Sri Lanka fabric maker’s 2008-09 profit slumps

May 15, 2009 (LBO) - Sri Lanka's Hayleys MGT Knitting Mills said net profit slumped 45 percent to 3.2 million US dollars in the 2008-09 financial year from a year ago as orders and profit margins fell. The firm, the cotton and synthetic fabric manufacturing unit of the Hayeys group, said in a statement that sales fell marginally - by 1.1 percent - to 59 million US dollars from 59.7 million dollars during the year ended March 31, 2009.

It attributed the slump in profits to the global economic downturn which reduced orders and eroded profit margins, and to higher input costs, especially energy.

But Bandula Weerasinghe, joint managing director of Hayleys MGT, said orders have recovered in the first quarter of the current year.

Weerasinghe also said prospects for Hayleys MGT would improve with the commissioning of its bio-mass steam generator in the new financial year.

"This would offset the high energy costs."

Hayleys MGT Knitting Mills, which has a production capacity of four million metres of fabric a month, supplies top international brands such as Marks & Spencer, Next, Nike, Reebok and Decathlon.

The company also supplies knitted fabric to the Sri Lankan apparel indust