Cost effective energy saving lighting systems, rechargeable lighting devices and electrification of the rural areas have resulted in diminishing importance for dry cell energy storing devices, says the country’s main household battery manufacturer, Laxapana.
The current demand pattern coupled to the continuing technical advances in the field of energy storage makes it clear that the manufacture and sales of dry cell batteries will soon be uneconomical for the company, noted Laxapana Chairman S.D.R. Arudpragasam in the company’s year ending March 2012 annual report.
Laxapana, now controlled by the E.B. Creasy/Lankem Group, said if the 56-year-old company is unable to make alternative economic use of its present manufacturing facility it will need to adopt an alternate for the continuity of the employees.
“Over the years, the company has gradually reduced its employee numbers to the minimum required to operate the factory as an economical unit. The company’s free hold office and factory building at Homagama, situated in close proximity to the Southern Expressway and the circular road which is currently under construction, is a valuable asset that the company holds,” he said. The factory and office are located on 3 ½ acres with 74 persons employed.
While the Laxapana brand is well known in rural Sri Lanka, the company said its medium term strategy is to develop trading activities in lighting and energy related products taking advantage of its strength in sales and product loyalty.
The company has already launched a range of CFL bulbs and associated lighting devices. Plans are also underway to launch a range of consumer disposables. Concurrently, the company is also evaluating other opportunities into which the company is able to diversify and ensure its long term viability, the report added.
Turnover for the year fell sharply to Rs.115.9 million from Rs. 316.6 million in 2010-11 while a loss of Rs. 73.8 million was recorded against a profit of Rs. 6.3 million earlier. The net loss increased due to a charge of Rs. 41.4 million owing to extraordinary provisions for spare parts and machinery impairment.
The report said that while the rural farming has been the mainstay for Laxapana battery sales it has also became the receiver of benefits from this optimistic economic environment. The farmers benefited from the substantial fertilizer subsidies offered by the government and from the peaceful environment brought about by the end of the war. |
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