Regnis shows positive results after losses

Regnis (Lanka) Ltd has shown positive trends during the first half of 2005 recording a 37% increase in turnover. The turnover increased from Rs. 334 million in the first half of 2004 to Rs. 458 million this year - an increase of Rs. 124 million.

From a 28.5% loss situation in the first half of last year, Regnis recorded a net profit of one million rupees in the same period of this year. The loss was not operational but out of the 15% investment in First Capital Ltd., which reported heavy losses last year.

"We have skillfully stabilised cost despite an exploding raw material scenario due to escalating oil prices, which has direct impact on chemicals and plastics, important components of the refrigerator structure", Regnis Chairman Hemaka Amarasuriya said in his half-yearly review.

Demand patterns for refrigerators and washing machines increased by close to 30% while the order book for deep freezers and bottle coolers is quite filled up for the second half with customized orders from most F.M.C.G. brands in Sri Lanka, he adds.

An expansion programme is under way and plans have been finalised to increase the capacity to 75,000 units of refrigerators, deep freezers and bottle coolers from the third quarter. Capacity will be further increased during the second phase of the expansion programme which is scheduled for 2006.

The performance of the financial service associate, First Capital which presently over-depends on stability of interest rates, is still a major concern for Regnis.

Amarasuriya is confident that the core business will deliver an even better performance in the second half of the year based on demand patterns emerging from the market.