Mar 14, 2010 (LBO) – Sri Lanka’s Chevron lubricants unit said sales fell in 2009 with a downturn in local and export demand, but is expecting a recovery this year with new demand expected from former war torn areas. The firm said industry volumes fell 7.0 percent in which was the third consecutive year of declines “due to cautious spending and escalating prices in the fourth quarter”.
Chevron said a “large percentage of vehicle owners had opted to stretch their service,” though construction and power generation sectors were “reasonable.”
“Competition in the market place ahs reached high levels with eight new player entering the already crowded market during the year,” managing director Kishu Gomez told shareholders in the annual report.
The firm had cut prices by 10 percent as raw material prices fell in the first half of the year.
Though revenues fell to 8.69 billion rupees from 8.90 billion a year earlier, cost of sales fell faster to 5.59 billion rupees from 6.77 billion rupees allowing the firm to post profits of 1.49 billion rupees, up from 947.7 million rupees.
Chevron Sri Lanka exports to Bangladesh and Maldives also suffered.
“The economies of Maldives and Bangladesh underwent