Strong performances by the Haycarb Group’s manufacturing plants in Thailand and Indonesia helped the company to post an after-tax profit of Rs 64.9 million for the quarter to June 2008, up just marginally from the first quarter of 2007, the company said on Tuesday.

The Hayleys subsidiary, the world’s largest producer of coconut shell based activated carbon accounting for more than 17 percent of global production, said turnover grew 16 percent to Rs 1.0 billion in the 3-month period. However, cost of sales (mainly raw materials, furnace oil, electricity, freight and wages) grew 28 percent over the corresponding quarter. Describing this performance as satisfactory in the context of the adverse factors that prevailed in the quarter under review, Haycarb Managing Director Ananda Hettiarachchy said adverse weather conditions and increased demand had kept local charcoal prices 20 percent higher than in the first quarter of the previous year.

The shortage of supplies compelled the company to import charcoal, incurring additional costs in the period reviewed. He said the prospects for the rest of the year were better, due to the productivity improvements and cost saving measures implemented in the first quarter. Another significant positive factor has been the company’s ability to reduce its finance costs by substantially reducing working capital. In the quarter reviewed, net finance costs declined by 82 percent.