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Brush manufacturer BPPL faced tough six months
By Duruthu Edirimuni Chandrasekera
Brush manufacture, and exporter of sanitary maintenance tools, BPPL Holdings PLC has had a tough six months ending September this year.
The impact of floods in May/June affected timber supplies, restricting their sales growth during the period. In a bid to avoid such hardships in the future, the company has opted to import some timber for manufacturing their products, BPPL Managing Director Dr. Anush Amarasinghe told the Business Times.
“We now carry a limited quantity of imported timber as a safety measure to manufacture our products.” Although the situation had normalised by July 2017, inventory replenishment took longer than anticipated due to the threat of landslides affecting tree uprooting early on. Inventories only normalised by September 2017, which meant that shipments could only be regularised towards the end of the reported period.
Dr. Amarasinghe added the order pipeline for the next few quarters is strong with substantial order flows from customers in the disaster management and janitorial sectors in the US. “The need to replenish inventory rapidly following the recent hurricanes has boosted orders from the disaster management sector. We have also had significant wins from customers in the janitorial sector for our synthetic fiber/monofilament products. Revenue from these orders is expected to flow through from the Oct-Dec’ 2017 quarter onwards,” he has said in the quarterly statement.
Supply of the yarn extrusion machinery is also on track with deliveries expected during November – December 2017. Machinery will be commissioned during the January to March quarter of 2018 and contribute to revenue from April 2018.
Consolidated revenue for the period was Rs. 1.2 billion, up 7 per cent over the corresponding period in the previous year. The North American region remained the dominant contributor, accounting for 82 per cent of reported revenue. The region saw a 9 per cent increase in revenue over the previous financial year. Robust growth was also seen in Australia, and the European region, Dr. Amarasinghe has said.
BPPL has continued to roll out their own brand of cleaning products in the South-East Asian region. A distributor was appointed in Malaysia during the past quarter and another national hypermarket chain undertook to carry its products in Indonesia. “Now there are four national hypermarket chains and seven local stores in the Jakarta region that retail our products,” Dr. Amarasinghe has added.
BPPL’s gross profit was slightly down to Rs. 439 million for the six month period as gross margins fell due to wage escalation as a result of the floods. Irregular timber supplies increased overtime payments as workers had to process the timber as and when it arrived.