Watawala Plantations profits up
Watawala Plantations PLC has had an excellent nine months ending
December 2010 with a group net profit of Rs 418 million which is an 85
percent increase over the same period the previous year. The company
recorded a profit after tax of Rs 332 million.
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Watawala
Plantations
PLC Managing Director
Vish Govindasamy |
The performance of tea was encouraging which bettered the performance
of the previous period by improving on the bottom line by 44 percent.
Increased production coupled with better agricultural practices and
better prices in comparison with the market elevation averages were the
main contributory factors. Waltrim Estate in the Lindula region, which
now has a 'state of the art' factory, has re-established its mark in the
region by fetching high prices. This recovery after the old Waltrim
factory was fully gutted by fire in April 2008 is remarkable.
Exceptionally high rubber prices have significantly increased the
profitability of this segment, with rubber contributing Rs 80 million
profit when compared to a loss of Rs 7.5 million in the same period
previous year.
The average prices during the nine months improved by 80 percent. The
company will be in a position to capitalize on this situation and report
a better performance in the next quarter subject to good weather
conditions. The oil palm segment has once again delivered excellent
results recording a Rs 168 million profit.
This is marginally lower when compared to the previous period as
production declined due to unfavourable weather conditions but with
improving prices due to global supply shortages, profitability was
maintained. However, it is envisaged that this trend would ease towards
the end of the financial year.
The company continues to benefit from its partnership with Tata
Global Beverages Ltd (formerly Tata Tea Ltd) with increasing support for
exports of bulk and value added tea to them and their clients.
Exports of the company to Australia are now handled by Watawala
Marketing Ltd., which is a fully owned subsidiary. Therefore these
results are reflected in the subsidiary's accounts.
The former FMCG division of the Company was converted to Watawala
Marketing Ltd in April 2010. They market Zesta Tea, Watawala Kahata, Ran
Tea, Zest Mineral Water and Oliate Vegetable Oil. The Company has had a
remarkable nine months ended December 2010, reporting a net profit of Rs
157 million which is a 43 percent growth over the net profit of the
previous period.
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