Haycarb PLC reported revenue of Rs. 15.5 billion, profit before tax of Rs. 926 million and profit after tax of Rs. 774 million for financial year 2017/18. The earnings per share of equity holders of the company was Rs. 22.63 for the year.
The Chairman of Haycarb PLC and its parent company Hayleys PLC, Mohan Pandithage said that the significant growth in the top line in spite of key challenges in the supply chain for raw material has proven Haycarb’s strength and position as a leader in the coconut shell based activated carbon industry. He added that the Environmental Engineering arm, Puritas (Pvt.) Ltd. has reported notable growth and contributed positively to the results of the group.
Haycarb PLC Managing Director, Rajitha Kariyawasan explained that the activated carbon business of the company faced significant margin pressure due to the shortage of supplies and substantial increase in prices of coconut shell charcoal in Sri Lanka, India and Thailand particularly during the second half of the financial year due to adverse weather conditions, that resulted in lower profits from the carbon business in the current year.
The availability of raw material in Indonesia on the other hand regained near-normalcy in the last quarter after shortages experienced for two consecutive years, even though the prices remained high due to the scarcity and shortage of the material in other countries.
Kariyawasan explained that the main objective during the year was to ensure that long standing end customers and distributors were supplied with their product requirements, which compelled Haycarb to absorb majority of raw material cost increases, to allow its global distribution network to average out price increases to customers, and mitigate the panic in the distribution chain.
Therefore although Haycarb had to negotiate increase in prices of its activated carbon products, prices were increased with a time lag, as the decision to shield our customers against the full impact of charcoal price increases was made in the medium term interest of the business that resulted in the short term erosion of profit margins.
Kariyawasan said that Haycarb’s Environmental Engineering business, Puritas (Pvt.) Ltd. has posted creditable results backed by growth in its local and regional presence as a superior provider of water and waste water purification solutions, while the activated carbon end products manufactured and marketed by this sector also showed satisfactory growth.
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