strategic & financial analysis of royal ceremics lanka plc
TRANSCRIPT
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Royal Ceramics Lanka PLC
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Vision“To Continue to be the leader in the surfacing industry locally and to enter and impact the global market.”
Mission“To offer state of the art surfacing solutions to both the home and commercial builders with products and services that transcend the highest quality, ensuring customer satisfaction by matching all expectations, growing the market by way of product innovation, thereby enhancing shareholder wealth, developing our human resources to excelling latitudes such that Royal Ceramics exudes a stance of excellence.”
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Rocell’s Brand Promise
Rocell is in the business of enhancing the quality of life by adding color, style, and elegance to life. It creates a sense of aspiration, expectation, fashion and style always stirring aspirations around good living. Creating sensorial pleasures of an aesthetically appealing living ambiance.
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Since Rocell inception in 1990 (then known as Royal Ceramics Lanka Ltd) focused its efforts on being a brand leader in its industry. In less than a decade the organization realized its goal through innovativeness and excellence in design. Glazed ceramic tiles and ceramic porcelain tiles are manufactured at the Company's two production facilities in Sri Lanka. Over the years the Company has graduated to producing polished tiles, non-slip rock and studded tiles.
History
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Rocell made the transition from a private company to a public one in 1994. Rocell has been listed on the Colombo Stock Exchange since 1994. Today it has captured 55% of the Sri Lankan market and exports to numerous countries across the globe.
The Company's marketing operations are supported by a strong distribution network comprising 40 showrooms and 3 warehouses located in strategic areas in Sri Lanka.
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Corporate Governance
Shareholders
External
AuditorsBoard of Directors
Managing Director
Corporate Management
Group Operational Committee
Remuneration Committee
Audit Committee
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Rocell’s “Environment Management System” which enables us to monitor and control pollution levels to a negligible minimum. This program is in accordance with ISO 14000 specifications for International Environment Management Standards. Some measures we have undertaken include:
Manufacturing our porcelain and ceramic tiles from naturally occurring clays and minerals found in the diverse regions of Sri Lanka.
Using recyclable paper cartons and boxes for packaging.
Environment
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Maximizing the use of natural gases and minimizing the use of waste matter throughout the production process.
Ensuring that our tiles can be maintained without the use of cleaning products that use harsh chemicals.
Manufacturing tiles that last, thereby eliminating waste created through replacement.
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Ceramic tiles are produced from natural raw materials such as feldspar, clay, silica sand and dolomite, which have to endure a process called ‘vitrification’ at temperatures of almost 1200 degrees Centigrade. This mixture of raw materials determines the ceramic nature of the tiles. Ceramic materials are very ancient products, but they are still used today in the most advanced and modern applications. The tiles possess several inherent advantages when compared with natural stone or clay tiles. Low water absorption, non-existence of radioactive metals, high resistance to stains, easy cleaning, and strength and durability are some of the benefits of using ceramic tiles.
Products
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Porcelain tiles are extremely compact and resistant flooring materials. Natural raw materials are fused at very high temperatures 1200 degrees Centigrade to form a single and extremely solid body, creating a perfectly homogenous slab. The product is almost completely vitrified, and because of its excellent mechanical properties, porcelain tiles are ideal for use in public spaces and for industrial purposes.
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Production ProcessThe production process commences with raw materials feldspar and dolomite being ground with silica sand and ball clay to create a liquid known as body slip. This liquid is spray dried and converted to form the base body powder. To develop colored body powder, dolomite and feldspar are ground with different colored stains. This powder is stored separately in silos.
The powder is then retrieved in required quantities and in required compositions and pressed at a pressure of 400 kg/cm2, to create green tiles or pre-fired tiles. The green tiles are then dried in driers for half an hour before being processed further. The tiles are then sent to the glazing line where the printing process is undertaken. The tiles undergo up to fifteen applications including 4-colour printing on each line.
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The tiles are then sent to the kiln for firing and are passed through a roller kiln at a temperature of approximately 1210 degrees Centigrade. In the kilns the tiles are transformed into finished products conforming to the CEN 177 BIIa International Standard for Ceramic products and CEN 176 B I International Standards for Porcelain products. Each tile is then inspected for surface quality, flatness and rectangularity using advanced optical sensors and devices. The tiles are next packed and palletized using automated packing and robotic palletizing machines and are dispatched to showrooms or are exported to international clients.
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Rocell’s business strategy is not to be just a volume based producer of tiles but to be an organization that focuses on value addition and design. As such the company has concentrated its efforts on research and development, investing in the latest machinery and infrastructure at its manufacturing facilities.
As a result of its continuous commitment to research on tiles, Rocell developed the homogenous porcelain tile. The specialty of this tile is its hardiness. The tile is characterized by its robustness and resistance features and is guaranteed to be four times stronger than normal stone.
In addition Rocell is constantly seeking ways to upgrade the textures of its tiles, and its state-of-the-art laboratories are equipped to determine ways in which to replicate naturally occurring surfaces such as stones and tree barks.
Research & Development
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Financial Statements
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Income Statement
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Balance Sheet
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Statement of Changes in Equity
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Shareholder Information
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Graphical Review Of Five Year
Financial Summary
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2010 2009 2008 2007 20060
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35 Return On Capital Employed (ROCE) (%)
Return On Capi-tal Employed (ROCE) (%)
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2010 2009 2008 2007 20060
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Current AssetsCurrent Liabilities
Current Assets & Current Liabilities (Rs.000,000)
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2010 2009 2008 2007 20060
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4
6
8
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14 Earnings Per Share (Rs.)
Earnings Per Share (Rs.)
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2010 2009 2008 2007 20060
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15
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25
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40 Net Sales Growth Rate (%)
Net Sales Growth Rate (%)
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2010 2009 2008 2007 20060
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50 Net Assets Per Share (Rs.)
Net Assets Per Share (Rs.)
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2010 2009 2008 2007 20060
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20 Profit Earnings Ratio (Times)
Profit Earnings Ratio (Times)
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2010 2009 2008 2007 20060
200
400
600
800
1000
1200 Profit After Taxation (Rs.000,000)
Profit After Taxation (Rs.000,000)
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2010 2009 2008 2007 20060
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400
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800
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1200Fixed Assets (Rs.000,000)
Fixed Assets (Rs.000,000)
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2010 2009 2008 2007 20060
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1400 Capital Expenditure (Rs.000,000)
Capital Ex-penditure (Rs.000,000)
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Rocell’s tiles conform to all product specifications outlined in the CEN 176 B1 international standard, they have also introduced methods at their production facilities to surpass these specifications.
Their quality management system is identified and standardized according to the specifications stipulated in ISO 9001 standards, certified by BVQ1 (London) in 1996.
Rocell has also put into effect “Total Quality Management Criteria” which includes resources, procedures, processes and responsibilities.
Achievements
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In recognition of such continuing improvements they were presented with a National Quality Award (Merit) in 1997 by the Sri Lanka Standards Institution.
They have also devised an “Environment Management System” which enables them to monitor and control pollution levels and maintain them at a negligible minimum. This program is in accordance with ISO 14000 International Environment Management Standards by BVQ1 (London) in 2000.
In addition they have implemented a formal “Safety Management System” in line with requisite international standards in order to ensure the safety and enhance the working conditions of their employees.
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Rocell Bathware LimitedProducts : Vitreous china sanitaryware Fire clay sanitaryware
Royal Porcelain Pvt. Ltd Products : Glazed Ceramic Tiles
Vitrified Glazed floor Tiles Royal Ceramics Distributers (Pvt) Ltd
Subsidiary Companies
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Anuradhapura
Kandy
BandarawelaRatnapu
ra
Badulla
Mathara
Galle
Kaluthara
Colombo
Kurunegala
KagalleGampa
ha
Showroom Network