Thursday 16 May 2019

Sri Lanka's Jetwing Symphony posts profits for first time in March

ECONOMYNEXT- Sri Lanka's hotel firm Jetwing Symphony (JETS) said its net profits for the March 2019 quarter were 89.2 million rupees, up from a 2.6 million rupee loss from a year earlier, amid foreign exchange gains from a stronger rupee.

The firm's earnings per share for the quarter were 17 cents, while the share last traded at 10 rupees in the Colombo Stock Exchange.

This is the first quarter in which the firm, which operates five hotels and is building one more, is posting profits, after going public in December 2017.

It is a holding company for new hotels owned by the Jetwing Group, one of Sri Lanka's largest leisure and travel companies.

Jetwing Group Chairman Hiran Cooray said that almost all the properties made profits during the quarter, except for the hotel in Arugam Bay, which suffered due to the off-season in the surfing destination.

JETS' revenue for the March quarter grew 19 percent from a year earlier to 608.1 million rupees, while cost of sales grew 16 percent to 97.9 million rupees, leading to gross profits growing 20 percent to 510.2 million rupees.

Tourist arrivals to Sri Lanka had grown only 5 percent during the quarter, as the country recovered from a political crisis in the December quarter.

Cooray said that as the new hotels mature, the management is getting better control of variable costs, leading to better gross profit margins.

With the Sri Lankan rupee gaining on the dollar during the quarter, JETS' made a foreign exchange gain of 44.1 million rupees from a dollar loan from a 21 million rupee loss a year earlier, when the local currency depreciated.

Finance expenses for the quarter grew 5 percent to 119.9 million rupees.

Long-term borrowings for the firm fell 20 percent to 2.2 billion rupees from a year earlier, while short-term borrowings grew 39 percent to 2 billion rupees.

Total assets remained stable at 10.2 billion rupees.

For the 2019 financial year, JETS posted a net loss of 280.6 million rupees, down 20 percent from 2018, while the loss per share was 56 cents.

Revenue for the year grew 26 percent to 1.9 billion rupees and cost of sales grew 15 percent to 316 million rupees, leading to gross profits growing 29 percent to 1.6 billion rupees.

Profits fell due to foreign exchange loss from the loan growing 423 percent to 155.7 million rupees as the rupee depreciated until December.

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