Brown & Company PLC, one of the oldest business conglomerates quoted on the Colombo Stock Exchange who’d origin goes back to 1872 when James Brown set up a bicycle repair business in Hatton, has posted an attributable group profit of nearly Rs.1.7 billion, up from Rs.412 million a year earlier while at company level there was a profit of Rs.2.1 billion against a loss of Rs.464.7 million the previous year.
The group’s Executive Chairman, Mr. Ishara Nanayakkara, has said in the annual report that a close study of the Browns’ operating sectors and its infrastructure needs had been undertaken at the beginning of the financial year – a process that is expected to be completed by the end of fiscal 2014/15.
"A key decision was to dispose of underutilized assets such as land and non-strategic investments in the equities market thereby raising funds of approximately Rs.3.8 billion," Nanayakkara said.
"The proceeds of the sale of this asset are being used towards de-leveraging the company by lowering borrowings and better managing the working capital requirements, a first of many steps that are being taken towards achieving the long-term growth targets of the company."
He admitted that in the light of the ongoing restructuring the financial result for the year under review "seem marginal." But the finance cost for the company had been eased with a net repayment of Rs.1.1 billion borrowings during the year.
No dividend had been recommended for the year under review against a dividend of 50 cents a share paid the previous year.
Nanayakkara said that the restructuring valuation included a study of the parent company, Lanka Orix Leasing Company PLC, (LOLC) Browns and its subsidiaries.
During the year under review LOLC’s leisure arm had been amalgamated with Browns Leisure Investments and consolidated under the group’s investment arm, Browns Investments PLC (BI) bringing all leisure operations of the group under one roof.
"BI, in keeping with the growth in the tourism industry, has embarked on expanding the leisure sector from its current 308 operational rooms to approximately 1,000 in three years," Nanayakkara said.
BI had property in strategic tourist locations such as Passikudah in the east coast, Kosgoda in the southern coast and several other strategic locations across the country. These will be used for hotel construction.
"BI is currently engaged in diversified industries that are expected to lead national growth. In addition to leisure, BI has investments in agri-business and plantations, construction, entertainment and includes a trading portfolio of approximately Rs.1.7 billion," he said.
The chairman also announced that Browns which had entered the healthcare sector during the previous financial year had continued limited operations at its hospital at Ragama which was being refurbished to be expanded into a 60-bed fully fledged secondary care general hospital.
Segmentally Browns had done best in its trading activities with a net profit of over Rs.2.3 billion, up from Rs.510.3 million the previous year and lost on leisure where a loss of Rs.761.3 million had been posted against a profit of Rs.9.5 million the previous year. Investments have grown profitability to increase Rs.148 million from Rs.103.2 million. Manufacturing posted a loss of Rs.29.9 million against a loss of Rs.74.4 million the previous year, plantations a loss of Rs.30.8 million against a profit of Rs.273.1 million the previous year and porcelain reduced its loss to Rs.15.5 million from a loss of Rs.166.9 million the previous year.
Nanayakkara said that Browns was planning to cultivate in collaboration with the army 1,000 acres in Polonnaruwa on the land leased from the Sri Lanka Army. This project spread over the next three years will see the growing of crops such as banana, mango and cashew for the export market along with other cash crops such as sesame.
Browns has a stated capital of Rs.2 billion, a capital reserve of Rs.1.1 billion and revenue reserves of Rs.10.9 billion in its books. Total assets ran at Rs.39.26 billion and total liabilities at Rs.14.74 billion.
LOLC is the ultimate parent of Browns with EPF (9.74%), NSB (1.41%) and the Life Fund of the Insurance Corporation (1.28%) being among the top 20 shareholders.
Net assets per share had declined to Rs.197.36 from Rs.212.99 the previous year while the share closed at Rs.90 during the year under review, down from Rs.117.90 a year earlier.
The directors of Browns are: Messrs. Ishara Nanayakkara (Executive Chairman), Shankar Somasunderam, Janaka de Silva, Kapila Jayawardena, Kalsha Amarasinghe and Rajah Nanayakkara.
The group’s Executive Chairman, Mr. Ishara Nanayakkara, has said in the annual report that a close study of the Browns’ operating sectors and its infrastructure needs had been undertaken at the beginning of the financial year – a process that is expected to be completed by the end of fiscal 2014/15.
"A key decision was to dispose of underutilized assets such as land and non-strategic investments in the equities market thereby raising funds of approximately Rs.3.8 billion," Nanayakkara said.
"The proceeds of the sale of this asset are being used towards de-leveraging the company by lowering borrowings and better managing the working capital requirements, a first of many steps that are being taken towards achieving the long-term growth targets of the company."
He admitted that in the light of the ongoing restructuring the financial result for the year under review "seem marginal." But the finance cost for the company had been eased with a net repayment of Rs.1.1 billion borrowings during the year.
No dividend had been recommended for the year under review against a dividend of 50 cents a share paid the previous year.
Nanayakkara said that the restructuring valuation included a study of the parent company, Lanka Orix Leasing Company PLC, (LOLC) Browns and its subsidiaries.
During the year under review LOLC’s leisure arm had been amalgamated with Browns Leisure Investments and consolidated under the group’s investment arm, Browns Investments PLC (BI) bringing all leisure operations of the group under one roof.
"BI, in keeping with the growth in the tourism industry, has embarked on expanding the leisure sector from its current 308 operational rooms to approximately 1,000 in three years," Nanayakkara said.
BI had property in strategic tourist locations such as Passikudah in the east coast, Kosgoda in the southern coast and several other strategic locations across the country. These will be used for hotel construction.
"BI is currently engaged in diversified industries that are expected to lead national growth. In addition to leisure, BI has investments in agri-business and plantations, construction, entertainment and includes a trading portfolio of approximately Rs.1.7 billion," he said.
The chairman also announced that Browns which had entered the healthcare sector during the previous financial year had continued limited operations at its hospital at Ragama which was being refurbished to be expanded into a 60-bed fully fledged secondary care general hospital.
Segmentally Browns had done best in its trading activities with a net profit of over Rs.2.3 billion, up from Rs.510.3 million the previous year and lost on leisure where a loss of Rs.761.3 million had been posted against a profit of Rs.9.5 million the previous year. Investments have grown profitability to increase Rs.148 million from Rs.103.2 million. Manufacturing posted a loss of Rs.29.9 million against a loss of Rs.74.4 million the previous year, plantations a loss of Rs.30.8 million against a profit of Rs.273.1 million the previous year and porcelain reduced its loss to Rs.15.5 million from a loss of Rs.166.9 million the previous year.
Nanayakkara said that Browns was planning to cultivate in collaboration with the army 1,000 acres in Polonnaruwa on the land leased from the Sri Lanka Army. This project spread over the next three years will see the growing of crops such as banana, mango and cashew for the export market along with other cash crops such as sesame.
Browns has a stated capital of Rs.2 billion, a capital reserve of Rs.1.1 billion and revenue reserves of Rs.10.9 billion in its books. Total assets ran at Rs.39.26 billion and total liabilities at Rs.14.74 billion.
LOLC is the ultimate parent of Browns with EPF (9.74%), NSB (1.41%) and the Life Fund of the Insurance Corporation (1.28%) being among the top 20 shareholders.
Net assets per share had declined to Rs.197.36 from Rs.212.99 the previous year while the share closed at Rs.90 during the year under review, down from Rs.117.90 a year earlier.
The directors of Browns are: Messrs. Ishara Nanayakkara (Executive Chairman), Shankar Somasunderam, Janaka de Silva, Kapila Jayawardena, Kalsha Amarasinghe and Rajah Nanayakkara.
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