Royal Ceramics posts modest first quarter group profit
Royal Ceramics Lanka Limited, one of the country’s biggest ceramic tile makers, has posted a first quarter group profit of Rs. 4.3 million turning around from a loss of Rs. 9.9 million during the comparative quarter a year earlier.
The company which has substantially increased production capacity in recent months after re-commissioning the Interbatch Porcelain factory it purchased last year has seen group turnover rise 61.1% to Rs. 268.8 million during the quarter under review.
At company level, turnover was up 116.9% to Rs. 164.3 million and there was an after-tax loss of Rs. 7.3 million, down from a profit of Rs. 14.3 million during the comparative quarter a year earlier.
Although the gross profit was up 91% to Rs. 91.5 million, a surge in distribution cost that rose 129% as well as rises in administrative expenses and finance cost had impacted on the bottom line.
Distribution cost was up to Rs. 49.4 million from Rs. 21.6 million a year earlier while administrative expenses climbed to Rs. 23 million from Rs. 21.3 million and other operating expenses too rose to Rs. 0.9 million from Rs. 0.7 million.
Despite these increased costs, the company’s operating profit was up substantially to Rs. 18.8 million during the quarter under review from Rs. 6 million a year earlier.
Finance costs were up 49% to Rs. 14.6 million and the company turned in a pre-tax profit of Rs. 4.3 million, up from a loss of Rs. 3.7 million. With no tax obligation during the period under review, this remained the bottom line and the after-tax profit of Rs. 4.3 million compared with a loss of Rs. 9.9 million during the first quarter of the previous year.
Royal Ceramics which is currently seeing a tussle for control with Mr. Dammika Perera, the deputy chairman of the company, and some of its other directors buying into the company in recent weeks, has an issued share capital of Rs. 553.9 million, capital reserves of Rs. 264.9 million and retained earnings of Rs. 41 million in its books.
The Royal Ceramics share was transacted at a high of Rs. 24 and a low of Rs. 14.50 during the quarter under review. This compared with a trading range of Rs. 22.25 to Rs. 15.50 a year earlier.
Net assets per share as at June 30, 2003 were stated at Rs. 15.51, up from Rs. 14.65 a year earlier.
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