Aitken Spence Plantations records best ever year

Elpitiya Plantations Ltd. (EPL), Aitken Spence's plantation arm recorded its best year of profits during the financial year ended 2007/08. Premium tea prices and returns from diversification into multi crops, especially palm oil contributed strongly to the bottom line.

Chairman of Aitken Spence Plantations, J.M.S Brito said, "We have had an excellent year which had seen our strategy of diversification paying off. Tea production and bought leaf production improved over the previous year. There was a significant improvement in palm oil production, which is now gradually increasing its productivity. Inclement weather during the year saw rubber production decline compared to the previous year."

On the revenue side, the company said that the sales average for tea showed a distinct improvement after September 2007 particularly in the high grown areas where a larger segment of tea in EPL is produced. Tea prices in the low grown areas continued its rising trend during the period under review.

Elpitiya Plantations also noted that the most significant improvement was seen in the sale average of palm oil, which has been boosted by a rising market for edible oils in the international market and the interest on bio fuels.

The company also invested heavily into energy saving devices from hot water generators to low energy saving withering fans, which all have contributed to controlling cost of production despite the wage impact during the year. EPL is in the process of completing a small hydropower project, which will supply power to the national grid on a Letter of Intent signed with the CEB.

The company noted that there is significant potential to develop hydropower in the future.

Over the years, EPL has also developed a valuable resource in over 400 ha of forestry, which has a substantial value in current terms particularly with a phenomenal rise in global oil prices.

Adding value to this resource is one of the strategies planned by EPL.