Overseas Realty records Rs. 1.5 b profit for 1st half 2016

Overseas Realty (Ceylon) PLC recorded a Group Profit after tax of Rs. 1,485 million, for the first six months ended 30 June.

The company recorded a revenue of Rs. 950 million from Property Leasing at the World Trade Centre (WTC) Colombo and expects to maintain good occupancy levels during 2016. Revenue from Other Services was Rs. 109 million which is an increase of 42% over the corresponding period of 2015. However, the revenue from apartment sales reduced from Rs. 733 million to Rs. 126 million due to non-recognition of revenue of Havelock City Phase 3 during this period. Phase 3 was launched in March 2016 and as at the quarter end around 25% of the Phase 3 units had been pre-sold. While construction of Havelock City Phase 3 is currently underway, pilling works for Phase 4 is scheduled to complete during 2016.

In addition to the developments in the Residential component, Havelock City is currently working on the design works for its Commercial complex. The Commercial complex will consist of a world class A grade Office Tower and a Shopping Mall built to international standards with a fusion of retail, dining and entertainment.

The Group Net Asset Value per Share as at 30 June stood at Rs. 32.39 and the Earnings per Share for the period stood at Rs. 1.66.

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Tourist arrivals cross 1 million mark in July

Tourist arrivals crossed the 1 million mark in July reflecting a near 17% growth year on year.

This year’s end July performance is the best ever with 1.17 million tourists visiting, up by 16.7% from 1.0 million a year earlier.

India remains the largest source market with 200,508 arrivals, up 18% in the first seven months, followed by China with 168,473, up by 37%.UK came third with 110,649 arrivals up by 18% over the first seven months of 2015.

Tourist arrivals in July rose by 19% t0 209,351.
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Expolanka Holdings’ 1Q top line up 7%

Via its strategic shift towards focus on growth sectors, Expolanka Holdings PLC has achieved revenue growth of 7% year-on-year (YoY) amidst challenges, thereby increasing its revenue for the first quarter of the 2016/17 financial year (1Q 2016/17) to Rs. 14,956 million.

According to unaudited figures released to the Colombo Stock Exchange (CSE), driven by good performances in its Logistics and Leisure sectors (with Ventures beings its other area of operations), the company also improved its operating profit (which excludes other incomes and finance cost) by 20% YoY to Rs. 400 million, for the three months which ended on 30 June 2016.

As a result of non-cash write down in passive investments held at the Group level, the Group Profit Before Tax (PBT) for the quarter was Rs. 378 million – a decrease of 6% YoY. The profit attributed to the equity holders for the quarter too declined by 18% YoY to Rs. 182 million.

“It is noteworthy that the strategic focus on growth sectors has delivered a resilient financial performance in the first quarter of 2016/17 even amidst challenges,” Group CEO Hanif Yusoof said. “With ongoing developments such as the possible restoration of GSP Plus to the EU and other macro related developments, we intend to capitalize on the emerging growth opportunities, both locally as well as regionally.”

Expolanka Group, which now operates in the three spheres of Logistics, Leisure and Ventures, after divesting its non-core assets to focus greater on growth sectors, experienced top line growth in Logistics and Leisure during the first quarter of the 2016/17 financial year.

In Logistics, the Group increased its revenue by 5% YoY to Rs. 12,405 million for the quarter – a noteworthy performance considering the surge in air freight shipments in the corresponding quarter of the previous year. Both air and ocean freight recorded double digit volume growth while the Group’s core markets in India, Bangladesh and Sri Lanka performed well, fuelled by healthy volume growth in the US trade lane. Indonesia, Vietnam and Hong Kong (the Far East) recorded notable performances, thereby contributing to the overall sector growth. In addition, cost rationalization exercises and global procurement efforts conducted over the past few years have yielded results boosting bottom line growth of the sector.

The Leisure sector experienced Revenue growth of 64% YoY, improving its top line to Rs. Rs. 1,383 million with the Group’s outbound business travel operations recording positive results, building further on the growth that the sector showed throughout last year. Expolanka Holdings will continue to focus its attention towards growing the Leisure Sector.

The Ventures sector recorded a revenue of Rs. 1,167 million during the quarter. Non-recurring charge of Rs. 48 million related to restructuring cost affected the PBT of the segment.

Expolanka Holdings PLC has been in operation since 1978 and has a workforce of over 2800 employees. Headquartered in Colombo, Sri Lanka, the Group’s network spans more than 20 countries in Asia, Africa, USA and the Middle East. 

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Sri Lanka's Sampath Bank to seek US$100mn from syndicated loans

ECONOMYNEXT - Sri Lanka's Sampath Bank will seek up to $100 million of 3-to-5 year funds this year to meet loan demand and supplement domestic deposits, Chief Executive Aravinda Perera said.

Perera said the bank may see up to 25 percent loan growth if deposit targets could be met this year.

The bank was focussing more on small and medium clients this year and reducing emphasis on corporate lending, he said.

Sampath had repaid syndicated loans taken earlier and it only had some short-term foreign borrowings, he said.

Bloomberg Newswires said the bank was already in the market for a $50 million syndication, with responses due by August 26.

A bank that finances credit from real deposits does not cause any balance of payments pressure.

Foreign currency shortages comes when the government spends money from Treasury bills sold to the central bank, when maturing Treasury bills are bought by the central bank with printed money, or when primary dealers buy bond or banks fund loans with money from the reverse repurchase window.

Central Bank releases summary trading statistics on Government Securities Secondary market information for the first time

Click here to view or download 

Government Securities Secondary Market 

Trade Summary 03.08.2016

As a further policy measure to develop the government securities market, the Central Bank from today has commenced releasing summary trading statistics on actual trading of government securities in the secondary market. From August 1, 2016, all primary dealers have been required to undertake inter-primary dealer trades in the trading platform arranged by the Central Bank through the Bloomberg which is a major international financial trading and information electronic platform. 

Further, all primary dealers will report all outright sales of government securities of value in excess of Rs. 50 mn to investors to this platform within 30 minutes of each transaction. Accordingly, the Central Bank will monitor these transactions on an on-going basis and summary of trading information consisting of yield rates and volume by each series of securities traded will be published in the Central Bank website in the format as annexed below. The Central Bank plans to release such information twice a day, at noon and close of the day, in due course when the reporting system is fully operative. This information will help investors to study the current status of government securities market conditions along with other financial market and economic information and make more informed decisions in relation to their investments. The availability of such market information will further promote transparency, price discovery and outreach of the government securities market in parallel to other financial markets. In due course, outright secondary market sales of government securities by non-primary dealer banks to their customers also will be brought into this system.  

In addition, the Central Bank has commenced procurement process for setting up a dedicated electronic trading platform along with Central Counter party System which will provide market information on real time basis similar to other developed financial markets and further develop the government securities market to international standards. Meanwhile, several measures are in the process to strengthen the regulation and supervision of the market in line with international standards. For this purpose, the regulation and supervision of the government securities market has been assigned to the Department of Supervision of Non-bank Financial Institutions whereas the Public Debt Department will undertake functions relating to issuance, registry, market development and debt management. These policy initiatives are expected to promote fair market practices and yield benefits of the government securities market to all participants.

Sri Lankan shares down on profit-taking

Reuters: Sri Lankan shares ended lower on profit-taking on Thursday, snapping five days of gains and slipping from their highest level in more than seven weeks hit in the previous session, analysts said.

The bourse has been on a gaining trend on hopes that economic fundamentals would improve after the central bank's rate hike last week.

The benchmark Colombo stock index ended down 0.51 percent at 6,478.25, slipping from its highest close since June 14 hit on Wednesday.

The central bank last week raised its main interest rates by 50 basis points each in a surprise move aimed at curbing stubbornly high credit growth that is adding to concerns about inflationary pressures.

"Today there was a bit of slowdown with lower interest from foreigners," said Yohan Samarakkody, head of research, SC Securities (Pvt) Ltd.

"The market started to consolidate today. Market cannot go up continuously, either it should stabilise or should go up again after some kind of consolidation."

Overseas investors were net buyers of 34.6 million rupees ($237,800.7) worth of shares on Thursday, extending the net foreign inflow during the last seven sessions to 784.3 million rupees worth of equities.

However, they have been net sellers of 4.02 billion rupees worth of shares so far this year.

Stockbrokers said the market is awaiting an economic policy announcement from Prime Minister Ranil Wickremesinghe, scheduled later this month.

Turnover stood at 504.7 million rupees ($3.47 million), less than this year's daily average of around 733.4 million rupees.

Shares in Ceylon Tobacco Company Plc fell 1.51 percent, while biggest-listed lender Commercial bank of Ceylon Plc fell 1.79 percent, dragging the overall index down. 

($1 = 145.5000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sunil Nair)

Haycarb records turnover of Rs. 2.9 billion and profit before tax of Rs. 245 million for Q1 2016/17

Sri Lankan multinational Haycarb Plc reported revenue of Rs. 2.9 billion and profit before tax of Rs. 245 million for the first quarter of 2016/17. The profit after tax stood at Rs. 203 million.

The turnover increased marginally, while the profit before tax and after tax recorded a growth of 12% and 7% respectively compared to the previous year.

Haycarb Plc Managing Director Rajitha Kariyawasan said that while the company’s initiatives to strengthen raw material supply chain networks in Sri Lanka and Thailand showed progress, the raw material situation in Indonesia had setbacks resulting in increasing prices due to low supply availability caused by bad weather cycles and increased exports. He further said: “The adverse market conditions due to the downturn in gold mining which continues to impact international markets was exacerbated by low cost competition from countries such as the Philippines and India, resulting in the under-utilisation of Haycarb’s installed capacity during the first quarter of 2016/17.” He noted however that success in business development and new product development initiatives that increased marketing reach to new geographies and product applications, together with the upturn in the value added product portfolio, helped the bottom line in spite of less than expected growth in sales revenue.

He added that growth in the environmental engineering arm Puritas Ltd. was expected to contribute positively to the profitability of the Group.

In the background of an increasing emphasis on environmental sustainability worldwide, Haycarb remains positive in its medium to long-term outlook in its activated carbon and water treatment systems businesses.

Haycarb is the pioneer manufacturer of coconut shell activated carbon in any coconut producing country with manufacturing facilities in Sri Lanka, Thailand and Indonesia supported by marketing offices in the US, UK and Australia. The company contributes net foreign exchange revenues with its value adding processes whilst remaining a leading and technologically superior manufacturer in its chosen segment. The Board of Directors of Haycarb Plc comprises Mohan Pandithage – Chairman, Rajitha Kariyawasan – Managing Director, Dhammika Perera, Arjun Senaratna, Sarath Ganegoda, Jeevani Abeyratne, Dushantha Ranaraja, Nimal Perera, Dr. Sarath Abayawardana, Sujeewa Rajapakse, M.S.P. Udaya Kumara, Brahman Balaratnarajah, Ali Asgar Caderbhoy, Sharmila Ragunathan and James Naylor. 

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