Feb 19, 2010 (LBO) – Sri Lanka’s Kuruwita Textile Mills said tight cost control helped generate a net profit of 81.7 million rupees in the December quarter although sales were stagnant, signaling a turnaround from losses caused by recession. The firm, which supplies treated fabric to garment manufacturers, said it will reduce reliance on buyers in the European Union after the EU said it would withdraw duty free access for Sri Lankan clothing exports on human rights concerns.
Kuruwita Textile Mills, which is owned by apparel exporter Brandix Textile Holdings, said in a stock exchange filing it will cut costs further and might buy raw material from cheaper sources.
Sales for the December quarter were stagnant at 2,017 million but gross profit almost doubled to 201 million rupees from a year ago.
Earnings per share for the quarter were 3.27 rupees compared with 0.05 rupees the previous year.
The company’s net profit in the December quarter of the previous year was only 1.3 million rupees as sales fell owing to the economic downturn, and it was forced to cut prices and bear higher costs at the time.
Chairman Aslam Omar said there were signs of recovery in its main markets in the United States and the UK.