Apr 24, 2013 (LBO) – Demand for lubricants fell in the first quarter, on the back of a slowing economy and lower thermal power generation but profits at Sri Lanka’s Chevron Lubricant unit profits rose amid falling expenses, interim accounts showed. Floods had also hurt agriculture and users were moving to longer lasting higher technology lubricants.

“Construction sector volume too has had a setback on the back of lower growth recorded in the sector,” he said.

Chevron is Sri Lanka’s market leader with strong brands but it is getting competition from Lanka IOC and other entrants.

Profits in the March 2013 quarter rose 16.5 percent to 796 million rupees from a year earlier. Earnings were 6.42 rupees per share.

Revenues fell 5.0 percent to 3.1 billion rupees but expenses fell at a faster 12.3 percent to 1.96 billion rupees allowing gross profits to grow 9.8 percent to 1.2 billion rupees.

Managing director Kishu Gomes told shareholders that base oil prices fell and an appreciation of the rupee had also reduced costs.

The firm, which has cash reserves, also earned higher interest income with finance income more than doubling from 30.3 million rupees to 65 million rupees.

Gomes said lubricant demand was sluggish in