Closure of key Hayleys export factory triggers Rs. 400 mln loss in turnover

The prolonged closure of Hayley's rubber product factory at Rathupaswala resulted in the loss of Rs. 400 million in turnover for the company during the second quarter which is a serious cause of concern, the group CEO said.

Despite this setback, Hayleys Group Chairman and CEO Mohan Pandithage said they were encouraged by the strong earnings growth.

Hayleys PLC, in a media release, said it maintained an upward growth trend in revenue and profitability for 1H 2013/14 reporting 22 per cent growth in profitability with pre-tax profit at Rs. 2.5 billion. Group revenue expanded by 11 per cent in the first half of the financial year.

Of the group's two largest manufacturing sectors, the purification sector posted operating profits of Rs. 663.3 million for the period under review, despite contracted revenue stemming from a global downturn in the gold carbon industry.

The hand protection sector experienced trying operational circumstances during the latter part of the period under review, since the management was compelled to suspend operations at the factory at Rathupaswala. However the sector continued to remain profitable, recording operating profit of Rs. 494.6 million for the first half of the financial year, the statement said. Strong contribution to the group's overall profitability also stemmed from the construction materials sector while operating profits from the agriculture sector rose by a significant 52 per cent. However, the plantations sector was negatively affected by adverse weather conditions in key plantation locations during the second quarter.