. Anandarajah, Dr. W.S.E. Fernando, G.K. Seneviratne, A.D.B. Talwatte, N.Y. Fernando N.B. Weerasekera and R.K. Witanachchi (Appointed with effect from 1st May 2005).