Sri Lanka recycled plastic exporter net up 188-pct

ECONOMYNEXT – Sri Lanka’s BPPL Holdings, a recycled plastic product exporter said profits rose 188 percent in the June 2022 quarter to 300 million rupees from a year ago amid soft-peg collapse helped by forex gains, price increases and falling freight rates.

BPPL Holdings reported earnings of 0.98 rupees per share for the quarter.

Sales had increased 57.7 percent to 1.58 billion rupees in the period, according to interim accounts filed with the stock exchange.

However, the cost of sales had increased 38.5 percent to 966 million rupees from 697 million rupees, a year earlier.

Gross profit for the period rose 101 percent to 619 million rupees for the period compared to 307 million rupees in the same period in 2021

“Gross profit margins improved to 39 percent during the period from 29 percent in the same period the previous year due to product price increases in Jan’22, recommencement of local sourcing of both timber and PET bottles following the lifting of COVID-related travel restrictions earlier this year and the effects of steep Sri Lankan Rupee depreciation in March ‘22,” Anush Amarasinghe Managing Director/Chief Executive Officer of BPPL Holdings said in the report.

Meanwhile, distribution costs have risen in the period 71.5 percent to 131 million rupees from 76 million rupees.

“Group distribution costs largely relating to freight, shipping and related costs, though a higher 8.3% of revenue during the period vs 7.6% during the corresponding period in the previous year, have now started to come down in line with falling global freight rate.”

As Sri Lanka’s rupee was depreciated in April 2022, the company made gains of 67 million rupees out of the exchange during the quarter.

BPPL has also completed Phase 2 of the Yarn expansion program during the JanMar ’22 quarter.

“We are making steady progress with obtaining the necessary regulatory approvals for the pending US Dollar 15 million,
10-year term loan from the United States Development Finance Corporation.

“Disbursement of funds is expected to
commence later this year and will be obtained in three tranches over a four-year period. (Colombo/Jul25/2022)