Export revenue up nearly 19 pct driven by sharp increase in sales to Europe
LBR,Thursday 01 September 2011
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Sri Lanka’s HVA Foods, a newly listed branded tea exporter’s profits for the year ended March 31, 2011 fell 14.5 percent to Rs 46.3 million, accounts showed.
Revenue for the year improved 15 percent to Rs 561 mn from the previous year pushed up by export sales which rose 18.9 percent to Rs 545.8 mn.
Export revenue was driven by a 123 percent increase in exports to Europe which earned Rs 105 mn.
Exports to Russia and the CIS states, US and Canada also increased while sales in Far East and Asia declined 14.1 percent to Rs 93.1 mn.
Local sales dropped 41 percent to Rs 15.7 mn during the year.
The firm’s cost of sales increased 21 percent to Rs 480.9 mn over the previous year narrowing gross profit margins to 14 percent, Rs 80.6 mn in 2011.
Distribution expenses alone had jumped 87.8 percent to Rs 15.7 mn.
The year under review takes in to account the firm’s principle activities of processing, packing and export of value added teas.
“The Company was also engaged in the development, manufacture and distribution of tea extract based products, contract packing of teas and franchise operations,” the annual report said.
Income from packaging business during the year is up 67.7 percent Rs 46 mn.
HVA Foods, is the listed subsidiary of holding company, HVA Lanka Exports (Pvt) Limited. The firm which sells ready-to-drink iced tea packs and other value added tea products under the
'Heladiv' brand currently ships 30 to 40 containers of value added tea a month to nearly 35 countries.
'Heladiv' brand, established in 1995 enjoys a strong presence in Russia, CIS and the far east. The firm recently ventured into China by opening specialty tea parlours.