A doubling of synthetic fabric volumes, higher selling prices and the impacts of the depreciation of the Rupee have generated strong growth for Teejay Lanka PLC, enabling Sri Lanka’s first multinational textile producer to close in on its preceding full-year revenue and profit figures by the end of the second quarter of 2022-23.
Teejay Lanka has reported revenue of Rs 48.6 billion and net profit of Rs 2.3 billion at Group level for the six months ending 30th September 2022, nearly achieving the corresponding figures of Rs 49.6 billion and Rs 2.5 billion recorded for 2021-22.
The Group’s six-month revenue grew by 111% over the revenue of the first half of the preceding year, while net profit growth for the period reviewed was 145%.
For the second quarter of FY 2022-23, Teejay Lanka posted revenue of Rs 24.8 billion reflecting growth of 95% and profit after tax of Rs 1.1 billion, an increase of 70%.
Teejay Lanka Chairman, Ajit Gunewardene commented however, that price hikes in raw materials, freight and energy had also increased the cost of sales, which for the second quarter alone stood at Rs 22.6 billion, representing a 96% increase.
“The period ahead is going to be a challenge, yet we remain optimistic that the strategies implemented will enable the Group to continue with its growth trajectory to achieve its US$ 300 million target in the coming years in line with the expanded capacity completed in September 2022,” Gunewardene said. “While there is a slowdown in the global demand for apparel, the Group is confident that it would be able to maintain its momentum by capitalising on newly emerging market segments and its synthetic fabric drive.”
Elaborating, Teejay Lanka CEO Pubudu De Silva said: “Teejay has achieved growth by focusing on its athleisure lines, synthetic orders, new customer segments and Asian markets. The ‘China Plus One’ strategy adopted by customers to shift demand from China to South Asian markets has opened up many opportunities for fabric and apparel manufacturers. We will continue to explore opportunities for growth by discovering new business and are evaluating the potential for capturing new international markets, going forward.”
Teejay Group closed the second quarter with a strong balance sheet, reporting a cash balance of Rs 8.1 billion. Furthermore, the Group recorded a net asset base of Rs 36.5 billion and a net assets value per share of Rs 50.9, reflecting a 99% increase over the same period of the previous year.
Teejay Lanka was the first textile manufacturer in Sri Lanka to receive membership of the US Cotton Trust Protocol, and is a public quoted company with 40 per cent public ownership. The company is backed by Sri Lanka’s largest apparel exporter Brandix Lanka which has a 32 per cent stake. Pacific Textiles of Hong Kong, whose key shareholder is the Tokyo Stock Exchange listed Toray Industries Inc., owns 27 per cent of Teejay Lanka.
The Company has been adjudged the Best Textile Exporter in Sri Lanka at the Presidential Export Awards presented by the Export Development Board (EDB) and has been named among the 100 Most Respected Companies in Sri Lanka by LMD.
An ISO 9001:2015, ISO 14001:2015 and OHSAS 18001:2007 compliant company and the first in the industry to develop green fabric, Teejay has been listed on the Colombo Stock Exchange (CSE) since 2011 and was included in the S&P Top 20 Index in Sri Lanka. The Company has also been named among the Forbes ‘200 Best under a Billion in Asia’ and been recognised as the ‘International Textile Firm of the Year’ and the ‘International Dyer and Finisher’ by World Textile Institute, London.