ECONOMYNEXT – Sri Lankan coconut shell-based activated carbon manufacturer Haycarb reported slow growth in profit in the June 2015 quarter owing to the continued slump in gold mining, currency depreciation and stiff lower cost competition.
The Hayleys group unit said June 2015 quarter net profit rose four percent to 135 million rupees from a year ago although sales rose 20 percent to 2.9 billion rupees.
Earnings per share for the June 2015 quarter were 4.55 compared with 4.40 rupees the year before, interim accounts filed with the stock exchange showed.
Haycarb Managing Director Rajitha Kariyawasan said margins were squeezed by the downturn in the gold mining industry coupled with significant depreciation of currencies in key markets of Europe, Japan and Australia.
“The low cost competition from smaller manufacturers in Philippines, Indonesia and India and continued difficulties in charcoal procurement especially in Sri Lanka has resulted in a very challenging period in the near term,” a statement said.
“Haycarb Group will focus on lean initiatives to achieve cost savings and pursue its strategy of increasing its market share in the value added carbon segment.”
At the same time Haycarb was trying to increase direct marketing in the USA, through its new structure at Haycarb USA.