A: The Sri Lankan economy is extremely conducive for business presently and things are looking promising overall. Unfortunately, we tend to forget that we have suffered a protracted 30-year war and that it will take a while to emerge from this shadow. The euphoria arising from the end of the war raised hopes to such an extent that people expected miracles overnight. We need to be more reasonable in our expectations.
Q: How is your company/group faring under existing macroeconomic conditions?
A: Laugfs was established at the height of the conflict 15 years ago – and looking for opportunity in crisis became our credo. Our business thrived despite the period of political and economic uncertainty in the past, which portrays that our fundamentals are sound. Now that peace has dawned and we have a prevailing conducive, eco political climate, I am extremely optimistic about the prospects for the company. The implementation of our strategic, tactical and operational plans contributed immensely, to penetrate hitherto untapped markets for LP Gas, especially in the Northern and Eastern provinces. Meanwhile, Laugfs maintained and improved on its market leading stake in the supply of bulk LP Gas to the industrial manufacturing sector. The engagement in the LP Gas downstream industry remains our core business and the mainstay of the Group, although a strategic, conglomerate style of diversification has taken place.
Q: How do you view your company’s/group’s prospects in the medium term?
A: Our performance in 2011 has been a clear improvement on last year. We listed several of our group companies on the Colombo Stock Exchange (CSE) to take advantage of emerging market opportunities. We plan to utilise the capital to consolidate existing operations, with a special emphasis on the energy sector. The listing has also enabled us to test the mettle of our business and we are leased with the overwhelming response from the market, which has given us added confidence. Overcoming challenges in a volatile economic political climate is our forte and given the prevailing enabling environment, Laugfs is poised to achieve significant objectives in the medium term, including entering the education sector.
Q: What are your company’s/group’s future plans, especially in regard to expansion?
A: Laugfs Holdings plans to consolidate its presence in Sri Lanka with an aggressive marketing strategy. Our aim is to become the number one energy company in Sri Lanka, with plans to venture into the energy sector in countries such as South Africa, Bangladesh and Cambodia. We also aim to become a regional player in the near future. The Company has in the meantime commenced the construction of an up-market, beach resort in Chillaw on the west coast and this will be the first hotel to be owned and managed by Laugfs and expected to be ready for commercial operations by end 2012.
Q: How much emphasis are you placing on CSR and what activities cover CSR at present?
A: As a completely indigenous company, Laugfs has added value by foraying into important sectors such as gas and energy, creating self sufficiency and reducing dependence on imports. These are valuable contributions to nation-building and to the country’s economy. Further, Laugfs generates employment to 3,000 employees. Our social responsibility is currently focused inward and takes the form of employee welfare. We want to ensure a healthy and happy workforce.
Q: How important is the human-resources factor in the present-day context?
A: Companies are driven by people and employee welfare is extremely vital in today’s context, where retaining talent takes on added significance against a backdrop of rapid economic growth that the country is poised to achieve. As for reversing brain drain, with foreign investment flowing into the country, the best and brightest who have left Sri Lanka’s shores will find this the ideal time to return.
Q: As for the political arena, what are your expectations?
A: In the past few decades we have had to make do with coalition governments, which focused more on political survival than on economic growth. Now, we have a strong political situation with a popular mandate, defence budgets can be redirected to economic growth and long term policies will come into play. Most importantly, there is a political will to change, which is a positive indication going ahead.
The interviewee, W. K. H. Wegapitiya is the Chairman and Chief Executive Officer of Laugfs Holdings.
