Sri Lankas' First Capital Holdings return to profit in March quarter

ECONOMYNEXT - Sri Lanka's First Capital Holdings Plc, which has interests in investment banking and securities trading, reported profits of 94 million rupees in the March 2017 quarter, against a loss of 86 million rupees, a year earlier.

The firm reported earnings of 94 cents per share.

Group revenues rose to 842 million rupees from 394 million rupees a year ealier, while costs rose to 725 million rupees from 278 million rupees.

Capital gains on trading rose to 67 million rupees from a loss of 109 million rupees a year earlier.

The group said First Capital Treasuries Plc, its primary dealer unit, was the key contributor to profits, making gains on its securities portfolio.

First Capital Limited, which deals in corporate debt, mobilized 12.4 billion rupees from corporate debt. But it was hit by higher funding costs and losses on trading securities, the firm said.

"Despite the setback experienced in the preceding quarters, the Group is optimistic in its outlook and has planned several calculated improvements to its operations," Group Chief Executive Dilshan Wirasekara said.

Sri Lanka Hayleys March net down 8-pct to Rs1.3bn

ECONOMYNEXT – Sri Lanka’s Hayleys group said net profit fell 8% to Rs1.3 billion in the March 2017 quarter from a year ago.

Sales of the group, whose core businesses span transportation, purification, agriculture, construction materials and power rose19% to Rs29.2 billion, a stock exchange filing said.

The accounts showed finance costs rose 74% to just over a billion rupees in the March 2017 quarter.

Quarterly earnings per share were Rs17.63. The company’s share was last traded at Rs293.90.

“Over the final quarter of the year, the group’s performance received a strong boost, particularly from its agriculture, construction and transport segments, to finally register turnover growth of 19% year-on-year, up to Rs. 29.2 billion,” a statement said.

“Results from operating activities rose to Rs. 3.52 billion, reflecting 24% YoY growth. Similarly, profit before tax (PBT) for the final quarter rose by 9% YoY to Rs. 2.96 billion.”

The accounts showed EPS fell to Rs37.12 in the financial year ending 31 March 2017 from the year before with annual net profit down 11% to Rs2.8 billion while sales rose 21% to Rs111.4 billion.

The Hayleys statement said sales were supported by strong performances across the group’s core businesses.

“This led to a substantial 14% YoY improvement on the group’s results from operating activities, which closed the year at Rs. 9.67 billion,” it said.

“Moving forward we will continue to consolidate our operations with a view to further strengthening overall profitability while also exploring opportunities to expand growth within our current business segments.” Hayleys chairman and chief executive, Mohan Pandithage said.

All of the group’s top five performing sectors posted pre-tax profits in excess of Rs. 1 billion.

Transportation and Logistics recorded a PBT of Rs. 1.79 billion, Purification Products posted a PBT of Rs. 1.18 billion, and the Group’s Agriculture segment achieved a PBT of Rs. 1.1 billion.

The group’s Power and Energy sector achieved a PBT of Rs. 1.02 billion whilst commissioning one of Sri Lanka’s largest Solar Power plant of 10MW during the year, Hayleys said.

The Construction Materials segment posted a PBT of Rs. 1.02 billion during the period under review.

Sri Lankan shares fall on profit-taking in blue chips

Reuters: Sri Lankan shares edged down on Monday as investors booked profits in blue chips such as John Keells Holdings Plc, with analysts saying the market was waiting for policy direction from newly-appointed finance minister Mangala Samaraweera.

President Maithripala Sirisena switched the finance and foreign ministers in a cabinet reshuffle on Monday, in a bid to restore confidence in the administration's handling of the economy.

The Colombo stock index ended 0.04 percent weaker at 6,726.90, slipping from its highest close since Jan. 7, 2016 hit on Friday.

The index rose 0.83 percent last week, and has climbed 11 percent since March 31 through Friday.

Turnover stood at 335.6 million rupees ($2.20 million), well below this year's daily average of 887.3 million rupees.

"The market is struggling to break the current psychological level. The market need a bit of a breather before it kickstarts again. We are seeing a bit of profit-taking," said Dimantha Mathew, head of research, First Capital Holdings PLC.

Foreign investors net sold shares worth 30.6 million rupees on Monday, but they have net bought 17.98 billion rupees worth of shares so far this year.

Shares in biggest listed lender Commercial Bank of Ceylon Plc fell 3.41 percent, while conglomerate John Keells Holdings Plc ended 0.30 percent weaker. 

($1 = 152.5000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

Sri Lanka's Access Engineering March net up 31-pct

ECONOMYNEXT - Sri Lanka's Access Engineering Plc, a construction group, said profits in the March 2017 quarter rose 31 percent to Rs831 million from a year earlier.

Sales rose 14 percent to Rs5.2 billion in the March quarter, according to interim accounts filed with the stock exchange.

Quarterly earnings per share rose 30 percent to 83 cents from 64 cents. The share last traded at Rs26.30.

EPS for the financial year ended 31 March 2017 rose 9.3 percent to Rs2.70 with annual net profit at Rs2.7 billion while sales rose 16 percent to Rs20.4 billion.

The increase in annual profits came mainly from the construction business with profit from its Sathosa Motors subsidiary, which holds the franchise in Sri Lanka for Isuzu Motor vehicles, falling.

Stockbrokers close outstation branches

By Duruthu Edirimuni Chandrasekera

Some stockbrokers, with the stock market continuing to show negative returns, are closing their outstation branches in a move to cut costs and manage their bottom lines.

While brokerages are faced with several serious issues and their cash-flows are strapped, some companies are mulling pay cuts as well. Some closed nearly four branches outstation, they told the Business times adding that altogether about 12 branches were closed by March. The Securities $ Exchange Commission (SEC)’s new rules in capital adequacy which direct the implementation of a risk based Capital Adequacy Requirement (CAR) of 1.2 times the risk requirement of stock brokers subject to a minimum liquid capital requirement of Rs. 35 million is also curtailing operations, they said.

These firms had met with both the Colombo Stock Exchange (CSE) and the SEC and requested for ‘assistance’, they said.

Officials of both institutions confirmed this saying that some firms had approached them in March for assistance but they had not specified ‘what’. CSE officials said that since April, the CSE has showed buoyancy and the stockbrokers haven’t come back to them on closing branches.

They said that some run their branches on CSE premises which are subsidised by the CSE. “Branches at Matara, Kandy, Kurunegala, Negombo and Jaffna are highly subsidised. They pay a minimal rent only and no utilities,” a CSE official said, adding that now with retailers rejoining the CSE things may change for the better.
www.sundaytimes.lk

Sri Lankan shares rise; post 8th straight weekly gain

Reuters: Sri Lankan shares ended higher on Friday, posting the eighth straight gain on week and hitting their highest closing level in more than 16 months, led by blue chips such as John Keells Holdings Plc.

The Colombo stock index ended 0.47 percent firmer at 6,729.66, its highest close since Jan. 7, 2016.

It rose 0.83 percent during the week, and has climbed 11 percent since March 31.

Turnover stood at 618.02 million rupees ($4.06 million), less than this year's daily average of 893.4 million rupees.

"The market is up on significant buying interest in John Keells. There was some buying interest in some finance companies too," said Dimantha Mathew, head of research, First Capital Holdings PLC.

"We expect profit-taking next week as the market needs some breather."

Foreign investors net bought shares worth 728,954 rupees, extending the year-to-date net foreign inflows to 18.02 billion rupees.

Shares in Nanda Investment Plc rose 24.89 percent to hit a record closing high, while conglomerate John Keells Holdings Plc climbed 1.51 percent and Browns Investment Plc was up 15.79 percent. 

($1 = 152.3000 Sri Lankan rupees) 

(Reporting by Ranga Sirilal; Editing by Biju Dwarakanath)

CCS to invest Rs6.3bn in new ice cream factory, bottling facility

(LBO) – Ceylon Cold Stores said it is enhancing capacity with investments of 3.8 billion rupees in a new ice cream factory and 2.5 billion rupees in a new bottling facility for beverages.

Chairman of CCS, Susantha Ratnayake, delivering a note in the 2016/17 annual report, said the company will continue to pro-actively cater to changing consumer needs and lifestyles, creating value for customers.

Ratnayake said their fully owned subsidiary Jaykay Marketing Services Limited will also continue to rapidly expand its outlet footprint whilst constructing a new distribution centre at an estimated investment of 3.2 billion rupees.

“The new distribution centre will consolidate both dry and fresh produce, enabling the business to further improve its offering to our customers, achieve significant scale benefits as well as deliver operational excellence,” he said.

Ratnayake said the construction of the integrated resort “Cinnamon Life” by their associate company Waterfront Properties Private Ltd is progressing with pre-sales of both the residential and commercial space continuing to be encouraging.

In the twelve months to March, net profits at Ceylon Cold Stores rose 24 percent to 3.5 billion rupees reporting 37.38 rupees per share as basic earnings.

However, profits fell 15 percent to 824 million rupees in the March 2017 quarter from a year earlier, interim accounts showed.

“Despite the moderation in the growth rate of consumer discretionary spending in the last quarter we remain confident,” Ratnayake said.

“Evolving product range and the efficacy of our distributor network which ensures availability of our soft drinks and ice creams will continue to drive top line growth, supported by the contribution from the rapid growth in our conforming store model.”