Rocell to cease operations in Ever Paint

The Board of Directors of Royal Ceramics Lanka have decided to cease the operations of Ever Paint and Chemical Industries (Private) Limited with immediate effect and to dispose of the assets thereof.

Ever Paint and Chemical Industries is a fully owned subsidiary of Royal Ceramics Lanka PLC. and the said company was engaged in the business of manufacturing and marketing of paints and allied products.

The immediate impact to the Group on this cessation of business is estimated at Rs.226 million based on the estimated disposable value of the assets of the said subsidiary company.
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Dipped Products 1Q profits down

Dipped Products PLC (DPL) posted Rs. 5.4 billion in group turnover during the 1Q 2016-17, compared to Rs.5.7 billion for the same period of the previous year. Group profit before tax (PBT) for the period was Rs. 12.5 million, from Rs. 176 million recorded for the 1Q last year.

The Hand Protection segment contributed Rs. 3.21 billion to revenue, a 1 percent increase against 1Q in 2015-16.Contribution to PBT from the segment was at Rs. 134 million, 32 percent lower for the same period of the previous year.

The Plantation segment reported Rs. 2.26 billion in revenue, a 13 percent reduction from the previous year and a loss of Rs. 122 million, compared to a loss of Rs. 20 million posted for the 1Q last year.

Dr. M Ranasoma commenting on the Hand Protection sector results said their industrial glove manufacturing facility, D P L Universal Gloves has begun commercial production and in a position to step up serving customer orders.

The low tea crop recorded and the lower rubber prices prevailed during the period impacted negatively to the Plantation sector performance.

Established in 1976, Dipped Products is one of the leading non-medical rubber glove manufacturers in the world, and accounts for a 5 percent share of the global market. The company’s products now reach 68 countries.
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Hayleys Q1 revenues up, PBT above Rs. 1 billion

Hayleys PLC, posted Rs.1.03 billion in Profits Before Tax (PBT) for the first quarter of the 2016/17 financial year. Revenue reached Rs. 24.13 billion, continuing the topline growth momentum from the last financial year.

The Agriculture, Purification Products, Construction Material,Eco Solutions, and Power and Energy Sectors saw appreciable profit growth over the same period in the previous year. All sectorsmade positive contributions to the bottomline except for the Plantation sector, where industrywide challenges continue to dampen sector performance.

During the period, the Leisure Sector acquired a Maldivian luxury resort in the South Ari Atoll close to the popular KudarahThila dive site. The Kudarah Island Resort which has 51 luxury villas is the group’s first leisure sector investment outside Sri Lanka and will be operated under its flagship Amaya Resorts and Spas.

Hayleys Chairman and Chief Executive Mohan Pandithage said the acquisition of the Kudarah Island Resort fulfills a long felt need to operate a resort in the Maldives to compliment the diversity under their Leisure Sector.

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Sunshine Holdings achieves highest-ever revenue, profits for 1Q

Achieving its highest-ever Group Revenue and Earnings Per Share (EPS) for a single quarter, diversified conglomerate Sunshine Holdings PLC has concluded the first quarter of its 2017 Financial Year (1Q 2016/17) on a high note.

For the quarter ended June 30, 2016 Sunshine Holdings boosted Profit After Tax (PAT) by a significant 30% year-on-year (YoY) to Rs. 408 million and increased Group revenue by 11% YoY to Rs. 4.6 billion.

The Group also improved Profit to Equity Holders by an impressive 27% YoY to Rs. 207 million, as well as its earnings per Share (EPS) by 27% YoY to Rs. 1.53.

The five sectors in which the diversified conglomerate operate are; Healthcare (Sunshine Healthcare Lanka Ltd. and Healthguard Ltd.), FMCG (Watawala Tea Ceylon Ltd.), Agribusiness (Watawala Plantations PLC), Packaging (Sunshine Packaging Ltd.) and Renewable Energy (Sunshine Energy Ltd.).

“This strong performance amidst economic and business volatility and challenges – especially in Agribusiness – reflects the solid fundamentals of Sunshine Holdings and its business units,” Group Managing Director (GMD) – Vish Govindasamy said. “The high growth trajectory of Sunshine Holdings is evident in the Group achieving its highest-ever Group revenue and EPS for a single quarter during the concluded financial period. With the expansion efforts and strategic initiatives which are underway, the Group is well poised for further growth acceleration in the medium to long term.”

Healthcare, the largest sector of the Group, which accounted for 42.4% of Group turnover for 1Q 2016/17, increased its revenue by 18% YoY. As a result of having to absorb exchange rate fluctuations (due to price controls on pharmaceuticals) Healthcare PAT however was down 6.1% YoY in 1Q 2016/17.

The FMCG sector revenue grew 14.4% YoY, with continued growth in the domestic market in which its brands – Zesta, Watawala Tea and Ran Kahata – collectively have over 35% market share. PAT however was adversely affected by pickup in tea prices and the cost of rollout of ‘Zesta Connoisseur’ to Shangri-La properties worldwide.
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Sri Lankan shares steady; foreign investor buying boosts sentiment

Reuters: Sri Lankan shares closed almost steady on Tuesday, with investor sentiment boosted by foreign investor buying, while markets waited for some firm direction on the government's economic policies.

The benchmark Colombo stock index ended 0.05 percent, or 3.18 points, firmer at 6,510.11, hovering near a more than seven-week high hit on Friday.

Foreign investors, who have sold a net 3.56 billion rupees ($24.51 million) in shares so far this year, bought shares worth a net 252 million rupees on Tuesday, extending the net foreign inflow in the last ten sessions to 1.24 billion rupees of equities.

"Investors are cautiously buying. We see retail investors are buying while some profit-taking is happening too," said Reshan Kurukulasuriya, chief operating officer of Richard Pieris Securities (Pvt) Ltd.

"Investors are optimistic and they are buying on earning hopes."

Stockbrokers said the market was waiting for a policy announcement on the economy from Prime Minister Ranil Wickremesinghe, scheduled later this month.

Analysts shrugged off a Supreme Court decision to stop considering a bill to raise the country's value-added tax because the draft has not followed due process as the government has said it will raise the tax with due process.

Shares have risen on hopes economic fundamentals would improve after the central bank on July 28 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.

Turnover stood at 940.2 million rupees ($6.47 million) on Tuesday, more than this year's daily average of around 731.6 million rupees.

Conglomerate John Keells Holdings edged up 1.56 percent, while Ceylon Cold Stores jumped 6.2 percent. 

($1 = 145.2500 Sri Lankan rupees) 

(Reporting by Shihar Aneez and Ranga Sirilal; Editing by Subhranshu Sahu)

Norges wealth fund increases stake in Dialog, EPF reduces

(LBO) – Norges Bank has increased its shareholding in Dialog Axiata PLC to 96.6 million shares as of end June, data filed with the Colombo Stock Exchange shows.

Norway’s Norges Bank, which manages the world’s biggest sovereign wealth fund, is now the fifth biggest shareholder in telecommunications company Dialog with a 1.19 percent stake.

The shareholding is up from 28.7 million shares as of end September, 2015.

EPF has reduced its position from 193.8 million shares in March to 180.8 million shares by end June. EPF now has a 2.2 percent stake and is the second largest shareholder.

Norges Bank Investment Management has close to 900 billion dollars invested in global assets, a fund built from the country’s oil revenues.

Sri Lanka Tokyo Cement in deal with Japan’s Ube Industries

ECONOMYNEXT – Sri Lankan cement manufacturer Tokyo Cement Group said it has struck a deal with Japan’s Ube Industries Ltd. for technical support and import raw to make high quality cement.

A statement said the deal was signed on 1 August 2016.

“Tokyo Cement Group has entered into a collaborative agreement with Ube Industries Ltd. of Japan for technical support services and import part of their raw materials requirement from Japan to manufacture high quality cement,” it said.

The Ube Group has five main business segments - chemicals, pharmaceuticals, cement and construction materials, machinery, and energy and environment.

Its cement and construction materials business makes cement, ready-mix concrete, building materials, and does resource recycling.