First Capital Holdings successfully concludes 2014/15 with solid financial performance

First Capital Holdings PLC has reported notable growth in performance during the 2014/15financial year. The company has recorded a consolidated profit after tax of LKR 997Mn for the year 2014/15. The results reflect anincrease of 200% from the previous financial year.

Reflecting on the results, Chief Executive Officer of First Capital Holdings PLC, Dilshan Wirasekara, said: "We are delighted with our financial performance and remarkable business momentum during the past year and will endeavour to keep raising the bar for investment banking services in Sri Lanka. Our commitment towards becoming the country’s leading investment bank has beenvalidated over the year through our performance, management discipline and perpetual emphasis on ethics".

First Capital Holdings PLC comprises of First Capital Treasuries Limited, First Capital Asset Management Limited, First Capital Equities (Private) Limited, First Capital Markets Limited and First Capital Limited. The Group’s largest subsidiary, First Capital Treasuries Limited, was the prime contributor towards the Group’s Net Earnings (Net Profit after Tax) for this year. First Capital Treasuries Limited capitalized on opportunities arising from the continuous decline in secondary market interest rates and realized net trading gains of LKR 900Mn during the period under review. This is a significant increase in comparison to LKR 227Mn reported during the previous year. First Capital Treasuries Limited also fortified its long term capital base (Tier II) through a Listed Debenture Issue of 500Mn in the fourth quarter of the financial year.

Recording its highest ever fee income, First Capital Limited mobilized LKR 22Bn through corporate debt for its clients during the financial year under review. The company reported a fee income of LKR 124Mn during 2014/15, reflecting almost a 3.2 times growth from the previous year. First Capital Limited also achieved significant milestones during 2014/15. The company recorded its largest ever listed debenture issue of LKR 5Bn; managed its largest asset backed securitization of LKR 1Bn and reported its first private equity placement of LKR 100Mn. During the year 2014/15, the company became the leader in managing listed corporate debentures through its management of listed debenture Issues worth LKR 10Bn. The Group’s other subsidiaries also reflected positive growth over the period under review. The Group’s investment management arm, First Capital Asset Management Limited, reported assets under management amounting to LKR 4.2Bn as at 31 March 2015 compared to LKR 1.3Bn the previous year. As per industry reports,  First Capital Wealth Fund was recognized as the  best performing Fixed Income Fund in Sri Lanka  for the second consecutive year, with a return of 15.48% (31 March 2015).
www.island.lk

Sri Lankan shares down for second day; Lanka IOC drags

May 27 Sri Lankan shares fell for a second session on Wednesday led by Lanka IOC after its poor performance in the March quarter, and also on foreign outflows, stockbrokers said.

However, most investors have been cautiously optimistic on the island nation's risky assets due to a lack of clarity on the political front and the timing of a parliamentary election as concerns over stability weighed on sentiment.

The main stock index ended down 0.11 percent at 7,253.50, the lowest close since May 14.

"The index will be moving zig-zag until you see some kind of positive news on political stability," a stockbroker said.

Political uncertainty due to the Ranil Wickremesinghe-led government not having a majority has been a drag on the market, though the trend reversed after the central bank cut key monetary policy rates to record lows on April 15.

The index has gained 5.2 percent since the rate cut.

Analysts say a new stable government after the election coupled with strong economic measures would boost confidence.

Foreign investors sold a net 482.3 million rupees ($3.60 million) worth of shares on Wednesday. But the bourse has seen net foreign inflows of 5.09 billion rupees in equities so far this year.

Turnover was 1.49 billion rupees, more than this year's daily average of about 1.13 billion rupees.

Lanka IOC, which last week posted a 1.06 billion rupee loss in the March quarter compared to a profit of 722.8 million rupees in the same period last year, fell 5.97 percent to 29.90 rupees, its lowest close since Nov. 28, 2013.

Stockbrokers said they had been expecting a better performance from Lanka IOC during the March quarter.

Analysts expect banking and financial shares to gain due to rising private sector credit growth, which grew 13.9 percent on-year in March from 12.6 percent in February. 

($1 = 133.9000 Sri Lankan rupees) 

(Reporting by Shihar Aneez; Editing by Sunil Nair)

Fitch rates Singer Finance's senior debt final 'BBB(lka)'

Fitch Ratings has today assigned Sri Lanka-based Singer Finance (Lanka) PLC's (SFL; BBB(lka)/Stable) senior secured debt a final National Long-Term Rating of 'BBB(lka)'. The final rating is at the same level as the expected rating assigned on 18 February 2015.

On 21 May 2015, SFL signed the trust deed to issue up to Rs1.5billion of senior secured debentures. The proposed issuance will have a maturity of five......years with bullet principal repayment at maturity. Coupon payments will be at a fixed rate, and paid annually.

SFL expects to use the proceeds to fund lending growth, lengthen maturities of its liabilities, and reduce structural maturity mismatches. The debentures are to be listed on the Colombo Stock Exchange.

KEY RATING DRIVERS
NATIONAL RATINGS AND SENIOR DEBT
The issue has been rated at the same level as SFL's National Long-Term Rating. Fitch has not provided any rating uplift for the colateralization as the secured notes' recovery prospects are considered to be average and comparable with those of unsecured notes in a developing legal system.

SLFL's rating reflects Fitch's view that support would be available from its parent, Singer (Sri Lanka) PLC (Singer; A-(lka)/Stable), if needed. This view is based on Singer's majority shareholding and board representation on SFL, the common Singer brand and a track record of support from Singer through equity injections and funding lines.

SFL's National Long-Term Rating is underpinned by its standalone credit profile, which reflects better capitalisation levels, modest profitability and satisfactory asset-quality when compared with similarly rated domestic peers.

RATING SENSITIVITIES
NATIONAL RATINGS AND SENIOR DEBT
Any changes to Singer Finance (Lanka) PLC's (SFL) National Long-Term Rating would impact the issue's rating. As such, the issue rating is sensitive to changes to Fitch's view on Singer (Sri Lanka) PLC's (Singer) ability and propensity to provide support to SFL. A weakening in SFL's intrinsic strength would only trigger a downgrade of its National Long-Term Rating if Fitch's support assessment were to change at the same time.

Fitch believes that an upgrade for SFL would most likely result from a significant increase in SFL's strategic importance to Singer. Positive rating action could also result if SFL develops its franchise, while maintaining its financial profile relative to higher-rated peers. 

www.ceylontoday.lk

Arpico Insurance renamed

Arpico Insurance Company has been renamed as Arpico Insurance subsequent to the entity being listed on the Dirisavi Board in the Colombo Stock Exchange. This is with effect from January 16, 2015.

The company annual general meeting will be held on June 26, at their Navinna office.
www.dailynews.lk

Textured Jersey to buy Quenby for US$ 3.5 m

Textured Jersey Lanka has decided to proceed with the acquisition of Quenby Lanka Prints for US$ 3.5 million.

The entire consideration is due to be paid out in cash to the shareholders of Quenby Lanka in order to acquire the shares of the company.

Quenby Lanka, a 50%-50% joint venture between Brandix Lanka Limited and Trust Family industries, , is a leading Fabric Printer based in Sri Lanka. Quenby Lanka is registered with the Board of investments of Sri Lanka and its facility is located on 4.4 acres of land in the Seethawaka International Industrial Park, in close proximity to TJL.

"In addition to the printing capability enhancement for TIL, the acquisition also offers potential for further capacity optimization and margin improvement through synergies. As a strategically located vendor, over the years Quenby Lanka has developed a strong working relationship with TJL," an official from Textured Jersey said.
www.dailynews.lk

United Motors Lanka property value increases on revaluation

The Board of Directors of United Motors Lanka PLC approved a report dated 22 May 2015 on the lands and owned and occupied by the company.

The properties on which the report has mentioned are the ones at Hyde Park Corner, Colombo 02, Majeed Place, Orugodawatte, Vauxhall Street, Colombo 02, Maligawa Road, Ratmalana and Kandy Road, Navatkuli, Jaffna.

Following this revaluation the value of the owner occupied lands increased to Rs. 3,879,590,350 and adopted by the Board as fair value of owner occupied properties and hence the surplus of Rs. 1,733,106,312 has been transferred to then revaluation account as at 31 March 2015.
www.adaderana.lk

Sri Lanka's John Keells Holdings net up 12-pct on capital gains

COLOMBO (EconomyNext) – Profits at Sri Lanka's John Keells Holdings, which has interests in ports, tourism, financial services and consumer goods rose 12 percent to from a year earlier to 5.2 billion rupees in the March 2015 quarter helped by capital gains from the sale of stock in an insurer, interim accounts showed.

The group reported earnings of 5.24 rupees for the quarter. In the year to March the firm reported earnings of 14.44 rupees on total profits of 14.3 billion rupees which grew 22 percent.

The firm had not provided for any tax from retrospective tax 25 percent extra income tax slapped by the new administration.

Revenues barely grew 1 percent to 22.6 billion rupees and cost of sales was also flat at 15.9 billion rupees allowing gross profits to be flat at 6.7 billion rupees.

Administration expenses fell to 1.9 billion rupees from 2.3 billion rupees and other operating income rose 37 percent to 1.8 billion rupees.

Early in 2015, JKH sold a part of its general insurance unit at a capital gain.

Net finance income also fell 9 percent to 1.32 billion rupees.