Haycarb PLC, the world’s biggest producer of activated carbon derived from coconut shell charcoal, has concluded successfully the year ended March 31, 2009 by increasing group turnover 8% and profit after tax 23% after reducing its finance cost by 48%, the company’s just published annual report said.

Haycarb Chairman N.G. Wickremeratne noted that this performance was significant in the context that it had been achieved in the teeth of severe global economic recession and adverse local factors relating to raw material procurement and energy costs.

"Despite the prevailing challenging business climate, your company perceives many areas of opportunity. This is especially in emerging industrial markets and projected growth of new applications," Wickremeratne said.

The company’s Managing Director, Mr. Ananda Hettiarachchy, reported that adverse conditions had affected the coconut crop and charcoal prices were 55% higher than in the previous year. Supplies too were short compelling Haycarb to import charcoal pushing up input costs, while energy prices and an unrealistic exchange rate which still prevailed had placed Haycarb’s Sri Lankan operations at a disadvantage against competitors.

However, Haycarb has production facilities in Thailand and Indonesia where the company runs two factories in addition to two here.

Hettiarachchy announced that the company was exploring "a more proactive presence in other manufacturing markets" where the company had hitherto not been very active.

He explained that having their own manufacturing facilities in countries with reasonable supplies of charcoal will raise their own competitiveness and position their brand and products within a vibrant local marketplace.

While no specific new factory location was identified, Hettiarachchy said that Haycarb saw opportunities "in being close to countries with a substantial local market, such as Thailand, Indonesia and India.’’

He said that the greatest growth in the activated carbon market is expected to be in the Asian region and Haycarb having manufacturing operations in place in those countries where growth is taking place makes good business sense. This was a course they were actively pursuing.

The 2009 profit of the company was with the exception of 2001, where there was an attributable profit of Rs.241.2 million, the highest in 10 years.

Haycarb has a stated capital of Rs.331.8 million, capital reserves of Rs.117.9 million and revenue reserves of Rs.1.2 billion in its books.

The year under review saw net finance cost cut to Rs.38.6 million from Rs.89.2 million the previous year.

Net assets per share had grown to Rs.55.65 from Rs.51.39 the previous year and the company’s share traded at a high of Rs.66 and a low of Rs.37 during the year under review. This compared with a trading range of Rs.60 to Rs.30.25 the previous year.