Hayleys reports robust December profits on performance of key sectors, other incomes

Hayleys PLC reported some robust performance for its third fiscal quarter ended in December 2024, propelled by most of its key business lines as plantations, leisure and construction materials and transportation and logistics led the top-line growth reflecting the turnaround in those sectors last year.

The diversified conglomerate with an outsize exposure to exports did revenues of Rs. 127.39 billion for the October – December quarter last year, up 4.2 percent from the same period in 2023, the result released by the company in the aftermarket hours on Friday showed.

The company’s share however added Rs.6.00 or 4.42 percent on Friday to close at Rs.141.75 a piece.

The group was seen to have managed to maintain its gross margin at around 24.5 percent due to not so hostile cost behaviour as commodities prices soften while the Rupee also appreciated against the US Dollars by about 10.0 percent in 2024.

Investors are parsing the export oriented counters for any softening in their performance due to rupee strength last year.

However at the operating level, the company reported a profit of Rs.13.41 billion, up by a robust 19.7 percent from the same period a year ago on other incomes of Rs.2.68 billion, up sharply from Rs.512.07 million in the year earlier period.

It wasn’t immediately clear what brought this massive jump in other incomes in the last three months.

Meanwhile the company reported earnings of Rs.5.87 a share or Rs.4.40 billion for the December 2024 quarter, more than doubling from the Rs.2.82 a share or Rs.2.11 billion in the year earlier period.

For the nine months, the company reported earnings of Rs.10.10 a share or Rs.7.57 billion, up 247 percent from Rs.2.91 a share or Rs.2.18 billion in the corresponding period in 2023.

Despite the sharp increase in the loans, the company has managed to keep its finance costs down, perhaps largely due to lower borrowing costs.

Segmental performance for the quarter showed that its consumer and retail business, group’s largest by revenue, generated revenues of Rs.30.51 billion, up just 1.4 percent from a year ago.

This may be coming from its subsidiary, Singer (Sri Lanka) PLC which saw a 7.0 percent decline in its top-line in its December 2024 quarter to Rs.24.88 billion.  

But the segment revenues grew by a strong 23.7 percent from the previous quarter ended in September 2024.

Transportation and logistics segment meanwhile reported revenues of Rs.26.67 billion, up 12.6 percent from a year ago.

Meanwhile, the group’s plantation sector recorded a 45.9 percent increase in its top-line to Rs.5.07 billion while its leisure business grew its revenues by 32.3 percent to Rs.3.12 billion.

While its eco-solutions and textiles businesses saw some fall in their revenues in the quarter, its hand protection, purification products and tea exports businesses grew modestly.

As half of the listed entities have reported their results for the December 2024 quarter so far, their performance has largely been a mixed one contrary to some upside expectations.