June 14, 2007 (LBO) – Sri Lanka’s Maskeliya Plantations, which produces some of the island’s best high grown teas, has reported a sharp fall in profits following a strike last year. Profit after tax fell 91 percent to 11.3 million rupees in the financial year ended March 31, 2007 from 138 million rupees the year before.
Turnover was virtually stagnant at 1.9 billion rupees, mainly because of higher auction prices for the firm’s teas as the crop harvested from company estates was almost a million kilos lower than the previous year.
Maskeliya Plantations chairman Sena Yaddehige told shareholders in the firm’s annual report that he was disappointed with the performance and the “meagre” profit.
The company, he said, was operating much below its potential owing to external factors beyond the management’s control.
The wage hike granted to estate workers in November 2006 after they went on strike had already cost the firm 141 million rupees and the full year impact would be higher, Yaddehige said.
He lamented the fact that the wage hike that was granted was not linked to productivity improvements and said this had affected company performance.