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Strong result from Dilmah in 2019/20 despite exchange rate hit

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IPO investors richly rewarded with a Rs. 10,000 investment earning Rs. 8.6 million in dividends

Dilmah Ceylon Tea Company PLC (previously Ceylon Tea Services) has posted an excellent result within a challenging environment in the year ended Mar. 31, 2020, growing revenue eight percent and gross profit 14% over the previous year; but the bottom line declined two percent owing to what its chairman, Mr. Merril. J. Fernando called a “remarkable” 46% decline in the exchange rate.

Commenting that the outlook for the global economy appeared bleak, he said how long the corona virus will last God alone knows, adding “we can only pray for it to disappear soon and bring hope and comfort back to our homes and our lives.”

Dilmah, with the consent of its shareholders, has increased its contribution to the MJF Charitable Foundation from 10% to 15% of pre-tax profits to be spent towards addressing inequality and wider social and environmental concerns as a part of its core business. This will enable a significant increase in the foundation’s humanitarian operations.

The  company’s key numbers for the year under review were: revenue up 8% to Rs. 11.61 billion, operating profit up 25% to Rs. 1.98 billion, pre-tax profit up 17% to Rs. 1.99 billion and the after tax profit down 2% to Rs. 1.56 billion. Dilmah’s total assets stood at Rs. 17.3 billion against liabilities of Rs. 4.97 billion.

Fernando, in his chairman’s review in the company’s recently published annual report, had drawn attention to the extraordinary rewards enjoyed by investors in what was then Ceylon Tea Services over the years. An investment of Rs. 10,000 in a thousand shares at the company’s initial public offering in 1982 had yielded Rs. 8.6 million in dividends and the original1,000 shares had increased to 20,000 via several bonus issues.

He has noted that the cost of an original ten-rupee share in the hands of the investor has as a result come down to fifty cents and the original 10,000-rupee investment is now valued at Rs. 531,000 at the current market price of the Dilmah share.

“Such is the power of Ceylon Tea in the hands of committed investors in the industry,” he has said.

It is not only investors who have benefited from Fernando’s conviction that “business is a form of human service.” He has said youth from the plantation community assisted by the MJF Foundation’s scholarship program have produced among others doctors, magistrates and chefs.

He says that the tea industry which is being written off by many, offers enormous potential to investors who believe in it. Government authorities responsible for tea can turn it around if they have a realistic vision for the industry, Fernando said welcoming recent interest and initiatives by government in finding solutions to longstanding issues in plantations and exports. Such efforts wold deliver benefit to the country’s economy and Ceylon Tea.

“If the tea industry is strategically managed in the hands of capable people with proven expertise, export earnings could well reach USD 5 billion within the next five years. Bulk tea exports should be discouraged and value added exports should be generously incentivised for the social end economic benefits they bring,” he said.

“Part of the additional income from value added export must be used to advertise and promote quality brands. This is likely to encourage bulk tea exporters to change course.”

 

 



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Baltimore bridge collapse: Divers find two bodies in submerged truck

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The bodies of two people have been recovered from a red pickup truck, which was under water where the Baltimore bridge collapsed.

Eight construction workers were on the bridge when a ship struck it, plunging them into the waters below. Two of the workers were rescued on the day, but the search continues for the other four – all presumed dead.

Salvage crews are working to address hazardous materials and accident investigators are on the scene.

Four of the six victims of the bridge collapse have been named so far. At a press conference on Wednesday, Maryland State Police identified Alejandro Hernandez Fuentes, 35, and Dorlian Ronial Castillo Cabrera, 26, as the two workers recovered by divers from inside the truck. Mr Fuentes is originally from Mexico and Mr Cabrera is from Guatemala.

But divers are no longer able to safely navigate the waters because of concrete and debris found in the river, police said. They are now using sonar scans and believe that vehicles that may contain other bodies are “encased in superstructure and concrete” that came down from the bridge, an official said.

Two other missing victims, who are presumed dead, have also been named: Miguel Luna, originally from El Salvador, and Maynor Suazo Sandoval, a Honduran citizen.

Mexico’s Ministry of Foreign Affairs said earlier that two of its citizens were presumed dead – one of whom is now identified as Mr Fuentes – while another was rescued from the water.

One person who was in hospital after being pulled out of the water was released, officials said late Wednesday.

First responders spent hours on Tuesday searching the waters of the Patapsco River for the six construction workers, who were working on potholes on the bridge around 01:30 (05:30 GMT) when the ship crashed into the bridge. The US Coast Guard called off the search around sunset, saying cold water temperatures and hours gone by meant the workers were presumed dead.

Officials have pledged to find the bodies of the men for their relatives. “We’ve got to give these families closure,” Wes Moore, governor of Maryland, told reporters on Wednesday, adding that air, land and water resources had been devoted to the search of the victims. “My promise to them is this: I will devote every single resource to make sure that you receive closure,” he said.

But the operation has been challenging, Coast Guard Vice Admiral Peter Gautier said on Wednesday. Divers have been swimming in chilly waters with metal debris from the bridge that fell in the river. The cargo vessel itself is stable but has over 1.5m gallons of fuel oil and lube oil on board, Mr Gautier said.

Roughly 4,700 cargo containers were also on board, including 56 that contained hazardous materials. “The Coast Guard has moved aggressively to board the vessel, and we have teams on board,” Mr Gautier said.

Jennifer Homendy, chair of the National Transportation Safety Board, said some containers with hazardous materials had been “breached”.

The US Navy plans to use barges with heavy lift cranes – some can carry as much as 1,000 tonnes – to remove parts of the bridge that fell in the water.

Investigations into what went wrong on the ship will be crucial, marine specialist Jim Bellingham told the BBC. “An enormous advantage is that the ship didn’t sink so they’ll get access to bridge records and hopefully recordings of what was going on,” he said. Officials are hoping that a data recorder they took from the ship overnight will provide more information.

The Dali was headed toward Sri Lanka when it lost power all of a sudden and issued a distress call before crashing into the Baltimore bridge.

Officials say the bridge collapse at a key port could pose a risk to global supply chains and the US economy.

Mr Moore said that 8,000 jobs could be affected by the bridge collapse and called the incident a “global crisis”. “The national economy and global economy depends on the port,” he said, noting that $80bn (£63.4bn) of cargo moved through there last year.

Paul Wiedefeld, Secretary of the Maryland Department of Transportation, stressed that replacing the bridge will not be a fast process, but he promised at Wednesday’s press conference that officials are working to “come up with a design for the replacement of that bridge as quickly as possible to get the port back up and the community back up and running”.

Experts say Key Bridge’s collapse could lead to losses of up to $15m (£11.8m) per day, until the shipping lane is reopened.

US Senator Ben Cardin of Maryland said he was confident “thanks to the Biden administration” the state would get the necessary resources to recover and begin work on a replacement bridge. “Our top priority is to get the shipping lane open because of the impact it has on our country and the global supply chain,” he said.

Investigators are also hoping to determine whether dirty fuel played a role in the deadly crash. Maritime experts say contaminated fuel can cause a ship to black out as it creates problems with the vessel’s main power generators.

(BBC)

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European Chamber Report: Diversity, equity and inclusion crucial for Sri Lanka’s socio-economic development

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Sri Lankan businesses must look beyond the surface to design Diversity, Equity and Inclusion (DEI) strategies that consider broader complexities, if they are to achieve tangible and transformative business results and greater social harmony, says a new landmark report that provides recommendations for businesses to harness the potential of DEI.

The new report “Unlocking the Power of DEI: Diversity, Equity, and Inclusion as a Strategic Imperative for Business Success and Social Harmony” was conducted by the European Chamber of Commerce of Sri Lanka (ECCSL) in partnership with the Strengthening Social Cohesion and Peace in Sri Lanka (SCOPE) program which is co-funded by the European Union and German Federal Foreign Office. The study is an exploratory exercise based on an extensive literature review and interviews with 41 diverse businesses in all nine provinces of Sri Lanka. The study and dialogue at the event aimed to shed light on best practices and how businesses can leverage on existing know how to grow their business potential in modern markets.

The study aligns with the Government’s new Strategy to Promote Inclusive and Sustainable Businesses to Achieve the Sustainable Development Goals in Sri Lanka (ISB Strategy), which was also presented at the event by Chamindry Saparamadu, Director General and CEO of the Sustainable Development Council.

The study was officially presented to the Minister of Justice, Prisons Affairs and Constitutional Reforms, Min. Wijeyadasa Rajapakshe and the Minister of Foreign Affairs, Ali Sabry, as well as Carmen Moreno, Ambassador, Delegation of the European Union to Sri Lanka and the Maldives. The event was also attended by a cross section of Sri Lanka’s businesses as well as government, non-government and international development representatives involved in supporting inclusive economic growth in Sri Lanka.

Speaking at the event, . Carmen Moreno emphasized that “We must all play a part in promoting inclusion and equality. Governments and the public sector must adopt and implement the necessary legislation and public policies to combat all forms of discrimination and promote social justice. But also, the private sector has an essential role to play in building social cohesion and inclusion, starting at the workplace.” She further stated ” Improving business performance is an imperative at a time of crisis, and the report presented today shows clearly the linkages between economic growth, inclusiveness and social justice and the opportunities for businesses in Sri Lanka to embrace diversity and contribute to build a more resilient and prosperous society”.

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Plans underway to reduce electricity charges incurred by Northern farmers

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Minister Amaraweera presides at the launching of major agricultural projects in the North

By Ifham Nizam

Plans are underway to submit a Cabinet paper to reduce electricity charges for farmers using electricity for agricultural purposes in the Northern Province, Agriculture and Plantation Industries Minister Mahinda Amaraweera said.

Amaraweera said recently that the decision was taken in consideration of the strong commitment of the people of the Northern Province to carry out all the work in relation to agricultural development, especially since there are people in the war torn Northern Province who have suffered for three decades due to the war.

Amaraweera added: ‘President Ranil Wickremesinghe is of the opinion that most of the money allocated to the ministries should in turn be provided to the people of the Northern and Eastern Provinces when implementing development activities.

‘People of the Northern Province suffered from the war that lasted 30 years. However, they didn’t give up farming even in the midst of those troubles.

‘Following the statement of the President, the farmers of the Northern Province have made a request to provide some relief when they use electricity in their agricultural activities.

‘Accordingly, steps are being taken to present a Cabinet paper asking for some relief for Northern farmers when electricity is used by them for agricultural purposes.’

The minister made these observations while participating in the inauguration of a Passion Fruit Production Technical Demonstration Park and a Jumbo Groundnut Production Farming Company, which have been installed in connection with the launching of a 100-acre passion fruit plantation in Kilinochchi, Akkarayankulam. The latter was introduced by the Agriculture Sector Modernization Project under the Ministry of Agriculture and Plantation Industries.

Nearly 200 farmers have got into passion fruit cultivation and the passion fruit factory was established with the participation of those farmers and declared open by the minister.

Passion fruit cultivation is being launched, targeting the export as well as the local market. Farmers are growing passion fruit in this farm so that they could obtain more yields by using new techniques.

The minister also inaugurated the factory bringing out jumbo groundnut-based products, involving 500 farmers in the villages of Karachi and Kandawalai in Kilinochchi.

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