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Sri Lanka Singer unit net down 35-pct
16 Nov, 2012 14:52:04
Nov 16, 2012 (LBO) - Profits at Singer Sri Lanka Plc, a distributor of consumer electronics fell 35 percent to 194 million rupees in the September 2012 quarter from a year earlier, as finance costs rose, interim accounts showed.
The group reported earnings of 1.65 rupees per share.

For the nine months to September the group reported earnings of 6.73 rupees per share on profits of 840 million rupees, unchanged from a year earlier.

Revenues rose 15 percent to 6.0 billion rupees in the quarter, cost of sales rose 18 percent to 3.8 billion rupees and gross profit rose at a slower 0 percent to 2.2 billion rupees in the quarter.

Finance expenses rose 114 percent to 432 million rupees.

Sri Lanka's rupee fell in the first and second half of 2012 pushing up the price of imported goods and export commodities and interest rates also rose.

The rupee peg broke after authorities used large volume of bank credit to manipulate energy prices and printed money to keep interest rates down.

In the past, after triggering balance of payments crises by printing money, authorities had raised taxes on electronic goods blaming 'imports' for currency weakness in a throwback to Mercantilism. This time only cars were singled out for blame and taxed to the hilt.

"The results were despite the fact that the economy and consumer sentiments were affected by the sharp devaluation and sharp increase in interest rates, electricity and fuel costs," Asoka Pieris group chief Executive officer told shareholders in reference to nine month profits.

"These adversely impacted the consumer sentiments and the buying power of the consumers.

"In addition, the drought destroyed part of the harvest and resulted in power cuts and shortages of water for consumers in some districts and further affected the consumers in the third quarter."

During the first nine months, refrigerator sales grew 17 percent from a year earlier sewing machines rose 9.0 percent but television sales fell 17 percent. Last year a cricket world cup had boosted sales.

Fans had grown 40 percent, microwave cookers 171 percent, air conditioners 22 percent, kitchen appliances 41 percent, irons 82 percent, rice cookers 54 percent. Computer sales were up 12 percent.

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