Watawala Plantations records outstanding earnings

Plantation arm of Sunshine Holdings, Watawala Plantations PLC (CSE: WATA), recorded a PAT of LKR 186 million for Q2 2012/13 compared to a loss of LKR 16.8 million reported in the same period a year ago.

The Tea sector, which accounted for 65% of the turnover of the company for Q2 showed a much-improved performance with a 12% increase in production to 2.07 million kgs compared to the same quarter a year ago. The Net Sale Average of tea showed a LKR 103.38 improvement (against Q2 a year ago) and several cost reductions and improved agronomical practices implemented by the company, now appear to be showing results.

Rubber production fell by 38% to 108,460 kgs over the same period last year and the Net Sale Average dipped by LKR 183.25 (against Q2 a year ago), thus creating a marginal loss in Q2 of LKR 5.1 million. The wet weather reported in Udugama, which accounted for 22 wet days in September resulted in the lower productivity.

Palm Oil continued to be the highest profit earner for the company with a profit of LKR 188 million in Q2. With the Palm Oil production improving by 15% to 2.2 million kgs against same period a year ago, with higher yields being recorded. The Net Sale Average continued to improve, up LKR 26.58 (against Q2 a year ago), which also contributed to an improvement in profitability by 61% against the same quarter a year ago.