Turnaround at Richard Pieris

The Richard Pieris Group recorded a profit of Rs. 77 million in the first quarter of 2009/2010 compared to a loss of Rs 340 million and Rs 533 million registered in the third and fourth quarters of 2008/2009. A turnover of Rs.4.8 billion and a profit from operations of Rs.451million was reported by the Group. The quarter also saw the Group debt levels reducing further by Rs.650million to Rs 6.2 billion.

The rubber sector recorded a turnover of Rs 411million and an operating profit of Rs.33 million for the three months ending June 30, 2009. The improvement in profitability was primarily a result of higher margins earned due to lower raw material prices and tighter control over waste and overheads.

The Retail Sector continued its steady performance with a turnover of Rs.2 billion and an operating profit of Rs.100 million for the three months ending June 30, 2009. The sector continued to consolidate its strong position in the marketplace with more focus on cost, inventory and cashflow management.

The Tyre Sector recorded a turnover of Rs.463 million and an operating profit of Rs.64 million, a growth of 88 percent compared to the previous year. The sector benefited from increased gross margins due to reduced raw material prices and higher volumes.

The Plantation Sector reported a turnover of Rs.1.3 billion and an operating profit of Rs.229 million for the three months ending June 30, 2009. All crops saw a downturn due to the adverse weather conditions that prevailed during the quarter, which adversely affected profitability. However, better prices achieved for rubber and tea due to the shortfall in production helped cushion the impact.