Richard Pieris Finance posts Rs 200 m PAT in second year

Richard Pieris Finance Limited, the newest subsidiary of Arpico Group was able to record Rs 200 million profit after tax in its second year, a top official said.

The company currently operating at Hyde Park Colombo plans to set up eight branches in the during this year. The company has performed well during the short span of two years, Chief Executive Officer K.M.M Jabir told Daily News business.

“We are also going to open Richard Pieris Finance service centres in Arpico Super Centres and super markets, which is the biggest strength of the company,’ Jabir said.

Jabir said they plan to venture into all sectors under a finance company’s mandate. The company now two years has an asset base of Rs 6.5 billion. Jabir also said they have a strong customer base including major corporate in the country. The company is to focus on leasing Islamic financing and other business areas covering micro finance, he said.

The company acquired Chilaw Finance, a Rs 1.3 billion worth assets based company in the North Western Province.

“We have acquired Chilaw Finance company recently and it is now running as an independent entity,” he said.

He said that current government has not forced mergers and acquisition of financial entities like the previous government.

“We are still in the process of ironing out certain issues of the company.”

Although the consolidation programme is ideal to create a strong banking and financial sector in the country, the Sri Lankan financial sector was not ready at that time to accept the consolidation programme of the previous government, he said.

“Since we could witness a rapid economic development in the North Western Province it is an opportunity to make our presence felt in the area with the acquiring of Chilaw Finance Company,” he said.

The company also won the emerging financé company of the year award.
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Ceylon Tea Brokers musters Rs. 278.27 m turnover for 2014/15

Ceylon Tea Brokers PLC registered Rs. 278.27 million as revenue during the 2014/15 financial year compared to Rs. 259.20 million in 2013/14.

The gross profit for the year under review accounted for Rs. 209.54 million as against 202.56 million in 2013/14 and Profit Before Tax (PBT) of Rs. 72.86 million as against Rs. 77.23 million in 2013/14 was achieved said, Suranga Perera, Director / Chief Executive Officer in the annual report.

“In view of the diluted demand from some of the key international markets for Ceylon Tea, resulting in sharply declining auction prices, the company implemented strategies to intensify effortsto improve the operational efficiencies and also focus on the cost factors that could be reduced without disturbing the quality of service.

These changes which were carried out with the concurrence of the entire team made sure that everyone understood the importance of a lean but an efficient operation in moving forward at this crucial juncture.”

“At the risk of creating controversy, we are of the view that we should examine the hotly debated topic of making Sri Lanka a Tea Hub without compromising the inherent value of marketing Pure Ceylon Tea.

We believe that there could be a happy medium said Ceylon Tea Brokers PLC, Chairman.Chrisantha Perera.

“When analysing Sri Lanka’s tea export profile, it will be found that our exports to some of the major markets where we had a dominant position have declined, whilst exports to the so-called “Tea Hubs” such as UAE & Turkey have increased. In fact, Turkey is presently the single largest export outlet for our tea although it is likely that most of this tea is traded out of Turkey either to the neighbouring Middle Eastern countries or Russia & other CIS countries.”

“An encouraging trend which we must develop is the emergence of China as a potential large export outlet for our teas. A significant feature that has taken place in 2015 is also the substantially higher quantities of exports to India.

“We should endeavour to maximize the potential of our Free Trade Agreement with Pakistan.”

Airing their future plans he said that they would be investing in a Warehousing Complex. “This project is well underway with potential land identified as well as the incorporation of a separate Company for this purpose,” Ceylon Tea Brokers PLC, Chairman. Chrisantha Perera

Suranga Perera, Director / Chief Executive Officer

The Daily News business inadvertently carried Tea Traders Association musters Rs. 278.27 m turn over for 2014/15 on its August 21 issue. The error is regretted.
www.dailynews.lk

Mercantile Investments posts Rs 631 m profit

Mercantile Investment and Finance PLC (MI) has posted a solid performance for the financial year ended March 31, 2015 with Gross Income reaching Rs. 4.29 billion.The profit after tax has come down marginally from Rs. 675.4 from previous year to Rs. 631.3 this year.

Founded by George Ondaatjie and is still largely owned by his family, Mercantile Investment and Finance said its success over the years is attributable to its unique business model that exemplifies strategic thinking and precise execution.

The group with three quoted hotel companies - Grand Hotel Nuwara Eliya, Tangerine Beach Hotel and Royal Palm Beach Hotel - along with the unquoted Nilaveli Beach Hotel, has recently launched a new 3 star hotel in Wellawatte.

Chairman Saro Weerasuriya said the national economy growth forecast looks very positive with GDP growth levels expecting to be hovering around 7% even in the medium term. This should pave the way for the corporates to exploit emerging opportunities to their advantage and thrive”

MI’s Managing Director Gerard Ondaatjie says in the annual report “We have kept our promise of generating stakeholder value and therefore celebrate this fiftieth anniversary with a real sense of achievement” He elaborated further saying that “The year had seen growth in the licensed finance company sector fuelled by the resurgence of the economy in key sectors and improved spending power of the people.

This indeed sustained the steady demand to provide finance support to purchase brand new as well as registered motor vehicles, while demand for non-traditional lending such as personal loans, property mortgage loans and microfinance showed potential as lucrative areas of focus for the sector” MI’s dividends payment to its investors was Rs. 89 million, up from Rs. 30 million of the previous year.

Sound financial results and retaining profits provided the strength for the company to ensure consistent increase in shareholder funds which exceeds Rs. 7.5 billion as at March 31,2015.

- See more at: http://www.dailynews.lk/?q=business/mercantile-investments-posts-rs-631-m-profit#sthash.46L3BGWD.dpuf

NSB 1H pre-tax profit up 68% to Rs. 6.2 b

Savings giant NSB has recorded the highest half yearly profits in its history with an impressive Profit Before Tax (PBT) growth of 68% as compared to same period last year.
The profitability for the first half for 2015 reached Rs. 6.2 billion with the increase mainly fuelled by growth in its traditional lines of business. 

The Profit After Tax (PAT) was reported at Rs. 3.9 billion for the first half of 2015. These profits were reported following prudent provisioning policies adopted for any adverse impact on declining gold market prices.

The bank’s loans and advances grew by 6.9% during this period with investments in Government securities increasing up to Rs. 519 billion. The total assets of the bank surpassed the Rs. 800 billion milestone by end of June indicating a growth of 4.7%.

A concerted effort to aggressively mobilise deposits during first and second quarters reaped benefits to the tune of Rs. 21.5 billion in incremental deposit balances of which Rs. 11.9 billion generated through savings related products. The total deposits of the bank stood at Rs. 575 billion at end of June 2015.

The bank’s Tier 1 capital adequacy ratio stood at 19.9%, while total capital adequacy for the reviewed period was at 18.5%. These ratios remain well above the regulatory standards for well capitalised banks.

The bank will continually evaluate initiatives to further enhance business and develop infrastructure as appropriate. Further improvements in customer delivery standards could be envisaged to maintain momentum in order to build competitive advantages with focus on information technology.  

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C H C Investment buys 31-pct stake in Sri Lanka's Taprobane Holdings for Rs 1.7bn

ECONOMYNEXT - C H C Investment (Pvt) Ltd. has bought a 31 percent stake in the diversified Taprobane Holdings PLC at 5.50 rupees a share in a deal worth 1,709.4 million rupees, a stock exchange filing said.

C H C Investment (Pvt) Ltd. bought 310.8 million shares of Taprobane Holdings PLC at 5.50 rupees a share amounting to 30.99 percent of the firm’s issued capital,Taprobane Securities,a fully owned subsidiary of Taprobane Holdings, said in a statement to the Colombo bourse.

The trade was in two blocks with Ishara Nanayakkara who held a 22.53 percent stake being one seller and P S W Rupasinghe, with an 8.46 percent stake, the other.

Sri Lanka to auction Rs40bn in 5 to 10 year bonds

ECONOMYNEXT - Sri Lanka has called offers to sell 40 billion rupees of 5, 6, 8 and 10 year bonds ahead of a bond maturity with yields moving up slightly over the past week.

The debt office is offering 4.0 billion rupees of 5-year bonds maturing on 01.05.2020, which is not liquid in the secondary market, dealers said.

Bonds maturing on 01.07.2019 were quoted around 8.18/28 percent Friday, up from 8.20 levels on August 18.

Ten billion rupees of 8-year bonds maturing on 01.09.2023 is also offered. Similar bonds were quoted around 9.45/50 percent.

The debt office is also offering 12.5 billion rupees of 10-year bonds maturing on 01.08.2025 and 15-yaer bonds maturing on 15.05.2030.

Ten year bonds were quoted around 9.65/70 percent on Friday, up from 9.45 percent on August 18.

Indicative quotes for the 15-year bond ranged around 10.05/25 percent.

The auction which closes on August 25, has a settlement date of September 01.

There is a 79.5 billion rupees bond maturity of September 01 and yields tend to spike ahead of suc roll-overs encouraging more investors to buy and also for dealers to bid with leveraged funds and sell-them down later.

However in the short end, the Central Bank has started buying up large volumes of Treasury bills to print money and resist an increase in interest rates, which analysts warn is generating pressure on the balance of payments as well as foreign reserve losses.

Sri Lanka company earnings growth picks up in June quarter

ECONOMYNEXT – Sri Lanka’s company earnings growth picked up in the June 2015 quarter as consumption increased, driven by low borrowing costs and higher disposable incomes, a research report said.

Overall market earnings growth in the June 2015 quarter picked up 10.7 percent year-on-year to 46.7 billion rupees after a slowdown to 2.2 percent year-on-year during the March 2015 quarter, CAL Research said.

Trailing 12 month market earnings grew 16.5 percent from a year ago to 207 billion rupees due to low interest rates and improving disposable incomes driving up consumption, compared with a contraction of 8.4 percent during the same period last year, they said.

CAL Research, the research unit of Capital Alliance Ltd., said the Banks, Finance & Insurance sector of firms listed on the Colombo bourse contributed 40 percent to earnings growth, the largest sector-wise contributors to market earnings in the June 2015 quarter.

They were followed by the Beverage, Food and Tobacco sector with a contribution of 18 percent and Diversified Holdings with 13 percent.

Earnings from firms in the Chemicals and Pharmaceuticals sector grew the fastest, up 180 percent from a year ago, followed by those in the Stores and Supplies sector, up 137 percent, and Motor Sector firms, up 78 percent.

But plantations sector firms suffered the most in the June 2015, with earnings falling by 138 percent from the previous year, followed by those in the Hotels & Travels sector, whose earnings slumped 95 percent, and Investment Trusts whose earnings fell 66 percent.

CAL Research said the Colombo Stock Exchange currently trades on a Trailing Twelve Month Price-to-Earnings Ratio of 14.4x and a Price-to-Book Value of 1.6x.

The largest individual contributors to June 2015 quarter earnings on the CSE came from Ceylon Tobacco Company (6.5 percent), Commercial Bank (5.7 percent), Hatton National Bank (5.1 percent) and John Keells Holdings (4.7 percent).

Lanka India Oil Corp. (LIOC) reported a net profit of 171 million rupees in the June 2015 quarter against 1.2 billion rupees in the same 2014 period.

Carson Cumberbatch and Bukit Darah, whose earnings are influenced by palm oil prices, saw net profit declines of 58 percent and 67 percent from the previous year.

The combined earnings of these three firms accounted for 2 percent of market earnings in the June 2015 compared with 9 percent of market earnings the year before.

Excluding LIOC, Carson and Bukit Darah, overall market earnings grew 18 percent in the June 2015 quarter from the year before, CAL Research said.