Kelani Valley Plantations PLC (KVPL), a wholly owned subsidiary of Dipped Products PLC (DPL) which is a member of the Hayleys group, had taken a major blow from the collapse of tea and rubber prices at the tail of the year ended December 31, 2008 with profit after-tax down to Rs.278.8 million from the previous year’s Rs.410 million despite turnover growth of 9.92% to Rs.3.1 billion.

KVPL Chairman, Mr. N.G. Wickremeratne, said that they had been able to post a pre-tax profit of Rs.300 million notwithstanding a very difficult final quarter which historically had always been favourable in terms of both crop and prices.

"If not for the highly detrimental impact of the global financial collapse on commodity trading, KVPL would have ended 2008 with a far more attractive result," he said.

The price declines in both tea and rubber in tandem last year was an unusual occurrence which he said posed severe challenges. It was important that all key stakeholders of the plantation industry including the state, trade unions, exporters and plantation companies must work at a national level towards re-stabilisng the industry.

When Dipped Products acquired Kelani Valley Plantations 17 years ago, plantations were a business that DPL was not familiar with. But they went ahead with the acquisition despite the volatility then associated with the plantation industry as they believed it would result in mutual beneficial synergy for the two businesses.

DPL was one of the world’s leading non-medical rubber glove manufacturers and KVPL had a number rubber estates in its portfolio.

Wickremeratne who was then head of DPL said that he had watched Kelani Valley grow into its present position as one of the country’s more successful plantation companies.

"I can look back on the development of this company and consider it a privilege to have been able to contribute to that growth," he said.

DPL Plantations with 71.18% of the company is the major shareholder of Kelani Valley followed by Lalith Hapangama (7.96%) and the Ceybank Unit

Trust (3.48%).

The after-tax profit of the company posted in 2008 was the second highest on record.

The company proposed a first and final dividend of Rs.3.50 per share to be declared at the AGM on March 31 and payable on April 7, down from the Rs.5.50 per share dividend paid the previous year.

The Kelani Valley share traded at a high of Rs.78 and a low of Rs.40 during the year under review against a trading range of Rs.63 to Rs.45.50 the previous year.

The directors of the company are: Messrs N.G. Wickremeratne (Chairman), J.A.G. Anandarajah, G.K. Seneviratne (MD), R.W. Soysa, Dr.W.S.E. Fernando, B.P.W. Jayasekera, A.M. Pandithage (Alternate R.A. Ebell), R. Seevaratnam (w.e.f. 30.10.2008) and F. Mohideen (w.e.f. 30.10.2008).