Sri Lanka's Hemas Dec net down 21-pct
Feb 12, 2018 12:23 PM GMT+0530 | 0 Comment(s)
ECONOMYNEXT – Sri Lanka's Hemas Holdings net profits for the December 2017 quarter fell 21 percent from a year ago to 681.8 million rupees with margins falling in consumer goods and losses in hotels, despite gains in healthcare and logistics.
The group reported earnings of 1.19 rupees a share in the quarter. In the nine months to December 2017, earnings were to 3.66 rupees a share on total profits of 2.1 billion rupees, down 12.7 percent from a year ago, interim financial results filed with the stock exchange showed.
Revenue in the quarter grew 11 percent to 12.5 billion rupees, cost of sales increased 9 percent to 7.8 billion rupees, expanding gross profits 14 percent to 4.8 billion rupees.
"Despite consolidated revenue growth, our Bangladesh consumer business, pharmaceutical distribution, leisure and travel segments are all facing margin challenges resulting in reduced group earnings," Steven Enderby, Chief Executive at Hemas Holdings told shareholders.
"Domestic consumer demand, mainly in the rural sector, remains soft impacted by higher headline inflation, poor climatic conditions persisting in parts of the country, lower levels of inward remittances and the VAT increase," he said.
Healthcare revenue grew 25 percent to 6.1 billion rupees and profits grew 26.6 percent to 419.8 million rupees on higher hospital occupancy levels, and growth in surgeries and laboratory services.
Revenue from logistics grew 50 percent to 759.4 million rupees. Profits grew 51 percent to 176.6 million rupees.
Revenue from leisure and travel, which includes airline agencies, fell 4.5 percent to 1 billion rupees. Losses were 15 million rupees, down from a profit of 76.4 million rupees last year on narrow margins as occupancy and inbound flights fell.
After falling two quarters, the company said Serendib Hotels reported stabilising revenues in the December quarter.
Lantern, a new hotel also helped. Anantara Peace Haven Tangalle made losses in the nine months despite better occupancies, the company said.
Revenue classified as 'other' (which includes corporate services, property development, a BPO, wharf clearing and IT) fell 41 percent to 734 million rupees. Losses expanded 460 percent to 180 million rupees.
The group acquired Atlas Axillia for 5.7 billion rupees in January 2017 and expects it will contribute 15 percent to group revenue.
JL Morison's, a subsidiary, saw profits grow 38 percent on pharmaceutical manufacturing and distribution during the nine months ending December 2017, the company said. Morison started selling 'Bunnies' baby diapers in Myanmar in December.
Spectra, a logistics joint venture with GAC and McLarens, has invested in a container yard at an industrial zone in Muthurajawela, in Sri Lanka's Western Province. The company said a new warehouse will be completed in 2019. (COLOMBO, February 12, 2018)