May 12, 2011

Three Acre Farms' profit increases despite price reductions

March 2011 quarter group net profit of Three Acres Farms was LKR41 million (US$373,764) in contrast to LKR0.5 million (US$4,558) last year albeit surplus caused it to decrease prices, according to Sri Lanka's Three Acre Farms

The poultry firm, a unit of Ceylon Grain Elevators, is also a listed company and part of Singapore's Prima Group, said sales rose 38% to LKR331 million (US$3.01 million) from the previous year.

Basic earnings per share were LKR1.75 (US$0.016) in the quarter up from LKR$0.02 (US$0.0002) the year before.

Three Acre Farms said in a stock exchange filing of interim results that accumulated losses carried forward fell to LKR435 million (US$3.97 million) from LKR705 million (US$6.43 million).

"The breeder operation made profit during the period under review due to productivity improvement in the breeder farms and hatcheries," a statement said.

"However, when compared with the final quarter of 2010, the company was compelled to reduce the selling prices of day-old-chicks due to the excess stocks in the market."

The poultry industry has been experiencing strong demand after the end of the island's ethnic war and a boom in tourism after a slump in 2009.

However, there have been excess stocks in recent months after the government allowed chicken imports in the run up to the peak tourism season.