Sri Lanka’s Haycarb Sept net profit up 56-pct

ECONOMYNEXT - Sri Lankan coconut shell-based activated carbon maker Haycarb said net profit rose 56 percent to 203 million rupees in the September 2018 quarter from a year ago.

Quarterly earnings per share were 6.84 rupees, according to interim accounts filed with the stock exchange.

The share was last traded at 128 rupees.

Sales rose 22 percent to 4.7 billion rupees during the period.

EPS for the six months to September 2018 were 10.24 rupees with net profit up 28 percent to 304 million rupees and sales up 26 percent to almost nine billion rupees.

Haycarb Managing Director Rajitha Kariyawasan said sales grew with an increase in prices in response to the sharp increases in raw material costs.

“As the shortage and cost escalation of raw material, coconut charcoal, continued during the first half of the year in most of the supply locations, Haycarb focussed on its lean platform,” a statement said.

This targeted cost saving initiatives and process improvements to minimise price escalations to customers while protecting profitability of the group, which has factories in Sri Lanka, Thailand and Indonesia.

“Considerable success achieved from product development efforts to expand its value added product portfolio strongly contributed to the overall business performance,” the statement said.

“Though we are expecting improved coconut crop and charcoal availability in most of our locations in the 2019 coconut season, the company is expecting a challenging period due to the increased competition from key coconut carbon producing countries,” Kariyawasan said.

Haycarb’s strategy of broad basing the raw material supply network and support for environment friendly charcoaling methods under its “Haritha Angara” initiative contributed to the improvement of sustainable charcoal supply, he said.

This will be continued as a core supply chain strategy of the group.

Kariyawasan noted that Puritas (Pvt.) Ltd., the environmental engineering business, is expected to continue to be a key contributor to the group’s performance during the second half of the year.

Its business in water and waste water treatment systems in Sri Lanka and in the region is projected to grow.

Sri Lanka’s Watawala Plantations Sept quarter net down 12-pct

ECONOMYNEXT – Sri Lanka’s Watawala Plantations, which has spun off its tea business, said net profit fell almost 12 percent to 336 million rupees in the September 2018 quarter from a year ago.

Earnings per share were 1.67 rupees for the quarter with sales down 51 percent to 867 million rupees, according to interim accounts filed with the stock exchange.

Profits from palm oil were higher while losses in the new dairy business narrowed.

Watawala Plantations share closed at 21.50 rupees Thursday, down 50 cents or 2.38 percent.

In the six months to September 2018, EPS fell to 2.49 rupees from 3.20 rupees a year ago with profits from palm oil slightly lower and losses in the dairy business higher.

Watawala Plantations Managing Director Vish Govindasamy said earnings were supported by higher production volumes in the second quarter.

“Global palm oil prices declined in response to the supply side factors, which affected the local price,” he said in a note accompanying the accounts.

“However, this was negated owing to the upward revisions of duty on crude palm oil imported to the country.”

Watawala Dairy Limited showed signs of recovery in the second quarter compared with the first as the milk volume, prices and revenue increased significantly, resulting in a reduction in operating losses, Govindasamy said.

The loss for the second quarter fell to 25 million rupees from a loss of 45 million rupees in the previous quarter, with the total loss being 70 million for the six months ended 30 September 2018.

“These start-up losses, now within the budgeted parameters, are regularly monitored and controlled,” Govindasamy said.

“Increased milk production from the cattle coming to the second lactation in the herd and the first lactation of 246 cattle imported from Australia in May 2018 mainly accounted for the volume increase.”

Govindasamy said the volatility in the global oil palm market will remain and the strengthening of the US dollar against rupee will have mixed consequences for the industry.

The dairy business will further consolidate its operations with more focus on rationalizing feed costs with the milk yields, he said.

Sri Lanka tourist arrivals up 0.5-pct in Oct

ECONOMYNEXT - Tourist arrivals to Sri Lanka in October 2018 grew 0.5 percent from a year ago to 153,123 led by Indian visitors, the tourism office said.

Arrivals from India grew 3.2 percent from 2016 to 38,169 tourists.

China, the second largest market, fell 13.6 percent from a year earlier to 18,882 tourist arrivals.

Arrivals from the United Kingdom, the third largest, grew 41.2 percent from a year earlier to 17,673 tourists.

Germany and Australia rounded up the top five tourist markets.

Up to end-October 2018, arrivals had grown 10.6 percent from a year earlier to 1.89 million tourists. India, China, UK, Germany and Australia were the top five markets for the first 10 months as well.

Following a constitutional crisis in the last week of October, Sri Lanka has been hit with several travel advisories from key tourism generating countries, hitting arrivals.

Sri Lanka’s 01-year Treasuries yield up 50bp to 10.89-pct

ECONOMYNEXT - Sri Lanka's one-year Treasury bill yield rose 50 basis points to 10.89 percent at an auction Wednesday, data from the state debt office showed.

The debt office, which is a unit of the central bank, said the yield on six-month bills rose 24 bp to 9.99 percent.

The 03-month Treasury bill yield rose 17 basis points to 9.65 percent.

Sri Lankan rupee falls on uncertainty amid foreign outflow; stocks up

Reuters: ** The Sri Lankan rupee fell in dull trade on Friday as outflows from government securities and stocks due to political uncertainty raised dollar demand.

** Stocks snapped four straight sessions of declines, but political uncertainty continued to weigh on investor sentiment after the parliament speaker said on Monday he would not recognise President Maithripala Sirisena’s sacking of Ranil Wickremesinghe as prime minister and appointment of Mahinda Rajapaksa in his place.

** The speaker has called the president’s sacking of the prime minister to bring a former leader back to power a non-violent coup d’etat.

** The rupee ended at 175.10/30 per dollar on Friday, compared with the previous close of 175.05/20. The rupee has weakened more than 1 percent since the political crisis began on Oct. 26.

** The rupee hit a record low of 175.65 per dollar on Nov.1.

** The rupee weakened 3.7 percent in October after a 4.7 percent drop in September against the dollar. It has dropped 14 percent this year.

** Foreigners sold a net 660.8 million worth stocks on Friday. They have offloaded equities worth 7.8 billion rupees since the political crisis started on Oct. 26. 

** The bond market saw an outflow of about 21 billion rupees between Oct. 25 and Nov. 7, central bank data showed. This year, the island nation has seen 17.2 billion rupees in outflows from stocks and 110.8 billion rupees from government securities, bourse and central bank data respectively showed. 

** The Colombo stock index rose 0.81 percent to 5,978.63. The bourse fell 1.9 percent this week after it gained 4.5 percent last week due to heavy retail investor participation. It has slipped 6.1 percent so far this year. Stock market turnover was 1.3 billion rupees ($7.43 million) on Friday, more than this year’s daily average of 820.7 million rupees.

** Shares of conglomerate John Keells Holidngs Plc ended 1.8 percent firmer, Sri Lanka Telecom Plc rose 4.5 percent, Lanka ORIX Leasing Company Plc closed 2.5 percent firmer and Dialog Axiata Plc gained 0.9 percent. 

($1 = 174.9000 Sri Lankan rupees) 

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

Sri Lanka parliament to be dissolved: state TV

ECONOMYNEXT - Sri Lanka's parliament will be dissolved tonight, state television Rupavahini said citing government sources.

The gazette dissolving parliament has been sent to the government printer for publication, the broadcast said.

Sri Lanka was plunged into a political crisis two week ago after President Maithripala Sirisena appointed Mahinda Rajapaksa as Prime Minister in a surprise move.

Sri Lankan rupee falls on uncertainty amid foreign outflow; stocks down

Reuters: ** The Sri Lankan rupee ended weaker on Wednesday as outflows from government securities and stocks due to political uncertainty raised dollar demand.

** Stocks fell for the third session running, hitting a one-week closing low and moving further away from their near two-month closing high hit last week, as the political crisis continued after the speaker of parliament said on Monday he would not recognise President Maithripala Sirisena’s sacking of Ranil Wickremesinghe and appointment of Mahinda Rajapaksa as the prime minister.

** Sri Lanka’s parliamentary speaker has called the president’s sacking of the prime minister to bring a former leader back to power a non-violent coup d’etat.

** The rupee ended at 174.80/175.10 per dollar on Wednesday, compared with the previous close of 174.45/60. The rupee has weakened 1 percent since the political crisis began on Oct. 26.

** The rupee hit a record low of 175.65 per dollar on Thursday.

** The rupee weakened 3.7 percent in October after a 4.7 percent drop in September against the dollar. It has dropped 13.8 percent so far this year.

** Foreigners bought a net 298 million worth stocks on Wednesday. They have offloaded equities worth 6.8 billion rupees since the political crisis started on Oct. 26. 

** Since the prime minister’s sudden sacking, 6.7 billion rupees has flowed out of the stock market, while the bond market saw an outflow of around 11 billion rupees between Oct. 25-31, central bank data showed. So far this year, the island nation has seen 16.2 billion rupees in outflows from stocks and 100.8 billion rupees from government securities, bourse and central bank data respectively showed. 

** The Colombo stock index fell 1.24 percent to 5,987.21, its lowest close since Oct. 31. It hit a near two-month high on Thursday. The bourse rose 4.5 percent last week due to heavy retail investor participation. It has slipped 6 percent so far this year. 

** Stock market turnover was 1.3 billion rupees ($7.45 million) on Wednesday, more than this year’s daily average of 817.1 million rupees.

** Shares of conglomerate John Keells Holidngs Plc fell 3.3 percent, the country’s biggest listed lender, Commercial Bank of Ceylon Plc, declined 5.1 percent and Hemas Holdings Plc lost 5.8 percent. 

($1 = 174.5000 Sri Lankan rupees) 

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