BPPL Holdings records stellar 85% growth in QoQ net earnings in Q2 ‘24

BPPL Holdings PLC witnessed a significant improvement in its financial performance during the three months ended 30 September 2024, as compared to both the corresponding quarter in FY 2023-24 and the three months ended 30thJune 2024.

The increase in revenue and gross margins was despite an appreciation in Sri Lankan Rupee rates used to convert US Dollar denominated sales to Sri Lankan Rupees.

Consolidated revenue for the three months to 30th September 2024 was Rs. 1.6 billion, a growth of 5% in Rupee terms and 11% in US Dollar terms over the same period in the previous year. EBITDA for the period was Rs. 356 million compared to Rs. 233 million in the corresponding period the previous year, a growth of 53%.

Net earnings after tax wereup 85% to Rs. 184 million compared to Rs. 99 million in the previous year. However, acharge of Rs. 99 million was recorded in the previous year,due to the net loss on conversion of foreign currency denominated assets and liabilities, as opposed to a gain of Rs. 43 million in the current year.

“The revenue of Rs. 1.6 billion for the quarter under review is an increase of 15% from that of the previous 1stquarter, mirroringthe growth in brush sales as well as recycled polyester yarn,” said . Resultantly, EBITDA grewby 104% QoQ,due to the higher revenue and gross margins during the quarter and net earnings by over 100% compared with a loss of Rs. 19 million.

“The increase in group revenue is due to an improvement in the operating environment in the brush segment, as well as higher than industry average growth in the yarn segment,” said MD/CEO of BPPL Holdings, Dr. Anush Amarasinghe.

The overall improvement in EBITDA during the quarter under review was the outcome of improved gross margins arising from higher volumes and savings in utility costs.  The operating environment forrecycled polyester yarn remains challenging given the competitive prices of imported yarn, possibly due to government subsidies in sourcing countries.