Laxapana more than trebles profit in the face of daunting challenges

Laxapana Batteries PLC, a member of the Colombo Fort Land and Building Group, has substantially boosted both revenue and profitability in the year ended Mar. 31, 2020, with revenue growing to Rs. 652.8 million from the previous year’s Rs. 480.2 million and the after tax profit more than trebling to Rs. 41.3 million from Rs. 11.3 million a year earlier.

Incorporated in 1956 as Elephant Lite Corporation Ltd., the company was the pioneer local manufacturer of dry cell torch and transistor batteries and continued this line of manufacture until its closure in 2012 due to the rapid drop in demand for D size batteries both locally and globally.

The company which continues to market, under the Laxapana brand, a range of zinc chloride and alkaline batteries, LED bulbs etc. was quoted on the Colombo Stock Exchange in 1972. In Aug. 2005, its name was changed to Laxapana Batteries Ltd. And subsequently re-registered as Laxapana Batteries PLC.

The company’s recent published annual report says that it continues to operate a fully equipped laboratory to ensure the quality of its dry cell batteries and LED bulbs. In April 2019, it commenced its own distribution as Laxapana Hardware distribution.

The company’s chairman, Mr. SDR Arudpragasam told shareholders that in a year of unprecedented challenges, Laxapana has performed commendably in terms of both turnover which grew 38% and profitability. This performance is mainly attributed to their strategic initiative of launching an in-house distribution network to cater to a market segment previously not met.

“The initiative directly improved sales volumes and margins during the year,” he said. “Further, we adopted a stringent cost reduction model to streamline our operational expense-base against the previous year. These strategies enabled us to sustain our business in this challenging environment.”

Thus their after tax profit had more than trebled to Rs. 41.3 million from the previous year’s Rs. 11.3 million reflecting the focused efforts to manage costs and improve margins. They also capitalized on investment initiatives by branding the Laxapana LED segment which directly improved the company’s performance.

A first and final dividend of one rupee per share has been paid for the year under review.

E.B. Creasy and Co. PLC through two accounts own over 51% of Laxapana. The company’s chairman, Mr. SDR Arudpragasam and related companies of the of the Colombo Fort Land and Building group are among the top 20 shareholders.

The directors of the company are: Messrs SDR Arudpragasam (chairman), RN Bopearatchy, S. Rajaratnam, RCA Welikala, PMA Sirimane, AR Rasiah, SNP Palihena, AM Mubarak and SW Gunawardena.