Testing lab of TT and SC receives ISO 9002

The Textile and Garment Testing Laboratory of the Textile Training and Services Centre made history as the first Textile Testing Laboratory in Sri Lanka to achieve ISO 9002 Certification for its Quality Management Systems.

This Laboratory has been in the forefront of Textile and Garment Testing Laboratories since it commenced commercial testing activities in 1986.

Since then, it has been updating its equipment and quality management systems to cater to the demands of the industry. This approach has helped this Laboratory to become the first to reach this milestone.

The assistance received from UNIDO/UNDP during the early stages and from JICA in recent years, in obtaining state-of-the-art equipment and training of laboratory staff by foreign experts in Sri Lanka and abroad hastened the achieving of this status.

This laboratory can now claim to be on par with any other Textile Testing Laboratory in the world. The laboratory is equipped to perform tests in accordance to ISO, ASTM, AATCC, BS, JIS and SLSI standards. With the achievement of ISO 9002 status the clients are assured of accurate and reliable service consistently, says the Service Centre.

Minister of Industrial Development C.V. Gooneratne received the certificate on behalf of the TT and SC from Country Manager of Det Norske Veritas of Netherlands, an independent autonomous organisation.

On Main Board of Maharaja

Gamini Marapana, P.C. has been appointed to the Main Board of Directors of the Maharaja Group with effect from September 23.

Mr Marapana, who had an outstanding school career at S. Thomas' College, Mt. Lavinia where he excelled in both studies and sports, won the Victoria Gold Medal for the best all round student. He completed his Law Degree and took oaths as an Attorney-at-Law in 1965 and commenced practice under Dr. H.W. Jayewardene Q.C. He also was a law lecturer and examiner at the Law College.

Mr Marapana was the first Chairman of the National Sports Council in Sri Lanka. He was also Asian Productivity Organisations' Director for Sri Lanka and has served on the Board of Governors of S. Thomas' College as well as on several boards in the Commercial World.

Mr Marapana is the first non-Executive Director to be appointed to the Main Board of the Maharaja Group.

Fuelmax saves on fuel

Liberty Impex (Pvt.) Ltd., sole agent and distributor for Fuelmax, fuel saver is headed by M. Loganathan, Managing Director of many companies such as Liberty Impex (Pvt) Ltd, L. R. S. Associates (Pvt) Ltd. Seeduwa Steel (Pvt) Ltd., Finnpack Industries (Pvt) Ltd, and the driving force behind it all.FUELMAX is about two inches in size and is made out of Neodymium an ingredient used to make pagers and cellular phones.

It is an invention of Dr. Robert Kane and advisor to NASA who revolutionized the world 30 years ago with his invention, the radio pager (beeper) and his ingenuity includes several patents spanning a wide diversified spectrum of innovations.

The FUELMAX on any motor vehicle caters to an unlimited market such as Cars, Taxies, Buses, School Buses, Fire trucks, Ambulances, Motor boats, Racing cars, Farming equipment, Material handling services, Construction companies. Armoured car services, Postal services, Police, Municipalities, Commercial freight lines, Leasing companies, Delivery services, Trucking companies, Shuttle services and Limousine services.

New MD at Caltex

Peter P. Martin will take over as Managing Director of Caltex's Sri Lankan operation including Lanka Lubricants Ltd. (LLL) with effect from mid October.

Caltex is one of the leading Oil Majors in Asia and is aggressively expanding business operations in the region. Caltex's presence in Sri Lanka spans over the last 60 years with the company's business operations being reactivated with the purchase of a 51% stake in LLL.

Since then LLL has progressed extensively and has become one of the leading companies in Sri Lanka.

Mr. Hopkins who steered the company in the initial stages leaves for Singapore where he will assume duties as Vice President Sales & Marketing, Caltex Lubricants Company.

Mr. Martin, who has had considerable exposure within the region itself, has been with Caltex since 1979 when he joined the company as a Product Engineer of Caltex Petroleum Corp. in New York City. Before his appointment in Sri Lanka, Mr. Martin was Director Caltex Oil Thailand Ltd. He has had wide international exposure in various Caltex operations including Australia, Dubai, Saudi Arabia, Bahrain and Thailand where he has been based for the last four years. The holder of a Bachelor of Science Degree in Mechanical Engineering and an MBA, Mr. Martin co-authored the best selling ASTM Manual of Aviation Fuel Quality Control Procedure 1998, which received the Charles B. Dudley award .

He is also a Member of the American Society of Heating Refrigeration and Air Conditioning Engineers, the American Society of Mechanical Engineers, the American Society of Civil Engineers, and of the Project Management Institute.With his wide experience within the Group, as well as in the region Mr. Martin looks forward to his tenure in Sri Lanka and is confident of steering the company to even greater heights.

Trade Expo '98 in Kandy

Around 100 export oriented enterprises including 86 from the small and medium sector in the Central and North Western Provinces will participate at Trade Expo'98 in Kandy for the third time at Hotel Suisse from October 28 to 31.

Trade Expo is a part of a comprehensive programme initiated by the Sri Lanka Export Development Board in 1994 to develop the small and medium enterprises in the provinces for the export market.

The programme includes the identification of potential producers, awareness seminars on products, markets, quality, packaging and entrepreneur development.

The trade expo will display products of potential exporters. One exhibition was held in the Southern province in 1996.

The programme started with a pilot project in the Central Province which has now extended to cover three Provinces - Central, Southern and North Western. It is expected to cover other provinces as well.

Trade Fairs, considered one of the best marketing tools all over the world are a meeting place of buyers and sellers. The established exporters of Sri Lanka and buyers from other countries will visit the fair and, it is expected these meetings will result in export orders and sub-contracting opportunities, as it happened in trade expo fairs held earlier.

Some of the products displayed speak for the excellence in the local craftsmen.

A first for Lanka

T .J. Pathirage, Chief Manager (Information System Audit) of Seylan Bank has been the first to pass the competitive, Certified Information System Auditor (CISA) exam from the Sri Lanka chapter of information system Audit and Control Association (ISACA) of USA.

Mr. Pathirage was one of nearly 5000 professionals from around the world who sat for the examination held in June 1998.

CISA is developed and administered by Information System Audit and Control Association of USA with 10,000 CISA qualified members around the world. The CISA exam is offered in more than 60 countries and Sri Lanka is one of them.

Commercial Bank in Rajagiriya

The Commercial Bank recently opened its 57th branch in the suburban town of Rajagiriya.

The new branch is connected to 54 other branches of the Bank which is the largest computer-linked banking network in Sri Lanka.

The Rajagiriya branch also offers the 24-hour banking facility through the automated teller machine CAT.

Lanka Bell office in Mt. Lavinia

Lanka Bell recently opened its 10th business office in the heart of Mt. Lavinia for the convenience of their customers in and around the area.

According to Sunil Lashmanasinghe, GM Sales and Marketing Lanka Bell, the new Mt. Lavinia office offers customers a range of services. "You can apply for a new telephone connection, pay your bills, obtain new features and services on existing services etc., while also offering customer care services".

Mr. Lashmanasinghe went on to say that due to Lanka Bell's latest and truly digital technology they are capable of offering their customers high quality voice transmission, advanced features, cost effectiveness specially over long distances coupled with a high degree of services.

British Trade Fair in November

To coincide with the 50th anniversary year of Sri Lanka's Independence, the British High Commission and the Department of Trade and Industry in Britain are organising a series of trade, cultural and seminar events in Colombo, from November 9 to 11, says a BHC press release.

The centrepiece will be a British Trade Fair at the Oberoi, featuring an exhibition of successful Anglo/Sri Lankan business and investment partnerships. Over 50 companies will exhibit a broad range of products and services.

Also on show will be a number of British companies new to the country, who are interested in developing long-term business relationships in Sri Lanka.

A series of seminars and interactive workshops will also take place at the Oberoi, with experts flown in from Britain to deliver detailed information on:

o Management and Leadership;

o International Standards - ISO 9000 and IS014000;

o Renewable Energy - Sources and Finance;

o Ceramics - New Technologies and Techniques;

o Training - English Language for Middle Management.

A Fashion Show, featuring a blend of UK designs and products from Sri Lanka's leading apparel manufacturers, will highlight the close links between the two countries in the clothing industry.

British Trade '98, will start with the unveiling of the new 'Rover Freelander', at the Oberoi Hotel, on November 6. The ceremonial opening of the Trade Fair will take place on November 9. It will be attended by Mr. Derek Fatchett, MP, Minister of State in the British Foreign and Commonwealth Office and the British High Commissioner, David Tatham.

Cultural highlights of the week include productions of Shakespeare's 'Comedy of Errors' and 'Henry V' by the Watermill Theatre Company, at the Lionel Wendt Theatre, presented in association with the British Council.

The British Trade Fair '98 is sponsored by: Hongkong Bank, Mott MacDonald, Standard Chartered Bank, P&O and Unilever.

National PVC ducts for Marubeni

Central Industries Ltd., the Manufacturer and Marketeer of National PVC pipes and a member of Central Finance business conglomerate recently signed another major Telecom contract with a Japanese business magnate, Marubeni Corporation for supply of Telecom ducting and accessories and HDPE subducting, says a company release.

S.V. Wanigasekera, Director, Central Industries Ltd., and T. Fujiwara, Resident Representative in Sri Lanka of Marubeni Corporation represented their respective organisations.

This multimillion rupee contract involves supplying of PVC ducting and accessories and HDPE subducts to the regional telecommunication development project which will be handled by Marubeni Corporation of Japan.

National PVC pipes and fittings and are both SLS certified products while the company has been ISO 9002 systems accredited for the manufacture of pipes.

A major event in this contract is that Central Industries Ltd., will be manufacturing and supplying HDPE subducts for use along with the PVC ducting. This is the first occasion on which a major Telecom project is being supplied with HDPE subducting manufactured locally.

The project covers Kandy, Kalutara and Matara regions.

Safety first at Safety Fest

CTC Eagle Insurance Company has once again declared October as the "Safety Month" and planned a series of educational programmes throughout the month to increase the awareness of 'safety' among the public.

The annual All Island Eagle Poster Competition is one such activity. The Safety Poster Exhibition and Activity Center will be held from 15th to 18th October at the National Art Gallery from 9 am to 7 pm.

The competition was open to the public and was divided into four main categories. "Saftey at home" was the theme for children between 5-8 years while "safety at school" was the theme for children between 9-12 years.

Youngsters between the ages of 13-16 years were asked to make "safety on road" their theme while "safety at work" was the theme for those who are 17 and above.

Computer generated graphics and cartoons were open to all ages and these were introduced with the intention of moulding and preparing our society to face the challenges of the 21st century.

Shipping

• MOL appointment a sign of the times
• Reform bill makes shipping contracts in US confidential
• Cho Yang to become independent

MOL appointment a sign of the times

Hayashi is waiting patiently for a change in the law that prevents foreigners taking up executive positions at companies operating Japanese- flag ships, writes Adam Corbett from Tokyo.

The law was written nearly 90 years ago in the Meiji era. A look at the recently appointed boards of major listed Japanese shipping companies reveals there is still considerable conservatism when it comes to appointing directors.

As Japanese directors continue to preach the need to become more international the boardroom remains a place that is extremely resilent to change.

There also seem to be strict age guidelines at Japanese companies judging by board appointments this year.

Currently no president is under 60 years old and no vice presidents or senior managing directors are under 55. There are also no directors in their 40s.

NYK president Kentaro Kawamura is 65, MOL president Masaharu Ikuta is 63, while Hinawa Kaiun's president Akira Tanigawa is 71 years old.

Compare that to Hayashi who was appointed chief operating officer at APL when he was a mere youngster in his early 40s and CEO when he was 50.

As one analyst points out: "The importance placed on age prevents people with ability in the company from rising to the top at a time when they might be most useful.''

Education also appears to be an important factor in determining who is destined to climb to the top. The majority of directors at Japanese shipping companies went to one of the top Japanese Universities in Tokyo, Osaka, Keio, Kyoto or Waseda.

Not unexpectedly there are no women directors at Japanese shipping companies. Also there are almost no outside apppointments.

Nearly all directors of Japanese shipping companies spent their entire career at the company or with a subsidiary.

At a time when stocklisted companies are supposed to make themselves more attractive to foreign investors, levels of disclosure remain comparatively low. Listed companies have to reveal the total income of their directors but do not need to report individual salaries of directors or even the president's pay as is the case in the US and other western countries.

Japanese listed shipping companies have been making some efforts to reduce the number of directors on their boards but they still add up to a considerable number.

There are 30 directors including five auditors on the NYK board and 24 on the MOL board including four auditors.

A more compact industrial carrier such as Navix has only 16 directors on its board. Shinwa Kaiun has the smallest board although even this company has 14 directors including two auditors.

The financial burden of having so many directors is not reduced by the practice of keeping on one or two of the most senior directors as "counsellors'' to offer advice to the working directors.

Following retirement they receive a salary and many of the privileges given to regular directors even though they are not required to take an active role in the operation of the company.

Hayashi's appointment will probably be the start of a long and slow reassessment of how directors are appointed to the boards of Japanese shipping companies. With financial deregulation just around the corner more major changes are likely to occur before another 100 years passes.

Trade Winds.

Reform bill makes shipping contracts in US confidential

Shipping tariffs are no longer required to be filed with the Federal maritime commission, according to a recent amendment in the 1984 Shipping Act. This provides for key terms of the service contracts between shippers and sea-carriers to remain confidential. However, these facts would be made available through private tariff- publishing services.

The ground- breaking legislation, which was recently approved by the US House of Representatives, has also stripped a provision to provide death benefits for World War 11 merchant mariners.

This proposed change has come under heavy opposition from forwarders and NVOs. Also , it still requires an approval from the Senate, which is expected to come through once the Senate returns to work in September.

This issue was severely criticised during a recent House debate, with Representative Henry Hyde arguing that it does not take an economic genius to see that the new system will pull small forwarders and NVOs out of business.

While the forwarders community is still imploring the Senate to decide against the changes, it is largely resigned to the fact that the Bill will most likely get passed.

Cho Yang to become independent

CHO YANG, the Korean carrier, has decided to operate independently in the North-Atlantic trade. The Shipping line is currently a member of the Trans-Atlantic Conference Agreement (TACA), a position it plans to resign from with effect from November 1.

TACA's service contract with shippers is due to expire at the end of this year.

This is when Cho Yang's status as an independent shipping carrier comes into effect.

Cho Yang's decision to part ways with TACA comes in the wake of increasing competition and rate cuts by aggressive non-conference member shipping lines on transatlantic trade routes.

This move comes close on the heels of a similar decision by Singapore-based Neptune Orient Lines in May. Several Asian shipoping carriers have opted to provide independent services in the transatlantic, starting with the Korean carrier Hanjin leaving TACA ealier this year. Meanwhile, Hyundai, another Korean carrier active in the transatlantic, has chosen to stay with the conference.

Going back to nature

By Ruvini Jayasinghe

The little wooden hut with a crooked wooden fence painted bright green and yellow had a quaint charm of its own. Inside, a dimly lit room housed cement beds filled with nitrogen rich, biodegradable waste; spoilt vegetables, off cuts, cow dung, dried leaves, sewage sludge and straw dust. A quick stir with a long stick revealed the inhabitants of the waste padded 21/2x4 foot cement beds - thousands of squirming worms!

The Managers of Bogawantalawa Plantations have a simple philosophy for their vermiculture project at Tientsin Estate, Bogawantalawa. "You feed the worms cow dung (composite) and the worms produce worm dung which in turn goes into the plants which grow much better."

With the simple, cost effective, low technology termed Vermi Tech, the management of Bogawantalawa Plantations have gone back to nature to feed their approximately 17,000 hectares of tea, rubber, vegetables and fruit.

Science has turned a full circle to go back to nature. On its voyage of discovery it has touched everything both natural and man made. It has relieved human suffering, introduced speed, comfort, quality to life, discovered existence beyond our planet and launched an era of technology in every conceivable thing.

Why then is the discovery of the century creeping back to nature at its tail end? A universe that worshipped science is discovering, not too late, that science is a good servant but a bad master.

Reacting fast to the downside of scientific knowledge and usage, the plantation sector in general has found a happy medium to mix science and nature to obtain optimum results.

The secret is that worms assimilate organic waste and discharge vermicompost or vermicast at a much higher speed than the best composting systems. Worms also promote bacterial growth, which enriches the soil.

The organic waste eaten at "high speed" by the worms and passed out as excreta castings create a unique product.

A spokesman in Colombo said that vermicast produces a nitrogen ratio of 30:1 to 40:1 and a pH factor of up to 7, a perfect eco friendly plant food enriched with all necessary nutrients.

Almost any waste can go into vermipost, from city garbage, kitchen waste, like potato peels, outer layers of vegetables, orange rinds, banana peels, plate scraps, spoiled food, tea leaves, egg shells, to other household waste.

The manure is ready within 7 - 10 weeks and decomposes into a black, granular, lightweight, humous rich form. Water is added regularly to the decomposing substance, but stopped about five days before the worms are separated from the compost.

At this point the worms go right to the bottom of the beds in search of water and because of the texture of the compost, it is easy to separate the worms from the soil and resume the process, the spokesman said.

The compost is still only used on experimental plots of tea, rubber and the plantations' vegetable and fruit cultivation. Barren land not suited for main crops have been diversified into vegetable and fruit cultivation to maximize land usage and offer alternate employment to the estates' workers.

The row upon row of lush broccoli sprouting from rich black soil, the strawberry patches heavy with red fruit and the mounds of orange carrots stacked in a storeroom somehow seemed fresher, more colorful and larger at Tientsin.

Seven Vegemart sales outlets in and around Colombo selling vegetables, fruit etc, are possibly the only place where chemical free, fresh vegatables are sold at fair prices, the spokesman said.

"We bring the vegetables straight from the plantation into the shop under refrigeration, preserving the freshness of the produce and eliminating the middle man and therefore are able to sell at reasonable prices," he explained.

While Bogawantalawa Plantations is worming its way out of chemical fertilisers, almost next door, Talawakelle Estate is selling power to the national grid which the estate relied so heavily on for years.

A mini hydro project commissioned in 1995 is almost running on its own steam now. The Rs. 2.2 million project funded by owners RPK Plantations generates power for the entire estate. Rainy season excess is even sold to the national grid.

The estate's electricity bill has hit Rs. 200,000 during some months of the year and has averaged Rs. 75,000. But now even when the estate has to resort to the national grid during the drought, electricity expenses are in the region or Rs. 40,000 per month, Manager Ranjit Perera says.

In the old days most tea factories were built at a lower level so that the estates' waterways could flow down into the factory premises to generate hydropower, Perera said.

"In the Talawakelle/Maskeliya area alone about six or seven estates have gone back to their own mini hydro power projects," he added, voicing the best testimony to the successful return of mini hydro projects to the plantations.

The estate is also toying with going back to the "wire shoot" to transport plucked leaf. Using a fundamental force of nature - gravity, a wire shoot or a cable is erected at a high point on the estate and drawn to its base on a ramp at the factory, where the tea bags are unloaded. The tea bags are hoisted on runners either in singles or on a frame taking a few bags at a time and transported on the wire thorough sheer force of gravity. The system was later motorised, with a dual rope system one for transporting tea bags and the other to take back the empty bags for re-loading.

Secretary General, Planters Association, Sene Seneviratne who spoke of the system in glowing terms said:"It is so much cheaper, faster, and environmentally friendly than the modern system of transportation via diesel tractor or lorries twisting their way up steep, narrow, estate roads spewing diesel and polluting the clean, fresh hill country air ." A motorised wire shoot of the old days still exists in Gourawila Estate, Upcot, but no estate has reintroduced the shoot as yet, Mr. Seneviratne added.

While some plantations are firmly marching towards nature, others are striving to keep it pure. Pollution is a dirty word. Cleaning it up is expensive business.

But some plantations are coughing it up in preference to destroying nature and facing industrial action.

At Pambegama estate in Ratnapura waste from the rubber factory used to join a stream, the only source of water for bathing to the villagers. The effluent plant is not the biggest or the best but treats the water and recycles for use, thus preserving supply and preventing pollution.

Most recently privatised plantations are grappling with a battery of problems; low yields, high production costs, world market price fluctuations etc. Despite this, most plantations under private management are innovative, adventurous and environment conscious.

Their prime commitment is to their owners, shareholders and workers to improve performance. Still some plantations seems to have a deep commitment to environment and nature too.

A sensible compromise, beneficial all round, is not impossible to achieve.

Industrial relations forum

Q1: I am a Security guard attached to a Private Security Agency and my total gross salary is only Rs.2300/- per month fixed by the Security Trade wages boards. No Cost of living is paid by the Security Agency.

1. Is it compulsory for overtime to be paid after 8 hours duty and what is the overtime rate for a wage of Rs.2300/- per month? At present most of the security agencies pay on a shift basis after 8 hours duty without paying overtime. Is this correct?

2. If a guard is paid on a shift basis and he works continuously 3 shifts (8 hours each) for 24 hours should the total earnings be taken for the calculation of EPF & ETF contributions by the employer?

3. Please define the total earnings?

4. Should overtime be paid for 3 hours duty on Saturdays after 45 hours duty per week and on what basis?

5. On what basis should payment be made if a guard works on the 4 weekly holidays (Sundays)?

6. On what basis should a guard is paid overtime if he works on a Poya day?

7. Should payment be made for unused Annual leave?

8. Why are private security personnel entitled for only 14 days annual leave, and not entitled for any casual and sick leave?

9. Are security workers entitled to the 9 statutory holidays granted to other wages board workers?

10. Why is the cost of living allowance not paid to guards by security agencies and why is this payment not gazetted by the Security wages board?

11. On what basis should gratuity be paid after 5 years service to a security guard and what payments are included in the total earnings?

12.Can a guard be compelled to be on duty for more than 24 hours?

1.Overtime should be paid after 8 hours duty and the hourly rate is to be determined by dividing monthly salary of 2300/= by 200 and multiplied by 150% (i.e. Rs.17/25)

2.It is not proper to employ a guard continuously for 24 hours. However total earnings of overtime is not to be taken for calculation of EPF/ETF contributions.

3.We have answered this question on several occasions previously. Very briefly, earnings include salary, cost of living allowance, payments for holidays, cash value of food and meal allowances, incentives tied to productions, commissions etc.

4.Security guards are required to work for 45 and half hours per week. They are entitled for normal overtime one and half times for any hour over 45 and half hours.

5.According to Wages Board decision of security trade, employee is allowed four off days (no need to be on Sunday) per month. If employed on off days they should be paid overtime at the normal rates.

6.Working on Poya days the employee should be granted extra half a day, wages irrespective of the number of hours.

7.Employer is required to grant annual leave before end of the year. However there are instances the employer pay a day's wage for each day of annual leave if leave is not taken. If employee insists for leave, that should be granted.

8.The leave, for security guards is determined based on wages board decision which specifies only 14 days annual leave and no other leave.

9.Security staff is not granted statutory holidays, in view of the nature of duties involved.

10Payment of cost of living allowance is not a legal requirement. The same condition applies to employees of all other trades.

11Gratuity is paid after 5 years as the rate of half a month salary for each year's service. The "earnings" include the same payment included for EPF.

12.No employee can be compelled to work more than 24 hours without a break.

Q2: I understand that the workers' charter is to be legalised soon? What are the changes proposed by this charter?

The workers' charter was proposed about three years ago and due to strong protest made by Employers, the government is still examining the views of both the trade unions and the employers. The original workers' charter included mainly the following proposals.

1.Recognition of trade unions by employers to deal with them on matters pertaining to their members and anti union discrimination by employers will be made an unfair labour practice.

2.Improving employment services

3.Ensure the minimum wages are reviewed from time to time, having regard to the increase in the cost of living

4.Ensure that the employees in unorganised sectors are guaranteed with minimum terms and conditions by empowering the commissioner of labour to fix minimum terms and conditions.

5.Employment of workers in the guise of "apprentices" or "Trainees" for regular employment to be prohibited.

6.To ensure that the employer in prescribed employment shall issue letters of appointment to their employees

7.To prohibit recruitment of casual workers for regular employment.

8. Legalise probation period of one year for technical and supervising grades and six months for other grades with the provision for extension of three months only. At the end of probation the employee will be confirmed automatically, if the services are satisfactory.

9.Temporary employees will not be allowed in regular employment

10.Fixed Term employment for regular employment will be prohibited other than in respect of employees in managerial capacity

11.Disciplinary action against employees will be formulated by law.

12.Ensure that an employer who closes down his establishment to fulfil his obligation under the law in relation to unpaid wages EPF, ETF and gratuity

Q3: I am employed as a stenographer in a Private Company. I was offered employment with six months probation period. My employer extended the probation period by 3 months once and again for the second time it was extended by 3 months without giving any reason. After this my probation was extended by 3 months in this manner on another 3 occasions. Can my employer treat me like this?

In Sri Lanka only in the state sector there is a fixed period of probation namely 3 years. In private sector there is no fixed period of probation. If may vary from 6 months to 2 years or more. During the probation period the employer can terminate the probationary appointment without assigning reasons. However, the employer should inform the employee about his unsatisfactory performance, to enable him to show an improvement during the period of probation, for the purpose of justifying the termination before a L.T.. The employer can extend the probation period on reasonable grounds, but he cannot justify it, if such extensions are made on several occasions without valid reasons. However, you cannot take any legal action as there is no fixed period of probation legalised for private sector, but you can go before a L.T. for relief if your probationary appointment is terminated.

Tobacco merger can affect Lanka

A recent merger between British America Tobacco (BAT) industries' financial arm and Zurich Group could have far reaching repercussions affecting even Sri Lanka.

The merged entity has US $ 375 billion in assets under management, US $ 44 billion in gross insurance premiums and 36 million customers in 50 countries, a press release says.

With this merger the tobacco component of BAT has been de-linked from BAT's financial services operations. BAT's well-known financial services entities Eagle Star Insurance, Allied Dunbar, Farmers and Threadneedle Asset Management are now parts of ZFS. And BAT operates its global tobacco businesses as freestanding operations except in Sri Lanka.

Ceylon Tobacco Company (CTC) is the holding company of one of Sri Lanka's strongly visible insurance companies - CTC Eagle Insurance Company (CTCE). CTC owns about 64% of CTCE and thereby tobacco and financial services continue to remain a 'mixed bag' in Sri Lanka whereas globally BAT has divorced itself from all financial services as a result of the merger with the Zurich Group.

From ZFS's perspective as well, it may not wish to tarnish its exclusive financial services with the globally censored substance of nicotine.

The second largest shareholder of CTCE is Capital Development and Investment Co. Ltd. (CDIC) which owns 15% of the insurance company. The NDB in turn owns 75% of CDIC and 49% of Eagle-NDB Fund Management company which is 51% owned by CTCE.

Business and stock market analysts in Colombo are speculating whether the recent merger will extend ZFS's global reach to Sri Lanka as well. CTCE could be an attractive candidate for ZFS on which to lay a foundation that could signal ZFS's long-term intentions in Sri Lanka.

But there is a technical impediment to ZFS acquiring a direct controlling interest in CTCE. As things stand, foreign investors are not permitted to own stock in Sri Lanka's insurance business. This could change if enabling legislation is introduced, though such legislation is not likely to be a priority in the government's political agenda. One cannot altogether rule out legislation coming into force in the near future.

However, in an open economy, the business world can always find creative ways of overcoming impediments. If ZFS acquires CDIC (or a major stake in it) it will automatically get a significant stake in CTCE indirectly. The next step could be for CDIC to target and acquire CTCE shares held by CTC.

This would neatly pave the way for CTC to divest financial services from tobacco in the only remaining territory where the two still remain blended. The NDB-Eagle Fund Management Comapny, CDIC and NDB will then be a formidable financial group in Sri Lanka with extraordinary synergy and focus in the entire gamut of financial services all functioning under the umbrella of ZFS.

Informed sources expect that before the year ends, the market will see exciting changes in the relationships between these companies.

Bottom Line

Good financial performance

By P.M.N. Bandara

Onally Holdings Limited. a company engaged in property development, has produced Rs. 25.0m. pre-tax profit and Rs.17.2 m. post-tax profit for the year ended March 31, 1998. The analysis indicates that there had been a decline of profits during the year under review compared to the previous year. The drop of profit before taxation and after taxation were 7.8% and 18.39% respectively.

Turnover for the year was up by 5.19%. During the year company paid an interim dividend of Rs. 0.65 per share and proposed a final dividend of Rs. 0.60 per share. The total dividend paid and proposed amounted to Rs. 17.5 m.

Carsons Group

Carsons Group recorded a pre-tax profit of Rs. 195.5 m. for the first quarter of financial year 1998/99, up from Rs. 78.8m., an increase of 148%. Group's post-tax profit amounted to Rs. 174.5 m. compared to Rs. 57.3 m. in the preceding period, showing an increase of 204%. Group's turnover was up by 47% from Rs. 509 m. to Rs. 746 m. during the quarter under review

According to company sources the significant profits were earned from the investment sector of the Group, owing to restructuring the investment portfolios, thus contributing substantially towards Group performance. However, the same level of contribution towards Group profitability cannot be envisaged from this sector in the future.

The company sources further state that the legislation envisaged in the national alcohol policy is of grave concern to the company, particularly, in the context of its Rs. 1.7 bn. investment in the Lion Brewery coming on stream.

The project was initiated on the basis of the liberalised policy as set forth in its budget of 1996, where excise duty on beer was reduced by 70%.

This reversal of policy orientation on the beer industry is likely to slow down growth of the industry.

Regnis (Lanka)

Regnis (Lanka) Limited, recorded a satisfactory financial performance for the half year ended June 30, 1998. Profit before taxation was Rs. 11.5 m. which reflects 25% growth compared to the previous year. Increase of profit after tax was 8% from Rs. 7.4 m. to 8.0 m. Turnover growth was 35% from Rs. 141 m. to 192 m.

This performance heralds a quick recovery from the long drawn out strike in second half of 1997 which had an adverse impact on last year's overall results, says Chairman/Managing Director Hemaka Amarasuriya in his circular to the shareholders.

C.W. Mackie

C.W. Mackie and Company Limited posted a Rs. 4.5 m. Group profit before taxation for the three months ended June 30, 1998. This shows an increase of 23% over the corresponding period in the previous year. However there had been a drop in profits after taxation by 17% from Rs. 1.2 m. to Rs. 1.0 m. The parent company incurred a loss of Rs. 140,000 during the period.

This is an improvement compared to the previous period loss of Rs. 5.7 m.

Group turnover was up by 16% from Rs. 482.4 m. to Rs. 562.0 m. during the period under review.

Singer Industries

Singer Industries (Ceylon) Limited recorded a sharp growth for the six months ended 30, June 1998 in contrast to the equivalent period of 1997 which was affected by a 31-day strike and work stoppage.

Turnover was up by 111.9% from Rs. 246.3 m. to Rs. 358.2 m. Profit before taxation moved up to Rs. 12.7 m. compared to Rs. 3.3 loss in the previous year.

Hemaka Amarasuriya, Chairman/Managing Director commenting on performance states: "We once again appeal to Government authorities to slow down the Tariff Reforms in order to allow manufacturing units to automate over a period of time. Such caution will avoid the potential chaos caused in other economies which accelerated Tariff Reforms without measuring the consequences of ill advice.''

Thilan of BOI one of top ten young

Thilan Wijesinghe, Chairman, Board of Investment (BOI) has been picked as one of the 10 Outstanding Young Persons of Sri Lanka (TOYP) by the Junior Chamber, Sri Lanka under an annual programme to honour Sri Lankans with outstanding personal achievements.

Wijesinghe, the youngest chairman of the BOI, will be presented a TOYP award for economic accomplishments along with winners of other categories, at the TOYP awards ceremony at the Trans Asia Hotel on October 11.

After a wide and varied career in the private sector, Wijesinghe was appointed to the BOI as its chairman and director-general by President Chandrika Bandaranaike Kumaratunga in September 1995 and has many achievements there.

According to a career profile filed with the Junior Chamber, Sri Lanka, Wijesinghe initiated the setting up of the Bureau of Infrastructure Investment under the BOI which has todate successfully structured five large scale infrastructure projects, introduced new guidelines for attracting and facilitating private investment into the infrastructure sector.

Some of Wijesinghe's other achievements at the BOI are social infrastructure facilities at the Katunayake and Biya-gama zones; co-ordi-nating aspects relating to obtaining a special assistance package from the government to rehabilitate buildings damaged by the Galadari bomb in October 1997; and playing a key role in tackling the power crisis in 1996 to restore investor confidence and the economy.

The BOI chairman on the boards of PERC, UDA and the Private Sector Infrastructure Development Company, is a member of various presidential task forces dealing with port development, aviation, tourism development and serves on many other government committees.

Prior to joining the BOI, he was executive director at Asia Capital Ltd for four years.

Before that he served as Planning and Special Projects Manager at Sampath Bank and senior consultant at Coopers & Lybrand (Management) Consultants.

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