JAT Holdings Posts Highest-Ever Q1 Revenue Amid Economic Crisis

  • Achieved 39% revenue growth and 37% gross margin growth
  • Highest PAT ever for 1Q
  • Secures more than eight months of raw material as inventory for uninterrupted production
  • Start of manufacturing operations in Bangladesh under wholly owned subsidiary, Asia Coatings
  • Financial assistance plans provided to protect employees










Founder and Managing Director Aelian Gunawardene
Chairman and CEO Nishal Ferdinando


Guided by its highly experienced and skilled corporate management team, JAT Holdings PLC achieved its highest ever revenue in the first quarter of the 2022/23 financial year. The Group also delivered exceptional performance, across a range of other financial performance indicators, defying industry trends, in a very difficult economic environment.


Overview of financial performance

Total revenue for the first quarter increased by a very handsome 39% to Rs. 1.935 billion from Rs. 1.396 billion in the corresponding quarter of the previous year, while gross profit in absolute terms increased by 37% to Rs. 525.6 million, from Rs. 382.6 million in the first quarter of FY 2021/22.

Gross profit margins remained unchanged at 27%, despite increasing domestic and external challenges such as Sri Lanka’s multiple economic, energy and currency crises, compounded by a global shortage of raw materials.

Meanwhile, operating profit increased by 50% in the reporting period to Rs. 280.2 million from Rs. 186.75 million in the corresponding period. However, operating profit margin growth was moderate, but still expanded to 14% from 13%. This was due to the various economic relief programs and employee facilities, making it the largest increase in wages ever, coupled with rising inflation costs and exchange rate volatility.

Profit before tax (PBT) rose by 18%, showing sustained momentum of recovery, to Rs. corresponding period to 10% over the period under review, due to the deterioration of the economic environment.

CEO Nishal Ferdinando said, “Through our skillful and agile maneuvers, and leveraging the expertise and experience of our management team, we have continued to deliver exceptional excellence to all of our stakeholders, including including our customers, in the midst of the worst economic crisis that Sri Lanka, or we, as an organization, have ever encountered. Thanks to foresight and experience, we have anticipated the current crises, based on economic indicators and information from the field.

Thus, we immediately mobilized our people and supply chain partners to secure adequate raw material stocks for at least eight months, which we were able to achieve thanks to our solid financial position, which was further consolidated at following our IPO. In fact, the cash injection from our IPO has ensured low leverage, hence lower funding costs, helping us to remain relatively unburdened in a tightening monetary environment.

Just over a year ago, in July 2021, JAT Holdings launched its IPO, which saw the company successfully raise Rs. 2.2 billion, amid an oversubscribed issue, thanks to the sale of 82,904,846 ordinary shares at a price of Rs. 27.00 per share. These funds have since been used for the establishment of an R&D center, the commissioning of a manufacturing plant in Bangladesh and channeled into market development initiatives for the Group’s new flagship brand, WHITE by JAT.

“We have also gone above and beyond, as an employer of choice, to ensure that our employees have adequate protection during the crisis. We provided financial relief programs, as well as other forms of support such as flexible working, access to essentials, moral and emotional support, and a general sense of job security. It has helped us to work better as a team and to continue to deliver what is expected of us, by customers and all other stakeholders”, Fernando.

The Group’s export revenues decreased slightly during the first quarter, by 12%, due to the reorganization due to the start of operations of the Group’s manufacturing plant in Bangladesh, owned and operated through its wholly owned subsidiary, Asia Coatings Ltd.

However, export earnings are expected to improve significantly as operations of the new facility ramp up. In addition, the Group has placed strategic emphasis on the development of its export operations, in order to further consolidate its financial and operational situation over the rest of the year.

Revenue from the group’s operations in Sri Lanka increased by 59% to Rs. 1.576 billion in the first quarter of the financial year 2022/23, from Rs. 989.3 million in the corresponding period. This development is explained by the increase in sales, combined with the effects of inflation in input prices.

All of JAT Holdings’ business segments recorded healthy to phenomenal gains in revenue growth during the reporting period. Its largest business segment, Wood Coatings, saw a 21% increase in revenue, reaching Rs. 796 million this quarter, from Rs. 658 million in the corresponding period.

WHITE by JAT recorded the strongest revenue growth, driven by growth in the emulsions business, coupled with increased market share. As a result, the sector recorded a phenomenal revenue growth of 206% in the quarter under review, reaching Rs. 203.1 million from just Rs. 66.5 million in the corresponding period. Similarly, WHITE by JAT’s online sales also saw remarkable revenue growth of 187%. The group’s Brushes business also recorded revenue growth of 27% to Rs. 56.25 million this quarter from Rs. 44.3 million in the corresponding period.

In particular, the sales volume of the Group’s Paints activity increased by 49%. A year after issuance, JAT Holdings PLC has delivered on its promises to investors regarding its IPO goals.

Founder and Managing Director Aelian Gunawardene said, “We are pleased to report to investors that we have made excellent progress towards our IPO goals. “The construction of our manufacturing plant in Bangladesh has been completed and the facility has been commissioned ahead of schedule. We look forward to reaping the benefits of the improved production capacity and capabilities of our new plant in the months ahead. “Work has also already started on our R&D center, and we expect it to be completed within the next two months, again ahead of schedule and well under budget. We have also used funds from the IPO to add value and grow our flagship WHITE by JAT brand, and it paid off.


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