The firm lost 8.0 million rupees in the year to March down from 49.
4 million rupees a year earlier, partly helped by capital gains from sale of stock of a related company.
Chairman Mohan Pandithage said without the capital gain the firm lost 39.
6 million rupees in the year to March 2012, without the capital gains.
But Hayleys Exports was taking corrective action.
The firm said it was moving out of baling mattress fibre, which millers were doing more cheaply, but would continue to trade in the product.
It had shifted its production facility from Ekala, a north of Sri Lanka's capital Colombo to Kuliyapitiya in North Central Sri Lanka and to Kotugoda.
"This has allowed us the opportunity to develop this prime real estate," managing director G M P de Silva said.
"Due to the relocation of the plants the company had the opportunity of refurbishing and re-laying the equipment improving productivity and efficiency.
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The depreciation of the rupee had given Hayleys Exports fore