Kelani Cables records highest turnover of Rs 6.62 bn in 2015/16: Govt policies should be consistent

kalani cable

Aug 19, 2016 – Kelani Cables is one of the nation’s biggest manufacturers and exporter of power cables, telecommunication cables and enameled winding wires. The company in 2015/16 recorded the highest turnover of Rs 6.62 billion, launched several new products and won many accolades for its commitment to sustainable business.

Daily News Business interviewed Kelani Cables CEO/Director Mahinda Saranapala.

Q: How has the company performed in 2015/16

A: In terms of key result areas we had a very good year in the sense that although ourtop line did not grow as expected other key result areas like GP, PBTand NP has grown tremendously. Top line grew by 6.7%, gross profit by 27%, profit before tax by 57% and net profit by 53%. The company has recorded the highest turnover of Rs 6.62 billion and the highest net profit of Rs 499 million.

Q: How did you achieve this success

A: We set a very clear strategic direction for the last five years and our commitment was to consolidate on the rock solid fundamentals in place which we have demonstrated with the excellent corporate results during the year 2015/16. Good leadership, teamwork and highly focused approach to deliver the numbers coupled with bottom-up approach also helped in the success.

Q: What were the key factors that enabled Kelani Cables to record the highest turnover of Rs 6.62 billion

A: With concepts 5 S, Kaizen and Lean in place and developing those fundamentals had a direct affect to the results we have achieved. If you look at the numbers our productivity has gone up. From the available resources we have got the maximum in terms of workers, raw material, machinery and all other resources including good financial management. Also maintaining quality standards and providing an excellent service to our customers is another key factor.

Q: Strong employer-employee relationship is vital for the success of the company, your comments

A: We place high priority in maintaining exceptional relationship with our staff and have constant dialogues with them. Another practical approach is what is called Management by Walking About. I make it a point to do a round daily in one of the plants and in the process meet people and talk to them, find out what’s happening, look into shortcomings and appreciate good things.

Q: What is the Asia Best Employer Award

A: This competition has been held for the seventh consecutive year and they have an international jury and this jury analyzes from various information available such as websites, annual reports and other institutions like the Institute of Personal Management and then put it to the final Board. Here the jury based on the information and criteria had picked Kelani Cables for the award considering reasons as to why people had preferred to work for the company. Whilst building our brand we have built a model company where people like to come and work with friendly and good working conditions. We look after the employees very well. Also the safety factor too has contributed very much as we maintain a very safe environment.

Q: Kelani Cables keeps on winning prestigious awards what is the secret behind this

A: We have been repeatedly winning prestigious awards and accolades for several years and that highlights the company’s robust systems and processes. We continue this journey of success receiving recognition by several organizations during the year under review.

Q: Corporate sustainability is a concept aligned with Kelani Cables, your comments

A:We are concerned about our environment.Corporate sustainability, in the sense we go all out to minimize waste, all kind of waste including water, raw materials and energy. In these areas we have really reduced waste as a result. We call it corporate sustainability looking at people, planet and profit. We don’t only look at pure profit; we look at the people in society, the environment and profit.

Q: With recent record turnovers what is Kelani Cables recent contribution to the country’s GDP

A: If you take the last five years our contribution to the GDP was Rs 26 billion. This gives a tremendous amount of self satisfaction and achievement because from what we were in 2011 and what we are today progressively with the same team and same machinery, we have made use of the resources and contributed our might to the Sri Lankan GDP. Also in that context of export earnings, approximately 14% of the total turnover of Rs 6.62 billion is of exports.

Q: Your CSR programmes Kelani Saviya and Kelani Shakthi has met with huge success. Do you get any commercial gain or benefits out of these programmes

A: None what so ever, no commercial gain. Traditionally in Sri Lanka the electrician or electrical technician learns the trade from the father, brother or uncle. What we found was that there was a huge discrepancy there in the sense if they learn the wrong thing it can affect people and property. So in 2007 my predecessor Hemantha Perera and Jayantha Wijesinghe initiated this first corporate social responsibility (CSR) project with the University of Peradeniya Engineering Faculty to train electricians during a one year period. And if these students pass this exam they are entitled to a certificate which has plenty of validity in the sense that their employability goes up and earning capacity enhanced. If I give you an example one of the students that passed out in 2007 is now drawing a six figure salary in the Middle East. And there are many people who have put up their own workshops. Now already over 300 students have passed out. Not many companies do these kind of things, it is a great commitment by Kelani and a good CSR. During the recent floods especially in the Biyagama area many houses were inundated with water and a group of these electricians trained in the university had formed an alumni association and through this association with the involvement of Kelani Cables and the CEB inspected all the electrical connections of more than 450 houses before they were switched on. This was all done as a CSR programme free of charge.

Q: Kelani Shakthi has reached the North

A: There was a request from the dean of that faculty and we studied that and taught its best that we extend the CSR to the Northern area also. In 2014 we signed the MoU and the first batch will pass out on the August 29 at the award ceremony held in the Jaffna University Faculty of Engineering in Kilinochchi.

Q: The new government adopts a policy of good governance and transparency, your views

A:We are delighted with the policy of good governance. Our only concern is the adhoc policies which are inconsistent. For a CEO of a company he always looks forward to have consistent policies at least for three to four years so that the company can work towards that. That’s what we are asking the government, consistent policies.Adhoc policies will upset the norm in the business community and business circles

Q: ETCA has faced the wrath of many, your comments

A: I have no issues with trade agreements. For example we have a population of 20 million and out of that 20 million, eight or 10 may be the captive market. But if you take the three Indian states that are close to us there is a 300 million captive market, now that is where we should go. Definitely it is a good move as long as we don’t allow workers to come from India to Sri Lanka and goods that can be manufactured according to world standards in Sri Lanka allowed to be brought here. For example we export to Maldives, Bangladesh, Seychelles, Australia, Japan and South Africa. In order to export to these counties, we got to manufacture as per their standards.For instance to enter the Australian market we have to manufacture to the Australian-New Zealand standards.

Q:What are your future plans

A: We have already got one of the latest machine and probably will be up and running by early September. We have invested Rs 30 million for the building and the machine. The new drum yard and cutting section is in operation now. Plans have been drawn to put up a modern central warehouse in the new land we acquired recently.



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