The aluminium extrusions market in Sri Lanka is anticipated to drop 40 per cent, owing to the hit on the property sector by the COVID-19 pandemic, said Lanka Aluminium Industries Plc in a stock exchange filing.
“We expect the market size for aluminium extrusions by approximately 40 percent and remain so until a permanent solution for Coronavirus is found,” said the company.
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Lanka Aluminium closed its factories due to curfews on March 19, and since then the sales slowed down. The company reported that there were, in fact, no sales in April and May.
However, on May 11, production recommenced at some of the factories with restricted staff.
Dealers around the company also re-opened but reported lower demand and sales.
In the March 2020 quarter, Lanka Aluminium generated revenues of 397 million rupees versus 463 rupees during the corresponding period last year.
The ongoing shutdown of the construction industry is estimated to hit the June quarter as well, leading to a further reduction in profits.
To mitigate the losses caused by the pandemic, Lanka Aluminium constantly strived to lower the fixed costs. It also corresponded with banks to re-structure short-term loans, which fell due in March and April.
“We, unfortunately, are not eligible for any of the concessions offered by the government, since we are not coming under the SME sector,” the firm said.
In April, the firm negotiated to reduce some overhead expenses. The directors and management agreed to a salary cut as well. The workforce also agreed to a cut, which kept to a bare minimum, the firm said.
The firm said it kept in touch with customers and also looked for overseas customers.
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