Dilmah Ceylon Tea Company PLC Annual Report 2020 21

A Focus on the Power of the People for Genuine Partnerships and a Sustainable Planet
DILMAH CEYLON TEA COMPANY PLC

ANNUAL REPORT 2020/21
People Power
A Focus on the Power of the People for
Genuine Partnerships and a Sustainable Planet
In the 1950s, it was the inequality that was embedded into the global tea trade that
motivated our Founder, Merrill J. Fernando to start a tea brand that values the people
who produce Ceylon Tea, and those who enjoy a cuppa, equally. The trade was defined
by colonialism, and the birth of Dilmah was a paradigm shift – the assurance of Taste &
Goodness for customers, and ethical Purpose for producers and their natural environment.
The world’s first genuinely ethical Ceylon Tea, was therefore handpicked and packed
at source for purity and antioxidant goodness – and shipped direct to tea consuming
countries. This made it possible for Merrill J. Fernando to retain earnings from his tea
in Sri Lanka and share it with the people who crafted his tea, while also promoting
biodiversity, conservation and climate action. This year, we focus on the power of our
people, the genuine partnerships we’ve made, and the sustainability of our planet.
Our People
The true essence of what makes our brand, is people. The pandemic has posed a challenge
to all businesses, but it has also shown us the true power of people; it is their strength,
compassion and resilience that has created a future inspired by it. Therefore, aiming to
create an impact beyond the realm of business and finance, we worked tirelessly to ensure
the wellbeing and safety of all our people amidst striving to adapt to a new normal.
Our Partners
As a Global Citizen, we attribute our reputation to the many Stakeholders that make up
our Brand. As a family company, we understand the importance of relationships and
human connections. In this new world of ‘quarantine, isolation and social distancing’, we
have taken steps to foster and nurture our brand ecosystem and our network of Partners.
Our Planet
As a company that values sustainability and advocates change for the better, all our
initiatives collectively contribute towards the UN 2030 Sustainable Development Agenda.
Here, it is the power of the people that enables collaborations and partnerships that,
inevitably, strengthen our efforts towards a sustainable planet.
Annual Report 2020/21 1 Dilmah Ceylon Tea Company PLC

CONTENTS
Performance Highlights 2020/21 06
About Dilmah 08
Board of Directors 12
Our Team 15
Chairman’s Review 16
CEO’s Report 18
Value Creation Preservation Model 20
Determining Material Issues 22
Risk Management 24
Sustainability at Dilmah 26
Stakeholder Engagement 34
Operating Environment 38
Capital Management 43
Financial Capital 44
Human Capital 47
Manufactured Capital 59
Social and Relationship Capital 62
Intellectual Capital 72
Natural Capital 81
Corporate Governance 94
Report of the Board of Directors 104
Report of the Audit Committee 111
Report of the Remuneration Committee 112
Report of the Related Party Transactions Review
Committee 113
Statement of Directors’ Responsibilities in Relation to
the Preparation of Financial Statements 114
Dilmah Ceylon Tea Company PLC 2 Annual Report 2020/21

Financial Reports 115
Independent Auditor’s Report 116
Statement of Financial Position 119
Statement of Profit or Loss 120
Statement of Comprehensive Income 121
Statement of Changes in Equity 122
Statement of Cash Flows 124
Notes to the Financial Statements 126
Five Year Summary - Company 175
Information to Investors 176

GRI Content Index 178
Notice of Meeting 182
Form of Proxy 183

ANNUAL REPORT 2020/21
WELCOME TO OUR 3RD INTEGRATED

ANNUAL REPORT
Dilmah embarked on an important milestone in our
corporate reporting as we steered our journey towards
Integrated Reporting, in 2019. This year, we publish
our third Integrated Annual Report. Since inception,
the Group has been deeply committed to social and
environmental sustainability, and the adoption of
Integrated Reporting has enabled us to highlight this in a
coherent and structured manner. Through this Report, we
are building on the foundation laid last year by providing
a balanced and concise assessment of how we utilise
our capital inputs in the creation of value, for our diverse
stakeholders. This Annual Report has been prepared
based on the guidelines issued by the Integrated
Reporting Framework published by the International
Integrated Reporting Council (IIRC).
SCOPE AND BOUNDARY

The Report covers the operations of Dilmah Ceylon
Tea Company PLC (DCTC) and its subsidiary MJF
Beverages (Private) Limited (collectively referred to
as the “Group”) for the period from 1st April 2020 to
31st March 2021. The Group adopts an annual reporting
cycle, and its latest annual report for the financial year
ending 31st March 2021 is available for download at
www.dilmahtea.com. There were no significant changes
to the Group’s size, structure or supply chain during
the year, nor any material restatements of non-financial
information published in previous years unless specifically
mentioned.

MATERIALITY
In determining the content to be included in this APPLYING THE <IR> PRINCIPLES
Integrated Report we have adopted the principle of Completeness
materiality. The material topics listed on page 22 and 23 The scope of the material topics has been
form the anchor of this Report and have been selected widened to include factors specific to the
following feedback received from Dilmah’s stakeholders, Group and the industry, in addition to the topics
the Group’s strategic aspirations and risks and prescribed by the GRI Framework
opportunities stemming from the operating landscape.
Materiality
Content included in the Report is determined
and structured, based on the principle of
Reporting Standards materiality
• Financial Statements: Sri Lanka Financial
Reporting Standards Strategic Orientation
• Narrative Report: <IR> Framework Dedicated chapter on the Group’s Strategic
Orientation
• Sustainability Reporting: GRI Standards,
In accordance ‘Core’ Connectivity
• Sustainable Development Goals Reporting Signposting and navigation icons throughout
of the Colombo Stock Exchange the Report to show connectivity of information
External Assurance REPORTING FORMAT

• Assurance on the Financial Statements
The Annual Report and the Sustainability Report has
have been provided by Messrs. Ernst and
been combined into one Integrated Report which
Young
includes all material information relevant to stakeholders;
• We have not sought assurance on our providing a balanced, concise and clear assessment of
sustainability reporting this year Dilmah’s value creation. This year we are continuing the
third Integrated Annual Report of Dilmah Ceylon Tea
Company PLC.
• Increased disclosure of quantitative information

relating to the Group’s non-financial performance
Print Available
available • Improved structure of the narrative report to
online as
on request present information in a clear and meaningful
a PDF
manner
Feedback
We understand that Integrated Reporting
is a journey and a process of continuous
improvement. We welcome your comments,
suggestions and feedback on our Report.
Kindly direct your feedback to,
sustainability@dilmahtea.com

PERFORMANCE
HIGHLIGHTS 2020/21
Metric 2020/21 2019/20 Y-O-Y
Financial Performance
Revenue Rs. Mn 9,212 11,610 -21%
Operating profit Rs. Mn 1,673 1,975 -15%
Profit before tax Rs. Mn 1,915 1,989 -4%
Profit after tax Rs. Mn 1,750 1,559 12%
Return on equity % 13.36 13.08 2%
Return on capital employed % 13.36 13.08 2%
Working Capital Ratios
Inventory days Days 81 57 42%
Debtor days Days 180 142 27%
Payable days Days 32 24 33%
Current ratio Times 8.2 3.4 135%
Quick asset ratio Times 7.1 3.0 133%
Financial Position
Total assets Rs. Mn 16,789 17,305 -3%
Total liabilities Rs. Mn 2,913 4,969 -41%
Shareholders’ funds Rs. Mn 13,876 12,336 12%
Non-controlling interest Rs. Mn - - -
Total debt Rs. Mn - - -
Shareholder Information
No of shares in Issue No. 20,737,500 20,737,500 0%
Earnings per share Rs. 84.38 75.19 12%
Dividends per share Rs. 18 25 -28%
Net asset value per share Rs. 669.12 594.88 12%
Closing price Rs. 636.75 531.00 20%
Market capitalisation Rs. Mn 13,205 11,012 20%
P/E ratio No. of times 7.55 7.06 7%
Dividend pay out % 6 47 -87%
Dividend cover No. of times 16.88 2.15 685%
Dividend yield % 3 5 -43%

Metric 2020/21 2019/20 Y-O-Y
Human Capital
Total employees – permanent No. 554 587 -6%
Payments to employees Rs. Mn 1,050 1,199 -12%
New recruits – permanent No. 35 52 -33%
Employee retention rate % 87 85 2%
No. of promotions No. 36 13 177%
Female representation % 41 43 -5%
Investment in training Rs. Mn 11 34 -68%
Total training hours Hours 16,034 21,584 -26%
Average training hours/employee Hours 29 37 -21%
Workplace injuries No. 4 4 0%
Union representation % N/A N/A -
Instances of disruption to work No. Nil Nil -
Manufactured Capital
Investment in capex Rs. Mn 4,153 4,100 1%
Property, plant and equipment Rs. Mn 3,328 3,246 3%
Highest performing equipment efficiency % 97.8 95.6 2%
Capacity utilisation % 42 80 -38%
Intellectual Capital
R&D investment Rs. Mn 10.1 32.6 -69%
New products launched No. 48 45 7%
Tea standards No. 336 360 -7%
Social and Relationship Capital

No. of distributors No. 109 108 1%
Payments to suppliers Rs. Mn 8,400 9,538 -12%
Proportional spending to local suppliers Rs. Mn 6,538 6,012 9%
Investment in CSR Rs. Mn 255 260 -2%
Natural Capital
Material - tea, flavours & herbs MT 4,577 5,639 -19%
Energy consumption GJ 15,697 16,473 -5%
Energy intensity GJ per unit 3.4 2.9 17%
Water consumption m3 21,830 23,928 -9%
Water consumption per unit m per unit

3
4.8 4.2 12%
Solid waste generation MT 270 287 -6%
Carbon footprint tCO2e 31,435 28,393 11%
Spending on environmental initiatives Rs. Mn 25.9 29.7 -13%

ABOUT DILMAH
BUSINESS OVERVIEW
Dilmah is a globally renowned Sri Lankan family tea
company, with an unparalleled reputation for producing
authentic, natural and ethical Sri Lankan tea of the
finest quality. The Company pioneered the concept of
Single Origin Tea in 1988, offering tea which was ‘picked,
perfected and packed’ where it is grown, giving power
back to Sri Lankan tea growers and consumers around
the world. As the first producer-owned tea brand,
Dilmah is the only fully vertically integrated tea company
with presence along the entire value chain including
ownership in several of Sri Lanka’s finest tea gardens,
factories, printing and packaging facilities. Dilmah
products are sold in over 100 countries supported by an
extensive global distribution network.
The Company has remained true to its Founder, Merrill

J. Fernando’s vision of making business a matter of
human service, and understand the Company’s most
invaluable assets are its people. The Company pursues
its commitment towards sustainability through balancing
economic success, environmental preservation, and social
responsibility, which is reflected through the Company’s
key pillars of Taste, Goodness and Purpose. A significant
portion of the Group’s profits are directed every year
towards supporting the humanitarian and environmental
initiatives of Dilmah Conservation and the MJF Charitable
Foundation. Dilmah Ceylon Tea Company (DCTC) is 87%
owned by MJF Group of companies; inclusive of MJF Teas
(Pvt) Ltd. and MJF Exports (Pvt) Ltd.

DILMAH IN NUMBERS
Over Over
3000 100 554 848 Rs. 13.8 Bn Rs. 1.7 Bn 31,435 tCO2e
Products Markets Employees Supply Chain Equity Profit Carbon
after tax Footprint
Partners
ARTISTRY OF OUR TEA
First Value-Added Pioneered Dilmah t-Lounges Dilmah Dilmah Pledges a

Sri Lankan Owned Single in Overseas School Core Commitment
Global Brand Origin Tea Markets of Tea to Sustainability
COMMITMENT TO TASTE, GOODNESS AND PURPOSE
ISO 9001: 2015 FSSC 22,000 BRC

Quality Management Food Safety Global Food Safety
System Management System Standard
ISO:17025
Rainforest Alliance ISO 14001: 2015
Chemical and
CoC & Carbon Neutral Environmental
Microbiological
Certification Management Systems
Laboratory Accreditation
SMETA SEDEX
Members Ethical
Trade Audit
SUSTAINABLE ORGANISATION
Communities and nature is the heart of Dilmah’s purpose. Our Founder’s long-term vision of building a truly
sustainable tea industry that benefits people, communities and the environment, is deeply instilled into the Company’s
ethos and organisational culture. The MJF Group’s charitable and conservation arms, The MJF Charitable Foundation
and Dilmah Conservation, which engage in island-wide humanitarian and environmental sustainability initiatives, are
primarily funded by DCTC.
15% of PBT Over 47,000

Sri Lanka’s First Private Sector
Directed Towards Social
Lives Impacted Directly Climate Change
and Environmental
Sustainability
and Indirectly Research Station
15 Rs. 255 Mn Rs. 26 Mn 100%

Spend on Carbon Neutral
Environmental Spend on Community
Environmental Product and Facility
Publications Initiatives
Initiatives

OUR IMPACT development, promoting sustainable lifestyles and
driving the workforce towards a circular economy whilst
The Dilmah Ceylon Tea Company has been instrumental
adhering to strict health guidelines. The Company
in enhancing the brand value of Ceylon Tea in the global
conducts signature international events and competitions
arena, with significant investments directed every
such as the Dilmah Thé Culinaire, Dilmah Tea Sommelier,
year towards global marketing efforts, research and
Chefs & the Teamaker, and The Dilmah School of Tea - to
development, communications and industry thought
name a few - aimed at engaging industry stakeholders
leadership. Amidst headwind caused by the pandemic,
in inspiring new tea experiences. Dilmah also publishes
the Company foregrounded that people are the greatest
a series of #teainspired publications aimed at raising
asset of our business. While thriving as a business,
awareness on industry innovations, health benefits of tea
prominence was given to supporting stakeholders
and tea gastronomy and mixology. In commemoration
to brave the storm of the pandemic. Acknowledging
of 150 years of Sri Lanka’s tea industry, the Company
its many challenges, the Company implemented
also launched a dedicated website on the History of
programmes to help its employees and surrounding
Ceylon Tea which includes numerous publications on the
communities, eliminate mental stress and turmoil the
fascinating evolution of the industry, preserving Ceylon
pandemic posed, while also investing in training and
tea’s historical knowledge and heritage.
Economic Impact Over 25,000 publications aimed

Promotional
at raising awareness on exciting
• Foreign Exchange Income
themes such as tea gastronomy, and Engagement
Generated: USD 49 Mn
tea mixology, food service and Initiatives
• Tax contributions: sustainability. • Dilmah Tea Inspired
Rs. 260 Mn Culinary, Mixology
and Hospitality
• Employment Generated: Value Distribution Competitions
554 numbers
• Dilmah Tea Fusion
• Payments to Employees: Experiences Around
Rs. 1,050 Mn
27% the World
• Payments to Suppliers: • History of Ceylon Tea
Rs. 8,400 Mn Website
• Market Capitalisation: • The Talking Tea
Rs. 13 Bn 51% 3%
Newsletter
7%
• Global Distributor
Dilmah School of Tea 5% Conference and
The World’s first consumer 7%
Various Global Events
and hospitality tea school,
the Dilmah School of Tea
Value Distribution
offers programmes that
seek to inspire passion in To Employees 27%
R&D and
tea amongst hospitality
professionals, consumers
To Shareholders 3% Innovation
Tax Contributions 7% • Rs. 10 Million Annual
and industry stakeholders.
The school offers tea Investment in R&D
To Lenders 5%
programmes around the • Over 3,000
world, with over 5,900 To Development Interventions
7% Products
& Environmental Initiatives
participants successfully
completing programmes Retention for Growth 51% • A Library of over
since inception. 300 Tea Standards

BRAND REACH the deeper importance of connections, bonds and
relationships that go beyond the realms of business and
Dilmah is a global citizen, with products being sold in
finance. As a family company committed to creating a
over 100 countries around the world through an extensive
positive impact and supporting our stakeholders and
network of sales agents and distributors. These partners
communities involved, staying connected to sales agents,
are a critical element of our value chain, engaging
distributors, people of the tea gardens, and consumers
proactively with consumers, pursuing new opportunities,
amidst a pandemic - when physical contact is impossible
and identifying emerging consumer preferences. While
- was vital to generate and define the ‘new normal’. This
it is usual to acknowledge that the success and effective
ensured support and the growth of the Company, beyond
reach of a business is dependent on stakeholders and
bar charts and numbers.
partners, as a family run company, Dilmah understands

BOARD OF DIRECTORS
Mr. Merrill J. Fernando Mr. Himendra S. Ranaweera Mr. Dilhan C. Fernando

Chairman Deputy Chairman Executive Director
Chief Executive Officer
Mr. Merrill J. Fernando is the founder Mr. Himendra S. Ranaweera has
of Dilmah Tea. He defined business been working with the MJF Group Mr. Dilhan C. Fernando is the
ethics in tea when he launched the of Companies for the past 30 years Chief Executive Officer of Dilmah
first producer-owned tea brand in and is its Deputy Chairman. He was Ceylon Tea Company PLC. He
the world in 1988 and pledged to appointed to the Board of Dilmah was appointed to the Board of
share his success with those in need. Ceylon Tea Company PLC (formerly Dilmah Ceylon Tea Company PLC
In fulfillment of his commitment to a known as Ceylon Tea Services PLC) (formerly Ceylon Tea Services PLC)
purpose beyond profit, Mr. Fernando in April 1998. Mr. Ranaweera has over in September 1991 as an Executive
established the MJF Charitable 40 years of experience in Operations Director and was appointed as the
Foundation, one of Asia’s largest Management, in Sri Lanka and CEO of the Company in August 2017.
private charitable foundations. overseas.
Dilmah Conservation extends Mr. Fernando had his secondary
his founding principle of making education at Stonyhurst College,
business a matter of human service, England and graduated from the
to the environment. London School of Economics with a
BSc (Hons) in Economics. He joined
He was honored for his service the MJF Group as a Management
towards humanity with the Oslo Trainee nearly 31 years ago.
Business for Peace Award in 2015
by a committee of Nobel Peace Mr. Fernando serves as Chair of
laureates, he received the First UN Global Compact Network
Award for Responsible Capitalism Sri Lanka and Biodiversity Sri
in 2016 and in 2019 an Honorary Lanka, a pioneering environmental
Doctorate from New Zealand’s collaboration amongst the Ceylon
Massey University, and the title of Chamber of Commerce, IUCN and
Deshamanya at Sri Lanka’s National Dilmah Conservation.
Honors.

Mr. Malik J. Fernando Mr. Roshan C. Tissaaratchy Ms. Minette D. A. Perera
Executive Director Executive Director Non-Executive Director
Mr. Malik J. Fernando is the Director Mr. Roshan C. Tissaaratchy is the Ms. Minette D. A. Perera was
of Operations of the MJF Group. Director of Sales of the MJF Group appointed to the Board of Dilmah
He was appointed to the Board of and was appointed to the Board Ceylon Tea Company PLC (formerly
Dilmah Ceylon Tea Company PLC of Dilmah Ceylon Tea Company Ceylon Tea Services PLC) in
(formerly Ceylon Tea Services PLC) PLC (formerly Ceylon Tea Services September 2000 as an Executive
in September 1991 as an Executive PLC) in April 2005 as an Executive Director. She is a Fellow member
Director. Director. of the Institute of Chartered
Accountants of Sri Lanka, the
Mr. Fernando had his secondary Mr. Tissaaratchy is a graduate of the
Chartered Institute of Management
education at Stonyhurst College, University of Colombo and a Fellow
Accountants of UK and the
England and obtained a BSc in member of The Chartered Institute
Association of Chartered Certified
Management from Babson College, of Marketing, UK. He also has an
Accountants of UK. After serving
Boston. MBA from the University of Sri
the Company as the Group Finance
Jayewardenepura.
He joined the MJF Group as a Director for over 12 years, Ms. Perera
Management Trainee nearly 36 years He has over 31 years of working retired from her post on 31st March
ago. experience in all aspects of sales and 2013 and continued on the Board as
marketing in a number of industries a Non-Executive Director.

Mr. Fernando spearheads
and also in advertising. He has now
Resplendent Ceylon, the first Ms. Perera has over 40 years of
completed 23 years of International
Sri Lankan luxury resort brand, working experience in Financial
Marketing with Dilmah Tea.
developing a collection of small, Management, having worked in
luxury resorts offering discerning leading local and international
travellers a remarkable circuit across companies. She is currently an
Sri Lanka, with a range of authentic Independent Non-Executive Director
experiences, while contributing of several Listed Companies.
towards local communities and

the environment through the
MJF Foundation and Dilmah
Conservation.

Mr. Rajan Asirwatham Mr. Gritakumar E. Chitty
Non-Executive, Non-Executive,
Independent Director Independent Director
Mr. Rajan Asirwatham was appointed Mr. Gritakumar E. Chitty was appointed the International Seabed Authority, a
to the Board of Dilmah Ceylon Tea to the Board of Dilmah Ceylon Tea Member of the Editorial Board of the
Company PLC (formerly Ceylon Tea Company PLC (formerly known as Law Journal “The Law and Practice
Services PLC) on 04th September Ceylon Tea Services PLC) on 04th of International Courts & Tribunals”, a
2008 as a Non-Executive Director. August 2010 as a Non-Executive practitioner before the UN Disputes
He is a Fellow member of the Director. Mr. Chitty has been an Tribunal and the UN Appeals Tribunal,
Institute of Chartered Accountants Attorney-at-Law and Advocate of the and a Trustee of the Weeramantry
of Sri Lanka. After a distinguished Supreme Court since 1968. He is also International Centre for Peace
career at Ford Rhodes, now known a former Assistant Secretary- General Education and Research.
as KPMG, he retired as its Senior and the founding Registrar of the UN
In 2016, Mr. Gritakumar E. Chitty was
Partner and Country Head on 31st International Tribunal for the Law of
appointed by the Cabinet as the
March 2008. the Sea in Hamburg, where he was
Chairman of the National Ocean Affairs
its Chief Executive and Head of Legal
Mr. Asirwatham is the Chairman Affairs for the period of 1996-2001.
Committee. He is a Life Member of
of the Board of Postgraduate He commenced practicing law in
the Bar Association of Sri Lanka and
Institute of Medicine, Council of the Sri Lanka from 1968 and joined the
a Member of the American Society of
University of Wayamba and Board of United Nations in New York, in 1975. He
International Law.
the S.W.R.D. Bandaranaike Memorial continued to serve at the UN for over
National Foundation. He is also the 20 years, in the capacity of Principal
Chairman of the Audit Committee Legal Officer in the UN Office of Legal
of the Institute of Chartered Affairs.
Accountants of Sri Lanka.
Mr. Chitty has been an adviser to
the Sri Lanka Delegation to the UN
and has served as an adviser to the
Inter-Ministerial Committee on Oceans
and the Law of the Sea. He is also
a member of the Appeals Board of

OUR TEAM
Mr. Darshana Gunasekera

Group Finance Director
Mr. Darshana Gunasekera is the

Director of Finance of the MJF
Group. He joined the MJF Group
as the Chief Financial Officer
in 2015 and was appointed to
the Board of Dilmah Ceylon Tea
Company PLC in October 2020
as an Executive Director. He is a
double qualified accountant, Fellow
member of the Chartered Institute
of Management Accountants of UK
and the Association of Chartered
Certified Accountants of UK. He
holds a BSc from the University of
Sri Jayewardenepura and is also
qualified in Marketing.
Mr. Gunasekera has over 25 years

of working experience including
extensive overseas exposure,
having worked in leading local and
multinational companies.
We leverage the talent, commitment

and expertise of our self-motivated
team to drive innovation, facilitate the
customer experience and to achieve
our strategic aspirations.

CHAIRMAN’S REVIEW
I am pleased to present the Annual Report the challenges more manageable and outcomes more
and Audited Financial Statements of Dilmah sustainable. The quality and reputation of Ceylon Tea has
Ceylon Tea Company PLC for the year ended sustained an industry that is striving to evolve from the
colonial model that it once represented. Improvements
31st March 2021.
in welfare, wages and sustainability will only be possible
if plantation, trader and export sectors adopt a shared
TEA CROP AND TEA PRICES commitment to quality. Like a pane of glass, once
Tea production was buoyed by favourable weather in cracked, reputation can never be perfectly restored,
Q4 of 2020/21 and reached 299,000kg. The migration and a focus on quality at every level is critical for Sri
to an online auction system marked the end of an era, Lanka to chart a future that is socially, environmentally,
although it also played a crucial role in continuing the economically and agriculturally sustainable.
sale of Ceylon Tea amidst the dislocation caused by the
pandemic.
CONTEXT & BUSINESS PHILOSOPHY
Global Tea price trends require us to carefully consider Challenged by an unprecedented health crisis, my
the future of Ceylon Tea. With exports of African CTC colleagues on the Board and I resolved that we would do
Teas to Sri Lanka growing exponentially, the industry everything possible to protect our employees as those
must collectively understand the potential and pitfalls who have been integral to the progress of the Company.
in aligning with price, or with quality. If price, the That decision echoes the founding philosophy of the
competition is severe and the prospect is only a cycle Company, that our business shall serve humanity. It has
of decline. If quality, the synergies are evident, while been honoured through support for the welfare of staff

and workers, and in the work of the MJF Foundation in revenue fell by approximately 21%, strong focus on cost
the wider community, especially the plantation sector. control, process efficiencies and other strategic initiatives
supported by exchange gain helped achieve the double
Your Company’s core values of quality and integrity
digit growth in the bottom line.
are demonstrated in a commitment to Taste, Goodness
and Purpose. Disruption in virtually every key market,
and growing emphasis on discounting in grocery retail, Corporate Social Responsibility and
challenges all three, although we have maintained our Alleviation of Poverty
commitment without compromise. Tea consumption is Your Company is founded on integrity and quality.
predicted to continue to grow, gaining momentum from The outcome of this is our commitment to addressing
research that suggests that natural antioxidants in tea are inequality, and wider social and environmental concerns
potent immune boosters. A parallel trend that demands as part of our core business philosophy. From the
sustainability is driven by awareness of the climate crisis. previous financial year, with your concurrence, the
Together, both are driving a premiumization trend with company increased its contribution to the fulfillment
customers prepared to pay more for sustainable, ethical, of that philosophy by 50%. The MJF Charitable
high quality products that come with the assurance of Foundation now receives 15% of the Company’s pre tax
wellness. profits, fueling a significant increase in its humanitarian
operations.
Your company established the first private sector Climate
Research & Adaptation Centre, now collaborating
with universities around the world in demonstration Dividends
options to build climate resilience. Dilmah Conservation Even though present circumstances caused by COVID 19
collaborates with scientists and government in requires extreme caution on cash outflows, I am declaring
conservation, restoration, environmental education, a dividend of Rs 18/- per share for 2020/21.
encouraging sustainable agriculture and promoting
biodiversity. These environmental initiatives have
Outlook for 2021/22
their humanitarian equivalent in the work of the MJF
Charitable Foundation. The work of the Foundation has The present volatility defies reasonable prediction of
been restricted by the pandemic but continues through what we might expect in the current year. The bleak
innovative initiatives that include teletherapy to support economic outlook is expected to continue into 2022. It
children with developmental disorders and their families, remains our prayer that as vaccination programmes are
and virtual educational, entrepreneurship development accelerated globally, COVID 19 will be contained. Many
and psychosocial support sessions for youth, women and businesses in Sri Lanka and across the globe have filed
men. for bankruptcy and it is a tragedy that SMEs are the most
vulnerable.
As the crisis wears on, and the world cries out for a return
to normalcy, we must remember that it is normalcy that I thank my colleagues on the Board for their advice and
led to this. The threefold crises in health, economy and guidance; our staff for their commitment and loyalty,
climate, now casts our business in a different role which our global distributors, their families and staff for their
magnifies the Purpose that forms part of our core values. untiring efforts and cooperation; our customers for
As we reaffirm our commitment to those values, we are becoming Dilmah tea lovers.
effectively aligned with the post pandemic customer
with a sincere commitment to the finest Ceylon Tea,
sustainably grown and ethically made, with the earnings
from our teas and infusions benefiting people and nature.
Performance
Your Company performed admirably under trying
circumstances in 2020-21. In an environment where Merrill J. Fernando
COVID-19 disrupted almost all aspects of the global trade, Chairman
the Company grew its bottom line by 12%. Even though 23rd August 2021

CEO’S REPORT
The persisting global pandemic and connected economic nutrition etc. We have not retrenched staff or downsized
and environmental crises continue to be the most due to the pandemic. The Company has additionally
critical amongst our current challenges. The company donated approx. Rs 40m worth of PCR testing kits to the
was however birthed and refined by adversity and Government to support the complications the country
the Founder’s relentless pursuit of a noble objective experienced in the early stages of the COVID crisis.
illuminated the way in overcoming adversity in the past.
Our sustainability journey has maintained the momentum
Similarly our focus amidst the recent volatility is defined
it has gained since its commencement in 2000 through
by a positive direction that values the people who
the co-operation we have with suppliers in delivering
together form the company, the wider community, and
more sustainable products. The Company’s evolution
environment. Not a single employee was laid off to-date
from Carbon Neutral to Carbon Negative is being charted
even though operational levels and capacity utilisation
with a host of initiatives - from expanded renewable
deteriorated. We have maintained uncompromising
energy production to reforestation and blue carbon
commitment to the safety and welfare of our employees,
initiatives. As we absorb what we have learned from the
while emphasizing our commitment to the Company’s
new normal thus far, we are embedding environmental
promise of Taste, Goodness and Purpose.
sustainability into every dimension of the Company
Up to 31st March 2021, the Company has spent approx. through a combination of technology and other
Rs. 20m in safeguarding our employees & their families initiatives designed to build resilience. Through Dilmah
from COVID 19, with the provision of safe transport, Conservation and the MJF Charitable Foundation, we will
protective equipment, medical testing, dry rations, meals, continue to serve humanity.

With the dramatic impact of the pandemic on the Our investment in IT infrastructure has enabled business
hospitality sector, we are working with our customers continuity and seamless transition to remote-working in a
to deliver new tea experiences, within the safety and secure environment whenever physical movements were
convenience that are necessary for the growing delivery restricted due to the pandemic.
economy. The uncertainty of the times demands
As part of our commitment to ethically produced tea,
innovation which the Company is delivering in product,
we maintain zero-tolerance of bribery and corruption.
service and experience. That extends to the fulfillment
The Company’s policies on anti-bribery and corruption,
of our Purpose as we collaborate to deliver education,
business ethics and human rights are applicable to all
and specialised therapy in support of less fortunate
employees and third parties dealing with the Company.
communities, virtually. It is important that even as we
As an initiating partner of Biodiversity Sri Lanka, we will
strive to adapt for the benefit of the Company and its
advocate for responsible conduct by business in the area
employees, we are also mindful of the difficulties faced
of biodiversity and conservation, while our involvement
by so many in our community.
in UNGC Sri Lanka is part of our affirmation of the
The economic impact of the pandemic is expected to Sustainable Development Goals and the Ten Principles of
continue well in to 2022 although we also expect that as the UN Global Compact.
countries start to manage the pandemic better, retail and
In concluding, I would like to thank each of my
hospitality will see growth. The Company’s efforts in the
colleagues, for their positive spirit, courage and
areas of e-commerce have strengthened our ability to
commitment. I also thank my father, the Founder of
continue to serve customers at consumer and trade level,
Dilmah, for the faith, vision and determination that
in spite of occasional lockdowns. Nevertheless, retail
produced a business sincerely formed around Quality
sales globally are negatively affected by a combination of
and Integrity. It is that clarity that inspires every Dilmah
uncertainty and operational complications.
employee, and gives us the ability to navigate volatility
In this context, the Company’s performance was by doing what is right, rather than what is expedient.
remarkable as top and bottom line were achieved without As the world enters an unpredictable phase of the
compromise on any aspect of quality or ethical purpose. pandemic, accelerating the changes and challenges we
Although revenue fell by approximately 21% due to the experienced in 2020-21, we will continue to honour that
worldwide economic slowdown, aided by stringent vision, and evolve, with education, innovation and an
cost control measures, operational efficiencies and uncompromising commitment to the promise of Taste,
exchange gain, the company saw double digit growth natural Goodness and Purpose beyond profit. Within this
(12%) in its PAT. Focused efforts on cost control & 24% framework, the Company will embrace the challenges of
reduction in Selling and Distribution expenses helped the new norm to strengthen resilience to the shocks that
reduce the operating cost base by 13%. The Company must be expected as part of the new norm.
also strengthened its Balance Sheet by making the
working capital cycle more efficient thereby ending with
strong performance in 2020-21. Financial performance is
analyzed in detail under the Finance Capital pillar in the
report.
Our continued investment in new technology is a Dilhan C. Fernando

critical component in our commitment to efficiency CEO
and sustainability, with the use of more environment 23rd August 2021
friendly materials, especially in teabag manufacturing.

VALUE CREATION &
PRESERVATION MODEL
Our Capitals Capital Inputs Activities
Tea Standards
Formulated by our team of globally renowned
Financial Shareholder Funds tea experts and approved personally by the
Capital Rs. 13.9 Bn Chairman & CEO, our unique collection of Tea
Standards determines the elevation, region
See page 44 and quantity of teas to be procured.
Grading and Tasting

Selection based on samples obtained
Manufactured Machinery and Equipment from estates / brokers to meet company
Capital Warehouse and Facility standards.
Evaluate 10,000 - 12,000 samples weekly
See page 59
Collection, Storage, Cleaning & Bulking

Human 554 Employees Stocks Cleaning & Bulking of the fresh
Capital • Skills, Values and Industry stock in hand to expected consumption
levels of the relevant blends.
Experience
State-of-the-art cleaning & bulking system
See page 47
Marketing Tools to Promote

Social and Tea as an Experience Sourcing
Relationship • Unique Customer Experience Procuring tea, herbs, spices, flavours &
Capital • Dedicated Philanthropic Arm
packing materials.
See page 62
Production & Packaging

Intellectual Research and Development Based on the confirmed orders in i-store,
Capital Innovations production will take place using our high-
tech packaging machines.
See page 72
Dedicated Marketing & Distribution

Natural Environmental Arm Marketing and Distribution to over 100
Capital • Renewable energy, water, countries through agents / distributors
waste and other natural and also via online sales.
See page 81
resources
Top Quality Leaf evaluation using all

Internal quality control procedures
Value Added Tea for stringent sample testing
sensory impacts including
guarded with 12 International
Delivered with visual, sound, feel & taste
Certifications & Standards
Key Pillars of Value Creation and Preservation Vision Mission

Activities Value Delivered Outcomes
Shareholders Financial stability

PAT Rs. 1.75 Bn and growth
Tea Improved efficiency Customer Satisfaction.

4,577 ensuring 100% delivery Improved process
MT in full and on-time efficiency.
Employees 87.1% Talented, committed

Value created Retention and empowered human
Rs. 1,050 Mn Rate capital
47,611 CSR The World’s 1st Consumer

beneficiaries & Hospitality Tea School - Empowered community.
Dilmah School of Tea with over Strengthened supply
supported through 5,900 Ambassadors Globally
island-wide Rs. 8,400 Mn payments to chain.
programmes suppliers
A Vertically Integrated Tea Business evolution with

Brand new technologies and
(from tea plant to tea cup) process improvements
100% Carbon Expanding Sustainable use of natural

Neutral Facility Reliance in resources.
and Product Renewable Energy Biodiversity Conservation.
Quality checks prior to production Sample tasting, After-sales customer

(through a trial batch), during with approximately engagement & feedback
production (through samples) & prior to 1,000 cups of tea mechanisms, including
packaging (individual silo samples) tasted daily customer & market surveys
Dilmah Values Strategy Governance Risk Management

DETERMINING
MATERIAL ISSUES
In improving the relevance and

meaningfulness of the Annual Report this
year, the Group adopted the principle of
materiality in determining the content that is
included here.
Material matters are defined as the issues

that have the highest ability to impact the
Group’s performance and value creation,
and are of the greatest importance to its
stakeholders. The material topics presented
below represent emerging issues in the
industry, factors relevant to the Group’s
strategic agenda, and its value creation
model. The process adopted to determine
these issues is illustrated below;
Emerging Industry Strategic Stakeholder

Trends Priorities Feedback
Identification Assessment
Prioritise
of Material of Relative
Matters
Issues Importance

The material topics which are considered most critical 1, 2, 3, 4, 5,
high
Significance to
to the Group’s business are listed below, it also 8, 9, 11, 12
Stakeholder
demonstrates how the Group’s selected material topics
medium
correspond to the topics recommended by the Global 6, 7, 10, 13, 14
Reporting Initiatives (GRI) standards in its sustainability
reporting. The process for determining material topics
low
is also in line with the guidelines prescribed by the
International Integrated Reporting Framework (IR)
low medium high
Framework.
Significance to Group
Corresponding
Material Topic Corresponding GRI Topic Sustainable Development
Goal
1 Sustainable growth in earnings
GRI 401: Employment

GRI 403: Occupational Health and
2 Managing our People
Safety
GRI 404: Training and Education
3 Innovation
4 Customer Satisfaction
5 Managing our Distribution Network
6 Manufacturing Capabilities
7 Implications of Climate Change
Geopolitical Conditions in Buying

8
Markets
GRI 416: Customer Health and Safety

9 Product Responsibility
GRI 417: Marketing and Labelling
10 Brand
11 Managing our Supply Chain GRI 204: Procurement Practices
12 Exchange Rate Fluctuations
GRI 301: Raw Materials

GRI 302: Energy
GRI 303: Water
13 Preserving the Environment
GRI 305: Emissions
GRI 306: Effluents and Waste
GRI 307: Environmental Compliance
14 Community Engagement GRI 413: Local Communities

RISK MANAGEMENT
As a Company with significant international
interest and exposure to agronomic supply Board of Directors
chains, DCTC is exposed to numerous
risks arising from the internal and external
landscapes. DCTC adopts a transparent
Enterprise Risk Management (ERM) system Audit Chief Executive
with structures and tools in place to identify, Committee Officer
manage and mitigate risks in a consistent
manner. Accordingly, clearly defined
governance structures, policy framework Decentralised Corporate Risk
and allocation of responsibilities for risk Management Management
identification, measurement, mitigation and Council
monitoring forms the foundation of DCTC’s
risk management framework.
RISK MANAGEMENT FRAMEWORK

The Board of Directors hold ultimate responsibility for identifying and managing the Company’s risk exposure. They
are assisted by the Board Audit Committee and Corporate Risk Management Team and Decentralised Management
Council. Risk identification is a continuous process and involves stakeholder engagement and frequent evaluation
of the internal and external business environment. Risk grids are updated on an ongoing basis and presented to the
Board for review.
PRINCIPAL RISKS OF 2020/21

The following table provides a high-level overview of the Company’s principal risks in 2020/21
Potential Impact & Developments in

Risk Mitigating Activities
2020/21
• Implementation of stringent COVID-19 health and safety protocols
across the organisation, exceeding regulatory requirements.
• Stringent procedures formulated to adopt in the event of infection.
• High risk to employees’ health and safety. • Vaccination programme covering all employees.
• Risk of office / factory operations getting interrupted • Adoption and facilitation of ‘Work from Home’ arrangements for
due to the spread of COVID-19. office employees.
COVID-19
• Supply Chain disruptions due to lockdowns, provincial • Establishment of a Health and Safety committee to ensure all
pandemic
border closures, factory shutdowns, logistical employee views, suggestions & concerns are understood and
related
challenges etc. addressed as applicable.
disruptions
• Increase in cost of raw materials (tea) and packing • Revamped Business Continuity Plan (BCP) taking into account
material due to the disruption in local and global possible COVID-19 disruptions.
markets and possible decrease in supply. • Broad-base supply chain with increased reliance on local suppliers.
• Close monitoring of suppliers’ stock positions and continuous
dialogue with suppliers.
• Increase the inventory levels based on the risk and demand.
• As an export-oriented Company, economic and • The Company’s focus and presence in diverse markets limit its
Geopolitical geopolitical conditions in buying markets have a dependence on a specific country / region / sector.
conditions significant impact on demand and pricing trends. • Focus on developing new channels such as e-commerce and
in buying • Due to COVID-19, less operations in airlines and launching more sustainable products, while also looking at
markets hospitality trade have resulted in less demand from the opportunities to give more value-added lines to make the products
given sectors resulting in a drop in revenue. more affordable and cost effective to consumers.

Potential Impact & Developments in
Risk Mitigating Activities
2020/21
Tea prices are dependent on a range of factors outside
the Company’s control including weather patterns,
• Tea buying strategy incorporates price fluctuations and seasonal
demand conditions and labour productivity among
Fluctuations in trends.
others. As the primary raw material, fluctuations in tea
tea prices • Ongoing monitoring of emerging industry trends.
prices have a direct impact on the Group’s profitability.
• Pursuing product differentiation through innovation.
From April 2019 to March 2021 tea prices have increased
by 21%.
Customer preferences are changing rapidly with the

increasing number of health-conscious customers,
• Proactive and ongoing engagement with customers through
Changing competition from alternate beverages and more
numerous platforms.
customer sophisticated customer demands. Inability to cater to
• Continuous monitoring of emerging industry trends and preferences
preferences these emerging preferences could affect the relevance
via various platforms and resources such as Euromonitor.
of the Company’s products, ultimately affecting its
competitive edge.
As a Company which is dependent on the Agriculture

sector, the increasingly pronounced effects of climate
change have a direct impact on our operations through • Sourcing from diverse regions and elevations.
Implications of
adverse weather and natural disasters which affect the • Conducting research through our self-owned Climate Change.
climate change
quantity and quality of tea. Drought conditions in tea Research Station and educating farmers on adaptation methodology.
growing areas resulted in the country’s tea production
declining during the said period.
• Compliance on a range of product quality related certifications.

• Training and awareness of quality aspects across the Company.
• Internal audit programme spreading throughout the year.
Product • Trained staff to conduct inspection and testing.
Issues relating to product responsibility and / or quality
responsibility / • Well-equipped testing facilities.
will directly impact the Group’s brand and reputation,
quality related • Stringent quality assurance across the sourcing, manufacturing and
thereby affecting its competitive edge.
risks distribution process.
• Ongoing monitoring of emerging customer preferences.
• Strategic focus on product innovation and developing
environmentally sustainable packaging.
• Maintain close relationships with employees, training & development

The organisational tacit knowledge of our employee base programmes, remuneration in line or above the industry.
Employee
is a critical factor in sustaining our competitive edge, and • Maintain a healthy working environment through an effective two-way
attraction and
the Company’s inability to attract and retain the right communication system.
retention
talent would affect the fulfilment of strategic objectives. • Provision of hostel facilities.
• Welfare programmes.
• Customers’ profiles are carefully evaluated before credit terms are

offered.
The Company is exposed to credit risk through potential
• Adopt secure payment terms such as LCs, bank guarantees,
loss of earnings and constrained cash flow arising from
Credit risk performance bonds etc. where required.
distributors / customers’ inability to fulfil their financial
• Obtain SLECIC (insurance) cover when there is a possible default risk.
obligations.
• Regular follow up action & continuous and frequent communication
with customers.
• The increase in interest rates have a direct impact on

profitability through both funding costs and finance
• The Company is mostly equity financed, and strives to maintain zero
Financial risk income. Interest rates were on a downward trend
exposure to long term debt servicing.
arising from during the year under review.
• Manage interest rate risk by constantly monitoring the market and
interest rate • The Company’s finance cost increased by 8% due to
forecasting trends and proactively negotiating / hedging the rates
fluctuations the short-term loan facility with Citibank. Finance
with the banks.
income also increased by 118% during the year due to
increase in foreign currency deposits.
• Fluctuations in exchange rates have a direct impact on

the Group’s profitability.
• LKR recorded sharp depreciation in the last quarter
of 2020, as capital outflows and the drastic decline • Follow efficient treasury management procedures to take advantage
Exchange rate in tourism earnings affected the country’s balance of of the positive movements.
impacts payment. • Adopt hedging strategies when applicable (e.g. forward booking etc.)
• During the year under review, the LKR depreciated at the right time to reduce potential exposure to exchange rate risk.
by 5% against the US Dollar and depreciated by 22%
against the Australian Dollar.

SUSTAINABILITY
AT DILMAH
As a Brand, Dilmah firmly believes that

business is a matter of human service. The
Founder’s long-term vision of building a
truly sustainable tea industry that benefits
people, communities and the environment,
is deeply instilled into the Group’s ethos
and organisational culture. For Dilmah,
sustainability is more than just caring
for the environment, and the Company’s
social responsibility begins with Dilmah’s
very own employees, because nature and
communities lie at the core of Dilmah’s
purpose.
OUR COMMITMENT AND APPROACH

The Group pursues its commitment towards sustainability
through balancing economic success, environmental
preservation, and social responsibility.
The COVID-19 pandemic posed many challenges to the

Brand, whilst also foregrounding that people are the
Dilmah tea was recognised as the winner of Best greatest asset of our business. The pandemic not only
Corporate Citizen Sustainability Awards 2020
posed a threat to people’s physical health, but also to
(category B), based on complex criteria linked
to social, environmental and economic value, their mental wellbeing, by forcing individuals to adapt to
compliance, resilience, stakeholder management a new normal in a short period of time. In 2020/2021 the
and crisis response. In addition to the coveted top
Group focused on worker health and wellbeing, while also
award, Dilmah won category awards for Customer
Relations, Environment Beyond the Business, and promoting mindfulness to help cope with the challenges
was chosen as one of the Top 10 Corporate Citizens of the pandemic. In addition, the Group invested in
of Sri Lanka.
training and development, promoting sustainable
lifestyles, climate adaptation, safeguarding natural
and cultural ecosystems, development interventions
and stakeholder engagement – to drive the workforce
towards a circular economy.

The ensuing section illustrates the Group’s
sustainability strategy consisting of 6 pillars and 26 elements
Corporate Governance Stakeholder Engagement

G1 Board Oversight S1 Consumer Engagement
G2 Management Accountability S2 Strategic Collaboration
G3 Corporate Policies and Management S3 Engagement of Merchants &
Systems Ambassadors
G4 Materiality Assessment S4 Platforms for Stakeholder Dialogue
G5 Public Policy
Supply Chain Sustainability

Employee Empowerment SC1 Policies and Codes
E1 Training and Development SC2 Procurement Practices
E2 Diversity SC3 Supplier Engagement
E3 Sustainable Lifestyles SC4 Verification and Disclosure
Responsible Operations Product and Services

R1 Climate Adaptation P1 Product Design and Packaging Innovations
R2 Facilities and Buildings P2 Business Model Innovation, R&D and
R3 Sustainable Transportations & Capital
Logistics
R4 Safeguard Natural and Cultural
Ecosystems Disclosure
R5 Water Management The Company will regularly report on its
R6 Waste Reduction sustainability strategy and performance
R7 Human Rights against standards and accepted matrices that
R8 Development Interventions for a is further verified, reviewed and acknowledged
better society by an independent party
SUSTAINABILITY GOVERNANCE STRUCTURE
Board of Directors
Operations Unit
Dilmah Conservation MJF Charitable

& Sustainability Unit Foundation

Research
Collaboration
between scientists and our
Dilmah Climate Change Centre
1 Million Cashew demonstrate solutions for climate Our Environmental
Trees Planted resilience in agriculture. Education
researches and shares knowledge on
in Eastern Sri Lanka to revitalise
nature, wildlife, natural medicine,
the land and uplift communities
sustainability and cultural heritage
under Dilmah’s Green Recovery
to inspire commitment to conserve.
Programme.
Our Nature
Our One Corridor
Earth Urban replaces tea lands with
Arboretum biodiversity to allow wildlife
models greening of to move freely between two
urban spaces for fragmented forest reserves
and strengthen species
healthier cities and
people. richness & resilience.
Elephant
Conservation
efforts including the Elephant
Indigenous Information Centre, support
Communities for a unique orphan elephant
empowered through care and reintroduction
initiatives to preserve their programme and supporting
traditions and knowledge. elephant research.
Aided Discovery of
New Species
Sustainable Our Marine in Sri Lanka to generate
Beekeeping Conservation
scientific evidence and
and bee research to conserve conserve herpetofauna
Sri Lankan bees while efforts support the creation of species.
empowering communities and marine sanctuaries and
promoting biodiversity. preservation of endangered
marine wildlife.

Network of
Early Childhood Community Life Skills & Vocational
Development Centres Training for Youth
Programmes taking knowledge & to increases their preparedness for
so that children under 5 have a opportunity to remote, the job market of the future.
stronger start to life. rural communities.
Educational Nutrition Support and

Scholarships and Awareness
promotes healthy minds and bodies
School Support that are crucial for children’s wellbeing.
so that young people on the
plantations and low income
backgrounds access higher
education.
Investment in
Disability Friendly
Training for Technologies
Government so that apps, databases and
Practitioners communications support
in health and education PWDs and their families.
to ensure that people
with disabilities are
supported in society.
Therapy, Education
and Vocational
Entrepreneurs Training
Developed for an improved quality of life
for children with disabilities.
have the tools, knowledge
and support to create
sustainable business models.
Housing and
Financially Infrastructure
Independent Women Improvement in
Support to
the Tea Gardens
who can make smart decisions Elders
that impact their entire families for Covid Support so that everyone has a place
ensures their dignity and to call home.
the better.
and Relief recognises their
to the local health system and continued capacity to
other beneficiaries affected by contribute.
the pandemic

BRAND ECOSYSTEM APPROACH
Dilmah’s business strategy is integrated within the brand ecosystem, enabling all stakeholders to engage better so
that every action in the business process contributes to a sustainable approach. As in any other ecosystem, Dilmah
acknowledges that the brand ecosystem thrives on the wellbeing of all stakeholders. In the midst of the pandemic,
Dilmah has strived to support all stakeholders and create an impact beyond the borders of business and finance, in its
attempts to generate and define the ‘new normal’.
Our commitment
to the industry
ETHICAL that has helped
TEA make Dilmah Tea
SOCIETY synonymous with
quality around
the world. It’s our
tribute to the men
and women who
have worked hard
to build this great
Industry.
PURPOSE
SUSTAINABILITY
Business is a Matter
of Human Service We believe that conservation
is ultimately about people and
the future of the human race,
that efforts in conservation DILMAH PUBLICATIONS
have associated human well-
being and poverty reduction
outcomes. These core values
allow us to meet and exceed
our customers’ expectations of
sustainability. TEA & YOUR
HEALTH
The Goodness in Real Tea,
Nature’s healing Herb
ADVOCACY KNOWLEDGE
Driving the category with
groundbreaking innovations
and being the sole voice for
protecting the Integrity of
Ceylon Tea. Initiating and
leading the national dialogue
on critical global issues
such as Climate Change and
Private Sector Involvement in
Sustainability.
Knowledge Inspires
Passion
EXPERIENTIAL
OUR TEAS
tea inspired music

Ripple Effect in Business Sustainability
CORPORATE ADVOCACY
As a brand that aims to create impact beyond the realms Dilmah is also a lead advocate of corporate sustainability
of business and finance, with an ardent belief in business within the United Nations Global Compact; a strategic
as a matter of human service, Dilmah values sustainability policy initiative for businesses that are committed
advocacy. As a Group that works towards the United to aligning their operations and strategies with 10
Nations 2030 Sustainable Agenda, Dilmah affirms the universally accepted principles in the areas of human
necessity for strengthening and revitalising partnerships, rights, labour, environment and anti-corruption. Dilmah
and realises the effect of stakeholder engagement on the Conservation is the climate leader for the United Nations
Company’s overall Sustainability Strategy. The Company’s Global Compact (UNGC) Network Sri Lanka, and has
dedicated environmental arm Dilmah Conservation, was established a collaborative platform to build climate
one of the founding partners of Biodiversity Sri Lanka awareness amongst businesses and the larger community
(BSL); a national platform entirely owned and driven by through multiple initiatives.
the private sector. It was established to promote strong
engagement of the corporate sector in biodiversity and
environmental conservation in Sri Lanka.
CONTRIBUTION TO THE SDGs

Strict health and safety procedures were
The brand emphasises Sustainable Development, both adopted during our operations amidst
as a concept and in practice, to build a more robust, the COVID-19 pandemic, to ensure health
and safety of all internal and external
competitive, and resilient business. Dilmah drives towards
stakeholders
aligning its sustainability strategy and initiatives with
the United Nations Sustainable Development Goals Special focus on employee wellbeing and
(SDGs) through strategic and concerted efforts aimed at mindfulness
alleviating poverty, promoting prosperity and protecting Stringent quality assurance at every stage
the environment. of the production process
The ensuing section is an illustration of Dilmah’s focus on Supplier ISO 9001:2015 FSSC
the UN SDGs through its businesses and sustainability assessments 22000 BRC Global
for quality and Standard for Food
initiatives. food safety Safety ISO 17025
Production and distribution of 4,577 MT of

tea - considered to be one of the healthiest
beverages available in the market

Total water consumption of 21,830 m3 Fostering sustainable livelihoods through
skills and capacity enhancement
Rainwater Harvesting unit of
18,000 L capacity at the One 17 new University and 19 Advance Level
Earth Centre Moratuwa scholarships were granted in 2020/21 with
a pledged commitment of Rs. 2.8 Mn
768 school Programmes for

Shift towards remote working students in the MJF early identification
arrangements, online meetings, trainings, Kids programme of children
and events during the COVID-19 pandemic benefiting through with special
study support and needs in the
BRC food safety cultural excellence to extracurricular plantation sector
enhance the existing overall Company activities – programmes
culture throughout the conducted in 5
year plantations
Equal Opportunity Employer
1291 kids from ages 6 months to 5 years,
16,034 training hours
belonging to 85 child development centres
provided with daily mid-day meals
40 small Over 1200 youth

Over 96% of total waste recycled / entrepreneurship empowered through
repurposed grants distributed skills development
in 2020 programmes
‘Waste to Craft’ initiative promoting reuse
and recycling of waste through Circular Construction of a new block of 11 classrooms
Economy Concepts for Anjali Aham MJF Kids Programme in
Point Pedro, costing Rs. 12 million
Generation of 447,202
kWh of renewable energy
Water and (solar power) Providing better, healthy and hygienic
Energy working conditions for the plantation
Stewardship workers on estates through projects
100% Carbon
amounting to Rs. 10,953,513/-
Neutrality
22% Reliance in Renewable Energy across

Partnered with governmental, national and the MJF Holdings
international organisations for technical
expertise and guidance - essential
Continue to increase the renewable energy
collaborations on Dilmah’s journey of
component in the Group’s energy mix with
sustainability
a Solar Expansion Plan
Achieved 100% carbon neutrality for all

Initiating Partner of Biodiversity Sri Lanka
products
in collaboration with Ceylon Chamber of
Commerce and IUCN - Sri Lanka
Extended the scope The Dilmah
of carbon neutrality Peliyagoda
Collaborated with the MillenniumIT ESP status, up to premises has been
for development of Sri Lanka’s first destination ports of carbon neutral
teletherapy and tele-education app all overseas markets since 2017
“disABILITY’
78,749 kWh 447,202 kWh
generated through generated through
Dilmah Conservation joined forces
hydropower plants solar units
with conservationists from Global
Wildlife Conservation (USA), Durrell
Wildlife Conservation Trust (UK) and
the IUCN Species Survival Commission
- amphibians, for building capacity of
Sri Lankan herpetologists to facilitate
assessing over 120 species of frogs that
inhabit Sri Lanka to include them in the
Global IUCN Red List

Equal opportunity employer
41% female representation
Capacity development through the

Women’s Development Programme
Empowerment and advocacy for women

concurrent to International Women’s
Day events. 1423 women participated in
Kalkudah and Colombo, including the
Dilmah Staff.
Marine conservation through the Beach

Caretaker Programme: Extended to
maintain a pollution-free 50km stretch of
beach with the help of 50 Beach Caretakers
Endana Nature Corridor: Aims to create a

biological corridor across our tea estate
in Endana which borders the Sinharaja
Rainforest - a World Heritage Site and a
Man & Biosphere Reserve
Initiating Partner of
Supported 5
Biodiversity Sri Lanka in
initiatives of
collaboration with Ceylon
Biodiversity
Chamber of Commerce and
Sri Lanka
IUCN - Sri Lanka
15 publications on biodiversity and heritage

conservation to encourage conservation are
made available at affordable prices
Selected publications are prescribed
for academic programmes in Sri Lankan
educational institutes
24 ha of Mangrove Restoration to support

blue economy and marine conservation

STAKEHOLDER
ENGAGEMENT
This issue of the
Annual Report is
dedicated to ‘People
Power’, as a tribute to
the collaborations and
partnerships that have Dilmah in its sustainability strategy
highlights and recognises SDG17 -
been the backbone of Partnerships for the Goals - as the most
Dilmah this past year. important Sustainable Development Goal,
thereby strongly advocating and driving
The Annual Report towards partnerships and collaborations
2020/21 honours the that are within and beyond its own sector,
both nationally and internationally. Dilmah
power of the people holds and builds upon the many inclusive
who unified and came partnerships, and strives to uplift all involved
- in both its social and environmental
together to make a spheres. As a truly sustainable brand, all
positive impact during a activities of Dilmah hold the people and
planet at its centre, while staying true to the
globally trying time. philosophy it is built upon - ‘business is a
matter of human service’.
Stakeholder feedback is used to gauge

the expectations of the stakeholders,
and perceived gaps in value delivered to
them. Engaging with stakeholders is a
responsibility shared across the organisation
with multiple channels for obtaining
feedback, which is a key input to Dilmah’s
strategic planning process. The table below
provides a summary of how Dilmah engages
with its stakeholders, their concerns and
how they have responded to them.

STAKEHOLDERS ENGAGEMENT CONCERNS
Stakeholders Engagement Concerns
Employees
• Open-door policy (ongoing) • Remuneration
Our team comprises 554
• Individual performance reviews • Opportunities for skill and career
motivated individuals
(biannual) progression
and we are committed to
• Meetings and internal mailers (ongoing) • Job security
inspiring our employees
• Awareness campaigns (ongoing) • Equal opportunities
to contribute towards our
• Sports and cultural activities (ongoing) • Conducive work environment
value creating process.
• Product quality and food safety

Customers • One-to-one interaction (ongoing)
• Product affordability
Our customers include • Customer service and relationship
• Compliance to relevant regulations
distributors, agents, management teams (ongoing)
• Ease of transactions
end-customers and the • Social media interaction (ongoing)
• Ethical production
HORECA channel. • Mailers and newsletters (ongoing)
• Environmental sustainability
Shareholders
• Annual General Meeting • Shareholder returns
Our shareholding base
• Publication of quarterly accounts • Strategic aspirations
consists of 1,028 individual
• Press releases (ongoing) • Prudent risk management
shareholders and 54
• Annual Report • Corporate governance practices
institutional shareholders.
• Price and profitability

Suppliers • Vendor review (ongoing) • Credit period and ease of transactions
We support the livelihoods • Regular dialogue and interactions • Capacity and demand planning
of over 15,000 suppliers (ongoing) • Climate change and sustainability
across our value chain. • Visits to ensure compliance (ongoing) • Production including responsible
sourcing and packaging sustainability
Communities
We benefit over 47,000 • MJFCF community projects (ongoing) • Community investments
individuals investing • Interactions with local authorities • Employment opportunities
15% of our pre-tax profit (ongoing) • Environmental impact
on community and • NGO interactions (ongoing) • Community support
environmental initiatives.
Government and
policy makers • Statutory audits (ongoing)
• Regulatory and legal compliance
The government is the • Meetings with Treasury, TRCSL and BOI
• Timely payment of taxes
regulator of markets and • Customs (ongoing)
• Product safety and quality
the environment. While • Dialogue through intermediaries
• Profitability and growth
also levying taxes on our (ongoing)
products sold, and profits.
COLLABORATING FOR SUCCESS

While growth and trade are common indicators of expertise and guidance - these are essential
success, since its inception, Dilmah has believed that collaborations on Dilmah’s journey of sustainability.
business is a matter of human service, and success is Partnering with organisations that have shared standards
measured not only by the graphs and numbers, but also is considered vital to addressing complex sustainability
by the countless lives touched and the positive impact issues. Dilmah engages in consulting and collaborative
caused to the environment. initiatives while driving cooperation along value chains,
financing project level partnerships and forming industry-
Dilmah has consistently partnered with governmental,
level business alliances to fulfil common objectives with
national and international organisations for technical
the organisations that are illustrated below.

KEY STAKEHOLDERS OF DILMAH DURING 2020/21
Dilmah Ceylon Tea

Company PLC Dilmah Conservation
National International National Government

Institutes Universities
Organisations Institutes Authorities
• Chefs Guild of Sri • IUCN • Tea Research • Coastal Conservation • University of

Lanka • Durrell Wildlife Institute & Coastal Resource Moratuwa
• Trade Partners Conservation Trust • National Institute Management • University of
including of Plantation Department Colombo
• Global Wildlife
World Leading Conservation Management • Marine Environmental • University of
Airlines, Super (NIPM) Protection Authority Peradeniya
Market Chains, • UNGC (United (MEPA)
Nations Global • Biodiversity Sri • Rajarata University of
Hospitality Chains Lanka • Sri Lanka Land
Compact) Sri Lanka
• Coconut Development
• Commonwealth Corporation (SLLDC) • Sabaragamuwa
Scientific & Research Institute University of Sri
International Industrial Research (CRI) • Department of Wildlife Lanka
Organisations Conservation
Organisation (CSIRO) • University of Kelaniya
• National History • Department of Forest
• The World Association Conservation • Eastern University of
Museum, London Sri Lanka
of Chefs’ Societies
• National Institute • National Building
(WACS) • University of
for Environmental Research Organization
• International Centre for Edinburgh
Studies (NIES), Japan • Biodiversity Secretariat
Culinary Arts – ICCA
of Sri Lanka
Dubai
• Central Environmental
• Institut Paul Bocuse
Authority (CEA)
• William Angliss
• Land Use Policy Planning
Institute
Department (LUPPD)
• Emirates Culinary Guild
• Department of
Meteorology Sri Lanka
• Sri Lanka Army
• Sri Lanka Navy
• Sri Lanka Climate Fund
(SLCF)
• National Library and
Documentation Services
Board
• Coconut Cultivation
Board
• National Aquaculture
Development Authority
(NAQDA)
• Sri Lanka Cashew
Corporation
• Department of Animal
Production & Health
• Department of
Agriculture

MJF Charitable
Foundation
Local International Organisations Governmental and/or Universities and

Organisations and/or Private Sector Local Authorities Academic Institutions
• King’s Revival • UNDP • NGO Secretariat (Ministry of • University of Colombo

Children’s Support • World Vision Defense) • University of Kelaniya
Centre • Mayor’s Office - Colombo
• Rotary International • University of Moratuwa
• Around the Pearl • Ministry of Health
Foundation • Mother Teresa’s Home in Moratuwa • University of Sri
• London Stock Exchange Group • Divisional Secretariats in all Jayewardenepura
• Candle Aid Areas of Operation
• MAS • Sri Lanka Institute of
• Community • Government Agents Marketing
Development Centre • GlaxoSmithKline Group
(Aranayaka) • District Secretariats in all • General Sir John Kotelawala
• Ceylon Biscuits Limited Areas of Operation Defence University
• Gemi Aruna • Durdans Hospital • Ministry of Social Services • SunRay Hotel School -
• Plantation Human • Microsoft Sri Lanka Gampaha
Development Trust • Urban Development Authority
• The Australian High Commission • Ministry of Agriculture and • Sunanda Upananda Vidyala
• Foundation of
• Chef’s Guild Skills for Inclusive Agriculture Extension Offices • JanaJaya Vidyala
Goodness
Growth (S4IG) in Siyambalanduwa and • Riversheen School of Music
• Sparklers Foundation Ampara
• Power of Play Pvt. Ltd.
• One Stage for All • Lady Ridgeway Hospital
• Who We Are SL
• Youth Action Network • NAITA
• SALT
Sri Lanka
• Kairos Sensing • Industrial Development Board
• Foundation of Goodness • Employees Federation Bureau
• Community Development Centre • Sri Lanka Prisons

“Ala Koratuwa” Aranayake
• Spinner Café
• Cerebral Palsy Alliance Australia
• The Asia Foundation
• Tekompaniet Sweden
• Tokai Coop
• Good Market
• World Association of Chefs’
Societies
• The Hilton Hotel
• Cinnamon Lakeside
• UNFPA
• Sooriya Village
• Physionet UK
• Ian and Barbara Karan Foundation
• Dialog
• Toastmasters International –
Moratuwa

OPERATING
ENVIRONMENT
GLOBAL ECONOMIC GROWTH
One year into the COVID-19 pandemic, the accumulating countries entered the outbreak with a precarious fiscal
human toll continues to raise concerns, even as growing situation and with less capacity to adapt to major
vaccine coverage, high uncertainty surrounds the healthcare policy responses or support livelihoods. The
global economic front, primarily related to the path of projected recovery follows a severe contraction that
the pandemic. The contraction of activity in 2020 was has had particularly adverse employment and earnings
unprecedented in its speed and synchronised nature. impacts on certain groups. Youth, women, workers
But it could have been a lot worse. Much remains to be with relatively lower educational attainment, and the
done to beat back the pandemic and avoid divergence informally employed have generally been hit hardest.
in income per capita across economies and persistent Income inequality is likely to increase significantly
increases in inequality within countries. because of the pandemic. Close to 95 million more
people are estimated to have fallen below the threshold
As per IMF (International Monetary Fund), Global
of extreme poverty in 2020 compared with pre-pandemic
economy contracted by 3.3% in 2020 and reflected a
projections.
far better outcome of 6% in 2021, and this is further
anticipated to grow by 4.4% in 2022. The recovery of Strong international cooperation is vital for overcoming
economic activity was far better than the early part of the aforementioned concerns and ensuring that
the year 2020 due to most regions being released from emerging market economies and low-income developing
lockdowns and discovering new ways of working. Regions countries continue to narrow the gap between their
were testing and adapting to the “new normal”. living standards and those of high-income countries.
On the healthcare front, this means ensuring adequate
Thanks to unprecedented support from world governing
worldwide vaccine production and universal distribution
bodies and regulators in setting policies and the policy
at affordable prices—including through sufficient funding
response, the COVID-19 recession is likely to leave smaller
for the COVAX facility—so that all countries can quickly
scars than the 2008 global financial crisis. However,
and decisively beat back the pandemic. The international
emerging market economies and low-income developing
community also needs to work together to ensure that
countries have been hit harder and are expected to suffer
financially constrained economies have adequate access
more significant medium-term losses.
to international liquidity so that they can continue
Negative growths & losses have been particularly large needed healthcare, other social, and infrastructure
for countries that are heavily dependent on sectors spending required for development and convergence to
such as tourism and commodity exports. Many of these higher levels of income per capita.

COMMODITY PRICES - November with the second wave of the pandemic.
All sectors of the economy contracted during 2020
In line with the projected global recovery, oil prices are
(agriculture, forestry and fishing by 2.4%, industry by
projected to grow 30 percent in 2021 from their low base
6.9%, and services by 1.5%), compared to the previous
in 2020, in part reflecting the OPEC supply output. Metal
year.
prices are also projected to accelerate strongly in 2021,
largely reflecting the rebound in China. Food prices are
Real Economic Growth Rate %
also expected to pick up this year.
+6.00%
4.50%
As noted, commodity prices (particularly for oil) are 3.60%
+4.00% 3.30%
expected to firm up further in the months ahead. Given 2.30%
their record-low levels of a year ago, firmer prices should +2.00%
mechanically lift consumer price indices, and headline 0.00%
inflation. Projections shows the commodity prices would
-2.00%
remain on a low key until the demand conditions rise.
-4.00% 3.60%
SRI LANKAN ECONOMY -6.00%

2016 2017 2018 2019 2020
As per the CBSL annual report 2020 published in April
2021, the Sri Lankan economy contracted by 3.6% in
On the other hand, the subsectors of growing of
2020, reflecting the effects of the COVID-19 pandemic
vegetables, fruits and cereals other than rice, recorded
compared to the 2.3% growth recorded in the preceding
a healthy performance during 2020, supported by the
year. This overall contraction in 2020 was driven by the
Government’s policy initiatives to promote domestic
year-on-year contraction of 16.4% experienced during
agricultural production.
the second quarter of the year, due to the nationwide
lockdown measures imposed to contain the COVID-19 Within the industrial sector subdued performance in
outbreak. Nevertheless, the economy rebounded during construction, manufacturing of textiles, apparel, leather
the second half of the year, registering a real growth of and leather related products, mining and quarrying
1.3% in spite of the disruptions caused during October subsectors primarily contributed to the contraction of

industrial activities during 2020, although manufacturing and low grown tea, which contributes about 22%, 17%
of food, beverages and tobacco products recorded and 61% of the total production, respectively, declined
a growth during the year. Of the services sector, by 1.3%, 0.9% and 10.5%, respectively, in 2020. In the
financial services and auxiliary financial services, meantime, the average yield in the smallholder sector
telecommunication, and wholesale and retail trade declined from 1,765 kilogrammes per hectare, compared
activities grew during 2020, thereby lessening the impact to 1,938 kilogrammes per hectare reported in 2019,
of the contraction of subsectors of transportation of mainly due to the drought conditions that prevailed in tea
goods and passengers, including warehousing, other growing areas.
personal services, accommodation, and food and
Tea prices at the Colombo Tea Auction remained elevated
beverage service activities, which were affected by
throughout the year in comparison to the corresponding
mobility restrictions, social distancing measures and
prices in 2019. The average price of tea increased by
border closures during 2020.
15.9% to Rs. 633.85 per kilogramme during 2020, from Rs.
This, along with the depreciation of the Sri Lankan rupee, 546.67 per kilogramme recorded in the previous year.
caused the overall size of the economy to contract to US
The average export price (FOB) of tea increased by
dollars 80.7 billion in 2020 from US dollars 84.0 billion
1.6% to US dollars 4.67 per kilogramme during 2020,
in the previous year, and per capita GDP to decline to
compared to US dollars 4.60 per kilogramme recorded
US dollars 3,682 in 2020 from US dollars 3,852 in 2019.
in the preceding year. Although the increase in tea prices
On the expenditure front, final consumption expenditure
can be partly attributed to the decline in the quantity
recorded a moderate growth of 2.1% in 2020 at current
supplied to the CTA due to reduced local production, a
prices, in comparison to a growth of 7.4% in 2019.
significant drop in tea exports from global competitors
Particularly, the growth of household consumption
due to setbacks caused by the COVID-19 pandemic
expenditure moderated to 1.0% in 2020 from 7.3% growth
enabled domestic exporters to attract a comparably
in the preceding year.
higher price during 2020.
Effects of the pandemic were observed in the
unemployment rate accordingly, the unemployment rate
increased to 5.5% in 2020 from 4.8% in the previous
National Tea Production Output YOY in Mn Kgs
year. Unemployment rates amongst males and females 340
increased from 3.3% and 7.4% in 2019, respectively, to
4.0% and 8.4%, respectively, in 2020. Prioritised export 330 328
promotion is essential, alongside taking measures to 320

implement long overdue structural reforms to address
310 307
legacy issues and revive the export sector. Although Sri 304
300
Lanka recorded its historically highest export earnings 300
293
in 2019 pre pandemic hit year, such earnings are meagre 290
when compared to those recorded by similar-sized
280 278
economies in the region. Steering the export sector
through the impact of the pandemic and fostering 270
competitiveness in the new global environment are 260
essential.
250
2015 2016 2017 2018 2019 2020
TEA – INDUSTRY ENVIRONMENT
The production of tea registered a notable decline of 7.1%
in 2020 due to adverse weather conditions and labour
supply disruptions due to COVID-19 and nationwide
lockdowns to curtail the spread. Although a significant
decline of 18.0% was recorded in the first half of the year,
tea production recovered in the second half of the year
2020 with a 4.9% growth. Production of high, medium

Data from the Sri Lankan Tea Board (SLTB) reports that From a Sri Lankan perspective, Sri Lankan Rupee would
domestic tea production reported at the lowest ever for weaken further once the imports on non-essential items
the last 10 years at 278 Mn Kgs. This was partly due to are relaxed and, in such circumstances, would augur well
nationwide lockdowns, social distancing, in addition to for Rupee tea prices considering that some of the key
adverse weather and low industry productivity arising importer country currencies have depreciated post the
from a lack of investment. Covid-19 pandemic.
Sri Lankan tea exports fell by 27,000 tons (-10%) y-o-y Sri Lankan tea output is likely to recover in 2021, as the
in 2020, to 238,500 tons. Higher y-o-y exports to Turkey, global consumptions stabilises post COVID. Therefore,
Iraq, Iran and Libya, were outweighed by lower shipments the supply situation would continue to remain tight.
to Russia and China, amongst others. This trend
From a global perspective, tea production in 2020 is
continued into the new year with Sri Lankan tea exports
likely to record a deficit reflecting the crop shortfall
contracting by 1,200 tons (-6%) y-o-y in January 2021 to
primarily from India and Sri Lanka. Kenya, on the other
20,820 tons, despite higher y-o-y output.
hand, has performed well and showed a year on year
increase mainly to compensate the volume drop from
TEA MARKET OUTLOOK FOR 2021 India and Sri Lanka.
As many tea producer countries continue to promote
As per F&W market reports, tea auction prices
‘tea drinking,’ the percentage of tea retained in producer
performed reasonably well in recent months. The trend
countries have increased quite significantly over the last
is exceptional to the last few weeks of May due to the
decade, resulting in a declining availability for exports.
depreciation of the rupee and further contributed by
Tea consumption is dominated by Asian countries, surge in the crop subsequent to the Sinhala and Tamil
particularly India and China & Sri Lanka which together is New Year and Easter holidays.
estimated to be 55% and more of global demand. Data Source: Forbes and Walker Tea Brokers
Movement of Tea Auction Average Price - 2021 (LKR)

680
660
640
620
600
580
560
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
Week number Y 2021

CAPITAL
MANAGEMENT
Capital Management
Financial
Capital
Dilmah Ceylon Tea Company The PBT for the FY 2020/21

(DCTC) delivered a strong Profit stood at LKR 1.91 Bn, a marginal
After Tax (PAT) figure of LKR decline of 4% versus last year,
1.75 Bn reporting a 12% increase compared to the last financials
versus LY results, despite the earnings per share reported an
continuing pandemic. Export increase of Rs. 9.18 per share to
revenue declined by 21% to LKR Rs. 84.38 per share. The steady
9.2 Bn for the year in review, and consistent performance
compared with the revenue has positively contributed to
figure of LKR 11.6 Bn achieved effectively executing the long-
last year. Export volume for the term strategy of the Company.
year stood at 4.6 Mn Kgs, which
dropped by 19% compared to
last year (LY 5.6 Mn Kgs).
REVENUE & GP GROWTH

14,000 48%
12,000 46%
Mn (Rs)
10,000 44%
8,000 42%
GP%
6,000 40%
4,000 38%
2,000 36%
34%
2015 2016 2017 2018 2019 2020 2021
Year
Revenue GP%

The Group continued to innovate its product portfolio, care was given to necessary brand building programmes
launching new recipes and consumer friendly packaging in order to further strengthen the brand despite cost
to meet the changing needs of the markets. Despite saving measures. The Company operates in well over
the price pressures and discounts by large retailers 100 countries while its main markets are Australia and
undermining Ceylon Tea, DCTC continued to maintain New Zealand. The Group has a wider distributor network
its strong brand equity with sustainably made, high and a direct customer base to roll out its marketing and
quality products. New packaging innovations include advertising activities – this includes the launch of 8 new
switching from tin tea caddies to paper canisters in product ranges which included 48 variants.
3 SKUs of Dilmah’s Inspiration Selection launched in
The PBT figure reported at LKR 1.91 Bn – a marginal
Australia, and switching from foil to paper envelope tea
reduction over the last year figure of LKR 1.99 Bn and the
bags in 8 variants of Dilmah’s Café Range, making it fully
PAT figure of LKR 1.75 Bn grew by 12% compared to the
biodegradable.
previous year due to reasons mentioned above.
DCTC reported a gross profit of LKR 3.7 Bn with an
Forex gain for the year rose sharply for the year and
impressive gross margin percentage of 41% compared to
stood at LKR 1.2 Bn. Mainly due to the favourable
LKR 5.3 Bn (GP margin of 46%) versus the last FY. The
exchange conditions of the USD and AUD, DCTC was able
Company was able to maintain its steady profitability
to maintain a healthy PAT figure, the same as last year
despite the global pandemic. It is important to note
despite the reduction in topline. The Company reported
that FY 19/20 is an above average year of performance
an increased net profit margin (NP margin %) of 19%
and less than 45 days (part of Feb & March 2020)
versus LY of 13%.
was impacted due to the virus outbreak, whereas the
FY 20/21 was significantly impacted due to the virus Non-operating income improved by 118% due to
outbreak. efficient and innovative methods adopted in treasury
management.
The decline in gross profit value in absolute terms is
reported at LKR 1.6 Bn – a decrease of 30% compared to
the last year. PBT, TAXATION AND PAT
DCTC maintained its PBT % within the range of 17% for
the last two years even with increased pay-outs and less
OPERATING EXPENSES forex gains. Decrease in tax figure is due to reversal of
Operating expenses overall reduced by 13% resulting in a deferred tax and exemption of interest income on foreign
saving of LKR 525 Mn compared to LY. It was mainly due currency deposits from income tax. The PAT figure for the
to the reduction in selling and distribution cost and other year is reported at LKR 1.75 Bn and the margin stood at
cost control measures initiated by the Company. 19% compared to last year’s 13%.
Administration Expenses showed a 1% marginal

reduction vs last year to LKR 1.6 Bn. It should also be INVESTMENT IN PPE
noted that cost savings were delivered in the following
DCTC regularly upgrades equipment to keep abreast
areas; staff related overheads (staff salaries, overtime,
of modern manufacturing technology, improving
allowances, fuel expenses etc.), utilities, stationary, and
product quality, flexibility, operational efficiency and
communication. Even though COVID related expenses
the environment. During the year in review, investments
have negated some of these savings.
were made in state-of-the-art tea bagging machinery.
Marketing & Selling expenses reduced by 24% to LKR The working capital progress reflects the ongoing
1.67 Bn (LY LKR 2.18 Bn) – mainly due to; reduction in construction of the Peliyagoda factory, and supplier
earned A&P provision due to the drop in sales, reduction advances paid for importing of the state-of-the-art
in overseas travel, tight cost control measures undertaken machinery.
and lesser merchandising provision in Dilmah worldwide
As per Listing Rule 7.6 (iii) Group posses total Land
customers. It should be noted that the year in review was
values carrying amount at Rs.936 Mn and at fair value Rs.
a subdued year due to the virus outbreak and most of
1,397 Mn As at 31st March 2021.
the brand promo activities took place online. However,

CURRENT ASSETS TRADE RECEIVABLES
Inventories – including tea, packing materials, finished The Company’s trade receivable recorded a 6% decline
goods and machinery spare parts – showed an increase versus last financial year to LKR 4.6 Bn. DCTC deploys
of 14% to LKR 1.5 Bn. DCTC maintained above average and maintains strong control over its debtors while
tea stocks to service the potential increase in short to maintaining a positive relationship with the global
mid-term demand and to take advantage of lower tea customers.
prices (where applicable) without having to compromise
on the freshness and quality of tea. Packing materials
also recorded an increase in anticipation for future orders CURRENT LIABILITIES
and to counter potential supply chain disruptions. Stock Overall current liabilities dropped by 60% compared
of Finished Goods also reported an increase mainly due to LY to LKR 1.34 Bn. Mainly the reductions are from
to global logistics issues and shipment delays due to the the repayment of the short-term loan granted. A short
outbreak of the pandemic. term USD loan is obtained to take advantage of current
market deposit rates and efficient use of treasury
management for the betterment of the entity.
CAPITAL STRUCTURE
DCTC’s consistent strong performance results in a strengthened capital structure. Key internal indicators, as well as
market indicators, shown below are evidence of DCTC’s strong capital structure. Return on equity (ROE) reported is
within the range of 13% - 15% for the last few years.
The company redistributed its earnings in the form of dividends while having sufficient funds for business expansion.
Accordingly, the Company proposed a dividend of LKR 18 per share.
Return to Shareholders 2020/21 2019/20 2018/19

ROE % 13 13 14
Earnings per Share Rs. 84.38 75.19 76.71
Net Asset per Share Rs. 669.12 594.88 555.65
Share Price (Closing) Rs. 636.75 531.00 619.90
P/E Ratio Times 7.55 7.06 8.08
Dividend Per Share Rs. 18 25 35
Dividend Yield % 3 5 6
Dividend Payout Times 6 47 46
Market Capitalisation Rs. Mn 13,205 11,012 12,855
800
700
600
500
400
300
200
100 Market Price Per Share (Rs.)
0 Dividend Per Share (Rs.)
2015 2016 2017 2018 2019 2020 2021 Earnings Per Share (Rs.)

Capital Management
Human Capital
Dilmah, as a Brand that is its business and reputation,

built upon the philosophy of because of the untiring effort
‘Business is a Matter of Human taken by members of the Dilmah
Service,’ is no stranger to the family who strive to uphold the
concept of employees being family values that the Brand is
our Company’s most valuable built upon. This reporting year
asset. The Company holds we have proven that the true
no bounds in leveraging the strength of the Company lies
talents and commitment of in the power of its people. The
the people that work tirelessly Company’s dynamic team of 554
behind the scenes to make employees drives its strategic
Dilmah the brand it is today, aspirations and facilitates a
while attracting and retaining healthier customer experience
the best talent in the country. that ultimately contributes to
Even in the midst of a pandemic business growth.
the Company has held together
41%
554
Female
Employees
Representation
87.1% Employee Performance

Retention Management System
Rate with Real-Time Feedback

Value Delivered
Total Payments to 87.1% TRAINING

Employees RETENTION INVESTMENT
RS. 1,050 Mn RATE RS. 10 Mn
TOTAL TRAINING HOURS

HIGH LEVEL OF DURING THE YEAR
EMPLOYEE ENGAGEMENT 16,034
Highlights of 2020 / 21 the year under review, a relatively low employee turnover
• Complete digitalisation of the was shown of 12.9%, justifying Dilmah’s commitment as a
HR process from hire to retire. preferred employer.
• Launched the Mobile app of the

Human Resource Information TEAM PROFILE
System. Dilmah is home to employees of all ages, the Company
is enriched by a young and energetic team with 59% of
• Employee productivity (defined
them being between 20 to 40 years of age. The Dilmah
as revenue per employee)
family is an inclusive one and is an equal opportunity
decreased by 16%. Despite
employer; Dilmah does not discriminate based on
reduction of the revenue due to
gender, ethnicity, age or any other form of diversity when
the COVID-19 pandemic, Dilmah
attracting, remunerating, or promoting employees.
has kept all employees on
payroll through the downturn
with no lay off. Total Employees Total Employees Total Employees
by Type of by Gender by Age
Employment
MANAGEMENT APPROACH 46
94
147
The values of Dilmah tea – dedication, integrity, loyalty,
225
motivation, authenticity, and humaneness are enlivened 329 132
by the 554-strong human capital of Dilmah. Dilmah 508 181
is a family business and as in any family, Dilmah puts

the health and wellbeing of its members first. Hence, Permanent Female 20-30 yrs
Contract Male 31-40 yrs
the Group ensures that their personal and career 41-50 yrs
aspirations are met by adopting a holistic employee Above 50
value proposition. The year in review brought with it
a multitude of challenges with an ongoing pandemic; Team Profile by Employee Category
forcing the Company to adapt to a new normal, whilst
WORKERS -
working remotely for a significant period of time. 158 119 PERMANENT
73 31 CLERICAL AND ALLIED

The Company has increased the efficiency of the HR
36 46 EXECUTIVES
process through complete digitisation which helps
optimise time and resources, from recruitment up to 50 25 MIDDLE MANAGERS
retirement / resignation. Whilst digitisation and online 6 4 SENIOR MANAGERS
communication can be alienating at times, the Company 6 DIRECTORS

took efforts to encourage mindful and sustainable Female
lifestyles to ensure the wellbeing of its employees. During Male

New Employee Hires workforce; whose talents and capabilities are constantly
enhanced through various programmes. The governance
5 1 CONTRACT
policies focus on capitalising and augmenting employee
13 16 PERMANENT interest based on stakeholder and organisational goals.
The Board, Remuneration Committee and the Heads
Female
Male of Departments constantly review and update policy
framework and the way-forward with said policies. Our
comprehensive HR policy framework is designed to
HR GOVERNANCE AND POLICIES comply with local and international regulations, standards
The Company’s essence is its employees. As the tea and industry best practices.
produced by the Company is carefully handpicked and
handcrafted with goodness and purpose, the Company’s The company’s zero tolerance towards bribery and
workforce is also cared for with kindness. The Company corruption is communicated through the Anti-Bribery
boasts an inclusive and well thought-out Human and Corruption Policy, its Workplace Anti-bribery rules
Resource Governance Framework, consisting of a resilient and its Code on Business Ethics, are all made available
HR, Grievance and Ethics policies that are centred on to employees via Dilmah’s intranet site. Training on
attracting, stimulating, developing, and retaining our these policies is carried out in the induction programme
human capital. conducted by the Legal department during the
onboarding process of new employees.
As the flavour in Dilmah tea is enhanced with ‘no
compromise’ to taste, this principle extends to the
Board Regulatory frameworks

Human Rights Policy
• The Factories Ordinance, No. 45 of 1942
• Employees’ Provident Fund Act Business Ethics Policy
DMC • Employees’ Trust Fund Act
Grievance Policy
• Payment of Gratuity Act
• Employment of Women, Young Persons and Human Resource Policy
Children Act
HR
Department • Convention against Torture and other Cruel, Health & Safety Policy
Inhuman or Degrading
• Treatment or Punishment Act
HOD • Convention on the Suppression of Terrorist
Financing Act Company Standing Orders &
Code of Conduct
• International Covenant on Civil and Political
Rights (ICCPR) Act • Conditions of Employment
• Protection of the Rights of Persons with • Classification of Employee
Disabilities Act • Employee Security
• Maternity Benefits Ordinance • Disciplinary Inquiry
• Shop and Office Employees (Regulation of Procedure
Employment & Remuneration) Act
• Workmen’s Compensation Ordinance
DIGITISED HR PROCESS
The world today is a digital world and in keeping with the official website for candidates to upload their CV’s for
times the HR process of the Company, from recruitment vacant positions.
up to retirement / resignation, has been completely
digitised through a Human Resources Information System Candidates best suited for the job are recruited based
(HRIS). Furthermore, to make matters more convenient on knowledge, skills, abilities and behaviour providing
and efficient, an online career page is in place on Dilmah’s an equal opportunity in line with organisational goals.

The requirements of the Employment of Women, Young
Persons & Children Act is firmly adhered to in our
recruitment process.
In order to ensure a smooth transition into the Dilmah

culture and familiarisation with the Company, all
recruits undergo an induction programme covering all
departments. All new recruits are quarterly reviewed
during their probation period to make sure that they are
familiar with the culture and the job, with right directions
given through mentoring and guiding.
The digitalised process in place helps improve the

efficiency, accuracy, and employee engagement towards Request by Head of Departments with
the betterment of the Company. The digitalised HR the description of required expertise
process proves to be extremely beneficial in times of the
pandemic and working remotely. Compilation of Job Descriptions based
on the job prerequisite by the Human
Listed below are some major areas which have been Resource Department
digitised through the HRIS.
Approval for recruitment of cadre by
Recruitment with Board or the Decentralised Committee
Real-time Feedback
www.dilmahtea.com/ Selection & recruitment internally or
careers/
externally
Figure 2: Recruitment Process
Onboarding
Attraction
Confirmation with • By Knowledge
Mentoring & Guiding
• By Skills & expertise
• Via an online system
Performance
Appraisal Development
• State-of-the-art evaluation system
• Management & technical
Training & • Competencies
Development
• Tailor-made development plan for each employee
Retention
Compensation
& Benefits • Rewards & recognition
• Prioritising health & safety
• Updated HR Policy
Figure 1: Digitalised HR Process
Employee Engagement
To make the HRIS more user-friendly a mobile app was • Sustainable lifestyles
launched. This enables employees to conveniently apply • Fitness & sports
for leave when necessary and supervisors to approve of • Employees’ children engagement
the same. Additionally, employees are able to check one’s • Engaging in cultural events
attendance easily through the app. Furthermore, since
Occupational Health & Safety
the app captures the geographic location of the user, the
• Immediate corrective actions
supervisor is more confident about approving leave. The • Accident-free working environment
app is also designed to process the approval of Medical
Claims. Figure 3: Human Capital Priorities

EMPLOYEE ENGAGEMENT AND
SUSTAINABLE LIFESTYLES
The unprecedented and unexpected COVID-19 pandemic
introduced the concept of working from home to many
of the Company’s employees. While working from
home has its many benefits, the loss of structure and
the blurring of boundaries between work-life and home
life were some of the challenges individuals faced.
Understanding this, the Company prioritised employee
management and encouraged the ‘work-life balance’ of
all employees.
International Women’s Day Celebrations
Various employee engagement activities were conducted
whenever possible, while adhering to strict health
guidelines; such as development initiatives, sporting
and recreational events, cultural events etc. However,
due to the restrictions stemming from the pandemic,
some of the major events in the Dilmah event calendar,
such as the Staff Christmas Party and the Annual Pirith
Ceremony were not conducted during the year under
review.
Employee Engagement Activities

During the Year
Staff Quiz on Environmental Sustainability
Special Project: Dilmah staff colour-washed

Mother Theresa Children’s Home in Moratuwa
Blood Donation Programme
Donation of the PCR Kits to the Ministry of

Long Service Awards
Health, Nutrition & Indigenous Medicine

GRIEVANCE HANDLING
As a family business, Dilmah aspires to instil familial values in the management of employees; the people who are
the backbone of the Company’s success. The Company believes in fairness, diversity and equality; open and honest
communication is encouraged at all levels of management. A transparent and streamlined grievance handling
procedure has also been put in place to ensure employee feedback is well received.
Joint Professional
Open Door Townhall Grievance
Consultative Counselling
Policy Meetings Records
Committee Service
• Report to HOD: The JCC which has Held once a A nominated An opportunity for
Direct access to their representation from month, open senior counsellor is the staff to express
HOD regarding both each department will to any and all assigned to attend their grievances and
professional and periodically discuss staff across to any level of workplace inquiries
personal grievances their grievances all categories grievance related to anonymously,
• Human Resource directly with the to speak out employee personal where all inquiries
Manager: Direct access Chairman, Deputy and voice their or professional are directed to the
to HRM regarding Chairman and the concerns health management for
both professional and CEO necessary action
personal grievances
Figure 4: Grievance Mechanism
PERFORMANCE EVALUATION
Dilmah values dedication, integrity, loyalty, motivation,
authenticity, and humanness. The Company believes in
nurturing a performance-driven & meritocracy culture.
The Employee Performance Management System
(EPMS) in place, evaluates employees on individual Key
Performance Indicators (KPIs), Competencies and Dilmah
Values during the assessment period; providing a well
defined and transparent performance evaluation system
upon which rewards, and remuneration can be decided.
The main purpose of the Dilmah EPMS is to guide all

executives to unleash their true potential. By which their
contribution with required competencies and adherence
to the corporate values will pave the way forward, to Promotions Total Male Female
achieve the objectives of the Company. Executive and above 26 15 11
The EPMS is a scientific and transparent system Non-Executive 10 10 0

to incentivise executives in duly recognising staff Total 36 25 11
performance and to develop necessary skills to help
employees step forward to the next level. With this
system the employees are made aware of the tasks they REMUNERATION AND BENEFITS
are designated to complete during a given time period.
Prior to commencing the performance review process,
Mid-year reminders and status checks of the agreed tasks
the Remuneration Committee is tasked to conduct a
further aids in guiding employees. This system evaluates
detailed salary benchmark across the industry to ensure
the employees for their performance in Job Tasks, Values
Dilmah retains and attracts the best talent. The results of
and their Managerial Competencies.
this benchmark, along with living cost analysis based on
national data and results of the performance appraisals,

form the key components taken into consideration when Benefits offered to our permanent cadre
determining remuneration. Once defined based on the Fringe Benefits
above approach, salary increments & promotions are then • Bonus
submitted by the Committee for the approval of the CEO • Production Incentives
and the Board. • Attendance Allowance
• Death Donation Scheme
The COVID-19 pandemic posed many challenges for • Thrift Society
industries worldwide and Dilmah was no exception. The • Housing Loans
Company has ensured that no deductions or delays took • Welfare Loan Scheme
place in the payments of salaries. Dilmah helps staff with • Special Grants from the Empathy Fund
required dry rations and sanitary items and employees of • School Books / Uniforms Distribution
the Company are entitled to a performance bonus twice • Scholarship Scheme for Children
a year. Despite the pandemic, the Company ensured that • In-house Hostel & Kitchen Facility for Staff
these bonuses were granted to their employees without • Evening Snack
fail. • Night Shift Meal
• Free Tea Quota
• Staff Tea Sales
• Staff Transport
A Retirement Plan
• Laundry Service
Small Entrepreneurship Programme
• Uniforms & Overcoats
(SEP) for Staff
• As a Company that values loyalty and humanity, Mindfulness & Wellbeing
this programme encourages and provides • Sports Club
support to staff at Dilmah in their livelihood • Box-fit Sessions
after retirement. Making the Company not just a
career driver, but also a partner in its employees’ • Yoga Sessions
journey of life. Healthcare
• The Company introduced the Small Entrepreneur • Medical Screening
Programme (SEP) which encourages the • Medical Clinics
employees awaiting retirement to start their
• Medical Leave
own business ventures to ensure a steady
income after their retirement. This is a grant • Hospitalisation Insurance
that the Company employees receive without a • OPD Reimbursement
payback bond. Prior to the providing the grant
a project assessment is carried out, after-which
the relevant sum is paid to the beneficiary. A
follow up assessment will also be carried out
and guidance will be provided as and when
necessary.
• During the financial year, 15 employees benefited
from the SEP with grants amounting to over Rs.
1.1 Mn.
Salary Saving for Hostellers

A special monthly salary saving scheme was
introduced to the hostellers in collaboration with
Commercial Bank, Peliyagoda. 58 employees
were part of this initiative, and they consented to
forwarding LKR 1,000 - 5,000 from their salaries
each month to their respective savings accounts,
as a means of securing an additional saving for
their future.

TRAINING AND DEVELOPMENT
Cross-Functional 8 TRAINING CLUSTERS Technical Competency

Training 1. Business & Communication Development Programme
• Information Technology 2. Compliance & System A special training programme to develop
the skill set of technical staff (Engineering
• Finance Requirements & Production) affiliated with NAITA.
• Quality Assurance At the end of theoretical and practical
3. Finance & Accounting
• New Product Development sessions conducted by the Technical
4. Information Technology College lecturers, our employee will be
• Food Technology
5. Leadership & Management certified with the NVQ 4 qualification.
• Shipping The first batch with 16 engineering staff
• Customer Services 6. Professional Training has completed their programmes and
• Tea Department 7. Food Hygiene & Safety / the second batch will be start to focus on
automation, robotics and mechatronics.
• 140 Employees to share OHS
the interdepartmental
process & procedures 8. On-the-job Training /
Technical
Machine Skill Enhancement
Awareness Sessions on Training 92 individuals
16,034
to enhance their skills on production
COVID-19 & Preventive requirement & process awareness.
Measure
The staff, hostellers and factory
associates were educated on Fire Training by the Fire Service
the do’s and don’t during the TOTAL TRAINING Department
pandemic to avoid the spread
HOURS
of the virus. 66 Employees of the fire crew
Better Collaboration | Increased Workforce Sustainability | Increased Motivation & Efficiency
Number of Trainings Total Number of Training Hours

Conducted Participants Trained
General Training
930 Machine skill enhancement
187 13 related training
11,648 Process related training
2 105 Introduction training for
new recruits
359
Periodic awareness on process
76 2,071
267
Individual Training External Group Training
Internal Group Training 2,830
Average Training Hours Average Training Hours

by Employee Category by Gender
26.1 33.8
24 30.5
40 Male
Female
Executive
Clerical and Allied
Worker

Dilmah Internship Programme Turnover by Gender Turnover by Age
The Dilmah Internship Programme (DIP) offers students 26 29

an opportunity to pursue a career based on their current
study path, while also providing corporate exposure 49 39
<30
in an international company engaged in ethical trade. 30 - 50
The DIP provides real-time insight into the world of
Male
7 >50
Female
tea, enabling students to build on their college-level
learnings, while obtaining practical skills, and enhancing
HEALTH AND SAFETY
their employability in the industry and to develop future
Dilmah as a manufacturing company is committed to
leaders. The Interns at Dilmah are considered as assets to
providing employees with a safe working environment
the Company and are an opportunity for innovation, as
focused on eliminating and managing health and safety
they contribute fresh perspectives and new ideas. Hence,
concerns such as the risk of hazards and injuries. Dilmah’s
their contribution is being closely monitored by the CEO
dedication to employee health and safety is further
himself.
strengthened by the Company’s proactive commitment
to the SDGs 3 and 8, which ensure ‘Good Health’ and
‘Decent Work and Economic Growth’, respectively.
Adhering to the requirements of the 4 pillars - labour,

health and safety, environment and business ethics
of Sedex Members Ethical Trade Audit (SMETA)
methodology, Dilmah ensures continuous improvement of
Health & Safety in the workplace.
The packing and bagging factory situated in Peliyagoda

is equipped with a fully-fledged medical facility with
medical check-ups conducted every weekend by
Interns presenting their learning outcomes and specialists in the medical field. The Health and Safety
suggestions for process improvements committee conducts monthly reviews on the safety
and hazardous situations, and comprises worker
representation of 25%. Proving the strength of our Health
EMPLOYEE RETENTION and Safety policy across the Group, zero injuries and
Dilmah’s values of dedication and loyalty are extended hazards of critical nature were reported during the year
to all those of the Dilmah family, and that includes the under review.
employees as well. Dilmah’s unique employee value
proposition characterised by above-average remuneration Work-related
and dynamic work environment has permitted the
Total Male Female
Injuries
Company to sustain a retention rate of 87.1% while Fatalities as a result of
maintaining the turnover at a rate of 12.9% during the year No. 0 0 0
work-related injury
under review. The executive staff turnover was 10% whilst High-consequence
the non-executive staff turnover was recorded at 15%. work-related injuries No. 0 0 0
(excluding fatalities)
Turnover by
Recordable injuries No. 4 4 0
Employment Category
Lost days due to
1 Senior Management Days 65.5
occupational injuries
Middle Management
Executives
5 • High-consequence injuries - Injuries that require more than
Non-Executives 6 months recovery time.
11 • Recordable injuries - Injuries that require recovery time of
greater than 1 day and less than 6 months.
58 • Zero fatalities of employees or contractors were recorded
in 2020/21.

By Type of Incident No. NEW NORMAL: COVID-19
• Falling - RESPONSE
• Bodily reaction-injury by bending, reaching, BEST PRACTICES GUIDE DESIGNED BY
-
standing or climbing DILMAH FOR THE HEALTH AND SAFETY
• Injury by being struck by / against an object 2
OF ESTATE WORKERS AND THEIR
FAMILIES DURING COVID-19
• Car accident -
• Natural disasters -
Documentation, Education and Policy
Changes
• Exposure to toxic / dangerous material -
Starting with data collection, Dilmah obtained a list of
• Other 2 outsiders who returned to the estate with the lockdown
and curfew being imposed in Sri Lanka on 20th March
2020. Thereafter, the said details were shared with the
HR follow-up procedure
Plantation Health Inspector (PHI) of the area. A Worker
in case of injuries
Welfare Officer was subsequently appointed to facilitate
and assist the respective Estate Managers to introduce
Health & safety officer will conduct safety measures regarding the pandemic. The next step
an investigation to find out the root was educating workers and non-workers regarding the
cause for the accident occurred COVID-19 pandemic and safety standards in place, while
adopting a ‘no visitors’ policy.
Take immediate corrective action to
prevent future probabilities
Worker Welfare, Hygiene and Nutrition
If the period of disablement in Dilmah has provided adequate food and essentials,
working days is more than 3 days, including masks, hand sanitising gel, and disinfectant
Human Resources will inform the to the estate workers and their families. Daily spraying
District Factory Inspecting Engineers of disinfectant and sanitisation of all worker housing &
Office within 10 days from the date factory surroundings is carried out. Dilmah also prepares
of the accident occurred
and offers hot coriander drinks to all field workers on
rainy days for their health.
The accident is reported to the
safety committee by the Health & Educating staff and raising awareness is a top priority at
Safety Officer Dilmah. Sporadic training sessions are being conducted
at Dilmah workspaces to ensure health and safety
guidelines are followed.
Salient Points of Our Health & Safety

Policy
Providing a healthy and safe working
environment by focusing on good
manufacturing practices and establishing a
safety culture, systems and procedures.
Providing necessary infrastructure
and education, necessary to achieve
aforementioned objectives while emphasising
the importance of housekeeping, industrial
hygiene and ensuring maintenance of
established health and safety systems.
Comply with all regulatory and statutory
provisions, governing health and safety of the
individual and the work environment.

During the year under review, the Company had
spent over Rs. 3.5 Mn on PCR tests for testing
of 545 employees, and Rs. 0.9 Mn on 360 Rapid
Antigen Tests. As at August 2021, the total spent
on PCR tests were recorded as Rs. 4.4 Mn.
New Harvesting and Admin System for

Physical Distancing
Handwashing stations with ‘alcoholic hand rub’ have
been set up for use by estate workers prior to plucking.
A new plucking system has been introduced to ensure
safe personal distance is being adopted during plucking Vaccination Programme against COVID-19
/ harvesting by picking from every other row, ensuring The Company has taken measures to make COVID-19
a minimum personal distance of 8 ft. between each tea vaccines more accessible to our employees by facilitating
plucker. The same safe distance is maintained during a special on-site vaccination programme that ensured
weighing and handing-over of harvested green leaf, 1,023 employees of the Group of Companies have
entering and recording of attendance for the day, been vaccinated. As a social responsibility, individuals
issuing of foodstuff to all residents, payment of monthly outside the Company were also facilitated through the
advances and wages, etc. vaccination programme at the Peliyagoda premises,
upholding Dilmah’s commitment to safeguard
COVID-19 OPERATIONAL GUIDE communities.
From the tea gardens to the factories and offices, strict
protocols are followed in making sure the tea produced
A HEALTHY WORKPLACE
remains Ceylon’s finest. Dilmah is taking control of the
‘new normal’, by setting up stringent hygiene and safety Dilmah is committed to maintaining a safe and healthy
protocols, followed by all Dilmah personnel in the Tea workplace by implementing workplace safety procedures
Gardens, Offices and Factories. such as screening employees prior to entering the
premises, equipping employees with adequate sanitary
facilities and providing transport facilities. In addition,
Safety Gear, Monitoring, Hygiene continuous visits and audits are conducted by relevant
Following the Ministry of Health Guidelines, daily MOH Doctors, and recommendations provided with
hygiene practices are strictly followed, where Masks, regard to the upkeep and up-to-date safety precautions
Gloves, and Head Gear have been provided to factory are stringently followed by the Company. The Peliyagoda
employees to be used at all times. Workers are premise is regularly sanitised with the assistance of
subjected to a mandatory temperature check at the tea the Urban Council of Peliyagoda and the compound is
factory entrance, along with washing of hands as per frequently visited by PHI Officers. To ensure the safety
recommended standards via a foot-operated washing and wellbeing of employees and the sustainability of
station installed at the entrance of the factory. Further, measures taken, awareness sessions were conducted on
foot dips are being used to disinfect foot gear through health guidelines and safety precautions.
‘foot bath facilities’ at the entry points.

In compliance with the COVID Guidelines laid down by awareness on safety protocols, with the facility to share
the Government and the MOH, the Company adopted details of any employee who is in distress due to COVID
working from home and a roster for employees, to called “Team MJF Employee in Distress and Requiring
minimise the number of staff physically reporting to Assistance”. Being an inclusive community, posters are
work. Understanding that a safe and healthy workforce displayed in English, Sinhala and Tamil languages, on
is not solely dependent on physical health, virtual events every notice board, lunchroom, and digital screensavers,
such as online yoga sessions and home gardening to further communicate safety measures.
webinars were conducted to improve mindfulness of
employees. Furthermore, special attention was given to DONATIONS AND SOCIAL
the staff using the hostel facility through activities such RESPONSIBILITY DURING THE PANDEMIC
as painting competitions and online yoga sessions while The unforeseen pandemic and the many countrywide
adapting to the COVID-19 guidelines on social distancing lockdowns left many employees helpless. Dry rations
within the hostel building. were distributed among the employees and were
delivered to those who were in areas under rigorous
Additionally, the Company has extended the lockdown.
transportation facilities to the doorstep, for the factory
associates as well as the staff, to ensure safety of the
employees during transportation. The Company has
borne an additional cost of Rs. 1 Mn each month for the
transportation extensions.
EFFECTIVE COMMUNICATION
As the Pandemic continues to spread and the virus
adopts and adapts to various environments, health and
safety regulations are constantly revised and updated.
Latest safety related news and employment related
communication are shared on the “MJF Team Safety”
WhatsApp group and via SMS. A special Page on
Facebook - “Team Dilmah” was created for employee

Capital Management
Manufactured
Capital
Highlights of 2020/21 The Group’s physical

infrastructure; comprising
46
of production facilities,
manufacturing equipment
and other machinery - are
vital components in the value
ENGINEERING addition process practiced at
IMPROVEMENTS
Dilmah. These work spaces,
equipment, and their upkeep,
facilitate the manufacturing
2%
of high quality products in an
uninterrupted, efficient, and
sustainable manner.
INCREASE IN
OVERALL EQUIPMENT 79.1% Overall
EFFICIENCY (OEE) Equipment
Efficiency
0.1%
Rs. 3,328 Mn
Property, Plant
& Equipment
REDUCTION IN
PRODUCTION Advanced
WASTAGE AT THE Manufacturing
FACTORY Technology

Value Delivered
Production Volume 100% Product Customisation

Based on Country / Customer
4,577 MT Requirements
Overall highest Production 100%

performing wastage at the
Delivery In
equipment efficiency factory
Full On Time
97.8% 2.2% (DIFOT)
CAPACITY UTILISATION The efficiency of the manufactured capital has increased

as a result of the increase in overall equipment efficiency,
Capacity utilisation is one of the most crucial aspects of
which has shown a 2% increase compared to the previous
production planning, considering several parameters such
year.
as speed process, design, etc. The company continues
to pay great attention to capacity utilisation, and The upkeep of this equipment enables the human capital
maintenance; as the upkeep and improving of machine to function better and more efficiently, by maintaining
utilisation - with regular preventive maintenance - helps the absenteeism cover at a low level of 10%.
to achieve the optimum performance of the machinery
on the production floor. However, the capacity utilisation
decreased by 38% compared to last year, due to the
pandemic lockdown and work shifts that were re- CAPITAL VALUE ADDITION
adjusted due to National COVID protocol. During the
year under review, the company has made 43 process The Company invested Rs. 385 million as capex during
efficiency related engineering improvements, including 9 the year, under new investments and regular maintenance
defect minimising projects. expenditure, to its manufactured capital.
Y-O-Y Rs.000’s
2020/ 2019/
Indicator Change
21 20 Building 20,149
%
Plant & machinery 300,545
Overall highest
performing Factory equipment 193
97.8% 95.6% 2.2%
equipment efficiency
Furniture & fittings 197
ratio
Oﬃce & store equipment 9,103
Production wastage
2.2% 2.3% -0.1%
at the factory Computer hardware 8,854
Capacity utilisation 42% 80% -38% Computer software 5,914
Delivery In Full On Motor vehicle 40,212

100% 100% 0.0%
Time (DIFOT)
Total CAPEX 385,167
Overall Equipment
81.1% 79.1% 2.0%
Efficiency (OEE)

ENGINEERING IMPROVEMENTS ENGINEERING
Dilmah understands the need for sustainable production
IMPROVEMENTS OF 2020/21
processes, and the positive impact well-maintained
equipment has on its human capital. Therefore, the
company pursues sustainable production processes
relentlessly through upkeep and enhancement of
the manufacturing capital, via many engineering
improvements. The ensuing section illustrates the
46 engineering improvements made during the year
under review, which are mainly categorised into energy
efficiency related projects and process efficiency related
projects.
4
Energy
Efficiency
Related
9
Process
Automation
9
Defect
Minimizing
7 43
Enhancing Process
Production Efficiency
Speed Related
12
Design
Modifications
2
Resource
Optimisation
4
Packaging
Quality

Capital Management
Social & Relationship Capital
Highlights of 2020/21 Tea – whether poured from

• Dilmah handed over 10,000 a teapot or brewed in a mug
testing kits, virus collection – sipped in the presence of
swabs and RNA mini-kits to friends and family, or in the
the Ministry of Health, Nutrition solitude of one’s own company,
and Indigenous Medicine to is symbolic of companionship
strengthen the health sector of and friendship. Dilmah Tea is a
Sri Lanka during the COVID-19 unique brand that thrives on the
pandemic situation.
relationships, partnerships and
• Launch of the disABILITY close-knit networks it nurtures
YouTube Channel for parental among all its stakeholders.
support and the disABILITY This financial year as the world
app for tele-therapy and tele- adapts to a new normal, Dilmah
education for children with placed at the forefront of its
disability, especially Down
operations - the people, that
Syndrome, Autism and Cerebral
are the true essence of the
Palsy.
brand, and the relationships
• Opening of the t-Lounge in and connections with its
Wellington, New Zealand. stakeholders, that make Dilmah
the family business that it is.

109 848 Over 47,000 benefi-
2.3 Bn Tea cups
Distributors Suppliers ciaries in community
served globally
engagement
Value Delivered
Rs.
Advocacy and Investment in 47,611 CSR
affiliation with United community
8,400 Nations Global engagement beneficiaries
initiatives of whom 6,576 received
million Compact (UNGC) Sri
long term and ongoing
payments Lanka and Biodiversity Rs. 255 support through island-
Sri Lanka (BSL)
to Suppliers million wide programmes
MANAGEMENT APPROACH
The true essence of the brand lies in its people; with the upkeep and maintenance of these relationships and
objective of generating shared corporate and ethical human connection were challenged, but Dilmah strived
values, Dilmah strives to nurture meaningful and mutually to take control of the ‘new normal’ and has succeeded
constructive relationships with our diverse stakeholder in nurturing and fostering these networks amidst a
base of customers, suppliers, business partners and pandemic.
communities. In a world plagued by the pandemic, the
Dilmah’s Global Presence
ASIA
CIS REGION
EUROPE
MIDDLE EAST
AMERICA
AFRICA
OCEANIA

CUSTOMERS
Dilmah builds on a principle of no compromise, which Despite the pandemic, Dilmah has continued to grow
extends to its integrity in relation to product, customer, from strength to strength because of its unfailing
community and natural environment. The brand prides commitment to Taste, Goodness and Purpose. As a global
itself in its production of single-origin, authentic, natural citizen, Dilmah aims to create an impact beyond the
and ethical tea and offers its valued customers spanning realms of business, and has achieved this objective thanks
across the globe in 108 countries across 8 regions, a to its loyal customers.
wholesome tea experience.
Quality & Product

Retail Innovation Engagement
Responsibility
• Supermarkets • Innovative and exciting • 3 Quality Management, • Numerous customer
• Hypermarkets products catering to Food Safety & engagement initiatives,
emerging customer Management Certifications tea promotion events,
• Traditional trade
requirements • 1 Environmental competitions &
• Convenience stores
• 48 products introduced Management Certification publications
• Online retail in 2020/21 • First ISO:17025 accredited • Strong social media
• Rs. 10.1 Mn annual Chemical & Microbiological presence with 2.5 million
HORECA investment in R&D laboratories for the tea brand followers
• Hotel groups industry in Sri Lanka • Consumer reached

• 3 Organic Certifications through Tea Radio,
• Restaurants
specialised apps and
• Cafés • 4 Ethical Sourcing &
e-commerce platforms
Responsible Operations
• Airlines
related certifications
Quality and Product Responsibility only as a beverage but also as a gastronomical delight
and experience. Dilmah’s efforts to strengthen its brand
As a brand that builds on value-addition, Dilmah works
reputation globally has also directly contributed towards
extensively to improve the quality of all products, whilst
elevating the position and brand of Ceylon Tea in general.
continuing to reduce our impact on the planet, and
Annually the Group invests close to Rs. 2 billion in
empowering our stakeholders, especially during these
marketing, promotion and brand building initiatives. A
trying times.
few engagement activities held during the year are listed
The end-to-end operations along our value chain ensures below:
adherence to the statutory requirements of the Factories
Ordinance, the Tea Control Act and the Group’s stringent
internal quality standards. During the year under review
there were no instances of non-compliance to any
product responsibility / customer health and safety
related laws or regulations.
Engagement
Over the years, a cup of tea has helped bring people
together and nurtured many companionships. Dilmah
is one of the most sought-after Ceylon tea bands, both
locally and globally. Proactive and ongoing engagement
Elixir & Gourmet Promotions
Thailand - 2020
with customers has enabled to elevate the brand not

Opening of the t-Lounge in Chartered Professional Handing over COVID -19
Wellington Managers Felicitation testing kits to the Ministry of
New Zealand - 17th November 2020 10th August 2020 Health
3rd June 2020
Gastronomical Tea Experiences
Through the 8 t-Lounges Spread The employees of Dilmah Tea and the
Across the World MJF Foundation initiated the 2nd phase
The t-Lounge by Dilmah is an upscale, of the company’s COVID-19 response with
elegant place designed around the the donation of 10,000 testing kits, virus
enjoyment and appreciation of fine tea; collection swabs and RNA Mini kits at a
complemented by light snacks and tea cost of Rs. 44 Million to the Ministry of
inspired food and beverages. Health, Sri Lanka.
Graduation Empower Culinary

& Hospitality School MJF
Centre West
2020
MJF Charitable Foundation Awards of Dilmah Waste to

Presentation to His Excellency Craft
the President, Gotabaya 22nd December 2020
Rajapaksa by MJF and Rotary Dilmah Tea is making a conscious decision
District COVID-19 Task Force to take responsibility for the disposable
1st July 2020 waste created from tea production. The
Waste to Craft initiative takes factory
generated waste, and turns it into
something purposeful like pencil holders
Beach Cleanup Initiative
and bags. This is one of Dilmah’s many
27th January 2020
initiatives to keep material from production
in use for as long as possible, instead of
using it and throwing it away after its use.
Graduation Empower Culinary

& Hospitality School (ECHS)
MJF Centre East
2020
Biodiversity Sri Lanka 5th
Annual General Meeting and
CEO Forum
17th September 2020

Launch of Common Forest Endana Estate & Hunuwela Handing over school
Trees of Sri Lanka - Sinhala Estate - Founder’s Visit stationary & kids Christmas
Edition 11th September 2020 gifts
1st October 2020 22nd December 2020
‘Sri Lankawe Sulabha Wanathuru’

is a Sinhala translation of Dilmah
Conservation’s original book in English
‘Common Forest Trees in Sri Lanka’.
Dilmah Conservation initiated a translation
of the book into Sinhala to educate and
inspire a new generation of botanists
and conservationists that understand
and respect the importance of nature.
Forests are a key ecosystem in regulating
the climate and are locally significant
in supporting the livelihoods of many
communities and sustaining biodiversity
Long Service Awards
and different species.
17th December 2020 MJF Charitable Foundation
A heartfelt Long Service Awards Ceremony Small Entrepreneurship
was held in celebration of 73 people who Programme Grants - Curtiss
have spent between 10 and 35 years Centre Graduation
sharing Dilmah’s dream. Being truly 1st October 2020
humbled by their loyalty and commitment,
the ceremony was held to thank them for
standing by us through thick and thin.
Acknowledging each of our long serving
colleagues, Founder, Merrill J. Fernando
shared his appreciation and Christmas
wishes with those gathered. He was joined
by sons, Dilhan and Malik in presenting
tokens of appreciation.
MJF Charitable Foundation

Staff Small Entrepreneurship
Programme Outcome
2nd October 2020
Marine Environment
MJF Charitable Foundation Protection Authority - Sri
- Celebrating Differences Lanka (MEPA) Appreciation
Virtual Performance Award
15th December 19th September 2020
Dilmah Conservation Peak

Ridge Leopard Conservation
3rd February 2021

Most Admired Companies The 3rd Empower Culinary The Next Generation of Chai
2020 Awards & Hospitality School East from Dilmah’s t-Lounge & Bar
10th February 2021 Graduation 20th February 2021
14th February 2021
Camellia Epicurean, Tea- COVID-19 Best Practices

Inspired Dinner at Cinnamon Best Corporate Citizen at Dunkeld & Kahawatte
Lakeside Sustainability Awards 2020 Plantations
8th September 2020 22nd May 2020
29th March 2021
MJF Charitable Foundation

Disability Teletherapy App -
World Cerebral Palsy Day
6th October 2020

TEA EXPERIENCES
Digital Engagement
Online Platform Tea Inspired Music
16,148
Orders
generated
$749,563 t-Radio
Revenue generated
Tea Inspired Through Mobile Apps Social Media Engagement
Facebook - 2.3M Followers
LinkedIn - 39,837 Followers
Twitter - 4,299 Followers
YouTube - 6,764 Subscribers
Pinterest - 1,827 Followers
Instagram - 127,880 Followers

1 Brand app 1 B2B app 1 t-Lounge 1 Educational
app app
Tea Inspired Dilmah Dilmah DC Arboretum
App Partners App t-Lounge App App
SUPPLIERS
The essence of every cup of Dilmah tea lies in the
Local suppliers and service providers 660
carefully selected ingredients hand-picked from its tea
gardens. Dilmah promotes and safeguards the integrity
of all its suppliers through ethical business practices, Foreign suppliers and service providers 188
which means that Dilmah values the commitment and
hard work of the people behind our teas. The majority of Total value created to suppliers Rs. 8.4 Bn
the Group’s suppliers are tea smallholders and regional
plantation companies through whom we procure tea. A stringent evaluation process for supplier
During the financial year in question, Dilmah continued selection based on;
to support and work closely with these SMEs, despite the • Quality
• Business practices
numerous challenges of the pandemic. Almost 100% of • Ethics
tea is procured from the Colombo tea auction in line with • Social & environmental practices
the Tea Control Act, and a few specialised varieties of tea
such as Darjeeling and Assam which are not available in Supplier Code of Conduct
Sri Lanka are imported. Ensures that all suppliers comply with a fundamental set
of guidelines which reflect the Group’s approach towards
business and sustainability goals.

BUSINESS PARTNERS COMMUNITY
The uniqueness of the Brand lies in the commitment Dilmah’s Philosophy “Business is a Matter of Human
to provide quality and authentic tea that is ethically Service” is reflected in its extensive community
produced. Dilmah ensures its business partners including engagement initiatives. Goodness in every cup of Dilmah
distributors, service providers and regulators, emulate tea is not only derived from garden fresh, unblended
the company’s non-negotiable standards on transparent tea, but also from the positive extension of the business
and ethical business practices in their dealings with to over 47,000 beneficiaries across the country. Over
the company. Built on family values, Dilmah holds all the last year, Dilmah has worked closely with the
partnerships to the highest esteem and has attempted in underprivileged and rural communities that were affected
all endeavours to support and uplift its partners. by the pandemic. Philanthropic initiatives are driven
through the MJF Charitable Fund (MJFCF), which is
Distributors funded entirely by DCTC.
A network of 109 distributors spread across
107 countries in 8 regions. The Group’s CSR projects can be broadly classified into
Engaged through events, conventions and the following long-term purposes;
the Partner App.
Service Providers Entrepreneurship

Tea gastronomy and mixology is promoted
• The Local Heroes programme in recognising
through collaborations with world renowned
unique SMEs
Chefs, culinary experts and hotel chains.
• Grants Programmes - providing financial and
technical assistance to SMEs
Catering to Leading Airlines • Community Based Organisations - supporting
natural and organic farming
• First training and grants programme for Staff of
Dilmah
• Launch of Velendho to support micro enterprises
and individuals affected by the pandemic
• Launch of the Night Market, Moratuwa featuring
49 COVID-19 affected vendors from the area.
• Participation of Women’s Development
Programme Moratuwa in pop-ups hosted by Brew
1867
• Youth and first-time entrepreneurs provided with
mentoring, coaching, tools and other resources
as well as start-up capital to set up their own
enterprise

MJF Kids and Youth
• MJF Kids programmes - offers educational
support
• sessions for Mathematics, Science, English,
Commerce, Life Skills, Music, the Arts and
Dancing in Peliyagoda, Moratuwa, Palansena,
Kalkudah, Siyambalanduwa, Pahalanda, Cape
Weligama and Point Pedro.
• Educational trips and sessions on environmental
awareness
• Adolescent and Sexual Reproductive Health
Training for children and youth, including those
with disability.
• Preschools in Koul Ara, Weligama and Moratuwa
• Street Drama on Suicide Prevention
• Launch of Free-Fridays Kids programmes on
Facebook, giving children free access to fun
activities while at home.
• Vocational training for Youth with Disabilities
• Launch of Tuk-Tuk Books and outdoor learning
for children in Moratuwa and Kumburumoolai
with over 700 participants
• Art Competition for CP Awareness
• Establishment of Study Centres in Plantations for
older children
• Rainbow Centres - free special education, speech
and language therapy, occupational therapy
and life skills programmes for children with
disabilities.
• English, IT, Marketing (with SLIM), Carpentry,
Public Speaking for Youth.
• Empower Culinary School for training in the
culinary arts
• CLF programme works with 5 schools and 417
students and mentors
Capacity Building
• Empower Culinary & Hospitality School
• Curtiss Institute of Design - Equipping the youth
with IT skills
• Swashakthi Bakery & Tea Room – Initiated for
enterprising women providing meals at an
affordable price
• Women’s Development Programme - guiding
women in dire circumstances with skill and
grants. Providing a Skills Upgrade course for
cloud kitchens in Eastern Sri Lanka.
• Mushroom training for 6 Women’s Community
Based Organisations in Eastern Sri Lanka

Changing Lives Tea Estate Workers
• School fees and tuition support to siblings • School bags for children on estates
orphaned by the Easter Bombings of 2019 • Mid-day meal programmes for Child
• Outpatient Department and Administrative Block Development Centres
for the Point Pedro Base Hospital • Childcare Development Healthcare for estate
• Construction of 15 classrooms at the Anjali Aham communities
Counselling Centre in Point Pedro • 5 Field Restrooms + 1 Factory Restroom and
• Refreshed training for 47 Chefs with Chef’s Guild Shower for 250 persons
and S4IG • 90 Toilets serving 360 Households or 1,800
• Launch of the disABILITY YouTube channel for persons
parental support • COVID-19 support to 772 families in Kahawatte
• Launch of the disABILITY app for the tele- plantation estates including 471 worker families,
therapy and tele-education for children with 206 non-worker families, 24 staff families and 35
disability, especially Down Syndrome, Autism and families with retirees
Cerebral Palsy • Scholarships for Advanced Levels and University
• 2 Blood donation Camps for Peliyagoda and Students from 43 estates
Siyambalanduwa with approx. 1,545 prospective
recipients
• Launch of elder’s care and the continued free Our CSR in numbers
physiotherapy for people over the age of 65 who
cannot afford therapy Investment in CSR (Rs. Mn) 255
• Saddhasarana Pitipana Home for the Elders
supporting 16 women Total beneficiaries for F/Y 2020 - 21 47,611
• Partnerships – partnering with like-minded
organisations and individuals in our re-budding Contribution as a % of profits 15%
task
• Sustainability Agriculture – promoting and MJF Centres 14*
funding organic based farming in the North and
East Number of beneficiaries in Centres incl Estates 6,576
• Empowering Sri Lanka’s East – Post tsunami
Beneficiaries with Disabilities 489
reconstruction
• 18 webinars on disability conducted by global Beneficiaries - Vocational Training 1,274
and local experts on a range of topics with over
3,000 participants
• Virtual Art Exhibition featuring 90 students and
*Excluding 3 external programmes and Estate sector
over 750 visitors centres benefitted
3 External programmes
1. King’s Revival Children’s Support Centre
2. Colombo Friend in Need Society
COVID Response & Support 3. Anjali Aham Centre, Point Pedro
• Dry rations to over 6,000 households including
families of staff in Peliyagoda and Plantations
MJFCF - Centres
• CEO Special fund for families especially impacted
by the pandemic: 15 beneficiaries 1. Moratuwa
2. Peliyagoda
• Rs. 40 Million Donation to the Ministry of Health
including PCR Testing Kits 3. Maligawatte
4. Kalkudah
• 47 Chefs trained in in-house 2 weeks course for
skills upgrade 5. Cape Weligama
6. NCCCPDD
7. NCCCPDD Kandy
8. Anjali Aham
9. Pahalalanda
10. Siyambalanduwa
11. Koul Ara
12. Pallansena
13. Pitipana
14. CLF – 5 schools

Capital Management
Intellectual Capital
Highlights of 2020/21 The company delivers a premium

• Launch of 70 Years quality tea combined with the
Commemorative teas, in 21st century culinary innovations
appreciation of Founder, to deliver superior customer
Merrill J. Fernando’s 70th year experiences. As a company that
in Tea believes in the intangible power
• Launch of Ceylon Bold,
of its greatest asset, the people,
supporting orphan elephants in Dilmah’s intellectual capital
Sri Lanka is fuelled by the unparalleled
tea expertise of the founding
• Launch of Arana, Ayurveda-
family and the Dilmah team
inspired wellness, immune-
boosting, herbal teas &
together with other elements
infusions of its intellectual capital, such
as its vast library of over 300
• Launch of Tea Beer in Australia,
unique tea standards, and value
a unique combination of two
of the Dilmah brand represent
brews
key sources of competitive edge
• Paper Canisters in Dilmah and is a critical input to its value
Inspirations range and paper creation process.
enveloped tea bags in the Café
Range

33 years of brand Most recognised The only tea
Over 300 Tea
presence led by Sri Lankan company with
Standards and over
the World’s Most owned global 100% carbon
3,000 products
Experienced Teamaker brand neutral products
Value Delivered
Rs. 10 million 80% of the tea

investments in R&D efforts packs are tear-strip
World’s only 64 R&D Launch of

vertically projects on 8 new
integrated tea material and product
brand – from tea waste reduction ranges of 48
plant to tea cup
and packaging variants
improvements
Management Approach COLLECTION OF TEA STANDARDS

Dilmah Tea is a brand that thrives on authenticity and The Group’s library exceeds over 300 tea standards with
value addition. Founded by the World’s Most Experienced approximately 45 new products generated every year.
Tea Maker, with an overall experience of 71 years, the Our range includes Specialty Gourmet and Premium Tea,
Brand’s existence spans more than 3 decades and boasts Herbal Infusions, Green Teas, Fun Flavoured Teas, Spiced
a global presence in over 100 countries. The Brand strives Chais, Organic Teas and Exclusive Teamaker’s Private
on its intellectual wealth. Currently Dilmah holds stellar Reserve among others.
innovations in Western, South Asian, Ayurvedic and
Organic teas. The Founder and his family are involved in
Tea Standardisation Process
the innovation process, in defining new tea recipes every
Tea standards are created upon evaluation of the
step of the way, because as a company, Dilmah holds the
standard against the specific market requirements and
principle of ‘no compromise’ at high esteem.
their organoleptic characteristics will be confirmed by the
The exceptional organoleptic properties preserved in top management. The tea standards will then go through
Dilmah tea expressed through unique recipes of flavour, an approval process and the approved standards will
aroma and taste are carefully formulated, tested and be circulated amongst new product development and
ultimately approved by the Group’s Chairman or Chief engineering departments.
Executive. The company houses a dedicated team
for Research & Development, who look into business
The Dilmah Brand
evolution and improvement on innovations in the entire
Dilmah exists in over 100 countries and is probably the
tea – making process, from the bud to the cup. The
most well-known Sri Lankan brand in the international
brand dwells on the belief that business is a matter of
market. The three core pillars Taste, Goodness and
human service, and understands the crucial role played
Purpose underpinned with the authenticity and
by nature in shaping our existence; over the years
innovations, results in the final quality of the product
Dilmah has extensively developed new products and
which is unblended, garden fresh and pure Ceylon tea.
made improvements in packaging that ensure minimum
In all its endeavours, the Group adheres to the belief
wastage. This commitment has enabled Dilmah to
that business is a matter of human service and holds
maintain consistency across its product portfolio, offering
its employees and customers in the highest esteem. In
the exceptional quality, freshness and authenticity that
addition to ensuring authenticity and uncompromised
the brand is renowned for.

taste; Dilmah is committed to driving the evolution of Inspiration for the 21st Century” have redefined tea as an
tea, from being a mere commodity to an experience that ingredient in gastronomy and mixology.
goes beyond the cup. In that light, the Dilmah School of
Tea has brought together a network of chefs, hospitality The brand equity is promoted and protected through
professionals and customers, to kindle a passion for continuous and targeted promotions, customer
quality, innovation and creativity, and produce over 5,900 engagement initiatives, competitions and numerous
tea-inspired ambassadors. Competitions such as “Tea publications.
Brand Recognition
• Dilmah’s Natural Infusions won the Australian Consumer Award
for Product of the Year 2020
The Product of the Year is the world’s largest consumer-voted
award for product innovation. The Dilmah Infusions range has
been voted number one in the tea category in 2020.
Taste
The range is unique for its Ayurveda inspired composition,
Unique recipes reflecting the Group’s
unmatched expertise in tea based on authentic and artisanal ingredients including Ceylon
cinnamon, cardamom, clove, nutmeg, moringa, turmeric, black
pepper and coconut amongst others.
• Trusted Brand - New Zealand 2020

New Zealanders have voted Dilmah their “Trusted Tea Brand” for
the 6th year in a row, in the Reader’s Digest survey - an indicator
of consumer trust for the past 21 years..
• Trusted Brands Australia 2020

Goodness Dilmah was voted a ‘Trusted Brand’ in Reader’s Digest’s annual
Promotes the health benefits of tea
survey.
• Dilmah Elixir ranked in Great Taste Awards, UK
• Dilmah has been listed in Forbes’ “Best Under a Billion 2020” in

the Asia-Pacific region
Purpose
Underpinned by the philosophy that
‘Business is a Matter of Human Service
RESEARCH
During the year under review, 40 improvement projects
being studied linked up with three key areas as follows:
MATERIAL SOURCE PRODUCTION EFFICIENCY WASTAGE REDUCTION

REDUCTION PROCESS IMPROVEMENT
25 PROJECTS 10 PROJECTS 5 PROJECTS

INNOVATIONS introduced 268 new products, enhancing the brand’s
reputation as an industry leader in innovation. Key
To innovate is to renew and reimagine. At Dilmah
product development innovations in recent years are
innovations are continuous and play a vital role in
given below;
ensuring that consumers only receive the best tea the
Brand has to offer. Since the inception of the company,
Dilmah has invested and believed in innovations Highlights Dilmah’s Product
that blend the rich traditions, cultural heritage, local Development Timeline
knowledge and the age-old-art of tea making, together
with state-of-the-art technology to produce the best teas. Dilmah Launches the Tea
Having pioneered and actively promoted the concept of
2005 Gastronomy Revolution with
“The Culinaire”
single origin tea, the Company has sought to consistently
expand its range through exciting and innovative product Launch of the Dilmah
propositions. 2007 Exceptional Range of Teas
At Dilmah, innovations are supported with a much Dilmah t-Lounges Launch

broader structure. Dilmah is home to skilled innovators 2015 Overseas
and passionate individuals, who help the company grow
from strength to strength. The culinary innovations are The total product range of
facilitated by a dedicated Research and Development
Dilmah becomes Carbon Neutral
team and a proactive Marketing team. The supply chain 2018 Dilmah launches the first ever
and industry related innovations are realised through tea concentrate - Elixir of
Ceylon Tea
a special unit dedicated for Business Evolution and
Innovations. Dilmah listens and understands requirements
Launch of the Dilmah Inspiration
of specific consumers, and the ability to customise and selection and Ceylon Golden
differentiate its offering based on these requirements
2019 Pekoe Leaf Tea Range
has enabled the Company to emerge as a leader in
Dilmah launches the Green Tea
the HORECA segment, catering to 6 of the largest Variant of Elixir of Ceylon Tea
international hotel groups.
Launch of the Arana, Ayurveda-
inspired Herbal Teas & Infusions
Supply Chain and Industry Innovations range
through Climate Smart Agriculture 2020
Immunity initiative
Asset Optimisation Velendho online platform
Apiculture with During the year under review, Dilmah designed and
Plantation Communities launched the following innovative products:
• Arana, Ayurveda-inspired wellness, immune-boosting,
Drone Technology herbal teas & infusions
• Repositioned products to adapt to COVID-19
Precision Agriculture dynamics and ease the burden on consumers
- Special promotional packages coupling additional
Biochar from Tea Waste
content for countries in distress
- Created smaller packs like Dilmah ten-cup sachets
NEW PRODUCT DEVELOPMENT • Immunity initiative on social media featuring medical
New product development has been a key strategic professionals and in-house experts on health benefits
priority over the last few years. In a world that is of tea
in constant flux, Dilmah understands the need for • Velendho online platform to market and broadcast
change, while prioritising uncompromised flavour and products and services by communities and small
core principles. Within the last 5 years the Group has businesses impacted by the pandemic

Positioning Dilmah as a more responsive and consumer-
conscious brand, the Trends Team was launched
internally where a team of young professionals researches
contemporary consumer trends and product innovations.
New Product Ranges of

Dilmah in 2020/21
Decaffeinated Flavoured Teas Dilmah NZ
Arana Natural Teas and Infusions
70 Years - Commemorative Teas
Taste Adventure in Tea 10S & 10E
Ceylon Bold
Natural Herbal Infusions 1.5g Europe
PACKAGING INNOVATION
Dilmah is currently using minimalist packaging that
complies with food safety regulations in its product
designs. As the Dilmah Group strongly believes
that innovation is the key to growth and managing
humanitarian and environmental challenges we face; it
Flavoured Green Teas is constantly sampling other packaging material with
the aim of reducing the non-recyclable content of its
packaging. At present, 80% of our tea packs are tear-
strip that helps reduce material requirement by weight
which is also cost effective while reducing the impact on
the environment.
Mojito Range of Teas 10E, 10ST & 90g

R&D projects conducted by the Company to identify
sustainable packaging options are as follows:
FILTER PAPER FOIL POUCH ENVELOPE OTHER OVERWRAPPING

RELATED RELATED N RELATED MATERIALS RELATED
5 PROJECTS 2 PROJECTS 8 PROJECTS 8 PROJECTS 1 PROJECTS

Dilmah Packaging Sustainability Journey Paper Canisters in Dilmah
Inspirations Range
Initiated eliminating the plastic of our
2000 tea packs by introducing a tear strip
design
Packaging Breakthrough: Pyramid tea

2007 bags changed to PLA, a plant-based
material.
Packaging that contains 10 tea

envelopes (10E) was changed to
2010 include a window to reduce material
usage
Continuous material reduction

2011 measures in tea tags, bags and packs.
Paper Enveloped Tea Bags in Café Range
Environmental impact of end product
2015 included in the selection criteria
when investing in new machinery.
Eliminating the plastic overwrap in

2018 80% of tea packs using tear strip
design
All inner cartons were delivered by

suppliers wrapped in kraft paper
which has now been discarded and
2019 75% changed to reusable corrugated
inner cartons and a system in place to
return to suppliers.
Eliminated 421,052 Kgs of plastic PACKAGING TARGETS

from packaging
On Dilmah’s journey of sustainability, through world-class
2020 Production lines were converted to
research, innovation, resources and technology, Dilmah
use 100% PLA based filter paper in
year 2020 remains committed to achieving 100% biodegradability
in all the elements of the production line. The Company
Switched from tin tea caddies to also continues research on tea bags and packaging
paper canisters in 3 SKU’s of Dilmah material composability in home & industrial composting
Inspirations Range launched in
2021 Australia
environments every year. In addition, Dilmah plans to
Paper enveloped tea bags (switched implement ECOVATION (Eco-Innovation) Awards in 2021,
from foil envelopes) for 8 variants in welcoming innovative ideas on sustainable packaging
Café range and waste management.

INNOVATION IN TEA GASTRONOMY AND In October 2020, Camellia Epicurean celebrated taste,
MIXOLOGY goodness, and purpose in tea. Continuing a tradition
of Camellia sinensis – tea-inspired gastronomy that
Dilmah has focused on the potential in quality tea, to
began a decade ago, Dilmah strengthened the brand’s
reverse commoditisation in the industry. Dilmah offers its
collaboration with Sri Lankan chefs, gastronomy and tea
consumers unblended tea that is ‘picked, perfected and
at a uniquely tea inspired event.
packed’ at source. This practice is furthered with Dilmah’s
focus on the experience of fine tea maintained through Tea Inspiration for the 21st Century (Ti21) designed by
tea Gastronomy, Mixology, and Tea inspiration for the 21st Dilmah, expresses the natural sophistication and taste in
Century (Ti21). fine tea through gastronomy and mixology. The ensuing
section illustrates the culinary innovations that were born
In September 2020, Pirate Life Brewing partnered with
during the year 2020/21.
Dilmah Tea launching Tea Beer in Australia, a unique
combination of two brews.
Tea Inspired Culinary Innovations in 2020/21
“Break Me” - Flavours of cocoa paired Tea inspired seafood served with Dilmah Uda Watte Tea Sangria
with Dilmah Moroccan Mint Green Tea. a Rose with French Vanilla Tea
Gazpacho – A culinary innovation
New dimensions of cocoa can be
with our Rose with French Vanilla Tea,
experienced when paired with tea:
combined with prawns and arugula
from myriad flavours and textures
salad.
of the handmade chocolate, a sip of
hot Moroccan Mint Ceylon Green Tea
hastens the melting of chocolate, and
this experience is completed with
a spirited digestif of a tea cocktail,
Dilmah Moroccan Mint Green Tea
infused with Ceylon Arrack.
Vegan Salted Caramel Chai
A decadent 21st Century Sachertorte

Serving: A classic Austrian dessert with
the delicate aroma of Cinnamon with
our Ceylon Cinnamon Spice Tea.
Elixir Apple Pie

Exceptional Lively Lime and Orange Teamaker’s Gelato: featuring Dilmah Dilmah Lively Lime and Orange Tea
Fusion - Tea Pairing: A high grown Earl Grey Tea, drizzled with a special paired with a Tea Infused Spiced Chai
Ceylon Pekoe grade, offering a bright Ginger and Orange infused Brown Crème Brûlée
and golden liquor in exotic embrace Sugar Caramel. This legendary, tea
with Orange, Lemon and Lime paired inspired gelato is made with love in
with different types of cheese such collaboration with Isle of Gelato to
as Brie, semi mature goat gouda commemorate Dilmah Founder, Merrill
or Shropshire blue, English orange J. Fernando’s 90th Birthday and 70th
coloured blue cheese. year in tea.
CERTIFICATIONS AND STANDARDS

Our continued commitment towards quality and product responsibility, tied with
our strong belief that business is a matter of human service, has enabled us to
maintain compliance with a range of international certifications as listed below.
Quality Management and Food Safety Management Certifications
Certificate LK15/711040965
This is to certify that
MANAGEMENT SYSTEM MJF Holdings Limited

Dilmah Ceylon Tea Company PLC
CERTIFICATE MJF Exports (Private) Limited,
MJF Teas (Private) Limited,
Certificate No: Initial certification date: Valid: Dilmah Fine Teas and Herbs (Private) Limited
Certificate No: Initial date: Valid:
184139-2015-AQ-LKA-RvA 22, July, 1997 21, September, 2018 - 20, September, 2021
202389-2016-FSMS-IND-RvA 19 June 2013 23 October 2020 - 18 June 2022
No. 111, Negombo Road, Peliyagoda, Sri Lanka.
SITE CODE 4390815
This is to certify that the management system of has been assessed and certified as meeting the requirements of
This is to certify that the management system of Global Standard for

Food Safety
MJF Holdings Limited
Dilmah Ceylon Tea Company PLC Dilmah Ceylon Tea Company PLC Issue 8: August 2018
Achieved Grade AA
111, Negombo Road,Peliyagoda, 10600, Sri Lanka Audit Programme: Announced
MJF Teas (Pvt) Ltd
For the following activities
Processing and Packaging of Tea, Flavoured Tea and Herbal Infusions in
value added form- in bags, packets and bulk.
MJF Exports (Pvt) Ltd has been assessed and determined to comply with the requirements of Product Categories: 15
Exclusions from scope: None
Dilmah Fine Teas & Herbs (Pvt) Ltd FOOD SAFETY SYSTEM CERTIFICATION 22000 Date of Evaluation 08 December 2020
111, Negombo Road, Peliyagoda, Sri Lanka Certificate Issue Date 10 February 2021
Certification scheme for food safety management systems consisting of the following Re-Evaluation Due Date: From 24 November 2021 to 22 December 2021
elements: ISO 22000:2018, FSSC 22000 V5 - ISO TS 22002-1:2009 (Food) and Certificate Expiry Date 02 February 2022
This certificate supersedes all other certificates bearing this certificate number with earlier certificate issue AUDITOR NUMBER
additional FSSC 22000 requirements. dates. 176805
has been found to conform to the Quality Management System standard: If you would like to feedback comments on the BRCGS Standard or the audit process
directly to BRCGS, please contact tell.brcgs.com
ISO 9001:2015 Visit brcdirectory.com to validate certificate authenticity
This certificate is applicable for the scope of:
Processing and packaging of tea, flavoured tea and herbal infusions.
This certificate is valid for the following scope: Category CIV
Design, development, processing and packaging of tea, flavoured tea & Authorised by
herbal infusions
This certificate remains the property of

SGS United Kingdom Ltd
Rossmore Business Park□Ellesmere Port□Cheshire□CH65 3EN□UK
The certification system consists of a minimum annual audit of the food safety management systems and a minimum annual t +44 (0)151 350-6666□f +44 (0)151 350-6600□www.sgs.com
verification of the PRP elements and additional requirements as included in the scheme and applicable technical specification for
sector PRPs. Validity of this certificate can be verified in the FSSC 22000 database of certified organizations available on HC SGS BRC FOOD issue 8 1020
www.fssc22000.com.
Page 1 of 1
Place and date: For the issuing office: Date of Certification Decision: For the issuing office:
Chennai, 26, September, 2018 DNV GL – Business Assurance 23 October 2020 DNV GL - Business Assurance
ROMA, No. 10, GST Road, Alandur, Zwolseweg 1, 2994 LB Barendrecht,
Chennai - 600 016, India Place and date: Netherlands
Barendrecht, 26 October 2020
Sivadasan Madiyath
Management Representative Erie Koek This document is issued by the Company subject to its General Conditions of
Management Representative Certification Services accessible at www.sgs.com/terms_and_conditions.htm.
Attention is drawn to the limitations of liability, indemnification and jurisdictional
issues established therein. The authenticity of this document may be verified at
http://www.sgs.com/en/certified-clients-and-products/certified-client-directory.
Any unauthorized alteration, forgery or falsification of the content or appearance
Lack of fulfilment of conditions as set out in the Certification Agreement may render this Certificate invalid. of this document is unlawful and offenders may be prosecuted to the fullest
Lack of fulfilment of conditions as set out in the Certification Agreement may render this Certificate invalid. extent of the law.
ACCREDITED UNIT: DNV GL Business Assurance B.V., Zwolseweg 1, 2994 LB, Barendrecht, Netherlands. TEL:+31(0)102922689.
ACCREDITED UNIT: DNV GL Business Assurance B.V., ZWOLSEWEG 1, 2994 LB, BARENDRECHT, NETHERLANDS. TEL:+31102922689.
www.dnvgl.com/assurance
assurance.dnvgl.com
ISO 9001:2015 Quality FSSC 22000 – Food BRC Global Standard for
Management System Safety System Food Safety
Certification Certification

Laboratory Accreditation Certification Environmental Management Certification
ISO:17025 Chemical and ISO 14001:2015

Microbiology Laboratory Environmental Management
Certificate of Accreditation System Certification
Organic Certifications
USDA, AMS 7 CFR Part 205, Regulation (EC) No 834/2007 Japanese Agricultural
National Organic Programme and Regulation (EC) No Standard of Organic
889/2008 Agricultural Products (JAS)
Ethical Sourcing and Responsible Operations Related Certifications
Certificate CARBON NEUTRAL CERTIFICATE CARBON NEUTRAL CERTIFICATE

For Presented to : Dilmah Ceylon Tea Company PLC Presented to : Dilmah Ceylon Tea Company PLC
Dilmah Ceylon Tea Company PLC Presented by : Sri Lanka Climate Fund Presented by : Sri Lanka Climate Fund
111, Negombo Road, Pelyagoda, Sri Lanka

Sri Lanka Climate Fund certifies that Dilmah Ceylon Tea Company PLC Sri Lanka Climate Fund certifies that Dilmah Ceylon Tea Company PLC
NC-C-101822 has offset its Product Level GHG emission of 31,435 tCO2e has offset its Organization Level GHG emission of 3,199 tCO2e
for the year 2019/2020 from Certified Emission Reductions (CERs) of for the year 2019/2020 from Certified Emission Reductions (CERs) of
CoC-Single Run-of-the river Hydroelectric Power Project in Uttarakhand, India Run-of-the river Hydroelectric Power Project in Uttarakhand, India
Issue date: 12/20/2018 Registered Under Clean Development Mechanism (CDM). Registered Under Clean Development Mechanism (CDM).
Expiration date: 12/19/2021 Product Carbon Footprint Assessment Assessment of Organization Level GHG Statement
Rainforest Alliance Standard(s): RA Chain of Custody Standard 2015 Scope Product Scope Organization
Methodology ISO 14067:2018
Product(s) and process(es) approved: Tea, Flavored tea and Herbal Infusions Methodology ISO 14064-1:2018
Product System Boundary Raw material acquisition, finished goods Organization Boundary Financially controlled business operations
manufactory and distribution up to all the of Dilmah Ceylon Tea Company PLC
destination ports of the overseas export
Client Location: Sri Lanka Period of Assessment 01.04.2019 – 31.03.2020
market
Inspection Body Authorized by Rainforest Alliance (if applicable): Wood Certification Pvt. Ltd Verified by Sri Lanka Climate Fund
Period of Assessment 01.04.2019 – 31.03.2020
Revision date: 12/20/2018
Verified by Sri Lanka Climate Fund
Certificate No : SLCF/CNC/0022 Certificate No : SLCF/CNC/0021

Laura Terrall Kohler
Date of Issue : 10.03.2021 Date of Issue : 10.03.2021
Director, NEPCon Assurance
This certificate is issued within the scope of Rainforest Alliance’s accreditation for ISO/IEC 17065:2012 by
the IOAS.
Country: USA Registration Number: 85 Valid until: 9/30/2022
………………………… …………………………
Chief Executive Officer Chief Executive Officer
Sri Lanka Climate Fund Sri Lanka Climate Fund
info@nepcon.org - +45 8618 0866
This certificate is the property of the Rainforest Alliance. This certificate and all copies or reproductions of this certificate shall be returned or destroyed if
requested by the Rainforest Alliance. © Rainforest Alliance. All rights reserved.
Sri Lanka Climate Fund, Ministry of Environment, ‘Sampathpaya’, No.82, Rajamalwatta Road, Battaramulla Sri Lanka Climate Fund, Ministry of Environment, ‘Sampathpaya’, No.82, Rajamalwatta Road, Battaramulla
Phone: 011 2053065 E-mail: info@climatefund.lk Phone: 011 2053065 E-mail: info@climatefund.lk
; ;
SMETA - SEDEX Rainforest Alliance Carbon Neutral Carbon Neutral

Members Ethical Trade Chain of Custody Product Certification Facility Certification
Audit Certification

Capital Management
Natural Capital
Highlights of 2020/21 Two leaves and a bud mark the

• Category Award for beginning of Dilmah Tea and
Environment Beyond the its enduring connection with
Business in the Best Corporate nature and mutual respect for
Citizen Sustainability Awards the environment that guides
2020 the everyday business decision
• Marine Environmental Protection making process. Tea is a product
Authority (MEPA) of Sri Lanka of nature and cannot be made
recognised Dilmah’s dedication by man without the influence of
to Marine Conservation and nature; it is the terroir in which
Coastal Area protection with an each tea bush is grown that
award to the Dilmah Founder, determines the strength, texture,
Merrill J. Fernando. fragrance and flavour of the tea.
• Achieved 100% Carbon Neutral
status up to the destination
ports of all overseas markets
• Rs. 26 million investments in

environmental conservation
• Increased reliance on renewable

energy.

19,000 Hectares
4,360 MWh
of Tea in Subsid-
Energy
iary / Associated
Consumption
Companies
21,830 m3 31,435 tCO2e

Water Discharge of
Consumption Emissions
Value Delivered
96.3% 15 Publications
of Total Waste Recycled on Environmental and
/Repurposed Heritage Conservation
5% 9% 5
Reduction in Reduction Ongoing
Total Energy in Water Biodiversity
Consumption Consumption Related Projects
Since its inception Dilmah has valued each component safeguard and protect the environment that blesses tea
of nature and treated the environment as an integral part drinkers around the world with fresh tea that is rich in
of its business ecosystem. Dilmah has a well-developed flavour, aroma and the subtle characteristics that form
environmental management system adopted within the the terroir of fine tea.
company, aligned with the ISO 14001 certification. Dilmah
has taken safeguarding natural capital to the next level by The Company has understood the importance of
being a corporate leader in environmental conservation integrating sustainability agendas to the business
and climate change adaptation advocacy. plan, long before the commercialisation of ethical and
sustainable practices. Governed by a comprehensive
Dilmah Conservation, the dedicated arm of the company environmental management policy, Dilmah makes every
for environmental restoration and protection, addresses effort to ensure its environmental commitment will
all opportunities and issues in the thematic area within continue to be fully compliant with the requirements of
the mosaic of Dilmah’s value chain, and is further ISO 14001:2015 Environmental Management Systems.
committed to facilitating national and global conservation Below is an illustration addressing different areas of
commitments. Dilmah Conservation is committed to priority of Dilmah’s Environmental Management System.
environmental education and propagating best practices
in biodiversity conservation, emission management and The Company is committed to upholding its
addressing consequences of climate change. environmental management system in a cohesive
manner, with every department playing a role towards
ENVIRONMENTAL MANAGEMENT its environmental agenda. This is done through
APPROACH packaging developments, sustainable energy and waste
From the inception of the Company, people and the management through target-setting for waste reduction,
planet have been at the heart of Dilmah’s operations. monitoring environmental parameters and making
Being a mere tool in the entire production process of improvements where possible.
Ceylon’s finest tea, Dilmah takes extra measures to

Atmospheric Emissions
dependence on fossil fuel, the Group purchased carbon
& Climate Change credits through UN approved Cleaner Development
Mechanisms (CDM), thereby offsetting its carbon
Waste Management footprint.
The environment is central to Dilmah’s business, and the

Material Management Company has pioneered a comprehensive commitment
Environmental
Management to minimising the impact on the planet. Thus far, Dilmah
Framework has actively offset its carbon emission through multiple
Noise Management
Dilmah Conservation projects such as; solar energy
implementation, hydroelectricity plants, rewilding tea
Water Management
gardens, restoring wetlands and many more. Dilmah’s
continuous commitment to research and development
Energy & Fuel enabled it to venture beyond the traditional means of
Management
offsetting, to more innovative approaches such as the
application of Biochar in tea gardens.
Ethical behaviour is a key principle upon which the
company is built, and creating an impact beyond the Our pledge of sustainability and fostering the endearing
realms of profit maximisation is an integral part of that connection with nature, have ensured that Dilmah’s
value. Testimonies to the Founder’s pledge in making production facility and its entire range of products
his business a matter of human service can be seen are Carbon Neutral since 2018. During the year under
in the work done by the Company, in the name of review, the scope of carbon neutrality status for Dilmah
humanity and conservation. Besides the adopted system, products has been extended up to the destination ports
Dilmah’s environmental agenda goes far beyond its of all overseas markets, demonstrating a significant
operations; as realised by Dilmah Conservation through commitment towards the pledge of being Carbon
biodiversity conservation, climate research / education Negative by 2030.
and safeguarding the natural capital of the supply chain.
It was concluded that there were no instances of non-
compliance to any environmental laws / regulations Our Commitment
during the year under review. Dilmah is an active member of the Climate
Emergency Taskforce of the UNGC Sri Lanka.
In 2021, Dilmah will commit to UNGC Science
EMISSIONS AND CLIMATE CHANGE Based Targets initiative (SBTi) further committing
to align the Company’s voluntary greenhouse gas
The goodness in a cup of fine tea is highly dependent on reduction targets with climate science.
one plant, Camellia sinensis, with its varying characters
that changes in aroma, taste and appearance, depending
on changes in the environment. Climate change and
carbon emissions have direct and lasting impacts on the
tea industry and being a Company that aims to do what is
best for people and the planet, Dilmah takes measures to
safeguard the natural environment in all its endeavours.
The Group marked a significant milestone in 2018,

achieving 100% carbon neutrality for its entire product
range, being the first Sri Lankan Tea Company to achieve
this status. This was achieved following a concentrated
organisation-wide effort towards reducing the Group’s
emissions. The Group engages an independent third-
party in measuring the carbon footprint, which is
computed based on the GHG Protocol published by
the World Resource Institute & World Business Council
for Sustainable Development. In addition to reducing

Journey to Carbon Neutrality
2019: Dilmah achieves 2020: Dilmah achieves carbon

2017: Peliyagoda
carbon neutrality for the neutrality for the facility and all
factory and head
facility and all products products up to the destination
office certified as
up to Australia shelf ports of all overseas markets
Carbon Neutral
ISO 14067: 2018 ISO 14067: 2018
ISO 14064-1: 2006
ISO 14064-1: 2018 ISO 14064-1: 2018
Dilmah pledges
to be Carbon
Negative by 2030
Dilmah’s Journey to Carbon Neutrality (Zero emissions
for the entire
manufacturing
process)
2018: Dilmah achieves 2020: Dilmah 2020: Carbon
carbon neutrality for all achieves carbon Footprint
products and factories neutrality for the Calculation mode
ISO 14064-1: 2006 event School of Tea was digitised
that Dilmah exports up to their destination ports. In

addition, Dilmah’s carbon footprint calculation mode was
Key Initiatives Adopted digitised in 2020.
• Energy efficiency in plant operations
• Energy efficiency in transportation
Product Carbon Footprint 2020/21
• Substitution of fossil energy with
renewable energy Material acquisitions & pre-processing
• Recycling of waste 27,395
(tCO2e)
Production (tCO2e) 3,199
The health of the environment lies at the core of the Total GHG Emissions (without final
30,594
Brand’s business strategy, and the Company works product distribution emissions) (tCO2e)
tirelessly on four key areas, energy, transport, water Distribution & storage link to Australia
and waste, with comprehensive plans detailing goals, 841
(tCO2e)
milestones and mitigation strategies in order to reduce
Total GHG Emissions (with final product
emissions. 31,435
distribution emissions) (tCO2e)
During the year under review, the Group’s total carbon
footprint of 31,435 tCO2e has shown a 11% increase
compared to the previous year which was 28,393 tCO2e, Organisational 2020/ 2019/ Y-O-Y
due to the expansion of the scope of Carbon Neutral
Carbon Footprint 21 20 %
status up to the destination ports of all overseas markets.
Direct Emissions (tCO2e) 807 705 14%
The computation at the initial stages of the Carbon Indirect Emissions

2,392 2,183 10%
Neutral journey had been limited to the institutional (tCO2e)
carbon footprint. In 2018, the company sought to
Total Institutional GHG
expand the scope of the computation by including the 3,199 2,888 11%
Emissions (tCO2e)
product carbon footprint on a cradle-to-gate basis. In
2019, the scope of product carbon footprint has been
Carbon Negative Dilmah 2030
expanded from raw material acquisition to finished good
Being a completely Carbon Neutral product, Dilmah is
manufacturing and distribution up to the local port,
committed to further reducing carbon emissions, and
and storage and distribution in Australia up to retail
has pledged to become Carbon Negative in all main
stores. During the year under review, the scope has been
operations of Dilmah by 2030(Zero emissions for the
expanded to capture emissions related to all countries
entire manufacturing process). During the year under

review, Dilmah has developed its Carbon Negative Action During the year under review, Dilmah has developed
Plan 2030 covering the main operations and identified the Solar Power model with a detailed solar expansion
opportunities to develop GHG emission mitigation plan. As a step of the solar expansion plan, Renewable
strategies in key focus areas such as renewable energy, Energy Targets have been developed that are expected
water, transport and infrastructure. to meet 49% reliance on renewable energy by 2022, 78%
by 2025 and 134% by 2030. This project is affiliated with
the Carbon Negative Action Plan 2030 to negate the
ENERGY AND FUEL MANAGEMENT
GreenHouse Gas emissions of the production facility.
The renewable energy practices in-place at the Dilmah
Premises in Peliyagoda were successfully expanded
Renewable Energy Targets
across the Group. The entire renewable energy initiative,
tailored and led by Dilmah, is followed by the group of By By By
companies. 2022 2025 2030
The Group will continue to drive its efforts on increasing Capacity of Solar panels to
1022 1102 2092
the reliance on renewable energy while reducing the be installed (KW)
dependence on fossil fuel. The Group operates 4 Cumulative Capacity (KW) 1848 2950 5042
hydropower plants with a combined capacity of 260
Reliance on Renewable
KW. The Group also functions as a solar plant with a 49% 78% 134%
Energy
combined capacity of 826KW. During the year under
review, total renewable energy has shown a share of
17% in the total energy consumption. The 52% increase
SAFEGUARDING THE NATURAL CAPITAL
in total renewable energy consumption along with a 3%
OF THE SUPPLY CHAIN
reduction in grid electricity and a 58% reduction in diesel The Company is truly committed to the values of Taste,
consumption has led to a 5% reduction in the total energy Goodness and Purpose, with no compromise. Through
consumption in 2020/21 compared to the previous year Dilmah Conservation’s initiatives, the Company has been
(2019/20) keenly engaged in safeguarding 19,000 hectares of tea in
subsidiary/associated companies.
Energy Consumption by Source By adhering to the Chain of Custody standard of the
Rainforest Alliance, Dilmah maintains traceability of
Y-O-Y
2020/ 2019/ its products throughout the supply chain, to support
Change
21 20 the mission of improving natural ecosystems of the tea
(%)
estates. (Please refer pages 79 and 80, for International
Non-renewable Energy Standards & Certifications)
Grid Electricity GJ 12,138 12,475 -3%
Diesel GJ 948 2,284 -58%
Renewable Energy Hydropower

Dilmah began its hydropower journey by setting
Solar GJ 1,610 1,431 12%
up of two hydroelectricity plants at the Dilmah
Hydro GJ 1,001 283 253% Queensberry and Craighead estates in 2016, and
hydroelectric power generation at the two plants
Total Energy GJ 15,697 16,473 -5% commenced in 2018.
Furthermore, steps have been taken to establish
Total Renewable
2,611 1,715 52% more hydropower stations within our estates
Energy GJ with a combined capacity of 260 KW. So far,
total generation of 814.8 MWh of Hydropower
% Reliance on
17% 10% 60% was generated collectively from four power
Renewable Energy stations given in the table below:

Capacity Generation
Power House
(KW) (MWh)
Green Recovery Project at
Craighead 70 137.7 Hunuwela Estate
Understanding that the restoration of healthy
Queensberry 50 59.9
ecosystems is vital, this project is focused on
Kataboola 70 444.4 the concepts of afforestation and facilitative
reforestation. The project is aimed at making use
Wellandura 70 172.8 of underutilised tea lands and other abandoned
lands for active agro-forestation and other
afforestation activities leading to large carbon
sinks in the long run.
The project was initiated in January 2021 with the
Biochar Application completion of a Biodiversity survey.
Dilmah Tea started applying biochar - a
nutrient rich soil enhancer which can also offset
greenhouse emissions - to its plantations in 2010.
Dilmah has also started making its own biochar
from waste tea generated during production Rainwater Harvesting at Kahawatta
processes.
Plantations
Large scale applications were completed in Kahawatta Plantations – a subsidiary of the MJF
several Dilmah Plantations, i.e. Rilhena Estate Group, fulfilled part of its water requirement
and Kahawatte Plantations, which have yielded through rainwater harvesting with a collective
extremely positive results for productivity. capacity of 129,799 m3. Gravitational dam, earthen
At present, research is being conducted by dam and rooftop collection methods were used
Dilmah Conservation at the Endana Estate on the in different estates according to the geographical
potential usage of biochar as a multi-beneficial feasibility of the area.
soil amendment in tea fields to increase yield and
quality of tea.
Biochar has a technical potential to reduce the Estate Capacity (m3)
average greenhouse gas emission by 1.0 - 1.8 pg
CO2 (eq) per year, per hectare (picograms of Barcaple 15,038
carbon dioxide equivalent per year, per hectare).
Craighead 12,613
Imboolpitiya 14,331
Kataboola 2,325
Westhall 85,330
Queensberry 161
Galamuduna 1,222
Total 129,799

Research Hub for the
13 Research Apiculture project
Endana Nature Corridor Projects ‘Bee a Keeper’ is a cross-cutting
Dilmah has pioneered ecosystem restoration conducted on initiative to promote the sustainable
through the biological corridor that was
established to preserve natural habitats and Climate Change use of bees in agriculture and
related ecosystems. Its main goals
enhance the biodiversity of tea estates. are monitoring the decline of bees,
Acknowledging that the success of the nature addressing the lack of taxonomic
corridor is dependent on the engagement of information on bees, assessing the
local communities, tea planting programmes Partnered in economic value and the economic
were conducted in parallel to a socio-economic 2 Global impact of apiculture and conserving
bees in Sri Lanka.
survey on community involvement. During the year
under review, the project has shown progress by Studies
To encourage beekeeping in
spanning to conduct a community Beekeeping different communities and to spread
project, establish a model organic garden, conduct awareness on the importance of
4 research studies and establish a plant nursery these pollinators, during the year
with over 1500 plants. under review, the project marked
A Self-Sustained its next milestone of extending
Centre Fuelled to the community by conducting
community beekeeping training
by Green Energy to provide them with a livelihood
Climate Smart Agricultural opportunity.
Techniques
Remote sensing for precision agriculture WATER MANAGEMENT
Dilmah has taken steps to introduce advanced
The Group’s water consumption is limited to cleaning
remote sensing technologies for sustainable and
efficient crop management in the plantations of manufacturing and operational units, drinking and
by creating a farm / estate management system sanitation requirements of employees - as the Group’s
(FMS).
core operations of blending and packing is not largely
This includes integration of data received water-intensive. Thus, water is sourced primarily through
from satellite, drone and GPS technologies
and incorporating them into a single platform the National Water Supply and Drainage Board and
through which the farmers / estate owners can ground water to a lesser degree. Further details of this
have a field-by-field database containing various distribution are given in the following table. SDG 6, ‘Clean
information, including aerial image orthomosaics,
satellite imagery, field health statistics, soil nutrient Water and Sanitation’ calls for improving water quality
statistics, prescription maps, real time weather by reducing pollution, and substantially increasing water
data etc. under a single application. use efficiency. During the year under review, the water
consumption has shown a 9% reduction compared to the
last financial year 2019/20.
CLIMATE RESEARCH AND ADAPTATION
Water Withdrawal by Source
Dilmah Conservation Centre for Climate Y-O-Y
Change Research and Adaptation (CCCRA) 2020/ 2019/
Source Change
21 20
Research is a vital part of any conservation initiative. (%)
Hence, in October 2017 as a part of its commitment Municipal Water (m3) 16,647 18,453 -10%
to contribute to global and national climate change
Ground Water (Well)
adaptation strategies, Dilmah Conservation inaugurated 5,183 5,475 -5%
(m3)
this research and adaptation centre. As the first private
sector initiative of its kind, this centre will be used to Total Water
21,830 23,928 -9%
better grasp the depth of the problems in climate change, Withdrawal (m3)
and provide feasible and effective solutions. The centre is
proactively working towards increasing climate awareness
and resilience in communities through education and
capacity building, driving novel research and facilitating
timely climate interventions.

Water Discharge by Quality
The Dilmah facility includes a wastewater treatment plant
Coffee Ground Mushroom
ensuring that discharged effluents meet the required
Experiments
standards as recommended by the Environmental
Dilmah Conservation conducted a laboratory
Protection License (EPL). Quarterly external testing is investigation from IDB to identify whether the
also carried out to assure safe discharge of effluents. coffee grounds from Brew 1867 were suitable to
be used as a substrate for growing mushrooms.
In order to conduct the feasibility study, 50kg of
coffee ground was transported to Badulla. A pilot
WASTE MANAGEMENT test was conducted which was successful, and the
The Group’s waste is mainly generated in production and pink oyster mushroom species was cultivated in the
coffee grounds.
packaging operations other than the general activities.
The Company is committed to growing as a business,
but not at the cost of the people and the planet; over
the past two decades the Company was involved in
intrinsic R&D measures to minimise the use of plastic
in production and packaging, that has resulted in a
product that is more than 98% compostable. To ensure a
responsible disposal of waste, Dilmah has adopted the 3R
approach of Reduce, Reuse & Recycle along with other
methods such as energy recovery, treatment & disposal.
Waste by Method of Disposal

Waste Mate- Method of Volume
%
rial Disposal (MT)
Cardboard and
Recycle 99.24 36.80%
Paper
Packaging Upcycled /
46.14 17.10%
Waste reprocessed Pallet Wood Structures in One
Wood Waste / Earth Centre - Moratuwa
Reuse 9.69 3.60%
Pallets The waste wood pallets are sent to One Earth
Centre Moratuwa to build gardening structures
Plastic / that serve as educational materials for the
Recycle 45.43 16.90% workshops conducted at organic farm and the
Polythene
Sustainable Agricultural Research Centre at One
Composite Energy Earth Centre Moratuwa.
4.08 1.50%
Material recovery
E-waste Recycle 0.56 0.20%
Reprocessed
Tea waste 61.6 22.90%
/ Refused
Food Waste Animal feed 2.5 0.90%
Sanitary Waste Incineration 0.32 0.10%
Total Waste 269.56
Total Re-used 9.69 3.60%
Total Recycled/
259.55 96.30%
Reprocessed

Material Quantity (MT)
Dilmah Waste to Craft Cardboard 1,668.63
‘Waste to Craft’ is the company’s creative
implementation under the circular economy Paper 573.06
concept taking place right at the centre of
Composites 211.85
Dilmah’s operations at the head office in
Peliyagoda. A dedicated focus has been given to Herbs 65.36
the Dilmah factory where the factory generated
waste is converted into craft objects such as pencil Polythene 57.88
holders and bags.
Wood 18.84
As part of the initial phase of the Waste to Craft
project, Dilmah Conservation held a ‘Waste to Tin Caddy 44.56
Craft’ Exhibition in September 2020 to showcase
the craft items Dilmah’s production, engineering Porcelain 14.93
and housekeeping departments worked hard to
create. Thread 10.93
Flavours 31.08
Plastic 4.55
Glue 9.26
Glass 2.93
Metal 3.33
Aluminium Wire 2.41
Cloth 0.59
Ink 0.41
Rubber 0.03
MATERIAL MANAGEMENT BIODIVERSITY

The primary raw material is tea, a product of Nature and The Taste, Goodness and Purpose, of a cup of Dilmah tea
a gift to mankind. Dilmah is committed to producing is derived from the healthy ecosystems from which the
fresh, authentic and ethical tea. The raw material, tea, is two leaves and a bud are picked, and these ecosystems
procured via tea auctions and sourced directly from the thrive because of the presence of rich biodiversity. Hence,
tea estates affiliated to the Group. Packaging material safeguarding Sri Lanka’s biodiversity and natural habitats
that consists of a range of constituents which include is integral and therefore a key focus area of Dilmah
filter paper, inner cartons, envelopes, tags and corrugated Conservation.
outer cartons are procured through different large and
Just as an ecosystem is interdependent on all its
SME suppliers. Dilmah strives in all its processes to drive
components, the health of our planet is dependent on
towards a circular economy. Safety and sustainability of
partnerships and collaborations that enable knowledge
our products are maintained through sourcing the best
sharing and support for conservation. The Group has
available packaging materials for our teas while pursuing
played an essential role in creating a national-level
methods to use recyclable and biodegradable packaging
dialogue on biodiversity by being the corporate leader
materials. Dilmah’s Luxury Leaf Tea bags are made from
in environmental conservation advocacy, through the
corn starch based Polylactic Acid (PLA) material, which
initiation of Biodiversity Sri Lanka, a platform which
is independently tested for safety to meet European
encourages information and knowledge sharing on
Commission regulation EU 10 / 2011.
environmental conservation among the corporate sector.
Raw material usage during the year under review is given The platform currently has a membership of 40 patron
in the table adjacent. members, 37 general members, 7 SMEs and 3 associate
members.

Joint Activities with Biodiversity Sri
Lanka 2020/21
• Celebration of International Day of
Biodiversity 2020
• Kanneliya Restoration Life Project -
Partnership in the restoration of the
degraded fern land in Halgahawala, Opatha
and the associated development of a
biodiversity credit accrual system for Sri
Lanka: Third year’s scope of work for 1 Ha
• Celebration of World Environment Day 2020
• Biodiversity Sri Lanka AGM Technical
session - BSL’s 5th Annual CEO Forum on “A
call to Action to Reverse Nature Loss” held
in September 2020
• “Life: A compendium of Biodiversity Stories
in Hospitality”
Other projects carried out by Dilmah Conservation on an ongoing basis are mentioned below.
Dilmah Conservation Projects and Key Events in 2020/21
Endana Nature Corridor Elephant Conservation Bee a Keeper Project

Establishment of a community Elephant Conservation Encouraging Establishing projects and research for
engaged biological corridor to conservation of elephants bee conservation and education
preserve natural habitats and enhance through education and awareness
• Launched Bee a Keeper project on
the biodiversity of tea estates. programmes conducted through
Dilmah Conservation’s Elephant World Bee Day
• Community Beekeeping project
Information Centre • Established 10 bee colonies at One
initiated to provide them with a
Earth Climate Change Centre
livelihood opportunity Sponsoring two baby elephants and
the Elephant Transit Home at the • Conducted two research focusing on
• Model organic garden established
Udawalwe National Park beekeeping
and shared knowledge to influence
• Conducted training programmes for
communities to grow sustainable • In May 2020, Ted, at the age of eight,
corporate and students
vegetable plots during pandemic was released back into the wild from
the Elephant Transit Home • Collaborated with Greenrange Young
• Four research studies conducted
Environmental Group to conduct a
focusing on land use patterns, • Baby Dilmah Art competition
national-level solitary bee conservation
ecosystem services, and beekeeping conducted for kids to create awareness
competition
• A plant nursery established with over towards elephant conservation
• Conducted community beekeeping
1500 plant representing 30 regional
training at Endana
plant species

Mangrove Restoration Dilmah Waste to Craft Marine Conservation
To support blue economy and marine Create internal awareness related Marine conservation through coastal
conservation related projects and to resource recovery and circular cleaning by establishing a Beach
research economy concepts Caretaker Programme
Mangrove project – “Defending • Staff produced over 100 products • Launched Beach Caretaker Programme
Mangroves” launched on International using existing factory waste within the by expanding it to 50km and 50 beach
Mangrove Day premises caretakers
• 1 craft item was produced in large scale • Removed 2743kg waste since January
to be used in the staff Christmas gift 2021
Publications Distribution
Supporting school library
programmes in Sri Lanka
Home Gardening Webinar Climate Smart Agriculture
Series A pilot model to educate and create
• Sharing 3 different publications with sector and community awareness
Creating online platforms to on hydroponics and vertical farming
National Library Board Sri Lanka to
disseminate knowledge related to models
be donated to their school library
home gardening
programmes
• Established Hydroponic Greenhouse
• 10 sessions conducted focusing on
unit at One Earth Centre in Moratuwa
different home gardening concepts
• Over 46kg of lettuce, tomatoes, and
and issues face by gardeners
salad cucumber was harvested from
the hydroponic system
• Two research studies were carried
out at Dilmah Conservation’s Eastern
Centre focusing on hydroponics and
the use of treated domestic wastewater
for Okra cultivation
Green Recovery Project -

Hunuwela
Objective: To regenerate soil quality Seaweed Cultivation Project -
and fertility in degraded tea lands “Afforest Underwater”
using traditional gardening and
agroforestry concepts Objective: Creating Blue Carbon Sinks
for Community Upliftment
• Initiated in January 2021 with the
planting of a sapling by Dilmah’s • Identified suitable locations and
Founder, Merrill J. Fernando. species to establish seaweed farms in
northern part of Sri Lanka

CORPORATE
GOVERNANCE
Corporate
Governance
OUR APPROACH TO
CORPORATE GOVERNANCE
Dilmah Ceylon Tea Company of the business, the Board
PLC (DCTC) is listed on the has set in place a governance
Diri Savi Board of the Colombo framework and structure that
Stock Exchange (CSE) with balances the interests of the
a public holding of 12.32% as Company and its stakeholders
the Company remains largely and ensures effective and ethical
a family owned business, with decision-making within a culture
highly specialised inputs from of professionalism, integrity
the family who are passionate and fair play. This approach
about the art of tea making. In to corporate governance has
the belief that high standards underpinned the Company’s
of corporate governance are success and recognition both
fundamental to the sustainability locally and internationally.

FRAMEWORK AND STRUCTURE Finance Management
Council
Our Governance framework is bound by external
Information Technology
regulations and internally formulated policies that define
how we do business. Human Resource Decentralise
Management
Committee
External Internal Legal
Companies Act Articles of Association
Internal Audit Executive
Listing Rules of the CSE Code of Business Ethics Management Team
Code of Best Practice on Anti-Bribery and Related Party Transactions

Review Committee
Corporate Governance Corruption Policy Chief Executive
Officer / Director
Other laws and regulations Human Rights Policy Remuneration Committee
Other procedures and

Audit Committee Deputy Chairman
practices
DCTC’s compliance with provisions of the Listing Rules

of the Colombo Stock Exchange (CSE) is disclosed on CHAIRMAN AND BOARD OF DIRECTORS
pages 101 to 103.
The Executive Management Team led by the Chairman
The Board led by the Chairman, bears ultimate and comprising of the Deputy Chairman, CEO and all
responsibility for the performance of the Company and other Executive Directors formulates and oversees the
is accountable to the shareholders who appoint the execution of strategies within the policy framework set
Directors. As the highest decision-making authority, the out by the Board. The Executive Management Team
Board determines the strategic direction of the Group is supported by the Executive Committees and Sub-
integrating financial, economic, social and environmental Committees responsible for the operational management
sustainability. It provides leadership, manages risk of the Group. The Finance Director and Company
without stifling innovation and entrepreneurship, and sets Secretary attend team meetings by invitation.
in place a sound governance framework that defines the
scope. The Management Council, chaired by the General
Manager / Chief Operations Officer gathers the senior
To assist in the discharge of responsibilities, the Board management staff to discuss common Group matters;
has established three (3) Board Sub-Committees and two including policy direction, areas of concern in business
(2) Executive Committees, delegating certain matters line performance, strategic planning and pursuit of Group
with oversight responsibility, driving accountability objectives and standards. Concerns raised are escalated
through reporting obligations. Terms of Reference for to the Decentralised Management Committee for
each of the Committees outlines their respective roles deliberation and resolution. This Council meets monthly.
and responsibilities.
The Board delegates functions warranting greater
attention to the Audit Committee, Remuneration
Committee and Related Party Transactions Review
Committee with oversight responsibility for the same,
enabling the Board to allocate sufficient time to matters
within its scope.

THE BOARD and having considered the possibility of any impairment
in independence due to extended Board tenures, where
Board Composition applicable.
Chairman (Executive) 1 Directors’ independence is discussed and evaluated by

the Board prior to nomination of Board members for re-
election.
Executive 5
Mr. Rajan Asirwatham – The Board is of the view
that the period of service of Mr. Asirwatham as a
Non-Executive 1 Board Member, which exceeds nine years does not
compromise his independence and objectivity in
discharging his functions as a Director. Therefore,
Non-Executive Independent 2
the Board determined that Mr. Asirwatham is
‘Independent’ as per the Listing Rules.
COMPOSITION Mr. Gritakumar E. Chitty - The Board is of the

The Board comprises of nine (9) members as at 31st view that the period of service of Mr. Chitty as a
March 2020 with the appointment of Mr. Darshana N. Board Member, which exceeds nine years does not
Gunasekera as the Group Finance Director on 1st October compromise his independence and objectivity in
2020. A brief profile of each of the Directors are given on discharging his functions as a Director. Therefore, the
pages 12 to 15. Board determined that Mr. Chitty is ‘Independent’ as
per the Listing Rules.
The Board comprises of eminent professionals in
their respective fields. Three of the Directors are Non-
Executive, of whom two are deemed Independent. Appointment, Re-Election and Resignation
Sufficient balance of power minimises the tendency Directors are re-appointed by the shareholders at the
for one or few members of the Board to dominate the Annual General Meeting (AGM), following a formal
Board processes or decision-making. Although three of process and based on recommendations made by the
the Executive Directors namely Mr. Merrill J. Fernando Board.
(Chairman) Mr. Dilhan C. Fernando and Mr. Malik J.
Fernando are related to each other, they act in the best Recommendations are made on consideration of the
interest of the Group in intention, purpose and attitude. combined skills, knowledge, experience and diversity of
the Board and any gaps thereof.
The Board is diverse in its experience, age and expertise
- contributing varied perspectives to boardroom In compliance with Article 24 of the Articles of
deliberations and exercising independent judgment to Association, a single Director will retire from office at
bear on matters set before them. each Annual General Meeting and on recommendation
by the Board, be eligible to stand for re-election by
All Directors possess financial acumen and business the shareholders at the AGM. Accordingly, Mr. Malik J.
knowledge gained through experience from leading large Fernando will retire by rotation in terms of the Articles
enterprises. of Association of the Group and being eligible, offers
himself for re-election at the AGM.
Three of the Directors including the Chairman of the
Audit Committee, are finance professionals. A Director appointed by the Board to fill a casual vacancy
arisen since the previous AGM, will offer himself for
election at the next AGM in terms of Article 23 (2) of the
Directors Independence
Articles of Association. There were no new appointments
Directors exercise their independent judgement,
to the Board during the year under review.
promoting constructive Board deliberations and
objective evaluation of the performance of the Company. Appointments are communicated to the shareholders
Independence of Directors is determined by the Board, through due notice to Colombo Stock Exchange. These
based on annual declarations submitted by Directors communications include a brief résumé of the Director

disclosing relevant expertise, key appointments, All Directors contribute meaningfully to leading the
shareholding and whether he is Executive, Independent Group and commit sufficient time to fulfil their duties.
or Non-Independent. Regular presentations by the Executive Management
on matters including; progress in implementation of
Resignations or removal, if any, of Directors and the
the strategic goals, financial, social and environmental
reasons thereof are informed promptly to the Colombo
performance, changes and challenges presented by
Stock Exchange together with a statement confirming
the operating environment - ensure that the Board is
whether or not there are any matters that need to be
apprised of developments impacting the Group. The
brought to the attention of shareholders.
Board seeks independent professional advice from
external parties when necessary, in the discharge of their
Board Responsibilities duties.
The Board determines the overall strategy to

enhance long term value of the Group and oversees Board Committees
implementation.
The Board has appointed an Audit Committee,
Providing independent, informed and effective judgment Remuneration Committee and Related Party Transactions
and leadership to decision-making, they ensure strategy, Review Committee to assist in the discharge of its duties
risk, internal controls, performance and sustainable in pursuance of the Listing Rules of the Colombo Stock
development considerations are effectively integrated Exchange. Areas of oversight and the composition of
and appropriately balanced. The Board also ensures all these committees are given below.
stakeholder rights and obligations are safeguarded whilst

complying with laws, regulations and ethical standards.
Board Report
Areas of Oversight Composition
Committee Reference
• Financial Reporting
• 2 Non-Executive
Audit Committee • Internal Controls
Independent Directors Page 111
(AC) • Internal Audit
• 1 Non-Executive Director
• External Audit
• Formulating Remuneration policy for Directors

Remuneration • 2 Non-Executive
and Key Management Personnel (KMP) Page 112
Committee (RC) Independent Directors
• Formulating HR Policy
Related Party • 2 Non-Executive

Transactions Review • Review of Related Party Transactions Independent Directors Page 113
Committee (RPTRC) • 1 Non-Executive Director

Meetings & Minutes
ATTENDANCE AT MEETINGS
Directors Status Board AC RPTRC RC
Mr. Merrill J. Fernando - Chairman E 03 - - -
Mr. Himendra S. Ranaweera - Deputy Chairman E 03 - - -
Mr. Dilhan C. Fernando E 04 - - -
Mr. Malik J. Fernando E 04 - - -
Mr. Roshan C. Tissaaratchy E 03 - - -
Mr. Darshana N. Gunasekera E 04 04 04 01
Ms. Minette D. A. Perera N 04 04 04 02
Mr. Rajanayagam Asirwatham I 04 04 04 02
Mr. Gritakumar E. Chitty I 03 03 03 02
Total number of meetings 04 04 04 02
I- Independent Director / N - Non-Executive Director / E - Executive Director
The Agenda and Board papers are sent seven days before require approval, in line with the Group’s Related Party
the meeting, allowing members sufficient time to review Transactions Policy and in compliance with regulations
the same. The CEO / Director sets the Board Agenda, and keep the Board apprised of their observations.
assisted by the Director of Finance and the Company
Secretary. Board meetings are held on a quarterly basis
COMPANY SECRETARY
with the flexibility to arrange additional meetings when
The Company Secretary is Ms. Jayanga Wegodapola,
required.
Attorney-at-law. She guides the Board on discharging its
All Board minutes are circulated to members within duties and responsibilities and keeps members abreast
two weeks of the meeting being held, and formally of relevant changes in legislative enactments that affect
approved at the subsequent Board meeting. Resolutions business operation. All Directors have access to the
concerning business matters are passed by circulation, services of the Company Secretary.
within regulations. However, if a Director deems it
The Company Secretary maintains the minutes of Board
necessary that such resolution must be decided at a
meetings, which are open for inspection by any Director
Board meeting and not by circulation, the Director shall
at any time.
put the resolution to be decided at a meeting.
Appointment and removal of the Company Secretary is a

Other Business Commitments / Directors
matter for the Board as a whole.
Interests
All Directors allocate sufficient time to enable them to
discharge their duties and responsibilities. Directors ROLES OF CHAIRMAN AND CEO /
declare their outside business interests at appointment DIRECTOR
and annually thereafter. The Company Secretary The role of Chairman is separate from that of the CEO /
maintains a Register of Directors’ Interests, which is Director ensuring no one Director has unfettered power
tabled to the Board annually. The Register is available and authority. The Chairman leads the Board, preserving
for inspection in terms of the Companies Act. Related good corporate governance and setting the ethical tone
Party Transactions are given in Note 30 to the Financial for the Board and Group. The CEO / Director leads the
Statements on pages 166. The Related Party Transactions executive management and is accountable to the Board
Review Committee considers all transactions that for the performance of the Group.

BOARD ACCESS TO INFORMATION AND • Non-Discrimination
RESOURCES • Anti-Bribery and Corruption
• Fair Competition
Directors have unrestricted access to management
• Good Governance and Financial Reporting
and organisation information, as well as to resources
• Intellectual Property
required to carry out their duties and responsibilities,
• Corporate Responsibility and Sustainability
independently and effectively. The Executive
• Whistle Blowing
Management makes regular presentations with regards
• Corrective Action
to the business environment and in relation to Group
• Personal Responsibility
operations. Access to independent professional advice,
coordinated through the Company Secretary, is available
to Directors at the Group’s expense. The Group has implemented a comprehensive Anti-
Bribery and Corruption (ABC) Policy to uphold its
approach of “zero tolerance” of bribery and corruption
INDUCTION AND ON-GOING TRAINING and commitment to integrity in all its business dealings.
FOR DIRECTORS The ABC policy scope applies to employees and third
On appointment, Directors are provided with an parties dealing with the Company and is accessible to
orientation pack with all relevant external and internal employees via the intranet and to all third parties dealing
regulation documents and a tour of the factory. with the Company https://www.dilmahtea.com/dilmah-
anti-bribery-and-corruption.html
The Directors are kept abreast of local and global
developments affecting business, including regulatory The Groups Human Rights Policy promote mutual
changes, economic movements and industry trends. respect, upholding rights and dignity of all employees
and stakeholders. (https://www.dilmahtea.com/dilmah-
They undertake training and professional development human-rights-policy.html)
by attending seminars / workshops / conferences,
Code of Conduct and Policy Framework implemented
participating as speakers at events, using web based
by the Group ensure ethical and responsible decision
learning resources and reading business updates etc.
making and endeavour to guide the directors, employees
and other stakeholders to maintain high standards of
CODE OF CONDUCT values and ethical business culture practices by Dilmah
DCTC’s culture is shaped by the Group’s Code of Ethics Tea from its inception.
/ Business Ethics Policy which articulates the standards
of conduct expected of all Directors and employees. It REMUNERATION
enshrines principles of honesty, integrity, equality and
The Group Remuneration Policy seeks to motivate
humanity by creating a responsible workplace founded
and reward performance while meeting regulatory
on ethical, professional and legal standards of conduct.
requirements, market expectations and corporate
A whistle blowing policy provides a direct values. No Director is involved in determining
communication line to the Chairman, where employees his / her own remuneration. The Remuneration
have the opportunity to report in good faith any genuine Committee in consultation with the CEO / Director
suspicions of fraud, bribery or malpractice. The policy makes recommendations to the Board regarding the
provides for anonymity and protection of the reporting remuneration of the Key Management Personnel.
employee. The Board as a whole, agrees on the fees of Non-
Executive Directors. Executive Directors Remuneration
Group’s Code of Ethics comprises of two components; fixed remuneration
• Commitment and variable remuneration, encompassing an annual
• Regulatory Compliance performance bonus aligned to corporate and individual
• Impartiality and Fairness performance.
• Accuracy and Confidentiality
• Company Resources Directors’ remuneration in respect of the Group for the
• Professional Standard and Etiquette Financial Year ended 31st March 2021 are disclosed on
page 168 of the Financial Statements.

RISK MANAGEMENT & INTERNAL SHAREHOLDER RELATIONS
CONTROL At the close of the financial year 2020/21, DCTC had 1,082
The Board is responsible for formulating and shareholders. The Directors directly and indirectly held
implementing effective risk management and internal 88% of shares whilst the Employees Provident Fund, the
control systems to safeguard shareholder interests and next largest shareholder held 8%. The Group encourages
the assets of the Group. These systems cover all controls, effective communication with shareholders who are
including financial, operational and compliance. They are engaged through multiple channels of communication,
monitored and regularly reviewed for effectiveness by the including the Annual General Meeting (AGM), Annual
Board. Report, Interim Financial Statements and announcements
to the Colombo Stock Exchange. These are provided to
Group Internal Audit supports the Audit Committee,
the Colombo Stock Exchange for publication on their
reviewing the adequacy and effectiveness of the internal
site. The Board recognises its responsibility to present a
control systems and reporting to the Audit Committee on
balanced and understandable assessment of the Group’s
a regular basis. Further, as required by the certification/
financial position, performance and prospects. The
accreditation process of the Group, trained internal
Company has reported a fair assessment of its position
auditors conduct regular system audits and verifications
via the published audited Financial Statements and
based on the requirements of certification standards and
quarterly accounts. In preparation of these documents,
audit criteria including ISO 9001:2015, ISO 14001:2015,
the Company has complied with the requirements of
FSSC 22000, BRC Global Standard for Food Safety
the Companies Act No. 07 of 2007 and the Sri Lanka
and SEDEX Members Ethical Trade Audit (SMETA).
Accounting Standards.
The findings are reported to the management and any
noncompliance is attended to immediately. The AGM is the main mechanism for the Board to interact
with, and account to shareholders. It also affords an
opportunity for shareholders’ views to be heard. It is
ACCOUNTABILITY
the key forum for shareholders to engage in decision-
The Board strives to provide stakeholders with a making matters reserved for the shareholders which
balanced and comprehensive account of the financial include approval of the Annual Report and Financial
position, performance and prospects of the Group. Statements and appointment of Directors and External
This is the Group’s third Integrated Annual Report, and Auditors. Board members, Sub-Committee Chairpersons,
it complies with the requirements of widely accepted Key Management Personnel and External Auditors on the
standards, codes and frameworks which have been request of the Board Chairman, are present and available
voluntarily adopted to ensure corporate reporting is in- to answer questions.
line with international best practice.
All Shareholders are encouraged to participate at the
AGM and exercise their voting rights. Notice of the
MAJOR OR MATERIAL TRANSACTIONS
AGM, the Annual Report and Financial Statements and
During the year, there were no major or material any other resolution together with the corresponding
transactions as defined by Section 185 of the Companies information, are circulated to shareholders not less than
Act No. 07 of 2007, which materially affected the net 15 working days prior to the Annual General Meeting. A
asset base of the Group. separate resolution for each item of business is proposed,
giving shareholders the opportunity to vote on each of
COMPLIANCE such issues, separately.
Directors are conscious of their duty to comply with the

laws, regulations, codes, internal controls and approved EXTERNAL AUDITOR
policies. DCTC is compliant with all relevant legal and The External Auditor is appointed subject to the provision
statutory requirements. of the Companies Act. The Audit Committee makes
recommendations to the Board for the appointment,

re-appointment or removal of the External Auditor in- annual statement confirming their independence in
line with professional & ethical standards and regulatory relation to the external audit.
requirements.
Appendix - Compliance with the Listing Requirements
On the recommendation of the Board, the shareholders Sections 7.6 and 7.10 on Corporate Governance Rules
approved the re-appointment of Messrs. Ernst & Young for Listed Companies issued by the Colombo Stock
(Chartered Accountants) as the External Auditor Exchange.
for 2020/21 at the last AGM. In compliance with the
Companies Act, the External Auditors submitted an
Rule
Requirement Disclosure Compliant
No.
Statement confirming compliance with the Corporate Governance Annual Report of the
7.10 (a)
Rules Board of Directors
Non-Executive Directors (NED) Composition

7.10.1 (a) Composition
• At least two or one third of total Directors, whichever is higher
Independent Directors Composition

7.10.2 (a) • Two or one-third of Non-Executive Directors, whichever is Composition
higher
Independence of Directors
Directors’
7.10.2 (b) • Each Non-Executive Director should submit a declaration of
Independence
Independence / Non-Independence
Disclosure Relating to Directors

7.10.3 (a) • The names of Independent Directors should be disclosed in the Directorate
Annual Report
Independence of Directors
7.10.3 (a) • The Board shall make a determination annually as to the Directors’
/ (b) Independence or Non-Independence of each Non-Executive Independence
Director
Disclosure Relating to Directors

7.10.3 (c) • A brief résumé of each Director including the Director’s areas Board Profiles
of expertise.
Appointment of New Directors Appointment,

7.10.3 (d) • Provide a brief résumé of any new Director appointed to the Re-Election and
Board Resignation
Remuneration Committee Remuneration

7.10.5
• A listed company shall have a Remuneration Committee Committee Report
Composition of Remuneration Committee

Remuneration
7.10.5 (a) • Shall comprise of Non-Executive Directors, a majority of whom
Committee Report
shall be Independent
Functions of Remuneration Committee

• The Remuneration Committee shall recommend the Remuneration
7.10.5 (b)
remuneration of the Chief Executive Officer and the Executive Committee Report
Directors of the Board, for approval

Rule
No.
Disclosure in the Annual Report relating to Remuneration
Committee The Annual Report should set out;
• Names of the Directors comprising the Remuneration
Remuneration
7.10.5 (c) Committee
Committee Report
• Statement of Remuneration policy
• Aggregate remuneration paid to Executive and Non-Executive
Directors
Audit Committee Audit Committee

7.10.6
• A listed company shall have an Audit Committee Report
Composition of Audit Committee

• Shall comprise of Non-Executive Directors, a majority of whom
are Independent
Audit Committee
7.10.6 (a) • Chief Executive Officer and the Chief Financial Officer should
Report
attend Audit Committee Meetings
• The Chairman of the Audit Committee or one member should
be a member of a professional accounting body
Audit Committee Functions Should be as outlined in the Section Audit Committee

7.10.6 (b)
7.10.6 (b) Report
Disclosure in the Annual Report relating to Audit Committee

• Names of the Directors comprising the Audit Committee Audit Committee
7.10.6 (c)
• Basis for determining the independence of the Auditors Report
• Report of the Audit Committee in the prescribed manner
Related Party Transactions Review Committee

• Details pertaining to Non-Recurrent Related Party Transactions Related Party
• Details pertaining to Recurrent Related Party Transactions
Transactions
9.3.2 • Report of the Related Party Transactions Review Committee
Review Committee
• Declaration by the Board of Directors as an affirmative
Report
statement of compliance with the rules pertaining to Related
Party Transactions, or a negative statement otherwise
7.6 Contents of the Annual Report
i) Names of Directors of the entity Board Profile
Principal activities of the entity and its subsidiaries during the year
ii) About Us
under review
20 largest holders of voting and non-voting shares and the

iii) Investor Information
percentage of shares
iv) The Public Holding percentage etc. Investor Information
Directors Interest
Directors and CEO’s holding in shares of the entity at the
v) in Shares and
beginning and end of each year
Shareholding
vi) Information pertaining to material foreseeable risk factors Risk Management
Details of material issues pertaining to employees and industrial

vii) Human Capital
relations

Rule
No.
Note 4 and 5 to the
Financial Statements –
Extents, locations, valuations and the number of buildings of the Property, Plant and
viii)
entity’s land holdings and investment properties Equipment and
Investment Properties,
respectively
xiv) Number of shares representing the stated capital Investor Information
Distribution schedule of the number of shareholders and the

xv) Investor Information
percentage of their total holding
xvi) Ratios and market price information Investor Information
Note 4 to the Financial

Significant changes in the entity’s or its subsidiaries fixed assets
xvii) Statements - Property,
and the market value of land
Plant and Equipment
If during the year the entity has raised funds either through a
xviii) N/A N/A
public issue, rights issue and private placement
xiv) Employee share option / purchase schemes N/A N/A
Disclosures relating
to Directors, Audit
xv) Corporate Governance Disclosures Committee and
Remuneration
Committee
Note 30 to the
Financial Statements
xvi) Related Party Transactions
- Related Party
Transactions

Report of the Board of Directors
GENERAL
The Board of Directors of Dilmah Ceylon Tea Company Companies Act No. 07 of 2007 on 13th October 2008.
PLC (DCTC) are pleased to present its Annual Report The re-registration number of the Company is PQ 209.
for the financial year ended 31st March 2021, together
with the audited Financial Statements of the Company, The ordinary shares of the Group were listed on the main
Consolidated Financial Statements of the Group and board of the Colombo Stock Exchange on 01st January
the Auditor’s Report on those Financial Statements, in 1982, and subsequently transferred to the Diri Savi Board
conformity with the requirements of the Companies Act on 16th August 2017.
No. 07 of 2007 and Listing Rules of the Colombo Stock
The registered office is located at No. 111, Negombo Road,
Exchange (CSE).
Peliyagoda, Sri Lanka.
DCTC was incorporated as a Public Limited Liability
The Annual Financial Statements were reviewed and
Company in Sri Lanka on 29th May 1981 under the
approved by the Board of Directors on 23rd August 2021.
Companies Ordinance No. 51 of 1938. The Company was
re-registered as required under the provisions of the
In compliance with Section 168 of the Companies Act No. 07 of 2007, the
following information is disclosed in the Annual Report published for the year
ended 31st March 2021.
Reference to
the Companies Disclosure reference for
Disclosure requirements Page
Act No. 07 of compliance
2007
The nature of the business of the Section 168 (1) (a) Note 1.2 to the Financial Statements 126
Company - Principal Activities and Nature of Business
Financial statements for the accounting Section 168 (1) (b) The Financial Statements of the Company 119 to
period completed and signed in and Group for the year ended 31st March 174
accordance with Section 152 2021
Auditor’s report on the fFinancial Section 168 (1) (c) Independent Auditors’ Report. 116 to
Statements of the Company 118
Any change in accounting policies made Section 168 (1) (d) Note 2.6 to the Financial Statements - 127
during the accounting period Changes in Accounting Policies
Particulars of entries in the interests Section 168 (1) (e) Directors’ Interest in Contracts with the 108
register made during the accounting Company
period Details of the Directors’ shareholdings -
Investor Information 109
There were no changes to the Directors’
shareholding during the financial year
Remuneration and other benefits of Section 168 (1) (f) Note 30.2 to the Financial Statements - 168
directors during the accounting period Profit / (Loss) Before Tax
Total amount of donations made by the Section 168 (1) (g) Note 22 to the Financial Statements - Profit 159
Company during the accounting period / (Loss) Before Tax

Reference to
the Companies Disclosure reference for
Disclosure requirements Page
Act No. 07 of compliance
2007
Names of the persons holding office as Section 168 (1) (h) Board Profiles 12 - 15
Directors of the Company as at the end In terms of Article 24 of the Articles of
of the accounting period and the names Association of DCTC, Mr. Malik J. Fernando
of any persons who ceased to hold office retires by rotation and being eligible offers
as Directors of the Company during the himself for re-election
accounting period
Amounts payable by the company to the Section 168 (1) (i) Note 22 to the Financial Statements - Profit 159
person or firm holding office as auditor / (Loss) Before Tax
of the company as audit fees and as
a separate item, fees payable by the
company for other services provided by
that person or firm
Particulars of any relationship (other than

that of auditor) which the auditor has with
Section 168 (1) (j) External Auditors 109
or any interests which the auditor has in,
the Company or any of its subsidiaries
Signed on behalf of the board by two

Section 168 (1) (k) 110
Directors and the Company Secretary
PRINCIPAL ACTIVITIES OF THE GROUP 07 of 2007. The Financial Statements of the Company
and the Group for the year ended 31st March 2021 duly
The principal activity of the Group is to manufacture,
signed by the General Manager of Finance and two
export and market tea bags and packets under the brand
Directors of the Company are given from pages 119 to 177.
name “Dilmah”. The principal activity of the Subsidiary
Company is to manufacture, export and market tea in the
form of liquid tea concentrate and ready-to-drink tea. DIRECTORS’ RESPONSIBILITY FOR
FINANCIAL REPORTING
REVIEW OF OPERATIONS The Directors are responsible for the preparation of the
Financial Statements of the Group and to present a true
A review of the operations of the Group and results of
and fair view of its state of affairs. The Directors are
its performance during the financial year are contained
of the view that these Financial Statements have been
in the Chairman’s Message (pages 16 to 17) and Financial
prepared in conformity with the requirements of the
Capital Report (pages 44 to 46).
Sri Lanka Accounting Standards, (SLFRSs and LKASs),
Companies Act No. 07 of 2007, Sri Lanka Accounting and
FUTURE DEVELOPMENTS Auditing Standards Act No. 15 of 1995 and Listing Rules
An overview of the future developments of the Group of the CSE.
is given in the Chairman’s Message and CEO’s Report
The Statement of Directors’ Responsibility for Financial
(pages 16 to 19).
Reporting is given on page 114.
FINANCIAL STATEMENTS
GOING CONCERN
The Financial Statements of the Company and the
The Board has made an assessment of the Group’s ability
Group have been prepared in accordance with Sri Lanka
to continue as a going concern and is satisfied that it has
Accounting Standards laid down by the Institute of
the resources to continue in business for the foreseeable
Chartered Accountants of Sri Lanka (CA Sri Lanka) and
future.
comply with the requirements of the Companies Act No.

GROUP RESULTS AND Assessment 2020/21 concessionary rate of 14% is
APPROPRIATIONS applicable for the Taxable Income of the Company
predominantly (80%) engaged in the business of exports.
For the year ended 31 st Gains from realisation of investment assets shall be taxed
2021 2020 at the rate of 10%.
March
Rs. ‘000 Rs. ‘000
HUMAN RESOURCES
Revenue 9,211,987 11,610,062
The Group continues to invest in human capital
Profit for the Year 1,749,715 1,559,247 development and implement effective human resource
practices and policies to improve workforce efficiency,
Other Comprehensive Income
(106,540) (19,861) effectiveness and productivity, offering equal career
Net of Tax
opportunities regardless of gender, race or religion.
Total Comprehensive Income
1,643,175 1,539,386
Net of Tax There were no material issues pertaining to employees
and industrial relations of the Company that occurred
Interim Dividend for the current
- 414,750 during the year under review which requires disclosure.
year
Proposed final Dividend 373,275 103,688 As at 31st March 2021, 554 persons were employed by the
Company (31st March 2020 - 587)
DIVIDENDS
There was no interim dividend paid during the year
STATUTORY PAYMENTS
ended. The Directors recommend paying a final dividend The Directors confirm that to the best of their knowledge
of Rs. 18/- per share for the year ended 31st March 2021. and belief, all statutory payments in relation to taxes and
duties, and in relation to employees have been made
The Board of Directors provided the Statements of promptly on the due dates.
Solvency to the Auditors and obtained Certificates of
Solvency from the Auditors in respect of each dividend
payment in terms of Section 56 (2) of the Companies Act
COMPLIANCE WITH LAWS &
No. 07 of 2007. The Board also fulfilled the requirement
REGULATIONS
of the Solvency Test in terms of Section 56 (3) of the To the best of the knowledge and belief of the Directors,
Companies Act No. 07 of 2007 immediately after the the Group has not engaged in any activities contravening
payment of interim dividends, and will ensure the the laws & regulations of the country. The Group has also
compliance of the Solvency Test after the payment of the formulated and implemented Policy Framework relating
aforesaid final dividend proposed. to Business Ethics, Human Rights and Anti-Bribery
& Corruption to emphasise its commitment towards
responsible decision making and corruption free business
CORPORATE DONATIONS
conduct.
We continue with the Company philosophy that business
is a matter of human service. For the current year, the
Company made a donation of Rs. 210 million (2019/2020
CAPITAL EXPENDITURE
Rs. 260 million) to the MJF Charitable Foundation. The Capital expenditure incurred on acquisition of Property,
activities of the Foundation are given on the pages Plant & Equipment during the year of the Company and
69 to 70. The Donations made by the Company of Group amounted to Rs. 385 million and Rs. 385 million
Rs.40,342,400/- to MOH/Government are given on the respectively (2019 / 20 Company: Rs. 801 million and
pages 65. Other Donations Rs.5,457,102/- (2019/20 - Group: Rs. 811 million). Details are given in Note 4 of the
Rs. 352,645/-). Notes to the Financial Statements on pages 141 to 146.
Capital expenditure approved and contracted for and not

TAXATION contracted for, as at Balance Sheet date are given in Note
According to the First Schedule of the Inland Revenue 27 to the Financial Statements on page 164.
Act No. 24 of 2017, with effect from the Year of

PROPERTY, PLANT AND EQUIPMENT (PPE) audit, and financial and other controls required to carry
out Group business and safeguard assets. The Audit
Details of property, plant and equipment are given in
Committee Report, Risk Management Report and the
Note 4 to the Financial Statements on page 141 to 146.
Independent Auditor’s Report thereon are given on
The net book values of freehold properties owned by
pages 116 & 118.
the Company and the Group as at 31st March 2021 are
included in the accounts at Rs. 2,448.5 million and Rs.
2,501.6 million respectively (2019 / 20 Company: Rs. SUSTAINABILITY
2,687.4 million and Group: Rs. 2,743.2 million). The Group is an early champion of adopting sustainability
practices and sustainability reporting. Economic,
The market value of Property, Plant & Equipment is
environment and social sustainability is ingrained into
considered not materially different to the values stated.
business strategies as detailed in the Sustainability at
Dilmah on pages 26 to 33.
INVESTMENTS
Investments made by the Company are detailed in Note 8
DIRECTORATE
of the Notes to the Accounts.
The following Directors held office as at the Statement of
Financial Position date and their brief profiles appear on
STATED CAPITAL pages 12 to 15 of the Annual Report.
The Stated Capital of the Company is Rs. 642,500,000/-
Mr. Malik J. Fernando, Mr. Gritakumar E. Chitty,
divided into 20,737,500 Ordinary Shares.
Mr. Rajanayagam Asirwatham and Mr. Himendra
S. Ranaweera retire in terms of Section 210 of the
SHAREHOLDING Companies Act No. 07 of 2007. Separate resolutions are
As at 31st March 2021, there were 1,082 (976 as at proposed respectively, to re-appoint the Director in terms
31st March 2020) registered shareholders and their of Section 211 (1) of the said Companies Act No. 07 of
distribution is given on page 176. The twenty major 2007.
shareholders as at 31st March 2021 and the number
Mr. Malik Fernando retires by rotation in terms of Section
of shares held and their percentage shareholding are
24 of the Articles of Association of the Company, and
disclosed on page 177.
being eligible offers himself for re-election at the Annual
General Meeting.
RESERVES
The total reserves as at 31st March 2021 stand at Rs. Name of the Director Status
13,233 million (2019/20 - Rs. 11,694 million) including Mr. Merrill J. Fernando - Chairman ED
the FVOCI Reserve of Rs. 145 million (2019/20 - Rs. 230
million). Mr. Himendra S. Ranaweera –
ED
Deputy Chairman
EVENTS OCCURRING AFTER THE Mr. Dilhan C. Fernando -

ED
BALANCE SHEET DATE
No significant events have occurred after the Balance Mr. Malik J. Fernando ED
Sheet date, which require adjustments to or disclosure in
Ms. Minette D. A. Perera NED
the Financial Statements.
Mr. Roshan C. Tissaaratchy ED
RISK MANAGEMENT AND SYSTEM OF Mr. Darshana Gunasekera ED

INTERNAL CONTROLS
Mr. Rajanayagam Asirwatham IND
The Group has an ongoing process in place to identify,
evaluate, and manage the risks that are faced by the Mr. Gritakumar E. Chitty IND
Group, as detailed in the Risk Report on pages 24 &
25. An effective and comprehensive system of internal *IND - Independent Director / NED - Non-Executive
Director / ED - Executive Director
controls is in place comprising of internal checks, internal

DIRECTORS OF THE SUBSIDIARY - MJF INTERESTS REGISTER
BEVERAGES (PVT) LTD. The Company maintains an Interests Register as required
by the Companies Act No. 07 of 2007. All Directors have
Name of the Director Status made general disclosures relating to share dealings and
Mr. Merrill J. Fernando - Chairman ED indemnities and remuneration to the Board of Directors
as permitted by Section 192 (2) of the Companies Act No.
Mr. Himendra S. Ranaweera – Deputy Chairman ED 07 of 2007. The related entries were made in the Interests
Mr. Dilhan C. Fernando- Chief Executive Officer ED Register during the year under review, and are available
at the registered head office of the Company, in keeping
Mr. Malik J. Fernando ED with the requirements of the Section 119 (1) (d) of the
Companies Act No. 07 of 2007.
Mr. Roshan C. Tissaaratchy ED
Mr. Daya P. Wickramatunga IND
BOARD SUB-COMMITTEES
The Board delegates functions warranting greater attention to three (3) Board Sub-Committees with oversight
responsibility for the same. Accordingly, the following mandatory Sub-Committees have been constituted by the
Board in compliance with the Listing Rules of the CSE.
Board Committee Members

Mr. Rajanayagam Asirwatham - Chairman
Report of the Audit Committee is given
Audit Committee Mr. Gritakumar E. Chitty
on page 111
Ms. Minette D. A. Perera
Mr. Gritakumar E. Chitty - Chairman Report of the Remuneration Committee

Remuneration Committee
Mr. Rajanayagam Asirwatham is given on page 112
Mr. Rajanayagam Asirwatham - Chairman

Related Party Transactions Review Report of the Related Party Transaction
Mr. Gritakumar E. Chitty
Committee Review Committee is given on page 113
RELATED PARTY TRANSACTIONS DIRECTORS EMOLUMENTS

Relevant disclosures made by the Directors on contracts During the year under review, total remuneration of the
and proposed contracts with the Company or any of the Executive Directors amounted to Rs. 148,295,259/- and
subsidiaries within the Group appear under Note 30 in Non-Executive Directors amounted to Rs. 1,950,000/-
Related Party Disclosure to the Financial Statements on (2019 / 20 - Executive Directors Rs. 118,091,561/- and
pages 166 to 167 of the Report. These interests have been Non-Executive Directors Rs. 1,950,000/-)
declared at Directors meetings in compliance with set out
in section 9 requirements on Related Party Transactions
DIRECTORS INTERESTS IN SHARES AND
of the Listing Rules of the CSE and Section 192 (1) of the
SHAREHOLDING
Companies Act No. 07 of 2007.
Directors of the Company and its subsidiaries who
The Related Party Transaction Review Committee is have relevant interests in the shares of the respective
responsible for reviewing the Related Party Transactions Companies have disclosed their shareholding and any
of the Company. The Committee Report is given on page acquisitions / disposals to their respective Boards in
113. compliance with Section 200 of the Companies Act No.
7 of 2007. The direct shareholdings of Directors together
with that of their spouses & dependent children are as
follows:

report. The Auditors have confirmed that they have
Name of the Director 2021 2020
no interest in, or relationship with the Company or its
Mr. Merrill J. Fernando 8,200 8,200 Subsidiary other than that of Auditors. They also confirm
that they are independent in accordance with the Code
Mr. Malik J. Fernando 24,200 24,200
of Ethics of the Institute of Chartered Accountants of Sri
Mr. Dilhan C. Fernando 24,200 24,200 Lanka.
Mr. Himendra S. Ranaweera 22,984 22,984 The Audit Fees payable and fees for other services
rendered are noted hereunder: Fees payable to Auditors
Ms. Minette D. A. Perera 200 200
for the current financial year Rs. 1,076,247/- (2019 /
Mr. Roshan C. Tissaaratchy 4,000 4,000 20 - Rs. 1,044,900/-). Fees payable for other services
rendered Rs. 1,014,281/- (2019 / 20 - Rs. 985,881/-).
Mr. Rajanayagam Asirwatham 4,800 4,800
Auditors Ernst & Young have expressed their willingness
Mr. Gritakumar E. Chitty - - to continue in office.
A resolution to reappoint them as Auditors and to

The indirect shareholdings of Directors, Mr. Merrill J. authorise the Directors to fix their remuneration will be
Fernando, Mr. Malik J. Fernando & Mr. Dilhan C. Fernando, proposed at the Annual General Meeting.
together with that of their spouses & dependent children
are as follows:
TRANSFER PRICING REGULATIONS
It is certified that the Group has complied with the
As at 31st March 2021 2020
transfer pricing regulations issued under Section 104 of
MJF Teas (Private) Limited 13,812,882 13,812,882 the Inland Revenue Act No. 10 of 2006. The information
pursuant to these regulations are given under certificate
MJF Exports (Private)
4,256,712 4,256,712 produced under Section 107 (2) (a) of the said Act.
Limited
Merrill J. Fernando and We believe that the transactions entered into with related
25,300 25,300
Sons (Private) Limited parties during the period 01.04.2020 to 31.03.2021 are
at arm’s length and not prejudicial to the interests of the
CORPORATE GOVERNANCE Group. The transactions are entered into on the basis
of transfer pricing policy adopted by the Group. All
The Directors are responsible for the formulation
transactions have been submitted to the independent
and implementation of overall business strategies,
auditor for audit and no adverse remarks have been
policies and setting standards in the short, medium
made in their report on the audit of such transactions.
and long-term basis, adopting good governance in the
management of the affairs of the Company.
OUTSTANDING LITIGATION
Accordingly, systems and structures have been
There is no litigation against the Group that will have a
introduced and improved from time-to-time to
material impact on the reported financial results or future
enhance risk management measures and to improve
operations.
accountability and transparency. A separate report
on Corporate Governance Practices adopted by the
Company is given on pages 94 to 103 of this Annual NOTICE OF ANNUAL GENERAL MEETING
Report. The Company has complied with Section 7.10 of The 40th Annual General Meeting of Dilmah Ceylon Tea
the Continued Listing Rules of Colombo Stock Exchange Company PLC is to be convened on 30th September
(CSE) on Corporate Governance. 2021 at 11.00 a.m. at 111, Negombo Road, Peliyagoda via
a virtual platform. Notice of the Annual General Meeting
GROUP AUDITORS appears on page 182.
Ernst & Young, Chartered Accountants, served as the

Group Auditors during the year under review and the
Auditors’ Report is given on pages 110 to 118 of the

ACKNOWLEDGMENT OF THE CONTENTS
OF THE REPORT
As required by Section 168 (1) (k) of the Companies
Act No. 07 of 2007, the Board of Directors hereby
acknowledges the contents of this Annual Report. For
and on behalf of the Board of Directors.
Mr. Dilhan C. Fernando

Director

Director
Ms. Jayanga Wegodapola

Company Secretary
23rd August 2021

Report of the Audit Committee
COMMITTEE COMPOSITION EXTERNAL AUDIT
The Audit Committee appointed by the Board of The Committee is empowered to recommend the
Directors of Dilmah Ceylon Tea Company PLC, comprises appointment of the external auditor in compliance with
of two Non-Executive Directors - both of whom are the relevant statues, the service period, audit fee and any
‘Independent’ as per the Listing Rules of the Colombo resignation or dismissal of the Auditor. The Committee is
Stock Exchange, and one Non-Executive Director. The satisfied that there is no conflict of interest between the
members of the Committee during the year under review Company and the Auditor, other than for the payment
were Mr. Rajan Asirwatham (Chairman), Mr. Gritakumar E. of audit fees. The Committee is thus satisfied that there
Chitty and Ms. Minette D. A. Perera. The Chairman of the is no cause to compromise on the independence and
Audit Committee is a qualified Chartered Accountant. objectivity of the Auditor.
The Committee has recommended to the Board of

COMMITTEE MEETINGS Directors that Messrs Ernst & Young be re-appointed
The Committee held four meetings during the financial as the Auditors for the year ending 31st March 2022,
year under review. All four members attended all four subject to the approval of the shareholders at the Annual
meetings. The Director of Finance and the Company General Meeting. The Committee has also made its
Secretary attended the meetings of the Committee by recommendations to the Board of Directors on the fees
invitation. payable to the Auditors for approval by the Board.
ROLE OF THE COMMITTEE FINANCIAL REPORTING

The primary function of the Committee is to assist the The Committee reviewed and recommended the Group’s
Board in fulfilling its responsibilities, overseeing the interim and annual financial statements for approval of
management’s conduct of the Company’s financial the Board prior to submission to the Colombo Stock
reporting process and systems of internal accounting Exchange and shareholders.
and financial controls, monitoring the independence
The Committee reviewed and certified the profit
and performance of the Company’s external auditors
reconciliation based on SLFRS / LKAS rules and
and providing a channel of communication between the
directions and impact to the prudential ratios with regard
external auditors, the management and the Board.
to dividend declarations in compliance with relevant
regulations. The Committee reviewed the internal
INTERNAL AUDIT controls on the financial reporting system to ensure
The Committee regularly reviews the scope of the internal the reliability and integrity of information provided, the
audit function and reviews audit programmes proposed. review included the extent of compliance with SLFRS
The internal audit findings are discussed and follow- / LKAS and applicable laws and regulations, review
up reviews of audit findings are undertaken to ensure of critical accounting policies and practices - and any
that audit recommendations are being implemented. changes thereto, alternative accounting treatments,
The Committee also assesses the effectiveness of the going concern assumptions, major judgmental areas and
internal audit function. The Committee is of the view material audit judgments.
that the internal controls prevalent within the Group are
satisfactory, and provides reasonable assurance that the
financial position of the Company is well monitored and
the assets are safeguarded.
Mr. Rajan Asirwatham
Chairman – Audit Committee
23rd August 2021

Report of the Remuneration Committee
The Committee is responsible for setting the Company’s POLICY
policy on compensation and benefits, overseeing its
The remuneration policy of the Company is formulated
implementation. It is also mandated to review significant
to attract and retain high calibre personnel and motivate
Human Resource policies that influence the Company’s
them to develop and implement the business strategy in
performance. The Committee specifically reviews
order to optimise long-term shareholder value creation.
remuneration of the Chief Executive Officer, Executive
Directors and senior members of the management, as it The Committee is responsible for determining the
is designated to consider. compensation of the senior management, and to lay
down guidelines and parameters for the compensation
structure of all management staff of the Company.
COMMITTEE COMPOSITION
In its decision making process necessary information
The Committee, appointed by and responsible to the
and recommendations are obtained from the Deputy
Board, comprises of two Independent Non-Executive
Chairman.
Directors. The members of the Committee during
the year under review were Mr. Gritakumar E. Chitty The remuneration packages of the Company are aligned
(Chairman) and Mr. Rajan Asirwatham. to individual performance and strategic priorities.
COMMITTEE MEETINGS
The Committee held one meeting during the year under
review and both committee members attended the
meeting. The Director of Finance and Ms. Minette D. A. Mr. Gritakumar E. Chitty
Perera - a Non-Executive Director, attended the meeting Chairman – Remuneration Committee
of the Committee by invitation. 23rd August 2021

Report of the Related Party Transactions
Review Committee
The Related Party Transactions Review Committee • The Committee communicates their observations on
is a Board Sub Committee. The Committee has been the Related Party Transactions, if any, to the Board of
established in compliance with the “Code of Best Directors.
Practices on Related Party Transactions”, issued by the
• The Committee also ensures that immediate market
Securities and Exchange Commission of Sri Lanka.
disclosure of any Related Party Transaction is made
The objective of the Committee is to review all Related in accordance with the Code, to the Colombo Stock
Party Transactions other than those transactions Exchange.
explicitly exempted by the Code.
• The Committee identifies persons who shall be
considered as “Key Management Personnel” of the
COMMITTEE COMPOSITION Company, and self-declarations are obtained from
The Related Party Transaction Review Committee each such person for the purpose of identifying
appointed by the Board of Directors of Dilmah Ceylon related parties to them. Based on the information
Tea Company PLC, comprises of three Non-Executive furnished on these declarations, the Company has
Directors; two of them are ‘Independent’ as per the developed a system that enables the Company to
requirements of the Code. retrieve data on Related Party Transactions.
The members of the Committee during the year under

review were Mr. Rajan Asirwatham (Chairman), Mr.
RELATED PARTY TRANSACTIONS DURING
Gritakumar E. Chitty and Ms. Minette D. A. Perera. The THE YEAR 2020 / 21
Chairman of the Committee is a qualified Chartered The Committee has reviewed the Related Party
Accountant. Transactions during the financial year 2020 / 21 and has
communicated their comments / observations to the
Board. It was also observed that there were no non-
PURPOSE OF THE COMMITTEE recurrent Related Party Transactions that exceeded
The purpose of the Committee as set out in its Terms of the respective thresholds mentioned in the Listing
Reference (TOR), is to review in advance all proposed Rules of the Colombo Stock Exchange. The Company is
Related Party Transactions, other than those transactions therefore compliant with the said Rules on Related Party
explicitly exempted in the TOR which are in conformity Transactions. Details of other Related Party Transactions
with the Listing Rules. entered into by the Company during the period
under review is disclosed in Note 30 of the Financial
The Committee adopts policies and procedures to Statements.
review Related Party Transactions of the Company, and
determines whether Related Party Transactions that are
to be entered into by the Company require the approval DECLARATIONS
of the Board or Shareholders of the Company. The Committee quarterly reviewed the disclosures made
by each of the members of the Board on transactions in
which they are interested or which are proposed to be
COMMITTEE MEETINGS entered into, with a related party. The declarations made
The Committee held quarterly meetings during the year by them on compliance with regulatory requirements
under review. All members attended all four meetings. as set out in the Listing Rules pertaining to Related
The Director of Finance attended the meetings by Party Transactions are recorded in an Interest Register
invitation. maintained by the Company.
• The Committee reviews in advance all Related Party

Transactions of the Company except those explicitly
exempted in the Code.
Mr. Rajan Asirwatham
• The Committee ensures that written policies and Chairman – Related Party Transactions
procedures of the Company are in conformity with Review Committee
rules and regulations governing Related Party
Transactions. 23rd August 2021

Statement of Directors’ Responsibilities in Relation
to the Preparation of Financial Statements
The following statement sets out the responsibilities inappropriate to presume that the Company will continue
of Directors, in relation to the Financial Statements. as a going concern. The Directors are required to take
This should be read in conjunction with the Auditor’s reasonable steps to safeguard the assets of the Company
responsibility in relation to the Financial Statements, set and to prevent and detect fraud and other irregularities. In
out in the Report of the Auditors on pages 116 to 118 of this this regard, the Directors have instituted an effective and
Annual Report. comprehensive system of internal controls; comprising
of internal checks, internal audit and financial and other
The Companies Act No. 07 of 2007 requires the Directors controls required to carry on the Company’s business in an
to prepare Financial Statements for each year, giving a true orderly manner and to safeguard its assets, and ensure as far
and fair view of the state of the affairs of the Company as at as practicable, the accuracy and reliability of records.
the end of the financial year and the financial performance
for the year. The Directors confirm that the Auditors of the Company,
Messrs Ernst & Young were provided every opportunity to
The Directors are also responsible to ensure that proper undertake whatever inspections they considered necessary
accounting books and records are maintained to prepare to enable them to form their opinion on the Financial
the Financial Statements with reasonable accuracy. Statements. Messrs Ernst & Young have examined the
Financial Statements made available, together with all other
The Financial Statements consist of the statement of
financial records, minutes of Shareholders’ and Directors’
financial position as at 31st March 2021, statement of
meetings and related information, and have expressed their
comprehensive income, statement of changes in equity and
opinion which appears on pages 116 to 118 of this Annual
statement of cash flow for the year ended, together with
Report.
the notes thereto.
The Directors confirm that to the best of their knowledge
The Directors confirm that the consolidated Financial
all taxes, duties and levies payable by the Company and
Statements of the Company give a true and fair view of;
all contributions, levies and taxes payable on behalf of and
• The state of affairs of the Company as at 31st March 2021 in respect of the employees of the Company and all other
• The profit or loss of the Company and its subsidiary for known statutory dues as were due and payable by the
the financial year then ended Company as at the Balance Sheet date have been paid, or
The Board accepts the responsibility for the integrity and where relevant provided for.
objectivity of the Financial Statements, and the Directors
The Board of Directors confirm that they have authorised
are responsible to ensure that in preparing the Financial
distribution of dividends upon being satisfied that the
Statements, appropriate accounting policies have been
Company fulfils the solvency test immediately after such
selected and applied in a consistent manner, and that
distributions are made in accordance with Section 57 of the
material departures, if any, have been disclosed and
Companies Act No. 07 of 2007, and as required by Section
explained.
56 (2) of the said Companies Act, have obtained solvency
It is the responsibility of the Directors to ensure that the certificates from the Auditor, prior to authorising interim
Financial Statements have been prepared in conformity dividends for this year.
with Sri Lanka Accounting Standards (LKAS / SLFRS),
The Directors are of the opinion that the Financial
Companies Act No. 07 of 2007 and the Listing Rules of the
Statements presented in the report from pages 119 to 177
Colombo Stock Exchange, and be certified by the General
have been prepared in accordance with the above, and that
Manager Finance of the Company, and signed by the two
they discharged their duties as set out in this statement.
Directors as required by the Companies Act No. 07 of 2007.
By order of the Board,
The Directors consider that in preparing the Financial
Statements exhibited from pages 119 to 177 they have
adopted appropriate accounting policies on a consistent
basis, supported by reasonable and prudent judgment,
assumptions and estimates.
Ms. Jayanga Wegodapola
The Directors are required to prepare these Financial Company Secretary
Statements on a going concern basis, unless it is
23rd August 2021

FINANCIAL
REPORTS
111, Negambo Road
Peliyagoda
Annual Report s 2021 – Dilmah Ceylon Tea Company PLC

INDEPENDENT AUDITOR’S REPORT
Use of Scanned Audit or’s Signat ure in t he Annual Report s
Dear Mr. Hathurusinghe
Further to your request, we confirm that the signature may be electronically scanned in the
annual reports of Dilmah Ceylon Tea Company PLC.
We trust that the electronic signature will be used only for the aforesaid purpose and would
appreciate if you could confirm the same by signing and returning the attached copy of this
letter.
WRHDS/NM/EDA responsibilities for the audit of the financial statements
section of our report. We are independent of the Group
Yours faithfully
INDEPENDENT AUDITOR’S REPORT
in accordance with the Code of Ethics issued by CA Sri
WRHDS/
TO THE NM/ EDA OF DILMAH CEYLON TEA
SHAREHOLDERS Lanka (Code of Ethics) and we have fulfilled our other
COMPANY PLC ethical responsibilities in accordance with the Code
Mr Chamil Hathurusinghe 29weAugust
of Ethics. We believe that the audit evidence have 2021
Sector Finance Controller obtained is sufficient and appropriate to provide a basis
Report on the audit of the
byfinancial statements
Dilmah
We agree Tea
to abide the above conditions. On behalf
for our of Dilmah Ceylon Tea Company PLC.
opinion.
111,
Opinion Negambo Road Key audit matters
With respect to publication of the annual report on our website, we acknowledge that:
Peliyagoda
We have audited the financial statements of Dilmah Key audit matters are those matters that, in our
Ceylon Tea Company PLC (“the Company”) and the professional judgment, were of most significance in our
(1) we
consolidated are responsible
financial statements offor
thethe electronic
Company and itspresentation of the annual report
audit of the financial statements of the current period.
Annual Report s 2021 – Dilmah Ceylon Tea Company PLC
(2)
subsidiaries we will
(“the ensure
Group”), thatcomprise
which the electronic versionThese
the statement of the audited
matters werefinancial
addressedstatements
in the contextand theaudit
of our
auditor’s report on 2021,
Use of Scanned Audit or’s Signat
of financial position as at 31 March the website
will be identical
ure
of thein
and thetot he
thestatements
financial final
Annualsignedahard
asReportcopy
whole, s inversion
and forming
(3)
statement ofwe willorclearly
profit differentiate
loss, statement between audited
of comprehensive and unaudited
our opinion information
thereon, and in thea separate
we do not provide
Dear construction of the entity’s web site as we understand the potential risk of below, our
income, statement of changes
Mr.forHathurusinghe
in equity and statement opinion on these matters. For each matter
of cash flows the year then ended, and notes to the
misrepresentation description of how our audit addressed the matter is
financial statements, including a summary of significant
(4) we have assessed the controls over the security and
provided in that integrity
context. of the data on the web site
Further
accounting to your request, we confirm that the signature may be electronically scanned in the
policies.
and that adequate procedures are in place Weto ensure thetheintegrity of thedescribed
information
annual reports of Dilmah Ceylon Tea Company PLC.
have fulfilled responsibilities in the
published
In our opinion, and
the accompanying financial statements of Auditor’s responsibilities for the audit of the financial
the(5)
Company weandwill
thenot present
Group give a the
true auditor’s report
and fair view of on the full section
statements financial statements
of our with extracts
report, including in relationonly
the We trust
financialof
that of
position the
the full
electronic
annual
the Companyreportandsignature
the Group aswill be used only for the aforesaid purpose and would
to these matters. Accordingly, our audit included the
at 31appreciate if you
March 2021, and could
of their confirm
financial the same
performance and byperformance
signing and returning the attached copy of this
of procedures designed to respond to our
cashletter.
flows for the year then ended in accordance with Sri assessment of the risks of material misstatement of the
Lanka Accounting Standards. financial statements. The results of our audit procedures,
Signature ……………………………
Yours faithfully
Basis for opinion
including the procedures performed to address the
matters below, provide the basis for our audit opinion on
WeDesignation ………
conducted our audit in……………………
accordance with Sri Lanka
the accompanying financial statements.
Auditing Standards (SLAuSs). Our responsibilities under
Date
those standards are……………
further ……………in…the Auditor’s
described Seal …………………………………
We agree to abide by the above conditions. On behalf of Dilmah Ceylon Tea Company PLC.
EY202108298625
With respect
Part ners: toFCA
H M A Jayesinghe publication
FCMA R N de Saramof
ACAthe
FCMA annual report
Ms. N A De Silva FCA W R Hon our
De Silva website,
ACA ACMA Ms. Y A Dewe acknowledge
Silva FCA that:
Ms. K R M Fernando FCA ACMA
N Y R L Fernando ACA W K B S P Fernando FCA FCMA Ms. L K H L Fonseka FCA D N Gamage ACA ACMA A P A Gunasekera FCA FCMA A Herat h FCA
D K Hulangamuwa FCA FCMA LLB (Lond) Ms. A A Ludowyke FCA FCMA Ms. G G S Manat unga FCA A A J R Perera ACA ACMA Ms. P V K N Sajeewani FCA
N M Sulaiman ACA ACMA B E Wijesuriya FCA FCMA
(1)
Principals: we are responsible for the electronic presentation of the annual report
G B Goudian ACMA Ms. P S Paranavit ane ACMA LLB (Colombo) T P M Ruberu FCMA FCCA C A Yalagala ACMA
A(2)
member ﬁrm ofwe will
Ernst & Youngensure
Global Limit ed that the electronic version of the audited financial statements and the
auditor’s report on the website will be identical to the final signed hard copy version
(3) we will clearly differentiate between audited and unaudited information in the
construction of the entity’s web site as we understand the potential risk of
misrepresentation
(4) we have assessed the controls over the security and integrity of the data on the web site
and that adequate procedures are in place to ensure the integrity of the information
Key audit matter How our audit addressed the key audit matter
Revenue from Contracts with Customers
The principal activities of the Group as Our audit approach included the following;
described in Note 1.2 is the manufacture ~ We gained an understanding and assessed the appropriateness of
and export of tea. Revenue was identified the Group’s revenue recognition accounting policy.
as a key audit matter due to:
~ We tested the operating effectiveness of key controls particularly on
~ The materiality of the account balance, the consideration of contractual terms and timely recording of sales
and transactions during the year.
~ The need to consider contractual terms
~ Due to the high reliance on information technology in revenue
of sales arrangements entered with
recognition, we tested the integrity of the general IT control
customers in determining the timing of
environment relating to the IT system relevant to revenue recognition
revenue recognition, particularly terms
and tested IT application controls
of delivery.
~ We obtained an understanding of how revenue has trended over
the year through performing analytical procedures and checked
supporting documents over revenue transactions recorded during the
year.
~ We selected invoices raised within proximity of the financial year
end and agreed to underlying evidence to support revenue being
recognized in the correct reporting period.
We also assessed the adequacy of disclosures made in relation to the
recognition of revenue in Note 2.18 to the financial statements.
Other information included in the 2021 Annual Report for such internal control as management determines
Other information consists of the information included is necessary to enable the preparation of financial
in the Annual Report, other than the financial statements statements that are free from material misstatement,
and our auditor’s report thereon. Management is whether due to fraud or error.
responsible for the other information.
In preparing the financial statements, management is
Our opinion on the financial statements does not cover responsible for assessing the Group’s ability to continue
the other information and we do not express any form of as a going concern, disclosing, as applicable, matters
assurance conclusion thereon. related to going concern and using the going concern
basis of accounting unless management either intends
In connection with our audit of the financial statements, to liquidate the Group or to cease operations, or has no
our responsibility is to read the other information and, realistic alternative but to do so.
in doing so, consider whether the other information is
materially inconsistent with the financial statements Those charged with governance are responsible for
or our knowledge obtained in the audit or otherwise overseeing the Company’s and the Group’s financial
appears to be materially misstated. If, based on the work reporting process.
we have performed, we conclude that there is a material
Auditor’s responsibilities for the audit of the financial
misstatement of this other information, we are required
statements
to report that fact. We have nothing to report in this
Our objectives are to obtain reasonable assurance about
regard.
whether the financial statements as a whole are free from
Responsibilities of the management and those charged material misstatement, whether due to fraud or error,
with governance and to issue an auditor’s report that includes our opinion.
Management is responsible for the preparation of Reasonable assurance is a high level of assurance, but is
financial statements that give a true and fair view in not a guarantee that an audit conducted in accordance
accordance with Sri Lanka Accounting Standards, and with SLAuSs will always detect a material misstatement

when it exists. Misstatements can arise from fraud or regarding the financial information of the entities or
error and are considered material if, individually or in business activities within the Group to express an
the aggregate, they could reasonably be expected to opinion on the consolidated financial statements.
influence the economic decisions of users taken on the We are responsible for the direction, supervision and
basis of these financial statements. performance of the group audit. We remain solely
responsible for our audit opinion.
As part of an audit in accordance with SLAuSs, we
exercise professional judgment and maintain professional
We communicate with those charged with governance
skepticism throughout the audit. We also:
regarding, among other matters, the planned scope
~ Identify and assess the risks of material misstatement and timing of the audit and significant audit findings,
of the financial statements, whether due to fraud including any significant deficiencies in internal control
or error, design and perform audit procedures that we identify during our audit.
responsive to those risks, and obtain audit evidence

We also provide those charged with governance
that is sufficient and appropriate to provide a
with a statement that we have complied with ethical
basis for our opinion. The risk of not detecting a
requirements in accordance with the Code of Ethics
material misstatement resulting from fraud is higher
regarding independence, and to communicate with them
than for one resulting from error, as fraud may
all relationships and other matters that may reasonably
involve collusion, forgery, intentional omissions,
be thought to bear on our independence, and where
misrepresentations, or the override of internal
applicable, related safeguards.
control.
~ Obtain an understanding of internal control relevant From the matters communicated with those charged
to the audit in order to design audit procedures with governance, we determine those matters that
that are appropriate in the circumstances, but not were of most significance in the audit of the financial
for the purpose of expressing an opinion on the statements of the current period and are therefore the
effectiveness of the internal controls of the Company key audit matters. We describe these matters in our
and the Group. auditor’s report unless law or regulation precludes public
~ Evaluate the appropriateness of accounting policies disclosure about the matter or when, in extremely rare
used and the reasonableness of accounting estimates circumstances, we determine that a matter should not
and related disclosures made by management. be communicated in our report because the adverse
~ Conclude on the appropriateness of management’s consequences of doing so would reasonably be
use of the going concern basis of accounting and, expected to outweigh the public interest benefits of such
based on the audit evidence obtained, whether communication.
a material uncertainty exists related to events or
Report on other legal and regulatory requirements
conditions that may cast significant doubt on the
Group’s ability to continue as a going concern. If we As required by section 163 (2) of the Companies Act No.
conclude that a material uncertainty exists, we are 07 of 2007, we have obtained all the information and
required to draw attention in our auditor’s report to explanations that were required for the audit and, as far
the related disclosures in the financial statements as appears from our examination, proper accounting
or, if such disclosures are inadequate, to modify our records have been kept by the Company.
opinion. Our conclusions are based on the audit
CA Sri Lanka membership number of the engagement
evidence obtained up to the date of our auditor’s
partner responsible for signing this independent auditor’s
report. However, future events or conditions may
report is 4107.
cause the Group to cease to continue as a going
concern.
~ Evaluate the overall presentation, structure and
content of the financial statements, including the
disclosures, and whether the financial statements
30 August 2021.
represent the underlying transactions and events in a
Colombo
manner that achieves fair presentation.
~ Obtain sufficient appropriate audit evidence

STATEMENT 0F FINANCIAL POSITION
GROUP COMPANY
As at 31 March 2021 Note 2021 2020 2021 2020
Rs.'000 Rs.'000 Rs.'000 Rs.'000
ASSETS
Non-Current Assets
Property, Plant and Equipment 4 3,328,489 3,245,976 3,273,610 3,188,118
Investment Property 5 647,946 658,528 647,946 658,528
Intangible Assets 6 176,085 195,979 176,085 195,979
Right of Use Asset 7 1,114,524 1,156,133 1,103,467 1,144,619
Other Non-Current Financial Assets 8 379,214 469,709 379,214 469,709
Total Non-Current Assets 5,646,258 5,726,325 5,580,322 5,656,953
Current Assets
Inventories 9 1,546,975 1,351,607 1,530,360 1,335,427
Trade and Other Receivables 10 4,639,012 4,930,503 4,616,911 4,904,140
Advances and Prepayments 242,079 451,144 239,998 447,643
Amounts Due from Related Party 11 - - 85,102 88,987
Other Current Financial Assets 12 1,543,601 - 1,543,601 -
Cash and Cash Equivalents 13 3,170,827 4,845,500 3,162,180 4,837,295
Total Current Assets 11,142,494 11,578,754 11,178,152 11,613,492
Total Assets 16,788,752 17,305,079 16,758,474 17,270,445
EQUITY AND LIABILITIES

Capital and Reserves
Stated Capital 14 642,500 642,500 642,500 642,500
Other Components of Equity 145,179 229,999 145,179 229,999
Retained Earnings 13,087,861 11,463,554 13,081,997 11,456,887
Total Equity 13,875,540 12,336,053 13,869,676 12,329,386
Non-Current Liabilities
Lease Liability 7 1,093,012 1,082,572 1,082,311 1,071,934
Deferred Tax Liabilities 23 187,426 254,531 182,823 250,257
Retirement Benefit Obligations 15 286,037 234,340 279,614 229,392
1,566,475 1,571,443 1,544,748 1,551,583
Current Liabilities
Trade and Other Payables 16 489,579 516,414 489,601 514,642
Provisions and Accrued Expenses 566,396 619,048 564,426 613,592
Lease Liability 7 99,012 111,569 97,904 110,321
Short Term Loans 17 - 1,895,000 - 1,895,000
Income Tax Payable 23 191,750 255,552 192,119 255,921
1,346,737 3,397,583 1,344,050 3,389,476
Total Liabilities 2,913,212 4,969,026 2,888,798 4,941,059
Total Equity and Liabilities 16,788,752 17,305,079 16,758,474 17,270,445
These financial statements are in compliance with the requirements of the Companies Act No. 07 of 2007.
Chamil Hathurusinghe
Sector Finance Controller
The Board of Directors is responsible for these financial statements. Signed for and on behalf of the board by;

Dilhan C Fernando Darshana Gunasekera

Director/Chief Executive Officer Group Finance Director
The accounting policies and notes on pages 126 through 174 form an integral part of these financial statements.
23rd August 2021

STATEMENT 0F PROFIT OR LOSS
GROUP COMPANY
Year ended 31 March 2021 Note 2021 2020 2021 2020
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Revenue from Contracts with Customers 18 9,211,987 11,610,062 9,175,653 11,555,335
Cost of Sales (5,463,590) (6,222,332) (5,419,116) (6,166,152)
Gross Profit 3,748,397 5,387,730 3,756,537 5,389,183
Other Income 19 41,334 14,879 41,318 14,133

Administrative Expenses (1,630,867) (1,640,332) (1,635,167) (1,641,557)
Selling and Distribution Costs (1,665,462) (2,181,006) (1,665,372) (2,180,510)
Foreign Exchange Gain 1,220,788 408,812 1,215,450 407,407
Finance Costs 20 (197,378) (183,357) (195,954) (181,925)
Finance Income 21 397,793 182,161 397,793 182,156
Profit Before Tax 22 1,914,605 1,988,887 1,914,605 1,988,887
Income Tax Expense 23 (164,890) (429,640) (164,494) (429,143)

Profit for the year 1,749,715 1,559,247 1,750,111 1,559,744
Earnings per Share (Rs.) 24 84.38 75.19 84.39 75.21

Dividend per Share (Rs.) 25 5.00 35.00

STATEMENT 0F COMPREHENSIVE INCOME
GROUP COMPANY
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Profit for the year 1,749,715 1,559,247 1,750,111 1,559,744

Other Comprehensive Income
Other Comprehensive Income to be reclassified to
Profit or Loss in subsequent periods;
Change in Fair Value of FVOCI Investments 8.3 (84,820) (42,585) (84,820) (42,585)
Net Other Comprehensive Income to be reclassified (84,820) (42,585) (84,820) (42,585)
to Profit or Loss in subsequent periods;
Other Comprehensive Income not to be classified to

profit or loss in subsequent periods:
Re-measurement Gain / (Loss) on Employee 15 (25,256) 26,423 (24,783) 26,293
Retirement Benefit Obligation
Deferred Tax attributable to re-measurement Gain / 23 3,536 (3,699) 3,470 (3,681)
(Loss) on Employee Retirement Benefit Obligation
Net Other Comprehensive Income not to be (21,720) 22,724 (21,313) 22,612

reclassified to Profit or Loss in Subsequent periods;
Other Comprehensive Income for the year, Net of Tax (106,540) (19,861) (106,133) (19,973)
Total Comprehensive Income for the year, Net of Tax 1,643,175 1,539,386 1,643,978 1,539,771

STATEMENT 0F CHANGES IN EQUITY - GROUP
Other Components of Equity
Stated FVOCI Retained
Year ended 31 March 2021 Note
Capital Reserve Earnings Total
Rs.'000 Rs.'000 Rs.'000 Rs.'000
As at 31 March 2019 642,500 272,584 10,607,395 11,522,479
Profit for the Year - - 1,559,247 1,559,247

Other Comprehensive Income - (42,585) 22,724 (19,861)
Total Comprehensive Income for the year - (42,585) 1,581,971 1,539,386
Interim Dividend - 2019/20 25 - - (414,750) (414,750)
Final Dividend - 2018/19 25 - - (311,062) (311,062)
As at 31 March 2020 642,500 229,999 11,463,554 12,336,053

Other Comprehensive Income - (84,820) (21,720) (106,540)
Final Dividend - 2019/20 23 - - (103,688) (103,688)
As at 31 March 2021 642,500 145,179 13,087,861 13,875,540

STATEMENT 0F CHANGES IN EQUITY - COMPANY
Other Components of Equity
Stated FVOCI Retained
Year ended 31 March 2021 Note
Capital Reserve Earnings Total
Rs.'000 Rs.'000 Rs.'000 Rs.'000
As at 31 March 2019 642,500 272,584 10,600,343 11,515,427

Other Comprehensive Income, Net of Tax - (42,585) 22,612 (19,973)
Total Comprehensive Income for the year (42,585) 1,582,356 1,539,771
Final Dividend - 2018/19 23 - - (311,062) (311,062)
As at 31 March 2020 642,500 229,999 11,456,887 12,329,386

Other Comprehensive Income, Net of Tax - (84,820) (21,313) (106,133)
As at 31 March 2021 642,500 145,179 13,081,997 13,869,676
The accounting policies and notes on pages 126 through 174 form an integral part of these financial statements

STATEMENT 0F CASH FLOWS
GROUP COMPANY
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Cash Flows From / (Used in) Operating Activities
Profit before Income Tax Expense 1,914,605 1,988,887 1,914,605 1,988,887
Adjustments for
Depreciation 22 307,274 285,545 303,936 282,886
Amortisation of Intangible Assets 22 25,808 109,532 25,808 109,533
Depreciation on Right of Use Asset 7 29,806 29,805 29,349 29,349
Interest Expense on Lease Liability 20 142,413 142,719 140,991 141,287
Unrealised Foreign Exchange (Gain) / Loss (457,255) (176,307) (454,703) (175,726)
Interest Expenses 20 54,965 183,357 54,963 181,925
Dividend Income 19 (5) (75) (5) (75)
Interest Income 21 (397,793) (182,161) (397,793) (182,156)
Loss/(Profit) on Disposal of Property, Plant and (29,267) 2,758 (29,267) 2,758
Equipment
Profit on disposal of Investment (1) - (1) -
Provision for Impairment of Receivables 61,965 72,500 57,798 72,500
Provision for Defined Benefit Plans 15 45,589 45,866 44,587 44,861
Impairment on Unquoted Equity Securities 5,675 - 5,675 -
Impairment Loss on Amounts due from Related Party - - 13,918 3,178
Operating Profit before Working Capital Changes 1,703,779 2,502,426 1,709,861 2,499,207
Working Capital Changes:

Increase/(Decrease) Inventories (195,368) (277,480) (194,933) (270,800)
Increase/(Decrease) Trade and Other Receivables 513,432 (833,776) 511,113 (852,768)
Increase/(Decrease) Advances and Prepayments 209,063 (74,807) 207,645 (81,786)
(Increase)/Decrease Amounts Due from Related Party - - (10,033) 5,203
Increase/(Decrease) Trade and Other Payables (26,109) 174,925 (24,534) 176,511
(Increase)/Decrease Provisions and Accrued Expenses (52,652) 136,802 (49,166) 135,257
Cash Flows from Operations 2,152,145 1,628,090 2,149,953 1,610,824
Retirement Benefit Obligation Paid 15 (19,148) (27,145) (19,148) (26,252)

Interest Paid (54,965) (183,357) (54,963) (181,925)
Income Tax Paid (292,262) (143,021) (292,262) (142,711)
Net Cash Flows from Operating Activities 1,785,770 1,274,567 1,783,580 1,259,936

STATEMENT 0F CASH FLOWS
GROUP COMPANY
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Investing Activities
Acquisition of Property, Plant and Equipment (379,178) (545,051) (378,819) (535,630)
Acquisition of Investment Properties (75) (19,459) (75) (19,459)
Acquisition of Intangible Assets (5,914) (5,336) (5,914) (5,336)
Acquisition of Bond Investments (1,511,601) - (1,511,601) -
Proceeds from disposal of Property, Plant and Equipment 29,314 15,120 29,314 15,120
Dividend Received 5 75 5 75
Interest Received 397,793 182,161 397,793 182,156
Net Cash Flows used in Investing Activities (1,469,656) (372,490) (1,469,297) (363,074)
Financing Activities
Repayment of Lease Liability (132,727) (134,517) (131,228) (133,001)
Dividend Paid (103,688) (725,812) (103,688) (725,812)
Proceeds from Interest Bearing Loans and Borrowings - 1,895,000 - 1,895,000
Repayments of Interest Bearing Loans and Borrowings (1,895,000) - (1,895,000) -
Net Cash Flows used in from Financing Activities (2,131,415) 1,034,671 (2,129,916) 1,036,187
Effect of Exchange Rate Changes on Cash and Cash 140,628 101,575 140,518 101,319
Equivalents
Net Increase / (Decrease) in Cash and Cash Equivalents (1,674,673) 2,038,323 (1,675,115) 2,034,368
Cash and Cash Equivalents at the beginning of the year 4,845,500 2,807,177 4,837,295 2,802,927
Cash and Cash Equivalents at the end of the year 13 3,170,827 4,845,500 3,162,180 4,837,295

NOTES TO THE FINANCIAL STATEMENTS
1. CORPORATE INFORMATION The Group did not adopt any inappropriate
accounting treatments, which are not in
1.1 General
compliance with the requirements of the SLFRSs
Dilmah Ceylon Tea Company PLC (“the Company”) and LKASs, regulations governing the preparation
is a public limited liability Company, incorporated and presentation of the Financial Statements
and domiciled in Sri Lanka and listed on the
Colombo Stock Exchange. The registered office of The preparation and presentation of these financial
the Company and the principal place of business is statements is in compliance with the requirements
situated at No. 111, Negombo Road, Peliyagoda. of the Companies Act No.07 of 2007.
1.2 Principal Activities and Nature of Operations 2.2 Basis of Preparation
The principal activities of the Company are to The Financial Statements have been prepared on
manufacture, export and market tea bags and a historical cost basis, except for the following
packets under the brand name “Dilmah”. material items in the Statement of Financial
Position;
MJF Beverages (Private) Limited is a private
limited liability company incorporated and ~ Fair Value through other comprehensive income
domiciled in Sri Lanka and is engaged in investment are measured at fair value.
manufacture, export, and market tea in the form of ~ Retirement Benefit Obligation at present value
liquid tea concentrate and ready to drink tea. of the obligation.
1.3 Parent Entity and Ultimate Parent Entity Where appropriate, the specific policies are
explained in the succeeding notes.
The Company’s parent undertaking is MJF Teas
(Private) Limited. In the opinion of the Directors, 2.3 Functional and Presentation Currency
the Company’s ultimate parent undertaking and The Financial Statements are presented in
controlling party is MJF Holdings Limited, which is Sri Lankan Rupees, which is also the Group’s
incorporated in Sri Lanka. functional currency.
1.4 Date of Authorization for Issue 2.4 Basis of Consolidation

The Financial Statements of the Group as at and The Consolidated Financial Statements comprise
for the year ended 31 March 2021 were authorized the Financial Statements of the Group and its
for issue in accordance with a resolution of the subsidiary as at the reporting date. Control is
Board of Directors on 23rd August 2021. achieved when the Group is exposed, or has rights,
to variable returns from its involvement with the
2. SIGNIFICANT ACCOUNTING POLICIES investee and has the ability to affect those returns
through its power over the investee.
2.1 Statement of Compliance
The consolidated Financial Statements of the Specifically, the Group controls an investee if and
Group and the separate Financial Statements of only if the Group has:
the Company, have been prepared and presented
~ Power over the investee (i.e. existing rights that
in accordance with the Sri Lanka Accounting
give it the current ability to direct the relevant
Standards (SLFRSs and LKASs), laid down by The
activities of the investee)
Institute of Chartered Accountants of Sri Lanka
~ Exposure, or rights, to variable returns from its
(CA Sri Lanka). These Financial Statements, except
involvement with the investee, and
for information on cash flows have been prepared
~ The ability to use its power over the investee to
following the accrual basis of accounting.
affect its returns
These SLFRSs and LKASs are available at www.
casrilanka.com

The country of incorporation, effective 2.5 Common Control Business Combinations
shareholding and principal activities of the Business combinations between entities under
subsidiary incorporated in the Financial common control are accounted for using pooling
Statements are as follows: of interest method. Accordingly,
Name of the Country of Effective ~ The assets and liabilities of the combining
subsidiary incorporation shareholding entities are reflected at their carrying amounts.
2021 2020 ~ No new goodwill is recognised as a result of
MJF Beverages Sri Lanka 100% 100% the combination. Net outcome of the net assets
(Private) Limited acquired and the shares issued is reflected
within equity.
The Group re-assesses whether or not it controls
an investee if facts and circumstances indicate 2.6 Changes in Significant Accounting Policies
that there are changes to one or more of the three New and amended standards and interpretations
elements of control. Consolidation of a subsidiary
The Group applied for the first time, certain
begins when the Group obtains control over the
standards and amendments, which are effective
subsidiary and ceases when the Group loses
for annual periods beginning on or after 1 April
control of the subsidiary. Assets, liabilities, income
2020.
and expenses of a subsidiary acquired or disposed
of during the year are included in the Consolidated The Group has not early adopted any other
Financial Statements from the date the Group standard, interpretation or amendment that has
gains control until the date the Group ceases to been issued but is not yet effective.
control the subsidiary.
Amendments to SLFRS 3: Reference to the
Profit or loss and each component of other conceptual framework
comprehensive income are attributed to the equity
The amendment to SLFRS 3 Business
holders of the parent of the Group and to the
Combinations clarifies that to be considered
non-controlling interest, even if this results in the
a business, an integrated set of activities and
non-controlling interest having a deficit balance.
assets must include, at a minimum, an input and
All intra-group assets, liabilities, equity, income,
a substantive process that, together, significantly
expenses and cash flows relating to transactions
contribute to the ability to create output.
between members of the Group are eliminated full
Furthermore, it clarifies that a business can exist
on consolidation.
without including all of the inputs and processes
If the Group losses control over a subsidiary, it de- needed to create outputs. These amendments
recognises the related assets (including goodwill), had no impact on the financial statements of the
liabilities and other components of equity while Group but may impact future periods should the
any resultant gain or loss is recognised in the Group enter into any business combinations.
Consolidated Statement of Profit or Loss.
Amendments to LKAS 1 and LKAS 8 Definition of
The Financial Statements of the subsidiary is Material
prepared for the same reporting period as the The amendments provide a new definition of
holding company. The accounting policies set material that states, “information is material
out below have been applied consistently by the if omitting, misstating or obscuring it could
Group entities to all periods presented in the reasonably be expected to influence decisions
Financial Statements. that the primary users of general purpose
financial statements make on the basis of those
financial statements, which provide financial
information about a specific reporting entity.” The

amendments clarify that materiality will depend Non-monetary items that are measured in terms of
on the nature or magnitude of information, historical cost in a foreign currency are translated
either individually or in combination with other using the exchange rates as at the dates of the
information, in the context of the financial initial transactions. Non-monetary items measured
statements. A misstatement of information is at fair value in a foreign currency are translated
material if it could reasonably be expected to using the exchange rates at the date when the fair
influence decisions made by the primary users. value was determined.
These amendments had no impact on the financial 2.9 Property, Plant and Equipment
statements of, nor is there expected to be any Property, plant and equipment are stated at
future impact to, the Group. cost, net of accumulated depreciation and
accumulated impairment loss. Such cost includes
Amendments to references to the conceptual
the cost of replacing part of the property, plant
framework in SLFRS standards
and equipment. Other subsequent expenditure is
Revisions to the Conceptual Framework were capitalised only when it increases future economic
made because some important issues were not benefits of the related item of property, plant and
covered and some guidance was unclear or out of equipment and the cost can be reliably measured.
date. The revised Conceptual Framework includes: The cost of self-constructed assets includes the
a new chapter on measurement; guidance on cost of materials and direct labour, any other
reporting financial performance; improved costs directly attributable to bringing the asset to
definitions of an asset and a liability, and guidance a working condition for its intended use, and the
supporting these definitions; and clarifications in costs of dismantling and removing the items and
important areas, such as the roles of stewardship, restoring the site on which they are located. All
prudence and measurement uncertainty in other expenditure is recognised in profit or loss as
financial reporting. incurred.
These amendments had no impact on the financial Depreciation is calculated on a straight-line basis
statements of the Group. over the estimated useful lives of the assets except
2.7 Comparative Information land, as follows:
The accounting policies have been consistently Buildings on Leasehold Over the lease period
applied by the Group and, are consistent with Land
those used in the previous year. Previous period Plant and Machinery Over 10 years
figures and notes have been reclassified wherever
Factory Equipment Over 5 years
necessary to conform to the current year’s
Furniture and Fittings Over 7 years
presentation. Such reclassifications were made to
improve the quality of presentation and do not Office and Stores Over 5 years
Equipment
affect previously reported profit or equity.
Computer Hardware Over 3 years
2.8 Foreign Currency Translation Motor Vehicles Over 5 years
The Financial Statements are presented in Sri
Lanka Rupees, which is the Group’s functional The carrying values of property, plant and
and presentation currency. Transactions in foreign equipment are reviewed for impairment when
currencies are initially recorded at the functional events or changes in circumstances indicate that
currency rate ruling at the date of the transaction. the carrying value may not be recoverable. If any
Monetary assets and liabilities denominated such indication exists and where the carrying
in foreign currencies are retranslated at the values exceed the estimated recoverable amount,
functional currency rate of exchange ruling at the the assets are written down to their recoverable
reporting date. All differences are taken to profit
or loss.

amount being the higher of their fair value less Investment properties are derecognised when
costs to sell and their value in use. either they have been disposed of or when the
investment property is permanently withdrawn
The asset’s residual values, useful lives and
from use and no future economic benefit is
methods of depreciation are reviewed, and
expected from its disposal. The difference
adjusted if appropriate, at end of each reporting
between the net disposal proceeds and the
period. An estimation change in the useful life of
carrying amount of the asset is recognised in
fixed asset during the period has occurred and
the Statement of Profit or Loss in the period of
the underlying assumptions considered are based
derecognition.
on historical experience and various other factors
that are believed to be reasonable under the Transfers are made to or from investment property
circumstances. Revisions to accounting estimates only when there is a change in use. For a transfer
are recognised prospectively. from investment property to owner-occupied
property, the deemed cost for subsequent
An item of property, plant and equipment and
accounting is the fair value at the date of change
any significant part initially recognised is de-
in use. If owner-occupied property becomes an
recognised upon disposal or when no future
investment property, the Group accounts for such
economic benefits are expected from its use or
property in accordance with the policy stated
disposal. Any gain or loss arising on derecognition
under property, plant and equipment up to the
of the asset (calculated as the difference between
date of change in use.
the net disposal proceeds and the carrying
amount of the asset) is included in the Statement 2.11 Intangible Assets
of Profit or Loss when the asset is derecognised. Intangible assets acquired separately are
measured on initial recognition at cost. Following
The residual values, useful lives and methods of
initial recognition, intangible assets are carried
depreciation of property, plant and equipment are
at cost less any accumulated amortisation
reviewed at each financial year end and adjusted
and accumulated impairment losses. Internally
prospectively, if appropriate.
generated intangibles, excluding capitalised
2.9.1 Capital Work-in-Progress development costs, are not capitalised and the
Capital work-in-progress is stated at cost related expenditure is reflected in profit or loss in
which include all costs incurred from the the period in which the expenditure is incurred.
date of acquisition to the date on which it is The useful lives of intangible assets are assessed
commissioned. When commissioned, capital as finite.
work-in-progress is transferred to the appropriate

Intangible assets with finite lives are amortised
category under property, plant and equipment and
over the useful economic life and assessed for
depreciated over the estimated useful life.
impairment whenever there is an indication
2.10 Investment Property that the intangible asset may be impaired. The
amortisation period and the amortisation method
Investment property is property held either to
for an intangible asset with a finite useful life are
earn rental income or for capital appreciation
reviewed at least at the end of each reporting
or both, but not for sale in the ordinary course
period. Changes in the expected useful life or
of business, use in the production or supply of
the expected pattern of consumption of future
goods or services or for administrative purposes.
economic benefits embodied in the asset are
Investment property is measured at its cost less
considered to modify the amortisation period
accumulated impairment losses, if any. Cost
or method, as appropriate, and are treated as
includes expenditure that is directly attributable to
changes in accounting estimates. The amortisation
the acquisition of the investment property.
expense on intangible assets with finite lives is

recognised in the Statement of Profit or Loss in 2.12 Leases
the expense category that is consistent with the The Group assesses at contract inception whether
function of the intangible assets. a contract is, or contains, a lease. That is, if the
contract conveys the right to control the use
Gains or losses arising from derecognition of an
of an identified asset for a period of time in
intangible asset are measured as the difference
exchange for consideration. To assess whether a
between the net disposal proceeds and the
contract conveys the right to control the use of an
carrying amount of the asset and are recognised in
identified asset, the Group considered whether;
the Statement of Profit or Loss when the asset is
derecognised. ~ The contract involves the use of an identified
asset. This may be specified explicitly or
Research and Development Costs
implicitly and should be physically distinct or
Research costs are expensed as incurred.
represent substantially all of the capacity of a
Development expenditures on an individual project
physically distinct asset. If the supplier has a
are recognised as an intangible asset when the
substantive substation right, then the asset in
Group can demonstrate:
not identified.
~ The technical feasibility of completing the ~ The Group has right to obtain substantially all
intangible asset so that the asset will be of the economic benefits of asset throughout
available for use or sale the period of use; and
~ Its intention to complete and its ability and ~ The Group has right to direct the use of the
intention to use or sell the asset asset. The Group has this right when it has
~ How the asset will generate future economic decision-making rights that are most relevant
benefits to changing how and for what purpose the
~ The availability of resources to complete the asset is used. In rare cases where the decision
asset about how and for what purpose the asset is
~ The ability to measure reliably the expenditure used is predetermined, the Group has the right
during development to direct the use of the asset if either;
~ The Group has right to operate the asset; or
Following initial recognition of the development ~ he Group designated the asset in a way that
expenditure as an asset, the asset is carried at predetermines how and for what purpose it will
cost less any accumulated amortisation and be used.
accumulated impairment losses. Amortisation
of the asset begins when development is Group as the Lessor
complete and the asset is available for use. It is Leases in which the Group does not transfer
amortised over the period of expected future substantially all the risks and rewards of ownership
benefit. Amortisation expense is recorded in the of an asset is classified as operating leases. Initial
Statement of Profit or Loss. During the period of direct costs incurred in negotiating and arranging
development, the asset is tested for impairment an operating lease added to the carrying amount
annually. of the leased asset and recognised over the lease
term on the same basis rental income. Contingent
A summary of the policies applied to the Group’s rents are recognised as revenue in the period in
intangible assets is as follows: which they are earned.
Software Group as the Lessee

Useful lives Finite The Group applies a single recognition and
Amortisation method used 10 years measurement approach for all leases, except
Internally generated or Acquired for short-term leases and leases of low-value
acquired assets. The Group recognises lease liabilities to

make lease payments and right-of-use assets incurred to produce inventories) in the period
representing the right to use the underlying assets. in which the event or condition that triggers the
payment occurs.
(i) Right-of-use assets
The Group recognises right-of-use assets at the In calculating the present value of lease payments,
commencement date of the lease (i.e., the date the the Group uses its incremental borrowing rate
underlying asset is available for use). Right-of-use at the lease commencement date because the
assets are measured at cost, less any accumulated interest rate implicit in the lease is not readily
depreciation and impairment losses, and adjusted determinable. After the commencement date, the
for any remeasurement of lease liabilities. The amount of lease liabilities is increased to reflect
cost of right-of-use assets includes the amount the accretion of interest and reduced for the lease
of lease liabilities recognised, initial direct costs payments made. In addition, the carrying amount
incurred, and lease payments made at or before of lease liabilities is remeasured if there is a
the commencement date less any lease incentives modification, a change in the lease term, a change
received. The right-of-use assets are subsequently in the lease payments (e.g., changes to future
depreciated using the straight-line method from payments resulting from a change in an index or
the commencement date to the lease term. The rate used to determine such lease payments) or a
estimated useful lives of right-of-use assets change in the assessment of an option to purchase
are determined on the same basis as those of the underlying asset. (refer Note 8).
property, plant and equipment and are in the
(iii) Short-term leases and leases of low-value
range of 3 to 36 years.
assets
If ownership of the leased asset transfers to The Group applies the short-term lease
the Group at the end of the lease term or the recognition exemption to its short-term leases (i.e.,
cost reflects the exercise of a purchase option, those leases that have a lease term of 12 months
depreciation is calculated using the estimated or less from the commencement date and do not
useful life of the asset. The right-of-use assets contain a purchase option). It also applies the
are also subject to impairment. Refer to the lease of low-value assets recognition exemption
accounting policies in section 2.516- Impairment of to leases that are considered to be low value.
non-financial assets. Lease payments on short-term leases and leases
of low-value assets are recognised as expense on a
(ii) Lease liabilities
straight-line basis over the lease term.
At the commencement date of the lease, the
Group recognises lease liabilities measured at The accounting policies applicable to the Group
the present value of lease payments to be made as a lessor in the comparative period were not
over the lease term. The lease payments include difference from SLFRS 16.
fixed payments (including in-substance fixed
Significant judgement in determining the lease
payments) less any lease incentives receivable,
term of contracts with renewal options
variable lease payments that depend on an index
or a rate, and amounts expected to be paid under The Group determines the lease term as the non-
residual value guarantees. The lease payments cancellable term of the lease, together with any
also include the exercise price of a purchase periods covered by an option to extend the lease
option reasonably certain to be exercised by the if it is reasonably certain to be exercised, or any
Group and payments of penalties for terminating periods covered by an option to terminate the
the lease, if the lease term reflects the Group lease, if it is reasonably certain not to be exercised.
exercising the option to terminate. Variable lease
payments that do not depend on an index or a The Group has the option, under some of its leases
rate are recognised as expenses (unless they are to lease the assets for additional terms of one

year. The Group applies judgement in evaluating of those from other assets or group of assets.
whether it is reasonably certain to exercise the Where the carrying amount of an asset exceeds
option to renew. That is, it considers all relevant its recoverable amount, the asset is considered
factors that create an economic incentive for it to impaired and is written down to its recoverable
exercise the renewal. After the commencement amount.
date, the Group reassesses the lease term if there
2.15 Financial Instruments
is a significant event or change in circumstances
that is within its control and affects its ability to Initial recognition of Financial Assets and
exercise (or not to exercise) the option to renew. Financial Liabilities
The Group shall recognise a financial asset or
2.13 Inventories a financial liability in its statement of financial
Inventories are valued at the lower of cost and net position when, and only when, the entity becomes
realisable value. Costs are those expenses incurred party to the contractual provisions of the
in bringing each product to its present location instrument.
and condition and are determined as follows:
Measurement of Financial Assets
~ Raw Material are valued on a first in first out A financial asset be measured at amortised cost if
(FIFO) basis both of the following conditions are met:
~ Finished Goods are valued at weighted average
costs, which includes all direct expenditure a. The asset is held within a business model whose
and appropriate share of production overhead objective is to hold assets in order to collect
based on normal operating capacity contractual cash flows and
~ Packing materials are valued at weighted b. The contractual terms of the financial asset give
average costs rise on specified dates to cash flows that are
~ Consumables and spares are valued at solely payments of principal and interest on the
weighted average costs principal amount outstanding.
~ Goods-in-transits are valued at actual costs
A financial asset shall be measured at fair
Provision for inventory obsolescence is estimated value unless it is measured at amortised cost
on a systematic basis and deducted from the in accordance with above criteria. The Group
gross carrying value of the inventory. measures Trade and Other Receivables at
amortised cost and fair value through other
Net realisable value is based on the estimated comprehensive income at Fair value and fair value
selling price in the ordinary course of business changes recognized to other comprehensive
less any further costs expected to be incurred on income.
completion and disposal.
Fair value through other comprehensive income
2.14 Impairment of Non-Financial Assets
The Group assesses at each reporting date If both of the following conditions are met,
whether there is an indication that an asset
a. the financial asset is held within a business
may be impaired. If any such indication exists,
model whose objective is achieved by both
or when annual impairment testing for an asset
collecting contractual cash flows and selling
is required, the Group makes an estimate of
financial essential assets
the asset’s recoverable amount. An asset’s
b. the contractual terms of the financial asset give
recoverable amount is the higher of an asset’s
rise on specified dates to cash flows that are
or cash generating unit’s fair value less costs
solely payments of principal and interest on
to sell or its value in use and is determined for
principal amount outstanding
an individual asset, unless the asset does not
generate cash inflows that are largely independent

Derecognition of financial assets hedging relationship be recognised in profit or loss
The Group derecognise a financial asset when when the financial liability is derecognised and
and only when the contractual rights to the cash through the amortisation process.
flows from the financial asset expire, or it transfers
Offsetting of Financial Instruments
the financial asset as and the transfer qualifies for
Financial assets and liabilities are offset and the
derecognition.
net amount is presented in the Statement of
A gain or loss on a financial asset that is measured Financial Position when, and only when, the Group
at amortised cost and is not part of a hedging has a legal right to offset the amounts and intends
relationship be recognised in profit or loss when either to settle on a net basis or to realize the
the financial asset is derecognised, impaired asset and settle the liability simultaneously.
or reclassified in accordance and through the
Cash and Cash Equivalents
amortisation process.
Cash and Cash Equivalents in the Statement of
Financial Liabilities Recognition Financial Position comprise cash on hand and at
The Group measured the financial liability at fair banks and short-term deposits which are subject
value, including the costs of the transaction which to an insignificant risk of changes in value.
can be directly assigned financial liability, when
For the purpose of the Statement of Cash Flows,
these are designated at their fair value in the profit
cash and cash equivalents consist of cash on
and loss account.
hand and at banks and short-term deposits with a
The Group assessed that the fair value of loans and maturity of three months or less.
borrowings, bank overdrafts, and trade and other
When the Group has transferred its rights to
payables.
receive cash flows from an asset or has entered
The Group has the following non-derivative into a pass-through arrangement, and has neither
financial liabilities loans and borrowings, bank transferred nor retained substantially all of the
overdrafts, and trade and other payables. risks and rewards of the asset nor transferred
control of it, the asset is recognised to the extent
Financial Liabilities Subsequent measurement
of the Group’s continuing involvement in it.
All financial liabilities are measured at amortised
cost, except for financial liabilities at fair value Impairment
through profit or loss. Financial Assets
Impairment- Recognition of expected credit
Derecognition of financial liabilities
losses
The Group derecognizes a financial liability (or
The Group recognise a loss allowance for expected
a part of a financial liability) from its statement
credit losses on a Trade Receivables to which the
of financial position when, and only when
impairment requirements apply.
its contractual obligations are discharged or
cancelled or expire. At each reporting date, the Group measure the
loss allowance for a financial instrument at an
The difference between the carrying amount of
amount equal to the lifetime expected credit
a financial liability (or part of a financial liability)
losses if the credit risk on that financial instrument
extinguished or transferred to another party and
has increased significantly since initial recognition.
the consideration paid, including any non-cash
assets transferred or liabilities assumed, shall be The objective of the impairment requirements is
recognised in profit or loss. to recognise lifetime expected credit losses for all
financial instruments for which there have been
A gain or loss on a financial liability that is
significant increases in credit risk since initial
measured at amortised cost and is not part of a

recognition — whether assessed on an individual Defined Contribution Plans – Employees’
or collective basis — considering all reasonable Provident Fund and Employees’ Trust Fund (“EPF
and supportable information, including that which and ETF”)
is forward-looking.
Employees are eligible for Employees’ Provident
Simplified approach for trade receivables Fund Contributions and Employees’ Trust Fund
The Group always measure the loss allowance at Contributions in line with the respective statutes
an amount equal to lifetime expected credit losses and regulations. The Group contributes 12%
for trade receivables or contract assets that result and 3% of gross emoluments of employees to
from transactions that are within the scope of Employees’ Provident Fund and Employees’ Trust
SLFRS 15, and that: Fund respectively, which are externally funded.
2.17 Provisions
i. do not contain a significant financing
component (or when the entity applies the Provisions are recognised when the Group has a
practical expedient for contracts that are one present legal or constructive obligation as a result
year or less) in accordance with SLFRS 15; or of a past event, it is probable that an outflow
ii. contain a significant financing component in of resources embodying economic benefits
accordance with SLFRS 15, if the entity chooses will be required to settle the obligation and a
as its accounting policy to measure the loss reliable estimate can be made of the amount
allowance at an amount equal to lifetime of the obligation. If the effect of the time value
expected credit losses. That accounting policy of money is material, provisions are discounted
shall be applied to all such trade receivables or using a current pre-tax rate that reflects, where
contract assets but may be applied separately appropriate, the risks specific to the liability. When
to trade receivables and contract assets. discounting is used, the increase in the provision
due to the passage of time is recognised as
2.16 Retirement Benefit Obligations finance cost.
Defined Benefit Plans - Retirement Gratuity
2.18 Revenue from Contracts with Customers
The retirement benefit plan adopted is as required
Revenue is recognised to the extent that it is
under the Payment of Gratuity Act No.12 of 1983
probable that the economic benefits will flow
and the Indian Repatriate Act No.34 of 1978 to all
to the Group and the revenue and associated
eligible employees.
costs incurred or to be incurred can be reliably
The liability recognised in the Statement of measured, regardless of when the payment is
Financial Position is the present value of the being made. Revenue is measured at the fair value
defined benefit obligation at the reporting date of the consideration received or receivable, net
using the projected unit credit method. Any of trade discounts and sales taxes. The following
actuarial gains or losses arising are recognized specific recognition criteria are used for the
immediately in the Statement of Comprehensive purpose of recognition of revenue:
Income. The Group is liable to pay gratuity in terms
a. Goods transferred at a point in time
of the relevant statute. The actuarial valuation was
carried out by a professionally qualified firm of Revenue from sale of goods is recognised at
actuaries, Messrs. Smiles Global (Private) Limited the point in time when control of the asset is
as at 31 March 2021. The liability is not externally transferred to the customer. In relation to sales
funded. with local customers, this point is generally the
delivery of goods, exports also take in to account
the term related to each shipment of goods. The
Group considers whether there are other promises

in the contract that are separate performance on disposal of such assets and the related selling
obligations to which a portion of the transaction expenses.
price needs to be allocated.
Gains and losses arising from activities incidental
b. Services transferred over time to the main revenue generating activities and
The Group determines, at contract inception, those arising from a group of similar transactions,
whether it satisfies the performance obligation which are not material are aggregated, reported
over time or at appoint in time. For each and presented on a net basis.
performance obligation satisfied over time, the
Interest Income
Group recognises revenue over time, by using
Interest Income is recognised as the interest
an output method to measure progress towards
accrues unless collectability is in doubt.
complete satisfaction of that performance
obligation. Dividend Income
In determining the transaction price for the sale Dividend income is recognised when the Group’s
of goods and the services the Group considers right to receive the payments is established.
the effects of variable consideration the existence
Others
of significant financing, non-cash considerations
and consideration payable to customer (if any). Other income is recognised on an accrual basis.
However, 2.19 Expenditure Recognition
~ The Group does not offer discounts, warranties Expenses are recognised in the Statement of
or incentives to its customers. Profit or Loss on the basis of a direct association
~ The Group does not receive long-term advances between the cost incurred and the earning of
from its customers for the services which entails specific items of income. All expenditure incurred
a financing element. in the running of the business and in maintaining
~ The period between the transfer of the the property, plant and equipment in a state of
promised service to the customer and when the efficiency has been charged to the Statement of
customer pays for that good will be one year or Profit or Loss.
less
For the purpose of presentation of the Statement
c. Presentation and disclosure requirements of Profit or Loss, the Directors are of the opinion
that “function of expenses” method presents fairly
As required for the financial statements, the Group
the elements of the Group’s performance, and
disaggregated revenue recognised from contracts
hence such presentation method is adopted.
with customers into categories that depict how
the nature, amount, timing and uncertainty of Finance Costs
revenue and cash flows are affected by economic
Finance costs comprise interest expense on bank
factors. The Group also disclosed information
overdrafts. Interest expense is recorded as it
about the relationship between the disclosure of
accrues using the effective interest method.
disaggregated revenue and revenue information
disclosed for each reportable segment. Refer Operating Leases
to Note 18 for the disclosure on disaggregated Operating lease payments are charged to the
revenue. Statement of Profit or Loss on a straight-line basis
over the period of the lease.
Gains and Losses
Net gains and losses of a revenue nature arising Others
from the disposal of other non-current assets, are Other expenses are recognised on an accrual
accounted in the Statement of Profit or Loss, after basis.
deducting the carrying amount from proceeds

2.20 Taxation sufficient taxable profits will be available to
Current Income Tax allow the deferred tax assets to be utilized.
Unrecognized deferred tax assets are re-assessed
Current income tax assets and liabilities are
at each reporting date and are recognized to the
measured at the amount expected to be recovered
extent that it has become probable that future
from or paid to the taxation authorities. The tax
taxable profits will allow the deferred tax assets to
rates and tax laws used to compute the amount
be recovered.
are those that are enacted or substantively
enacted at the reporting date. Deferred tax assets and liabilities are measured
at the tax rates that are expected to apply in the
Management periodically evaluates positions
year when the assets are realized or the liabilities
taken in the tax returns with respect to situations
are settled, based on tax rates and tax laws that
in which applicable tax regulations are subject to
have been enacted or substantially enacted at the
interpretation and establishes provisions where
reporting date.
appropriate.
Deferred tax relating to items recognised outside
Taxable income is determined according to the
the Statement of Profit or Loss is recognised
provisions of the Inland Revenue Act No.24 of
outside the Statement of Profit or Loss. Deferred
2017 (as amended)
tax items are recognised in correlation to the
Deferred Taxation underlying transaction either in the Statement
of Profit or Loss or Statement of Comprehensive
Deferred tax is provided on temporary differences
Income.
at the reporting date between the tax bases of
assets and liabilities and their carrying amounts Turnover Based Taxes
for financial reporting purposes. Deferred tax
Turnover based tax include Value Added Tax.
liabilities are recognized for all temporary
The Group pay such tax in accordance with the
differences, except:
respective statutes.
~ Where the deferred tax liability arises from an
2.21 Current versus Non-Current Classification
asset or liability in a transaction that affects
The Group presents assets and liabilities in the
neither the accounting profit nor the taxable
Statement of Financial Position based on current/
profit.
non-current classification. An asset is classified as
Deferred tax assets are recognized for all
current when it is:
deductible differences, carry forward of unused
tax credits and unused tax losses, to the extent ~ Expected to be realised or intended to be sold
that it is probable that taxable profits will be or consumed in normal operating cycle
available against which the deductible temporary ~ Held primarily for the purpose of trading
differences and the carry forward of unused tax ~ Expected to be realised within twelve months
credits and unused tax losses can be utilized, after the reporting period, or
except: ~ Cash or cash equivalent unless restricted from
being exchanged or used to settle a liability
~ Where the deferred tax assets relating to
for at least twelve months after the reporting
deductible temporary differences arises from
period.
the initial recognition of an asset or liability in a
transaction that affects neither the accounting All other assets are classified as non-current.
profit nor the taxable profit.
A liability is current when:
The carrying amount of deferred tax assets are
reviewed at each reporting date and reduced ~ it is expected to be settled in normal operating
to the extent that it is no longer probable that cycle

~ It is held primarily for the purpose of trading outstanding for the effects of all dilutive potential
~ It is due to be settled within twelve months ordinary shares.
after the reporting period, or
2.24 Significant Accounting Judgements, Estimates
~ There is no right to defer the settlement of the and Assumptions
liability for at least twelve months after the
The preparation of the Financial Statements
reporting period.
requires management to make judgements,
The Group classifies all other liabilities as non- estimates and assumptions that affect the
current. reported amounts of income, expenses, assets
and liabilities, and the disclosure of contingent
2.22 Segment Reporting
liabilities, at the reporting date. However,
A business segment is distinguishable component uncertainty about these assumptions and
of an enterprise that is engaged in providing estimates could result in outcomes that require a
an individual product or service or a group of material adjustment to the carrying amount of the
related products or services that is subject to asset or liability affected in future periods.
risk and returns that are different from those of
other business segments. The accounting policies The estimates and underlying assumptions are
adopted for segment reporting are the same reviewed regularly. Revisions to accounting
accounting policies adopted for preparing and estimates are recognised in the period in which the
presenting Consolidated Financial Statements of estimate is revised, if the revision affects only that
the Group. period or in the period of the revision and future
periods, if the revision affects both current and
An operating segment is a component of the future.
Group that engages in business activities from
which it may earn revenues and incur expenses, Useful life-time of the Property, Plant, and
including revenues and expenses that relate equipment
to transactions with any of the Group’s other The Group reviews the useful lives and methods
components. All operating segments’ operating of depreciation of assets at each reporting date.
results are reviewed regularly by the Senior Judgement of the management is exercised in the
Management to make decisions about resources estimation of these values, rates, methods and
to be allocated to the segment and assess its hence they are subject to uncertainty.
performance, and for which discrete financial
information is available. Impairment of Fair Value of Other Comprehensive
Income Investments
Segment results that are reported to the The Group treats equity securities designated at
Chairman/Board of Directors include items directly fair value through other comprehensive income/
attributable to a segment as well as those that can available for sale as impaired when there has been
be allocated on a reasonable basis. a significant or prolonged decline in fair value
2.23 Earnings Per Share below its cost or where other objective evidence
of impairment exists. The determination of what is
The Group presents basic and diluted Earnings
“significant” or “prolonged” requires considerable
Per Share (EPS) for its ordinary shares. Basic EPS
judgment. The Group treats “significant” generally
is calculated by dividing the profit attributable
as 20% or more and ‘prolonged’ greater than six
to ordinary shareholders of the Group by the
(6) months. In addition, the Group evaluates other
weighted-average number of ordinary shares
factors, including normal volatility in share price
outstanding during the period. Diluted EPS
for quoted equities and the future cash flows and
is determined by adjusting the profit or loss
the discount factors for unquoted equities.
attributable to ordinary shareholders and the
weighted average number of ordinary shares

Impairment of Trade Receivables Going Concern
From 01 April 2018, the Group assess on a In determining the basis of preparing the financial
forward-looking basis the expected credit loss statements for the year ended 31 March 2021,
associated with its debt instruments carried based on available information, the management
at amortized cost and FVOCI. The impairment has assessed the existing and anticipated effects
methodology applied depends on whether there of COVID-19 on the Group and the appropriateness
has been a significant increase in credit risk for of the use of the going concern basis. In March
trade receivables the Group applies the simplified 2021, each Group evaluated the resilience of its
approach permitted by SLFRS 9 which requires businesses considering a wide range of factors
expected lifetime losses to be recognize from under multiple stress tested scenarios , relating
initial recognition of the receivables. to expected revenue streams, cost management,
profitability, the ability to defer non-essential
At the reporting date, gross trade receivables of
capital expenditure, debt repayment schedules,
the Group were Rs. 4,407 million (2020 - Rs. 4,690
if any, cash reserves and potential sources of
million) with allowance for impairment of trade
financing facilities, if required, and the ability to
receivables amounting to Rs. 164 million (2020
continue providing goods and services to ensure
– 102 million) and gross trade receivables of the
businesses continue as least impacted as possible.
Company were Rs. 4,388 million (2020 - Rs. 4,668
million) with allowance for impairment of trade Having presented the outlook to the Board,
receivables amounting to Rs. 160 million (2020 - the Directors are satisfied that the Group has
102 million). adequate resources to continue in operational
existence for the foreseeable future, furthermore,
Employee Defined Benefit Plan – Gratuity
the management is not aware of any material
The employee benefit liability of the Group is uncertainties that may cast significant doubt upon
based on the actuarial valuation carried out by the Group’s ability to continue as a going concern.
Independent actuarial specialists. The actuarial Therefore, the Financial Statements continue to be
valuations involve making assumptions about prepared on a going concern basis.
discount rates and future salary increases. The
complexity of the valuation, the underlying In determining the above significant management
assumptions and its long term nature, the defined judgements, estimates and assumptions the
benefit obligation is highly sensitive to changes impact of the COVID 19 pandemic has been
in these assumptions. Management reviews all considered as of reporting date and specific
assumptions at each reporting date and revised considerations have been disclosed under the
assumptions where appropriate. relevant notes.
Deferred Taxes 3. STANDARDS ISSUED BUT NOT YET

Deferred tax asset of Rs. 3 million (2020 - Rs. EFFECTIVE
6.4 million) as at 31 March 2021 has not been
recognized on the carried forward tax losses of The new and amended standards that are issued,
the Subsidiary of the Company as it is unable but not yet effective to the date of issuance of
to assess with reasonable certainty that taxable these financial statements are disclosed below.
profits would be available to recover the deferred None of the new or amended pronouncements
tax asset in the foreseeable future. If the Group are expected to have a material impact on the
recognize deferred tax asset, profit and equity consolidated financial statements of the Group in
would have increased by Rs. 3 million (2020 - Rs. the foreseeable future. The Group intends to adopt
6.4 million) for the year ended 31 March 2021. these amended standards, if applicable, when they
become effective.

Amendments to SLFRS 9, LKAS 39, SLFRS 7, present obligation exists as a result of past events.
SLFRS 4 and SLFRS 16 – Interest Rate Benchmark For a levy that would be within the scope of
Reform (Phase 1 & 2) IFRIC 21 Levies, the acquirer applies IFRIC 21 to
The amendments to SLFRS 9 & LKAS 39 provide determine whether the obligating event that gives
a number of reliefs, which apply to all hedging rise to a liability to pay the levy has occurred by
relationships that are directly affected by interest the acquisition date. Finally, the amendments add
rate benchmark reform. A hedging relationship an explicit statement that an acquirer does not
is affected if the reform gives rise to uncertainty recognise contingent assets acquired in a business
about the timing and/or amount of benchmark- combination.
based cash flows of the hedged item or the
The amendments are effective for business
hedging instrument.
combinations for which the date of acquisition
IBOR reforms Phase 2 include number of reliefs is on or after the beginning of the first annual
and additional disclosures. Amendments supports period beginning on or after 1 January 2022. Early
companies in applying SLFRS when changes application is permitted if an entity also applies all
are made to contractual cashflows or hedging other updated references (published together with
relationships because of the reform. the updated Conceptual Framework) at the same
time or earlier.
These amendments to various standards are
effective for the annual reporting periods Amendments to LKAS 1: Classification of
beginning on or after 01 January 2021. Liabilities as Current or Non-current
In March 2021 , ICASL adopted amendments to
Amendments to SLFRS 16 - COVID – 19 Related
paragraphs 69 to 76 of LKAS 1 which specify the
Rent Concessions
requirements for classifying liabilities as current or
The amendments provide relief to lessees from non-current. The amendments clarify:
applying SLFRS 16 guidance on lease modification
accounting for rent concessions arising as a direct ~ What is meant by a right to defer settlement
consequence of the Covid-19 Pandemic. ~ That a right to defer must exist at the end of
the reporting period
As a practical expedient, a lessee may elect not to ~ That classification is unaffected by the
assess whether a Covid-19 related rent concession likelihood that an entity will exercise its deferral
from a lessor is a lease modification. A lessee that right
makes this election accounts for any change in ~ That only if an embedded derivative in a
lease payments resulting from Covid-19 related convertible liability is itself an equity instrument
rent concession the same way it would account for would the terms of a liability not impact its
the change under SLFRS16, if the change were not classification
a lease modification.
The amendments are effective for annual reporting
The amendment applies to annual reporting periods beginning on or after 1 January 2022 and
periods beginning on or after 01 June 2020. must be applied retrospectively.
Amendments to SLFRS 3: reference to the Onerous Contracts – Costs of Fulfilling a Contract

conceptual framework. – Amendments to LKAS 37
The amendments update SLFRS 3 so that it refers In March 2021, the ICASL adopted amendments
to the 2018 Conceptual Framework instead of to LKAS 37 to specify which costs an entity needs
the 1989 Framework. IASB also add to SLFRS to include when assessing whether a contract is
3 a requirement that, for obligations within the onerous or loss-making.
scope of LKAS 37, an acquirer applies LKAS 37
to determine whether at the acquisition date a

The amendments apply a “directly related cost Proceeds before Intended Use, which prohibits
approach”. The costs that relate directly to a entities deducting from the cost of an item of
contract to provide goods or services include property, plant and equipment, any proceeds from
both incremental costs and an allocation of costs selling items produced while bringing that asset
directly related to contract activities. General to the location and condition necessary for it to
and administrative costs do not relate directly be capable of operating in the manner intended
to a contract and are excluded unless they are by management. Instead, an entity recognises the
explicitly chargeable to the counterparty under proceeds from selling such items, and the costs of
the contract. producing those items, in profit or loss.
The amendments are effective for annual reporting The amendment is effective for annual reporting
periods beginning on or after 1 January 2022. The periods beginning on or after 1 January 2022
Group will apply these amendments to contracts and must be applied retrospectively to items of
for which it has not yet fulfilled all its obligations property, plant and equipment made available
at the beginning of the annual reporting period in for use on or after the beginning of the earliest
which it first applies the amendments period presented when the entity first applies the
amendment.
Property, Plant and Equipment: Proceeds before
Intended Use – Amendments to LKAS 16
In March 2021, the ICASL adopted amendments
to LKAS16-Property, Plant and Equipment —

4. PROPERTY, PLANT AND EQUIPMENT
4.1 Group
Balance Balance
As at Additions/ Disposals/ As at
01.04.2020 Transfers Transfers 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Gross Carrying Amounts
At Cost
Land 702,444 - - 702,444
Buildings on Leasehold Land 67,474 - - 67,474
Plant and Machinery 3,284,812 2,538 - 3,287,350
Factory Equipment 11,389 193 - 11,582
Furniture and Fittings 59,050 197 (76) 59,171
Office and Store Equipment 118,579 9,103 (1,760) 125,922
Computer Hardware 115,230 8,854 (5,882) 118,202
Motor Vehicle 232,633 40,212 (41,919) 230,926
Total Value of Depreciable Assets 4,591,611 61,097 (49,637) 4,603,071
In the Course of Construction

Capital Work In Progress 978,703 318,081 - 1,296,784
978,703 318,081 - 1,296,784
Total Gross Carrying Amount 5,570,314 379,178 (49,637) 5,899,855
Balance Charge for Disposals Balance

As at the year As at
01.04.2020 31.03.2021
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Accumulated Depreciation
At Cost
Buildings on Leasehold Land 20,507 1,823 - 22,330
Factory Equipment 6,758 431 - 7,189
Furniture and Fittings 13,537 7,636 (76) 21,097
Office and Store Equipment 70,439 17,048 (1,713) 85,774
Motor Vehicle 180,303 22,645 (41,919) 161,029
Total Depreciation 2,324,338 296,617 (49,589) 2,571,366

2021 2020
Rs.'000 Rs.'000
Net Carrying Amounts
Land 702,444 702,444
Buildings on Leasehold Land 45,144 46,967
Plant and Machinery 1,106,103 1,335,357
Factory Equipment 4,393 4,631
Furniture and Fittings 38,074 45,513
Office and Store Equipment 40,148 48,140
Computer Hardware 25,502 31,891
Motor Vehicle 69,897 52,330
2,031,705 2,267,273
Capital Work In Progress 1,296,784 978,703

1,296,784 978,703
Total Net Carrying Amount 3,328,489 3,245,976
4.1.1 During the financial year, the Group acquired Property, Plant and Equipment to the aggregate value of Rs.
379,178,312/- (2020 - Rs.553,046,237/-). Cash payments amounting to Rs 379,176,312/- (2020 - Rs.543,281,500/)
were made during the year for purchase of Property, Plant and Equipment.

4.1.2 Property, Plant and Equipment includes fully depreciated assets having a gross carrying amount of Rs.
593,243,434/- (2020 - Rs. 607,011,646/-) and continue to be in used by the Group.

4.1.3 The Subsidiary of the Group has entered in to a long-term operating lease agreement with Kahawatte
Plantations PLC from 01 January 2006 to 14 June 2045 for the use of land situated at Rilhena Estate. Buildings
on leasehold land as reflected above represent buildings constructed by the Subsidiary of the Group on the
said leased land.
4.1.4 Details of Group’s land and buildings stated at cost are indicated below;
Land
Location Extent
111, 167, 179, Negombo Road, Peliyagoda 279 P
Buildings
Location Number of Buildings
111, Negombo Road, Peliyagoda 01
Rilhena, Palmadulla, Rathnapura 01

4.2 Company
Balance Balance
Rs.'000 Rs.'000 Rs.'000 Rs.'000
At Cost
Land 702,444 - - 702,444
Furniture and Fittings 58,604 195 (76) 58,723
Office and Stores Equipment 120,673 9,082 (1,760) 127,995
Motor Vehicles 232,637 40,212 (41,919) 230,930
Total Value of Depreciable Assets 4,335,489 60,738 (49,637) 4,346,590

Capital Work In Progress 978,703 318,081 - 1,296,784
978,703 318,081 - 1,296,784
Total Gross Carrying Amount 5,314,192 378,819 (49,637) 5,643,374
Balance Charge for Disposals Balance

As at the year As at
01.04.2020 31.03.2021
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
At Cost
Furniture and Fittings 13,122 7,629 (76) 20,675
Office and Stores Equipment 69,843 16,992 (1,713) 85,122
Motor Vehicles 180,307 22,645 (41,919) 161,033
Total Depreciation 2,126,074 293,279 (49,589) 2,369,764

2021 2020
Rs.'000 Rs.'000
Net Carrying Amounts
Land 702,444 702,444
Plant and Machinery 1,098,192 1,326,443
Furniture and Fittings 38,048 45,482
Office and Stores Equipment 42,873 50,830
Computer Hardware 25,372 31,886
Motor Vehicles 69,897 52,330
1,976,826 2,209,415
Capital Work In Progress 1,296,784 978,703

1,296,784 978,703
Total Net Carrying Amount 3,273,610 3,188,118
4.2.1 During the financial year, the Company acquired Property, Plant and Equipment to the aggregate value of
Rs. 378,819,094/- (2020 - Rs. 543,626,319/-). Cash payments amounting to Rs. 378,820,094 (2020 - Rs.
535,630,816 /-) were made during the year for purchase of Property, Plant and Equipment.
4.2.2 Property, Plant and Equipment includes fully depreciated assets having a gross carrying amount of Rs.
416,875,487/- (2020 - Rs. 431,765,632/-) which are still in use.
4.2.3 Details of Company’s land and buildings stated at cost are indicated below;
Land
Location Extent
111, 167, 179, Negombo Road, Peliyagoda 279 P
Buildings
Location Number of Buildings
111, Negombo Road, Peliyagoda 01

5. INVESTMENT PROPERTY
Group/Company
Balance Balance
Rs.'000 Rs.'000 Rs.'000 Rs.'000
At Cost
Land 234,064 - - 234,064
Building 426,233 75 - 426,308
Total Value of Investment Property 660,297 75 - 660,372
Total Gross Carrying Amount 660,297 75 - 660,372
Balance Balance
As at Charge for As at
01.04.2020 the year Disposals 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
At Cost
Building 1,769 10,657 - 12,426
Total Depreciation 1,769 10,657 - 12,426
GROUP/COMPANY
2021 2020
Rs.'000 Rs.'000
Land 234,064 234,064
Building 413,882 424,464
647,946 658,528
Total Net Carrying Amount 647,946 658,528
5.1 Investment Property of the Group/Company relates to land acquired by the Company in February 2012. The
land with an extent of 2 Acres, 3 Roods and 23 Perches together with a building is situated at No 480, Handala,
Wattala.
5.2 Level 3 fair value of the Investment Property as at 31 March 2021 is estimated to be Rs. 560,230,000/- (2020
- Rs. 509,300,000/-), and have been derived by considering the prevailing prices of similar lands in the same
locality. Accordingly, price per perch of Rs. 1,210,000/- (2020 - Rs. 1,100,000/-) has been taken to arrive at the
said fair value.

5.3 The Group/Company has no restrictions on the realizability of its investment properties and no contractual
obligations to purchase, construct, or develop investment properties or for repairs, maintenance and
enhancements.
5.4 The Company has not generated any income during the year (2020-Nil). The operational expenses of the
property had been limited to Security charges and General maintenance expenses amounting to Rs. 288,641/-
for the year (2020 - Rs. 1,709,616/-).
6. INTANGIBLE ASSETS
GROUP/COMPANY
2021 2020
Rs.'000 Rs.'000
At Cost
As at 1 April 680,953 463,162
Acquired during the year 5,914 4,460
Transferred From CWIP - 213,331
As at 31 March 686,867 680,953

As at 1 April - 220,882
Acquired during the year - 876
Transferred to Cost - (213,331)
Transferred to Property, Plant and Equipment - (7,997)
Reversal of Over provision - (430)
As at 31 March - -
686,867 680,953
Amortization
As at 1 April 484,974 375,443
Amortization for the year 25,808 109,531
As at 31 March 510,782 484,974
Net Book Value 176,085 195,979
6.1 During the financial year, the Group/Company acquired Intangible Assets to the aggregate value of
Rs.5,913,304/- (2020- Rs. 217,791,566/-). Cash payments amounting to Rs. 5,913,304/- (2020- Rs 5,336,179/-)
were made by the Group/Company during the year for purchase of Intangible Assets.

7. SLFRS 16 - LEASES
7.1 Right of Use Asset
The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability
(present value of future lease payments discounted using the Company’s incremental borrowing rate) adjusted
for any lease payments made at or before the initial application date, plus any initial direct costs incurred. The
right-of-use asset is subsequently depreciated using the straight-line method from the initial application date
to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The movement
of Right of Use Lease assets of the Company is as follows;
The weighted average incremental borrowing rate applied to the lease liability is 12% (p.a.).
Group
Balance Advance Balance
As at Payment for As at
01.04.2020 Additions Leases 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
At Gross Value
Land 797,358 (8,017) - 789,341
Buildings and installations 388,581 (3,786) - 384,795
1,185,939 (11,803) - 1,174,136
Balance Balance
As at Charge for the De- As at
01.04.2020 year Recognition 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Depreciation
Land 19,934 19,934 - 39,868
Buildings and installations 9,872 9,872 - 19,744
29,806 29,806 - 59,612

2021 2020
Rs.'000 Rs.'000
Net book values
Land 749,473 777,424
Building 365,051 378,709
1,114,524 1,156,133
7.1.2 Company
Balance Advance Balance
As at Payment for As at
01.04.2020 Additions Leases 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
At Gross Value
Land 797,358 (8,017) - 789,341
Buildings and installations 376,610 (3,786) - 372,824
1,173,968 (11,803) - 1,162,165
Balance Balance
As at Charge for the De- As at
01.04.2020 year Recognition 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000
Depreciation
Land 19,934 19,934 - 39,868
Buildings and installations 9,415 9,415 - 18,830
29,349 29,349 - 58,698
2021 2020
Rs.'000 Rs.'000
Net book values
Land 749,473 777,424
Building 353,994 367,195
1,103,467 1,144,619

7.2 Lease Liability/Lease Creditor
The lease liability is initially measured at the present value of the lease payments that are not paid at the
initial application date, discounted using the interest rate implicit in the lease or, if that rate can not be readily
determined, the Company’s incremental borrowing rate. The movement of Lease creditor for the period is as
follows;
7.2.1 Group
Balance As at Additions Accretion of Repayment Balance
01.04.2020 Interest During the As at
Year 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000 Rs.'000
Land 802,979 (8,017) 95,760 (89,129) 801,593

Buildings and installations 391,162 (3,786) 46,653 (43,598) 390,431
1,194,141 (11,803) 142,413 (132,727) 1,192,024
Amount Amount
repayable repayable
within 1 year after 1 year Total
Rs.'000 Rs.'000 Rs.'000
Lease Liability/Lease Creditor 99,012 1,093,012 1,192,024

99,012 1,093,012 1,192,024
7.2.2 Company
Balance As at Additions Accretion of Repayment Balance
01.04.2020 Interest During the As at
Year 31.03.2021
Rs.'000 Rs.'000 Rs.'000 Rs.'000 Rs.'000
Land 802,979 (8,017) 95,760 (89,129) 801,593

Buildings and installations 379,276 (3,786) 45,231 (42,099) 378,622
1,182,255 (11,803) 140,991 (131,228) 1,180,215
Amount Amount
repayable repayable
within 1 year after 1 year Total
Rs.'000 Rs.'000 Rs.'000
Lease Liability/Lease Creditor 97,904 1,082,311 1,180,215

97,904 1,082,311 1,180,215

7.2.3 Maturity analysis of lease liability as follows,
Group Company
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Payable within one year
Gross liability 134,040 134,040 132,540 132,540
Finance cost allocated to future periods (35,028) (22,471) (34,636) (22,219)
Net liability transferred to current liabilities 99,012 111,569 97,904 110,321
Payable within two to five years

Gross liability 410,125 549,546 405,625 543,546
Finance cost allocated to future periods (170,584) (207,645) (168,714) (205,384)
Net liability 239,541 341,901 236,911 338,162
Payable after five years

Gross liability 5,582,775 5,638,299 5,552,398 5,607,925
Finance cost allocated to future periods (4,729,304) (4,897,628) (4,706,998) (4,874,153)
Net liability 853,471 740,671 845,400 733,772
Net liability payable after one year 1,093,012 1,082,572 1,082,311 1,071,934
7.2.4 The lease liability as at 31 March 2021 has been reassessed under the provisions of SLFRS 16 and both “Right-of-
Use Asset” and “Lease Liability” has been enhanced. The Net liability as at 31 March 2021 as follows:
Group Company
2021 2021
Rs.'000 Rs.'000
Payable within one year
Gross liability 6,126,940 6,090,563
Finance cost allocated to future periods (4,934,916) (4,910,348)
Net liability transferred to current liabilities 1,192,024 1,180,215

8. OTHER NON-CURRENT FINANCIAL ASSETS
GROUP/COMPANY
2021 2020
Investment in Subsidiary - -
Equity Securities designated as FVOCI - Quoted Investments 367,512 452,332
- Unquoted Investments 11,702 17,377
379,214 469,709
8.1 Investment in Subsidiary

Holding % COMPANY
Value Value
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000
Non-quoted
MJF Beverages (Private) Limited 100% 100% 300,750 300,750
Provision for Impairment of Investment in Subsidiary (300,750) (300,750)
- -
8.2 An impairment assessment on investment in MJF Beverages (Private) Limited were carried out by the Board of
Directors as the carrying value of the investment exceeds the net assets attributable of the Subsidiary as at 31
March 2021. Based on that assessment, the investment has been fully provided for as at 31 March 2021.
8.3 Quoted Investments Unquoted Investments Total

Value Value Value Value Value Value
2021 2020 2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Group/Company
Equity Securities designated as FVOCI
At the beginning of the year 452,332 494,917 17,377 17,377 469,709 512,294
Gain/(Loss) on Change in Fair Value (84,820) (42,585) (5,675) - (90,495) (42,585)
At the end of the year 367,512 452,332 11,702 17,377 379,214 469,709

8.4 Quoted Investments
2021 2020 2021 2020
No. of Shares Rs. ‘000 Rs. ‘000
Kahawatte Plantation PLC 12,571,800 12,571,800 363,325 448,813
Renuka City Hotels PLC 17,500 17,500 3,959 3,343
John Keells Holdings PLC 1,476 1,476 219 170
Maskeliya Plantation PLC 800 800 9 5
Hapugastenna Plantation PLC - 100 - 1
367,512 452,332
The Group/Company mainly holds a non-controlling interests of 12.65% (2020 - 15.74%) in Kahawatte
Plantations PLC. The fair value of quoted equity shares is determined by reference to published prices in the
Colombo Stock Exchange.
8.5 Unquoted Investments

2021 2020 2021 2020
No. of Shares Rs. ‘000 Rs. ‘000
Rainforest Ecolodge (Private) Limited 2,500,000 2,500,000 17,377 17,377
(-) Impairment on Unquoted Equity Securities (5,675) -
11,702 17,377
The Group/Company holds a non-controlling interest of 5.25% (2020 - 5.25%) in Rainforest Ecolodge (Private)
Limited – a Resort Company incorporated in Sri Lanka.
The fair value of unquoted investment in Rainforest Ecolodge (Private) Limited has been estimated considering
the fair value of net assets held by Rainforest Ecolodge (Private) Limited as at 31 March 2021 and potential
returns expected through its future operations.

9. INVENTORIES
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Raw Materials 659,167 484,043 651,110 482,454
Packing Materials 427,454 464,949 425,585 455,679
Finished Goods 227,378 98,401 225,448 96,892
Goods in Transit - 67,111 - 67,111
Consumables and Spares 232,976 237,103 228,217 233,291
1,546,975 1,351,607 1,530,360 1,335,427

10. TRADE AND OTHER RECEIVABLES
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Trade Debtors Related Party 2,134,996 2,420,165 2,120,708 2,407,332
(Note 10.1)
Others 2,436,254 2,372,016 2,428,193 2,362,435
4,571,250 4,792,181 4,548,901 4,769,767
Less: Provision for Doubtful Debts (10.2) (164,129) (102,164) (159,962) (102,164)
4,407,121 4,690,017 4,388,939 4,667,603
Other Receivables Related Party 33,428 29,833 33,428 29,833
(Note 10.3)
Others 198,463 210,653 194,544 206,704
4,639,012 4,930,503 4,616,911 4,904,140
10.1 Trade Receivables - Related Party Relationship

Dilmah Australia (Pty) Limited Fellow Subsidiary 2,122,401 2,317,812 2,109,368 2,305,721
MJF Group Europe Holding B.V Fellow Subsidiary 12,595 102,353 11,340 101,611
2,134,996 2,420,165 2,120,708 2,407,332
10.2 Movement of Provisions for Doubtful Debts

GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
As at 01 April 102,164 29,664 102,164 29,664
Charge for The Year 61,965 72,500 57,798 72,500
164,129 102,164 159,962 102,164
10.3 Other Receivables - Related Party Relationship

MJF Exports Ltd - India Fellow Subsidiary 33,428 29,833 33,428 29,833
33,428 29,833 33,428 29,833

10.4 Trade Receivable - Age Analysis
Past due but not impaired
Total Neither 0 -60 61-90 91-120 121-360 >360
Past due nor
days days days days days
Impaired
Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000
Group
At 31 March 21 4,407,121 3,446,191 388,923 139,214 165,186 267,607 -
At 31 March 20 4,690,017 2,532,154 1,449,101 574,769 82,354 42,421 9,218
Company
At 31 March 21 4,388,939 3,436,149 386,802 136,479 161,583 267,926 -
At 31 March 20 4,667,603 2,521,886 1,441,397 572,992 81,961 40,148 9,219
11. AMOUNTS DUE FROM RELATED PARTY
2021 2020
Relationship Rs. ‘000 Rs. ‘000
Company
MJF Beverages (Private) Limited Subsidiary 165,848 155,815
Provision for Impairment of Amounts due from Related Party (80,746) (66,828)
85,102 88,987
12. OTHER CURRENT FINANCIAL ASSETS
2021 2020
Rs. ‘000 Rs. ‘000
Group/Company
Debt Instruments designated as Amortized Cost
Sri Lanka Development Bonds 498,998 -
Sri Lanka Sovereign Bonds 1,044,603 -
1,543,601 -

13. CASH AND CASH EQUIVALENTS
Cash and cash equivalents included in the Statement of Cash Flows include the following Statement of
Financial Position amounts:
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Favorable Cash and Cash Equivalents Balances
Cash on Hand 684 866 642 709
Bank Balances 430,942 1,260,241 422,337 1,252,193
Short-term Deposits 2,739,201 3,584,393 2,739,201 3,584,393
3,170,827 4,845,500 3,162,180 4,837,295
14. STATED CAPITAL
GROUP/COMPANY
2021 2020
Number Rs. ‘000 Number Rs. ‘000
Fully Paid Ordinary Shares 20,737,500 642,500 20,737,500 642,500
20,737,500 642,500 20,737,500 642,500

15. RETIREMENT BENEFIT OBLIGATION
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
As at 1 April 234,340 242,043 229,392 237,076
Current Service Cost 23,327 19,329 22,795 18,783
Interest Cost 22,262 26,536 21,792 26,078
Actuarial (Gain)/Loss 25,256 (26,423) 24,783 (26,293)
Benefits Paid (19,148) (27,145) (19,148) (26,252)
As at 31 March 286,037 234,340 279,614 229,392
The employee retirement benefit liability of the Group/Company is based on the actuarial valuation carried out
by Smiles Global (Private) Limited (2020 - Smiles Global (Private) Limited), Independent actuarial specialists as
at 31 March 2021. The principal assumptions used are as follows:
GROUP/COMPANY
2021 2020
Discount Rate 7% 9.5%
Future Salary Increment rate 10% 10%
Expected future working life time 4 - 7 Years 4 - 7 Years
Sensitivity of Principal Assumptions used

A one percentage change in the assumptions would have the following effects:
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Discount Rate
1% increase (9,512) (6,438) (9,232) (6,242)
1% decrease 10,395 6,932 10,083 6,715
Salary Increment Rate

1% increase 11,231 5,656 10,909 5,473
1% decrease (10,495) (5,334) (10,200) (5,168)

16. TRADE AND OTHER PAYABLES
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Trade Payables Related Party 62,398 88,483 62,621 88,483
(Note 16.1)
Other 305,796 369,161 305,600 367,639
368,194 457,644 368,221 456,122
Other Payable 121,385 58,770 121,380 58,520

489,579 516,414 489,601 514,642
16.1 Trade Payables - Related Party

Relationship
Printcare Universal (Private) Limited Affiliate Company 31,031 20,581 31,031 20,581
Packages Lanka (Private) Limited Affiliate Company 3,551 24,949 3,551 24,949
Timber Concepts (Private) Limited Fellow Subsidiary 5,025 20,176 5,025 20,176
Forbes and Walker Tea Brokers (Private) Fellow Subsidiary - 5,270 - 5,270
Limited
Print Care PLC Affiliate Company 16,438 8,318 16,438 8,318
PCL Solutions (Private) Limited Fellow Subsidiary 3,869 5,990 3,869 5,990
Dilmah Australia (Pty) Limited Fellow Subsidiary - 2,449 - 2,449
MJF Holdings Limited Ultimate Parent - 1 - 1
Forbes and Walkers Warehouse (Private) Fellow Subsidiary - 348 - 348
Limited
Dilmah (SEA) PTE Ltd Fellow Subsidiary 1,277 278 1,277 278
Cape Weligama (Private) Limited Fellow Subsidiary - 123 - 123
Dilmah Rus LLC Fellow Subsidiary 1,200 - 1,200 -
MJF Beverages (Pvt) Ltd Subsidiary 223
MJF Group Europe Holding B.V. Fellow Subsidiary 7 - 7 -
62,398 88,483 62,621 88,483
17. SHORT TERM LOAN
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Short Term Loan - Citibank - 1,895,000 - 1,895,000
- 1,895,000 - 1,895,000
In 2020, the Group has obtained a three month revolving facility of USD 10 Million from Citibank at an annual
interest rate of 2.8%

. GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
18. REVENUE FROM CONTRACTS WITH
CUSTOMERS
Export Sales - Related Party (Note 18.1) 2,050,181 3,576,999 2,034,094 3,560,497
- Others 7,161,058 8,030,900 7,141,559 7,994,838
9,211,239 11,607,899 9,175,653 11,555,335
Local Sales 748 2,163 - -
9,211,987 11,610,062 9,175,653 11,555,335
18.1 EXPORT SALES - RELATED PARTY

Dilmah Australia (Pty) Limited 2,026,904 3,481,973 2,014,268 3,466,209
MJF Group Europe Holding B.V. 23,277 95,026 19,826 94,288
2,050,181 3,576,999 2,034,094 3,560,497
All sales related to export sales are Tea and Value Added Tea sold across the Globe under the brand name
Dilmah.
Contract Assets arising from Revenue from Contracts from Customers only include Trade and Oher
Receivables. Refer Note No.10.
19. OTHER INCOME

Profit on Disposal of Property, Plant and Equipment 29,267 - 29,267 -
Income on Hire of Vehicles 3,336 3,588 3,336 3,588
Dividend from Equity Securities 5 75 5 75
Sundry Income 7,177 9,140 7,161 8,394
Service Fees 1,549 2,076 1,549 2,076
41,334 14,879 41,318 14,133
20. FINANCE COSTS

Interest Expense on Short Term Loans 54,847 40,428 54,847 40,428
Interest Expense on Early Settlements 118 210 116 210
Interest Expense on Lease Liability 142,413 142,719 140,991 141,287
197,378 183,357 195,954 181,925
21. FINANCE INCOME

Interest on Deposits and Saving Accounts 280,193 181,841 280,193 181,836
Interest on Bonds 117,457 - 117,457 -
Other Interest 143 320 143 320
397,793 182,161 397,793 182,156

22. PROFIT BEFORE TAX
Profit before tax is stated after charging all expenses including the following:
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Included in Cost of Sales:
Consumption of Tea and Packing Material 4,501,355 5,149,808 4,491,246 5,133,965
Employee Benefits including the following; 501,221 559,802 480,967 538,018
- Defined Benefit Plan Costs - Gratuity 14,201 14,677 13,199 13,672
- Defined Contribution Plan Costs - EPF and ETF 38,880 42,630 36,878 40,533
Depreciation 256,140 242,378 252,882 239,783
Included in Administrative Expenses:

Employee Benefits including the following; 549,274 638,942 549,274 638,942
- Defined Benefit Plan Costs - Gratuity 31,388 31,128 31,388 31,128
- Defined Contribution Plan Costs - EPF and ETF 39,200 39,966 39,200 39,966
Directors' Fee and Emoluments 150,245 120,042 150,245 120,042
Donations 255,457 260,353 255,457 260,353
Amortisation of Intangible Assets 25,808 109,532 25,808 109,532
Depreciation 51,134 43,167 51,055 43,102
Impairment Loss on Trade Receivables 197,913 72,212 197,913 72,212
Statutory Audit fee 1,045 1,127 965 1,037
Other Audit Fees 5,071 - 5,071 -
Impairment Loss on Amounts due from Related Party - - 13,918 3,178
Included in Selling and Distribution Costs:

Export Promotion 1,446,649 1,843,131 1,446,649 1,843,131

23. INCOME TAX EXPENSE
The major components of income tax expense for the year ended 31 March are as follows :
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Statement of Profit or Loss
Current Income Tax
Current Income Tax Expense 230,443 341,893 230,443 341,893
Over Provision of Current Income Tax in respect of prior (1,983) (1,220) (1,983) (1,220)
years
228,460 340,673 228,460 340,673
Deferred Income Tax
Deferred Taxation Charge (Reversed) (63,570) 88,967 (63,966) 88,470
Income Tax Expense recognised in Statement of Profit 164,890 429,640 164,494 429,143
or Loss
Statement of Comprehensive Income

Deferred Tax attributable to re-measurement Gain on (3,536) 3,699 (3,470) 3,681
Employee Defined Benefit Liabilities
Deferred Tax Charge recognised in Statement of (3,536) 3,699 (3,470) 3,681

Comprehensive Income
23.1 Reconciliation between Current Tax Expense and Accounting Profit

The reconciliation between tax expense and the product of accounting profit multiplied by the applicable
corporate tax rate for the financial year ended 31 March are as follows:
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Profit before Tax 1,914,605 1,988,887 1,914,605 1,988,887
Intra-group Eliminations (2,806) (1,806) - -
1,911,799 1,987,081 1,914,605 1,988,887
Disallowable Expenses 912,163 928,630 914,390 924,966

Allowable Expenses (273,130) (261,095) (263,779) (253,403)
Allowable Income (885,104) (358,544) (885,104) (357,957)
Taxable Profit 1,665,728 2,296,072 1,680,112 2,302,493

GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Taxable Income at 14%
Business profit 1,665,728 2,302,493 1,680,112 2,302,493
Investment Income 401,134 182,161 401,134 182,156
Allowable Income (394,885) (43,801) (394,885) (43,797)
Taxable Other Income at 24% - (1,743) - (1,742)
Qualifying Payments (40,342) - (40,342) -
Tax Losses Brought Forward and Utilised 14,384 - - -
1,646,019 2,439,110 1,646,019 2,439,110
Taxable Other Income at 24% - 1,743 - 1,742

Investment income (Excluding FCBU interest) - 1,743 - 1,742
Income Tax at 14% on Taxable income 230,443 341,475 230,443 341,475

Income Tax at 24% on Taxable Other income - 418 - 418
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
23.2 Income Tax (Receivable) / Payable
At the beginning of the year 255,552 57,900 255,921 57,959
Over Provision of Current Income Tax in respect of prior (1,983) (1,220) (1,983) (1,220)
years
Income tax paid / Set off (292,262) (143,021) (292,262) (142,711)
At the end of the year 191,750 255,552 192,119 255,921
Income tax Payable 191,750 255,552 192,119 255,921

191,750 255,552 192,119 255,921
23.3 Tax Losses

At the beginning of the year 46,816 35,497 - -
Adjustment for tax losses brought forward (39,399) 3,898 - -
Loss incurred during the year 14,384 7,421 - -
Loss set-off for the current year - - - -
At the end of the year 21,801 46,816 - -

23.4 Deferred Tax Liablilities
STATEMENT OF FINANCIAL STATEMENT OF PROFIT OR STATEMENT OF
POSITION LOSS COMPREHENSIVE INCOME
2021 2020 2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Group
Deferred Tax Liability
Accelerated Depreciation 261,470 292,660 (31,190) 96,816 - -
for Tax Purposes
Deferred Tax Assets

Unclaimed Right of Use (10,942) (5,321) (5,621) (5,321) - -
Asset Rentals
Defined Benefit Plans (40,046) (32,808) (3,703) (2,528) (3,536) 3,699
Provision for Doubtful (22,395) - (22,395) - - -
Debt
Provision for Slow Moving (661) - (661) - - -
Inventory
Tax Losses - - - - - -
Deferred Income Tax (63,570) 88,967 (3,536) 3,699

Charge
Net Deferred Tax Liability 187,426 254,531
Company
Deferred Tax Liability
Accelerated Depreciation 255,967 287,641 (31,674) 96,252 - -
for Tax Purposes
Deferred Tax Assets

Unclaimed Right of Use (10,942) (5,269) (5,673) (5,269) - -
Asset Rentals
Defined Benefit Plans (39,146) (32,115) (3,563) (2,513) (3,470) 3,681
Provision for Doubtful (22,395) - (22,395) - - -
Debt
Provision for Slow Moving (661) - (661) - - -
Inventory
Tax Losses - - - - - -
Deferred Income Tax (63,966) 88,470 (3,470) 3,681

Charge
Net Deferred Tax Liability 182,823 250,257

24. EARNINGS PER SHARE
The calculation of earnings per ordinary share is based on the profit after taxation over the weighted average
number of ordinary shares in issue during the year.
Given below is the computation of earning per share:
Group
2021 2020
Rs. ‘000 Rs. ‘000
Amount Used as the Numerator:
Profit for the year 1,749,715 1,559,247
Number Number
Number of Ordinary Shares Used as the Denominator:
Weighted Average Number of Ordinary Shares * 20,738 20,738
Company
2021 2020
Rs. ‘000 Rs. ‘000
Amount Used as the Numerator:
Profit for the year 1,750,111 1,559,744
Number Number
Number of Ordinary Shares Used as the Denominator:
Weighted Average Number of Ordinary Shares * 20,738 20,738
25. DIVIDEND PER SHARE

GROUP/COMPANY
2021 2020
Rs. ‘000 Rs. ‘000
Dividend paid on Ordinary Shares during the year
Final Dividend for 2020 - Rs.5.00 (2019 - Rs. 15.00) per share 103,688 311,062
Interim Dividend for 2021 - Nil (2020 - Rs. 20.00) per share - 414,750
103,688 725,812
Dividend per Share (Rs.)* 5.00 35.00

*Dividend per share is calculated by considering the dividend paid for the year divided by the number of
shares in issue which ranked for those divided.

26. SEGMENTAL INFORMATION
The Group does not have separately distinguishable components within the enterprise that is engaged in
providing individual products or services or a group of related products or services that is subject to risk and
returns that are different from those of other business segments.
For management purposes, the Group monitors the sales and the costs associated with the different product
types offered in evaluating the profitability of the same as follows;
26.1 Business Segment - Group

Tea Bags Tea Packets Other* Total
2021 2020 2021 2020 2021 2020 2021 2020
Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000
Revenue from Contracts
7,352,160 9,652,276 1,742,974 1,782,363 116,853 175,423 9,211,987 11,610,062
with Customers
Cost of Sales (4,360,293) (5,141,473) (1,033,769) (959,699) (69,528) (121,160) (5,463,590) (6,222,332)
Segment Gross Profit 2,991,867 4,510,803 709,205 822,664 47,325 54,263 3,748,397 5,387,730
26.2 Business Segment - Company

Tea Bags Tea Packets Other* Total
2021 2020 2021 2020 2021 2020 2021 2020
Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000 Rs. '000
Revenue from Contracts
7,352,160 9,652,276 1,742,974 1,782,363 80,519 120,696 9,175,653 11,555,335
with Customers
Cost of Sales (4,360,293) (5,141,471) (1,033,769) (959,699) (25,054) (64,982) (5,419,116) (6,166,152)
Segment Gross Profit 2,991,867 4,510,805 709,205 822,664 55,465 55,714 3,756,537 5,389,183
*Other Sales include Bulk Tea and Other Value Added Teas.
Management considers that there is no suitable basis for allocating assets, related liabilities and operating
expenses to business segments. Accordingly, segment assets, segment liabilities, segment operating expenses
and other segment information by business segment is not disclosed.
27. CONTINGENCIES AND COMMITMENTS

As at reporting date, the Group and Company has following commitments and contingencies arising in the
ordinary course of business from which it is anticipated that no material liabilities will arise.
GROUP/COMPANY
2021 2020
Rs. ‘000 Rs. ‘000
27.1 Capital Expenditure Commitments
Estimated capital expenditure contracted but not provided for;
Tea Bagging Machines 278,778 224,040
Factory Automation Project 81,900 334,670
Finance Automation Project - Bank Reconciliation 4,000
364,678 558,710

27.2.2 The Company has given a corporate guarantee to the following Affiliated Comapny
Company in favour Relationship Bank 2021 2020
Rs. ‘000 Rs. ‘000
Cape Weligama (Pvt) Ltd Fellow The Hongkong & Shanghai
1,815,420 1,815,420
Subsidiaries Banking Corporation Limited
28. ASSETS PLEDGED

There are no material assets pledged as at the reporting date.
29. EVENTS OCCURRING AFTER THE REPORTING DATE

After satisfying the solvency test in accordance with Section 57 of the Companies Act No. 07 of 2007, the
Directors recommended the payment of a final dividend of Rs. 18/- per ordinary share for the year ended 31
March 2021. However, in accordance with LKAS 10 – Events After the end of the Reporting Period of the Sri
Lanka Accounting Standards, the proposed final dividend has not been recognized as a liability as at 31 March
2021. This would result in a total outflow of Rs. 373,275,000/- subject to approval at the forthcoming Annual
General Meeting.
There have been no material events occurring after the reporting date that require adjustments to or disclosure
in the financial statements.

30. RELATED PARTY DISCLOSURES
Related parties represent the shareholders, key management personnel of the Company, close family members of key management personnel’s
and entities controlled or jointly controlled by such parties Pricing policies and terms of transactions with these related parties are approved by
the Group/Company’s management.
30.1 Related Party Transactions

Transactions with related parties are as follows:
Group
Transaction Value
2021 2020

Recurrent Transactions exceeds 10% of Revenue Rs. ‘000 Rs. ‘000
Name of the Company Relationship Nature of Transaction Terms
Dilmah Australia (Pty) Limited Fellow Subsidiary Export Sales Note (a) 2,026,905 3,481,973
As a % of revenue 22% 30%
Note (a) - Export sales to Dilmah Australia (Pty) Limited are made on Relevant Commercial terms.
Recurrent Transactions not exceeds 10% of Revenue

Name of the Company Relationship Nature of Transaction
166
MJF Teas (Private) Limited Parent Company Rent Expenses (40,563) (41,103)
MJF Exports (Private) Limited Fellow Subsidiary Local Sales 542 2,163
Transfer of Tea and Packing Materials 224,880 364,979
Vehicles Hire Income 1,193 1,358
Print Care Universal (Private) Limited Affiliate Company Purchase of Packing Materials (279,359) (341,514)
Printcare PLC Affiliate Company Purchase of Packing Materials (158,946) (207,214)
Timber Concepts (Private) Limited Fellow Subsidiary Purchase of Packing Materials (50,371) (103,700)
Vehicles Hire Income 15 82
PCL Solutions (Private) Limited Fellow Subsidiary Purchase of Packing Materials (18,514) (34,786)
Packages Lanka (Private) Limited Affiliate Company Purchase of Packing Materials (172,899) (352,306)
Dilmah Properties (Private) Limited Fellow Subsidiary Rent Expenses (90,665) (91,898)
Kahawatte Plantations PLC Fellow Subsidiary Rent Expenses (1,500) (1,515)
Vehicles Hire Income 360 -
Forbes and Walker Tea Brokers (Private) Limited Fellow Subsidiary Vehicles Hire Income 960 960
MJF Tea Gardens (Private) Limited Fellow Subsidiary Vehicles Hire Income - 306
Annual Report 2020/21

MJF Charitable Foundation Affiliate Organisation Vehicles Hire Income 45 209
Donations (209,658) (260,000)
Company
Transaction Value
2021 2020
Recurrent Transactions exceeds 10% of Revenue Rs. ‘000 Rs. ‘000
Name of the Company Relationship Nature of Transaction Terms
Dilmah Australia (Pty) Limited Fellow Subsidiary Export Sales Note (a) 2,014,268 3,466,209

As a % of revenue 22% 30%
Note (a) - Export sales to Dilmah Australia (Pty) Limited are made on Relevant Commercial terms.
Recurrent Transactions not exceeds 10% of Revenue

Name of the Company Relationship Nature of Transaction
MJF Teas (Private) Limited Parent Company Rent Expenses (40,563) (41,103)
MJF Exports (Private) Limited Fellow Subsidiary Transfer of Tea and Packing Materials 224,880 364,979
Vehicles Hire Income 1,193 1,358
Print Care Universal (Private) Limited Affiliate Company Purchase of Packing Materials (279,359) (341,514)
Print care PLC Affiliate Company Purchase of Packing Materials (158,946) (207,214)
Timber Concepts (Private) Limited Fellow Subsidiary Purchase of Packing Materials (50,371) (103,700)
167
PCL Solutions (Private) Limited Fellow Subsidiary Purchase of Packing Materials (18,514) (34,786)
Packages Lanka (Private) Limited Affiliate Company Purchase of Packing Materials (172,899) (352,306)
Dilmah Properties (Private) Limited Fellow Subsidiary Rent Expenses (90,665) (91,898)
Forbes and Walker Tea Brokers (Private) Limited Fellow Subsidiary Vehicles Hire Income 960 960
MJF Tea Gardens (Private) Limited Fellow Subsidiary Vehicles Hire Income - 306
MJF Charitable Foundation Affiliate Organisation Vehicles Hire Income 45 209
Donations (209,658) (260,000)

30.2 Transactions with Key Management Personnel of the entity or parent
Key Management Personnel include the Board of Directors of the Company and its Subsidiary.
GROUP/COMPANY
2021 2020
Key Management Personnel Compensation Rs. ‘000 Rs. ‘000
Short-term Employee Benefits 150,245 120,042

Post Employment Benefits 12,695 8,932
162,940 128,974

No material transactions have taken place during the year with the parties/entities in which key management personnel or their close
family members have control or jointly control, which require disclosure in these Financial Statements other than those disclosed
under 30.1.
168
31. FINANCIAL RISK MANAGEMENT Foreign Currency Risk
OBJECTIVES AND POLICIES Foreign currency risk is the risk that the fair value
of future cash flows of a financial instrument will
The Group’s principal financial liabilities comprise fluctuate due to changes in foreign exchange
trade payables, amounts due to related parties rates. The Group’s exposure to the risk of changes
and other payables. The main purpose of these in foreign exchange rates relates primarily to the
financial liabilities is to finance the Group’s Group’s operating activities.
operations. The Group’s principal financial assets
Trade receivables of the Group include an amount
include bank balances and cash, short-term
of Rs. 2,272 Mn (2020 - Rs. 2,270 Mn) and the
deposits, trade receivables, amounts due from
Company include an amount of Rs. 2,268 Mn (2020
related parties and other receivables that derive
- Rs. 2,260 Mn) due in foreign currencies, mainly in
directly from its operations. The Group also holds
Australian Dollars and United States Dollars.
equity securities.
Bank balances of the Group include an amount of
The Group is exposed to market risk, credit risk Rs. 431 Mn (2020 - Rs. 1,260 Mn) and the Company
and liquidity risk. The Board of Directors reviews include an amount of Rs. 422 Mn (2020 - Rs. 1,252
and agrees policies for managing each of these Mn) due in foreign currencies, mainly in Australian
risks, which are summarised below. Dollars and United States Dollars.
Market Risk Short-term deposits of the Group include an

amount of Rs. 2,739 million (2020 - Rs. 3,584 Mn)
Market risk is the risk that the fair value of future
and the Company include an amount of Rs. 2,739
cash flows of a financial instrument will fluctuate
Mn (2020 - Rs. 3,584 Mn) due in foreign currencies,
because of changes in market prices. Market risk
mainly in Australian Dollars and United States
of the Group comprises interest rate risk, foreign
Dollars.
currency risk and equity price risk.
Amounts due from related parties of the Group
Interest Rate Risk include an Amount or Rs. 2,168 Mn (2020 -
Interest rate risk is the risk that the fair value or Rs.2,449 Mn ) and the Company include an
future cash flows of a financial instrument will amount of Rs. 2,154 Mn (2020 - 2,437 Mn) due in
fluctuate due to of changes in market interest foreign currencies mainly in United States Dollars,
rates. The Group’s exposure to the risk of changes Australian Dollars and EURO.
in market interest rates relates primarily to the
The following table demonstrates the sensitivity
Group’s financial assets and liabilities with floating
to a reasonably possible change in the United
interest rates.
States Dollars exchange rates by 5%, with all other
The following table demonstrates the sensitivity variables held constant, of the Group’s/Company’s
of the Statement of Profit or Loss to reasonably profit due to changes in the fair value of monetary
possible changes in interest rates by 25 basis assets and liabilities held as at reporting date. The
points, with all other variables held constant. The effect of decreases in foreign exchange rates is
sensitivity of the statement of profit or loss is the expected to be equal and opposite to the effect of
effect of the assumed changes in interest rates the increases shown.
for one year, based on the floating rate financial
assets and financial liabilities. As at the reporting
date there were no interest bearing loans and
borrowings and there are the Group is not exposed
to interest rate risk.

GROUP COMPANY
Effect on Profit for the year Effect on Profit for the year
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
United States Dollars 250,270 316,702 249,633 315,948
Australian Dollars 119,015 142,491 118,363 141,886
Other 10,143 16,394 10,069 16,304
379,428 475,587 378,065 474,138
Equity Price Risk

The Group’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties
about future values of the equity price and key assumptions used to fair value listed and unlisted equity
securities.
At the reporting date, the unlisted equity security is fair valued at Rs. 12 Mn (2020 - Rs. 17 Mn). The fair value
of unquoted investment has been estimated considering the fair value of net assets held by investee as at 31
March 2021 and potential returns expected through its future operations.
The following table demonstrates the sensitivity of the cumulative changes in fair value to reasonably possible
changes in equity prices, with all other variables held constant. The effect of decreases in equity prices is
expected to be equal and opposite to the effect of the increases shown.

GROUP/COMPANY
Change in Effect on Change in Effect on
Equity Price Equity Equity Price Equity
2021 2021 2020 2020
Rs. ‘000 Rs. ‘000
Fair Value Through Other Comprehensive Income

Investments
Quoted Investments +10% 36,751 +10% 45,233
Credit Risk
Credit risk is the risk that the counterparty will not meet its obligations under a financial instrument or
customer contract, leading to a financial loss. The Group is exposed to credit risk from its operating activities
primarily trade receivables and amounts due from related parties and from its financing activities, including
deposits with banks and other financial instruments.
The Group trades only with recognised creditworthy third parties. It is the Group’s policy that all customers
who wish to trade on credit terms are subject to credit verification procedures as and a majority of these trade
receivables are not secured. In addition, receivable balances are monitored on an ongoing basis with the result
that the Group’s exposure to bad debts is not significant.

As at 31 March 2021, short term deposits and bank balances comprise 100% (2020 - 100%) for the Group and
Company were rated “A” or better
With respect to credit risk arising from the deposits with banks, the Group’s exposure to credit risk arises from
the default of the counterparty, with a maximum exposure equal to the carrying amount of these assets in the
Statement of Financial Position. Exposures are considered of good credit standing and management believes
there is a minimal risk of default thus, expected credit loss is insignificant but being monitored for significant
changes in credit risk.
The credit risk arising from the financial assets of the Group, the Group’s exposure to credit risk arises from
default of the counterparty, with a maximum exposure equal to the carrying amount of these financial
instruments as follows:
GROUP COMPANY
2021 2020 2021 2020
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Trade Receivables 2,272,125 2,269,852 2,268,231 2,260,271
Other Receivables 198,463 210,653 194,544 206,704
Amounts due from Related Parties 2,168,424 2,449,998 2,154,136 2,437,165
Short-term Deposits 2,739,201 3,584,393 2,739,201 3,584,393
Bank Balances 430,942 1,260,241 422,337 1,252,193
7,809,155 9,775,137 7,778,449 9,740,726
Management has assessed the existing and anticipated effect of COVID -19 on recoverability of trade and other
receivable and concluded that Company and its subsidiaries don’t have significant doubt on recoverability of
trade and other receivable. Therefore, no incremental impairment allowance has been recognised.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet obligations as they fall due. The Group’s
approach to managing liquidity risk is to ensure, as far as possible, that it will always have sufficient liquidity to
meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses
or destructing the Group’s operations.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through use of the
Group’s own reserves, funds from the shareholders and bank facilities.
The table below summarises the maturity profile of the Group’s financial liabilities as at reporting date, based
on contractual undiscounted payments.

On Demand Less than 3 3 to 12 Total
Months Months
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
As at 31st March 2021
Group
Trade Payables 5,437 67,795 232,564 305,796
Amounts due to Related Parties - 62,398 - 62,398
Other Payables 59,364 10,728 51,293 121,385
64,801 140,921 283,857 489,579
Company
Trade Payables 5,241 67,795 232,564 305,600
Amounts due to Related Parties - 62,621 - 62,621
Other Payables 59,359 10,728 51,293 121,380
64,600 141,144 283,857 489,601
As at 31st March 2020
Group
Trade Payables 1,522 207,428 160,212 369,162
Amounts due to Related Parties 2,365 86,117 88,482
Interest Bearing Loans and Borrowings - 1,895,000 - 1,895,000
Other Payables 9,112 14,871 34,787 58,770
12,999 2,203,416 194,999 2,411,414
Company
Trade Payables - 207,428 160,212 367,640
Amounts due to Related Parties 2,365 86,117 - 88,482
Interest Bearing Loans and Borrowings - 1,895,000 - 1,895,000
Other Payables 8,862 14,871 34,787 58,520
11,227 2,203,416 194,999 2,409,642
Management has assessed the existing and anticipated effect of COVID -19 on liquidity of the Company and
its subsidiaries to settle liabilities when it is due and management are satisfied that the Company and its
subsidiaries don’t have significant concerns relating to the Group’s liquidity.

Capital Management 32. FAIR VALUE MEASUREMENT
The Company manages its capital to ensure that it
will be able to continue as a going concern while Financial instruments comprise of financial assets
maximising the return to shareholders through the and financial liabilities. Financial assets consist of
optimisation of the debt and equity balance. bank balances and cash, short-term deposits, trade
receivables, amounts due from related parties,
The Company makes adjustments to its capital
other receivables and Financial asset at fair value
structure, in light of changes in economic and
through other comprehensive income investments.
business conditions. To maintain or adjust
the capital structure, the Company may issue Financial liabilities consist of trade payables,
new shares or adjust dividend payments to amounts due to related parties, interest bearing
shareholders. No changes were made in the loans and borrowings and other payables.
objectives, policies or processes during the year
ended 31 March 2021 and 2020. The following table provides the fair value
measurement hierarchy of the Group’s assets
Capital, which includes stated capital, fair value which are stated at Fair value.
through other comprehensive income reserve and
retained earnings of the Group is measured at
Rs. 13,876 million as at 31 March 2021 (2020 - Rs.
12,336 million) and the Company is measured at
Rs. 13,670 million as at 31 March 2021 (2020 - Rs.
12,329 million).

GROUP/COMPANY
FAIR VALUE MEASUREMENT USING
Quoted
prices Significant Significant
in active observable unobservable
markets inputs inputs
Total (Level 1) (Level 2) (Level 3)
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
Assets measured at fair value:
As at 31 March 2021
Fair Value Through Other Comprehensive Income Investments
Quoted Investments 31 March 2021 367,512 367,512 - -
Unquoted Investments 31 March 2021 11,702 - - 11,702

Fair Value Through Other Comprehensive
Income Investments as at 31 March 2021 379,214 367,512 - 11,702
As at 31 March 2020
Fair Value Through Other Comprehensive Income Investments
Quoted Investments 31 March 2020 452,332 452,332 - -
Unquoted Investments 31 March 2020 17,377 - - 17,377

Fair Value Through Other Comprehensive 469,709 452,332 - 17,377
Income Investments as at 31 March 2020
The fair value of unquoted investment has been estimated considering the fair value of adjusted net assets held
by investee as at 31 March 2021 and potential returns expected through its future operations.
During the reporting period ending 31 March 2021, there were no transfers between Level 1 and Level 2 fair
value measurements, and no transfers into and out of Level 3 fair value measurements.
The fair values of other financial instruments are not materially different from their carrying values.

FIVE YEAR SUMMARY - COMPANY
2021 2020 2019 2018 2017
Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000 Rs. ‘000
TRADING RESULTS
Turnover 9,175,653 11,555,335 10,676,761 9,177,758 7,288,357
Operating Expenses 8,719,655 9,988,218 9,843,218 8,427,774 6,924,578
Other Income 1,654,561 603,696 875,360 554,531 619,712
Interest Expense 195,954 181,925 14,451 34,417 19,325
Profit before Income Tax 1,914,605 1,988,887 1,694,452 1,270,098 964,166
Income Tax on Profits 164,494 429,143 110,638 77,219 136,664
Profit for the Year 1,750,111 1,559,744 1,583,814 1,192,879 827,502
SHAREHOLDERS' FUNDS
Stated Capital 642,500 642,500 642,500 642,500 200,000
Reserves 13,227,176 11,686,886 10,872,927 9,683,293 9,881,216
NET ASSETS 13,869,676 12,329,386 11,515,427 10,325,793 10,081,216
ASSETS
Property , Plant & Equipment 3,273,610 3,188,118 2,943,485 3,032,933 2,326,180
Investment Property 647,946 658,528 640,838 516,074 234,064
Intangible Assets 176,085 195,978 308,601 442,928 444,684
Right of Use Assets 1,103,467 1,144,619 - - -
Other Financial Assets / Investments 379,214 469,709 512,294 503,846 523,444
Current Assets 11,178,152 11,613,492 8,377,277 7,107,235 9,125,302
LIABILITIES
Non-current Liabilities 1,544,748 1,551,583 395,182 426,887 316,206
Current Liabilities 1,344,050 3,389,476 871,886 850,336 2,256,252
NET ASSETS 13,869,676 12,329,386 11,515,427 10,325,793 10,081,216
Market Price Per Share (Rs.) 636.75 531.00 619.90 554.90 599.90
Dividend Per Share (Rs.) 18.00 25.00 20.00 45.00 15.00
Total Dividend Rs. 000s (Gross) 373,275 518,438 414,750 933,188 300,000
No of Shares 20,737,500 20,737,500 20,737,500 20,737,500 20,000,000
RATIOS
Return on Average Shareholders Funds (%) 13.36 13.08 14.50 11.55 8.37
Earnings Per Share (Rs) 84.39 75.21 76.37 58.74 41.37
Dividend Cover (times) 4.69 3.01 2.18 1.28 2.76
Liquidity (times) 8.32 3.43 9.61 8.36 4.04

INFORMATION TO INVESTORS
31st March 2021
1. STOCK EXCHANGE LISTING

The issued ordinary shares of Dilmah Ceylon Tea Company PLC are listed on the Colombo Stock Exchange.
2. ORDINARY SHAREHOLDERS
Number of Shares Number of Shareholders Total Holding % Holding

1 - 1,000 980 65,927 0.32%
1,001 - 5,000 56 147,753 0.71%
5,001 - 10,000 14 103,862 0.50%
10,001 - 50,000 26 569,110 2.74%
50,001 - 100,000 3 203,485 0.98%
100,001 - 500,000 - - 0.00%
500,001 - 1,000,000 - - 0.00%
1,000,001 - Over 3 19,647,363 94.75%
Total 1,082 20,737,500 100.00%
3. ORDINARY SHAREHOLDERS
Number of Shares Number of Shareholders Total Holding % Holding

Individuals 1,028 894,113 4.31%
Institutions 54 19,843,387 95.69%
Total 1,082 20,737,500 100.00%
Number of Public Shareholders as at 31st March 2021 was 1071

2,554,022 (12.32%) shares were held by the public as at 31st March 2021
The float adjusted market capitalization is Rs. 1,626,807,105/-
The Company is listed on the Dirisavi Board having complied with a minimum public holding 10% of the total
listed shares in the hands of a minimum of 200 public shareholders.
4. SHARE TRADING
Number of Shares 2021 2020 2019 2018 2017

No of Transactions 1,376 532 319 780 277
No of Shares Traded 36,813 16,553 18,317 43,847 40,955
Value of Shares Traded 25,066,297 9,258,053 11,001,198 24,890,630 29,939,882
5. DIVIDENDS
Number of Shares 2021 2020 2019 2018 2017

Interim - 20/- 20/- Rs. 15/- -
Final 18/- 5/- 15/- Rs. 30/- Rs. 15/-
Amount (Rs.000's) Gross 373,275 518,437 725,813 933,187 300,000

6. EARNINGS
Number of Shares 2021 2020 2019 2018 2017

Earnings/share Rs. 84.38 75.19 76.71 57.48 41.37
P/E Ratio 7.55 7.06 8.08 9.65 14.15
7. MARKET VALUES (RS.)
Number of Shares 2021 2020 2019 2018 2017

Highest 799.00 605.00 630.00 600.00 850.00
Lowest 500.50 480.00 530.00 520.00 565.00
Year End 636.75 531.00 619.90 554.90 599.90
The weighted average trading price for the year was Rs. 680.91
8. MARKET CAPITALISATION (RS.MILLION)
Number of Shares 2021 2020 2019 2018 2017

Capital & Reserves 13,870 12,329 11,312 10,326 10,112
Market Capitalization 13,205 11,012 12,855 11,507 11,998
9. TOP 20 SHAREHOLDINGS AS AT 31ST MARCH
SHAREHOLDER NAME 31.03.2021 31.03.2020

TOTAL SHARES % TOTAL SHARES %
MJF Teas (Pvt) Ltd 13,812,882 66.61% 13,812,882 66.61%
MJF Exports (Pvt) Ltd 4,256,712 20.53% 4,256,712 20.53%
Employees Provident Fund 1,577,769 7.61% 1,577,769 7.61%
Mrs. S.T.Fernando 79,501 0.38% 156,019 0.75%
GF Capital Global Limited 69,700 0.34% 69,700 0.34%
Mrs. A.S.Fernando 54,284 0.26% 24,284 0.12%
Mr. W.H.M.Fernando 46,662 0.23% - 0.00%
Mrs. S.T.F.Ortiz 42,854 0.21% 42,854 0.21%
Mr. A.W.Athukorala 36,750 0.18% 36,750 0.18%
Mr. M.W.De Silva 34,830 0.17% 34,830 0.17%
Mr. H.A. Van Starrex 32,850 0.16% 32,850 0.16%
Mr. J.W.Burton 32,270 0.16% 32,270 0.16%
Merrill J Fernando & Sons (Pvt) Ltd 25,300 0.12% 25,300 0.12%
Mr. M.J.Fernando 24,200 0.12% 24,200 0.12%
Mr. D.C.Fernando 24,200 0.12% 24,200 0.12%
Dr. K.Poologasundram 23,808 0.11% 23,808 0.11%
Mr. H.S.Ranaweera 22,984 0.11% 22,984 0.11%
Ms. N.Harnam 22,265 0.11% 22,265 0.11%
Mr. H.R.Peries 21,200 0.10% 21,200 0.10%
Mr.H.D.A.D.Perera 20,467 0.10% 20,467 0.10%
20,261,488 97.73% 20,261,344 97.73%

GRI Content Index
Page Omis-
GRI Standard Disclosure
number sion
"GRI 101: Foundation 2016
(does not include any disclo-
sures)"
General Disclosures
GRI 102: General Disclosures

102-1 Name of Organisation 4
2016
102-2 Activities, brands, products and services 8
102-3 Location of headquarters 126
102-4 Location of operations 126
102-5 Ownership and legal form 26
102-6 Markets served 63, 64, 69
102-7 Scale of the organisation 6, 7
102-8 Information on employees and other workers 47, 48
102-9 Supply chain 68
102-10 Significant changes to the organisation and supply

68
chain
102-11 Precautionary principle 24
102-12 External initiatives 26
102-13 Membership of associations 31, 36, 37
102-14 Statement from senior decision-maker 16
102-16 Values, principles, norms and standards of behaviour 1, 20, 21, 99
102-18 Governance Structure 95
102-40 List of stakeholder groups 36, 37
102-41 Collective bargaining agreements 7
102-42 Identifying and selecting stakeholders 34, 35
102-43 Approach to stakeholder engagement 29, 30
102-44 Key topics and concerns raised 35
102-45 Entities included in the consolidated financial

126
statements
102-46 Defining report content and topic boundary 5, 22
102-47 Material topics 22, 23
102-48 Restatement of information 127
102-49 Changes in reporting 4
102-50 Reporting period 4

Page Omis-
number sion
102-51 Date of most recent report 4
102-52 Reporting cycle 4
102-53 Contact point for questions regarding Report 5
102-54 Claims of reporting in accordance with GRI

5
Standards
102-55 GRI content index 178
102-56 External assurance 5
Material topics
Procurement practices
GRI 103: Management Ap-

103-1 Explanation of material topics and its boundaries 62 - 71
proach 2016
103-2 The Management Approach and its components 62 - 71
103-3 Evaluation of the Management Approach 62 - 71
GRI 204: Procurement practic-

204-1 Proportion of spending on local suppliers 7, 68
es 2016
Materials

103-1 Explanation of material topics and its boundaries 83, 89
proach 2016
103-2 The Management Approach and its components 89
103-3 Evaluation of the Management Approach 89
GRI 301: Materials 2016 301-1 Materials used by weight or volume 89
Energy

proach 2016
GRI 302: Energy 2016 302-1 Energy consumption within the organisation 7, 85
Emissions

103-1 Explanation of material topics and its boundaries 83
proach 2016
GRI 305 Emissions: 2016 305-1 Direct greenhouse gas (GHG) emissions 7, 84
305-2 Energy indirect greenhouse gas (GHG) emissions 7, 84
305-3 Other indirect greenhouse gas (GHG) emissions 7, 84
305-4 Greenhouse gas (GHG) emission intensity 84

Page Omis-
number sion
Effluents and Waste

proach 2016
GRI 306: Effluents and Waste

306-2 Waste by type and disposal method 7, 88
2016
Environmental Compliance

proach 2016
103-2 The Management Approach and its components 81, 83
103-3 Evaluation of the Management Approach 81, 83
GRI 307: Environmental Com- 307-1 Non-compliance with environmental laws and
80, 82, 83
pliance 2016 regulations
Employment

proach 2016
GRI 401: Employment 2016 401-1 Employee hires and turnover 49, 55
401-2 Benefits provided to full time employees that are not

53
provided to temporary or part-time employees
401-3 Parental leave 49
Training and education

proach 2016
GRI 404: Training and educa- 404-2 Programmes for upgrading skills and transition
54, 55
tion 2016 assistance programmes
404-3 Percentage of employees receiving regular

52
performance and career development reviews
Local Communities

proach 2016
GRI 413: Local communities 413-1 Operations with local community engagement, impact
69, 71
2016 assessments and development programmes

Page Omis-
number sion
Customer health and safety

proach 2016
GRI 416: Customer health and 416-2 Incidents of non-compliance concerning the health
64
safety 2016 and safety impacts of products and services
Marketing and labelling

103-1 Explanation of material topics and its boundaries 64, 72, 73
proach 2016
103-3 Evaluation of the Management Approach 72 - 80
GRI 417: Marketing and label- 417-2 Incidents of non-compliance concerning product and
64
ling 2016 service information and labelling
Notes

Notice of Meeting
Notice is hereby given that the 40th Annual General 70 years referred to in Section 210 of the Companies
Meeting of Dilmah Ceylon Tea Company PLC to be Act shall not apply to Mr. Rajanayagam Asirwatham
convened on 30th September 2021 at 11.00 am at 111, and Mr. Rajanayagam Asirwatham be and is hereby
Negombo Road, Peliyagoda through the Microsoft Teams re-appointed a Director of the Company as provided
virtual platform to take the matters under the agenda of for in Section 211 (1) of the Companies Act No. 07 of
the meeting as follows; 2007.”
1. Read the notice convening the meeting 6. To re-elect as a Director, Mr. Malik Fernando who
retires by rotation under Article 24 of the Articles of
2. To re-appoint as a Director, Mr. Merrill Joseph
Association.
Fernando who retires in terms of Section 210 of
the Companies Act No. 07 of 2007, by passing the 7. To receive and adopt the Annual Report of the Board
following resolution: of Directors on the affairs of the Company and
“IT IS HEREBY RESOLVED THAT that the age limit of Financial Statements for the year ended 31st March
70 years referred to in Section 210 of the Companies 2021 along with the Report of the Auditors thereon.
Act shall not apply to Mr. Merrill J. Fernando and Mr.
8. To declare a final dividend of Rs. 18/- per share as
Merrill J. Fernando be and is hereby re-appointed a
recommended by the Board of Directors.
Director of the Company as provided for in Section
211 (1) of the Companies Act No. 07 of 2007.” 9. To re-appoint retiring Auditors Messer. Ernst &
Young, Chartered Accountants, as Auditors of
3. To re-appoint as a Director, Mr. Himendra S.
the Company and to authorise the Directors to
Ranaweera who retires in terms of Section 210 of
determine their remuneration.
the Companies Act No. 07 of 2007, by passing the
following resolution 10. To authorise the Directors to determined and make
“IT IS HEREBY RESOLVED THAT that the age limit of donations and contributions to charities.
70 years referred to in Section 210 of the Companies
By order of the Board,
Act shall not apply to Mr. Himendra S. Ranaweera
and Mr. Himendra S. Ranaweera be and is hereby
re-appointed a Director of the Company as provided
for in Section 211 (1) of the Companies Act No. 07 of
2007.”
4. To re-appoint as a Director, Mr. Gritakumar E. Chitty

who retires in terms of Section 210 of the Companies Ms. Jayanga Wegodapola
Act No. 07 of 2007, by passing the following Company Secretary
resolution
“IT IS HEREBY RESOLVED THAT that the age limit of At Colombo
70 years referred to in Section 210 of the Companies 23rd August 2021
Act shall not apply to Mr. Gritakumar E. Chitty and Mr.
Gritakumar E. Chitty be and is hereby re-appointed a
Notes:
Director of the Company as provided for in Section
• A shareholder is entitled to appoint a Proxy to attend and vote at
211 (1) of the Companies Act No. 07 of 2007.” the meeting on his/her behalf.
• A Proxy need not be a shareholder of the Company.
5. To re-appoint as a Director, Mr. Rajanayagam • A Form of Proxy accompanies this Notice.
Asirwatham who retires in terms of Section 210 of • The completed Proxy should be delivered to Registered Office of
the Companies Act No. 07 of 2007, by passing the the Company, Dilmah Ceylon Tea Company PLC, No.111, Negombo
following resolution Road, Peliyagoda or duly signed, scanned and emailed to
info@dilmahtea.com by or before 11.00 a.m.
“IT IS HEREBY RESOLVED THAT that the age limit of on 28th September 2021.

Form of Proxy
I / We ....................................................................................................................................................................................................................
NIC No ................................................................ of ...............................................................................................................................................
.......................................................................... being shareholders of Dilmah Ceylon Tea Company PLC hereby appoint: .......
...................................................................................... NIC No ................................................................ of ........................................................
................................................................................................................................................................................................. or failing him/her
Mr. Merrill Joseph Fernando of Colombo or failing him

Mr. Malik Joseph Fernando of Colombo or failing him
Mr. Dilhan Chrishantha Fernando of Colombo or failing him
Mr. Himendra Somasiri Ranaweera of Colombo or failing him
Ms. Minette Delicia Anne Perera of Colombo or failing her
Mr. Roshan Conrad Tissaaratchy of Colombo or failing him
Mr. Rajanayagam Nalliah Asirwatham of Colombo or failing him
Mr. Gritakumar Edmund Chitty of Colombo or failing him
Mr. Darshana Gunasekera of Colombo
As my / our Proxy to attend and vote for me / us on my / our behalf at the Fortieth Annual General Meeting of
the Company to be held on the 30th September 2021 at 11.00 a.m. and any adjournment thereof and at every
poll which may be taken in consequence of the aforesaid meeting.
For Against
1. To pass the ordinary resolution set out under item 2 of the Notice of Meeting for the
re-appointment of Mr. Merrill Joseph Fernando, as a Director.
2. To pass the ordinary resolution set out under item 3 of the Notice of Meeting for the
re-appointment Mr. Himendra S. Ranaweera as a Director of the Company.
3. To pass the ordinary resolution set out under item 4 of the Notice of Meeting to re-
appoint Mr. Gritakumar E. Chitty, as a Director of the Company.
appoint Mr. Rajanayagam Asirwatham, as a Director of the Company
elect as a Director, Mr. Malik J Fernando who retires by rotation under section 24 of the
Articles of Association
6. To pass the ordinary resolution set out under item 7 of the Notice of Meeting to receive
and adopt the Annual Report of the Board of Directors on the affairs of the Company
and Financial Statements for the year ended 31st March 2021 along with the Report of
the Auditors thereon.
7. To pass the ordinary resolution set out under item 8 of the Notice of Meeting to declare
a final dividend of Rs. 18/- per share as recommended by the Board of Directors.

Form of Proxy
For Against
8. To pass the ordinary resolution set out under item 9 of the Notice of Meeting to re-appoint
retiring Auditors Messer. Ernst & Young, Chartered Accountants, as Auditors of the Company and
to authorise the Directors to determine their remuneration.
9. To pass the ordinary resolution set out under item 10 of the Notice of Meeting to authorise the
Directors to determine and make donations and contributions to charities.
As Witness my hand / our hands this ........ day ................ of 2021
Signature: .......................................................
N.B. 1. Please delete the inappropriate words

2. Instructions as to completion are given below
3. A Proxy need not be a member of the Company
Instructions as to Completion
1. Kindly perfect the Proxy by filling legibly your full name and address
and by signing in the space provided and filling in the date of signature.
2. In the case of corporate members, the proxy form must be under the
seal or hand of an authorised officer or attorney.
3. If the proxy form is signed by an attorney, the relevant Power of

Attorney should accompany the proxy form for registration, if such
Power of Attorney has not already been registered with the Company.
4. The completed proxy form should be deposited at the registered office

of the Company at the address given below not less than 48 hours
before the time appointed for the Meeting.

111, Negombo Road
Peliyagoda

Corporate Information
Legal Form
Quoted Public Company with Limited Liability Incorporated in
Sri Lanka in 1981
Company Registration Number

PQ 209
Registered Office
111, Negombo Road, Peliyagoda, Sri Lanka.
Telephone: (94 11) 4 822000
Facsimile: (94 11) 4 822001
E-mail : info@dilmahtea.com
Website : www.dilmahtea.com
Stock Exchange Listing

The Ordinary Shares are listed on the Colombo Stock Exchange
Subsidiary
MJF Beverages (Private) Limited
Board of Directors
Chairman - Merrill J. Fernando
Deputy Chairman - Himendra S. Ranaweera
Chief Executive Officer/Director - Dilhan C. Fernando - B.Sc.
Directors
Malik J. Fernando - B.Sc.
Roshan Tissaaratchy – B.A, MBA, DipM, FCIM
Minette Perera – FCA, FCMA, FCCA
Rajan Asirwatham – FCA
Gritakumar E. Chitty – Attorney at Law
Darshana Gunasekera – FCMA, FCCA, B.Sc.
Secretary - Jayanga Wegodapola – Attorney at Law
Bankers
Bank of Ceylon
Cargills Bank Limited
Citibank N. A.
Commercial Bank of Ceylon PLC
DFCC Bank PLC
Hatton National Bank PLC
National Development Bank PLC
Nations Trust Bank PLC
Standard Chartered Bank Limited
The Hongkong & Shanghai Banking Corporation Limited
Auditors
Ernst & Young
201, De Saram Place,
Colombo 10.
78579 00 L
Dilmah Ceylon Tea Company PLC. 111 Negombo Road, Peliyagoda, Sri Lanka
011 4822000 info@dilmahtea.com www.dilmahtea.com
dilmah dilmah dilmahceylontea

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A Focus on the Power of the People for Genuine Partnerships and a Sustainable Planet

DILMAH CEYLON TEA COMPANY PLC

Annual Report 2020/21 1 Dilmah Ceylon Tea Company PLC

Dilmah Ceylon Tea Company PLC 2 Annual Report 2020/21

Independent Auditor’s Report 116

Statement of Financial Position 119

Statement of Profit or Loss 120

Statement of Comprehensive Income 121

Statement of Changes in Equity 122

Statement of Cash Flows 124

Notes to the Financial Statements 126

Five Year Summary - Company 175

Information to Investors 176

Annual Report 2020/21 3 Dilmah Ceylon Tea Company PLC

ANNUAL REPORT 2020/21

WELCOME TO OUR 3RD INTEGRATED

SCOPE AND BOUNDARY

Dilmah Ceylon Tea Company PLC 4 Annual Report 2020/21

External Assurance REPORTING FORMAT

• Increased disclosure of quantitative information

Annual Report 2020/21 5 Dilmah Ceylon Tea Company PLC

Operating profit Rs. Mn 1,673 1,975 -15%

Profit before tax Rs. Mn 1,915 1,989 -4%

Profit after tax Rs. Mn 1,750 1,559 12%

Return on equity % 13.36 13.08 2%

Return on capital employed % 13.36 13.08 2%

Working Capital Ratios

Inventory days Days 81 57 42%

Debtor days Days 180 142 27%

Payable days Days 32 24 33%

Current ratio Times 8.2 3.4 135%

Quick asset ratio Times 7.1 3.0 133%

Total assets Rs. Mn 16,789 17,305 -3%

Total liabilities Rs. Mn 2,913 4,969 -41%

Shareholders’ funds Rs. Mn 13,876 12,336 12%

Non-controlling interest Rs. Mn - - -

Total debt Rs. Mn - - -

Earnings per share Rs. 84.38 75.19 12%

Dividends per share Rs. 18 25 -28%

Net asset value per share Rs. 669.12 594.88 12%

Closing price Rs. 636.75 531.00 20%

Market capitalisation Rs. Mn 13,205 11,012 20%

P/E ratio No. of times 7.55 7.06 7%

Dividend pay out % 6 47 -87%

Dividend cover No. of times 16.88 2.15 685%

Dividend yield % 3 5 -43%

Dilmah Ceylon Tea Company PLC 6 Annual Report 2020/21

Payments to employees Rs. Mn 1,050 1,199 -12%

New recruits – permanent No. 35 52 -33%

Employee retention rate % 87 85 2%

No. of promotions No. 36 13 177%

Female representation % 41 43 -5%

Investment in training Rs. Mn 11 34 -68%

Total training hours Hours 16,034 21,584 -26%

Average training hours/employee Hours 29 37 -21%

Workplace injuries No. 4 4 0%

Union representation % N/A N/A -

Instances of disruption to work No. Nil Nil -

Property, plant and equipment Rs. Mn 3,328 3,246 3%