Sri Lanka fabric firm hit by lower prices, smaller orders

Feb 01, 2010 (LBO) – Sri Lankan fabric manufacturer Hayleys MGT Knitting Mills said December quarter profit fell sharply owing to lower prices and loss of orders to cheaper competitors. Net profit in the December quarter fell 73 percent to 20.7 million rupees from a year ago while sales fell 17 percent to 1.3 billion rupees, the Hayleys Group subsidiary said in a stock exchange filing.

“The drop in prices and volumes in the third quarter had resulted in a decline of seven percent in profits to shareholders,” Bandula Weerasinghe, Hayleys MGT joint managing director said in a statement accompanying the results.

Prices had fallen in the third quarter and volumes had also declined as the company had lost some orders to lower-priced overseas competitors. However, the company has regained the lost orders in the current quarter and expects a better year-end result.”

Earnings per share for the quarter were 0.41 rupees compared with 1.51 rupees a year ago.

The company’s nine-month profits were flat at 227.7 million rupees from a year ago with revenues down 15 percent to 4.3 billion rupees owing to lower prices and a smaller order book.

The outlook for the final qu