BPPL Holdings PLC became an immediate casualty of the pandemic-induced lockdowns as its factories had to be closed down, disrupting its normal cause of operations, but the company is seeing increased demand for its products from the cleaning sector and the Do-It-Yourself (DIY) sector in the home improvement category.
BPPL was among a handful of industrial sector entities that stood to benefit from the novel coronavirus, as the fast spreading respiratory decease forced governments around the world to declare cleaning sector an essential service, while the restricted movement of people stoked higher demand for the company’s products.
BPPL CEO Dr. Anush Amarasinghe said this subsequent increase in demand helped offset the slowdown in demand from the food services sector due to closure of restaurants around the world.
“The demand for brush-ware remained strong during April to June quarter as the cleaning sector was declared an essential service by most governments around the world. We also saw robust orders from the home improvement sector as most homeowners spent time working on their homes and gardens during the period,” stated Dr. Amarasinghe in the company’s June 2020 quarterly financial accounts.
The company made Rs.589.6 million in revenues for its first fiscal quarter ended in June 30, 2020 (1Q21), down 8.5 percent from the comparable quarter in 2019.
The company said it closed all its manufacturing operations on March 20 and recommenced with scaled down operations in the second half of April.
The company’s plants are located in the Kalutara district, which was then identified as a high risk zone for the spread of the decease and hence the company had to run its operations at 30 to 40 percent of its capacity until mid-May.
“All our brush customer orders received during the quarter could not be completed and delivered by quarter-end as a result of this closure. We are only likely to complete delivery of the order backlog in the July to Sep’20 period,” Dr. Amarasinghe said.
The company reported earnings of 19 cents a share on a profit of Rs.59.8 million for the April - June 2020 quarter compared to 32 cents a share or Rs.98.5 million in the comparable period last year.
The company booked a higher tax charge of Rs.26.3 million for the quarter, up from Rs.15.5 million in the year earlier period due to a deferred tax charge stemming from the capitalisation of the yarn machinery in the previous quarter.
BPPL manufactures a range of durable brush-ware and cleaning for both professional and household applications.
The company recently diversified into synthetic filament extrusion and polyester yarn products, and the latter became a casualty of the pandemic-driven closures of retail outlets of most global sportswear brands—BPPL’s primary customers in that segment.
While BPPL lost most of the Autumn/Winter’20 season deliveries, the company is now starting to receive orders for deliveries from July’20 for the Spring/Summer’21 season.