COLOMBO (EconomyNext) – Distilleries Corporation of Sri Lanka, the country’s largest legal alcohol seller said gross revenues rose 30 percent in the March 2015 quarter to 15.57 billion rupees from a year earlier, while its own revenues after excise taxes rose 6.9 percent to 4.4 billion rupees.
Turnover based taxes such as excise rose to 11.1 billion rupees in the March 2015 quarter, up 42 percent from a year earlier, interim accounts filed with the Colombo Stock Exchange shows.
Sri Lanka’s new administration clamped down on distilleries connected to powerful figures of the last regime which were producing arrack with smuggled ethanol and were also selling without paying excise duty by under-declaring total volumes sold, it is alleged.
Analysts familiar with the industry say the controversial distilleries were selling arrack to the trade at around 680 rupees when government levies alone were 658 rupees, but excise officials were unable to act.
In the nine months to December 2014 Distilleries Corporation gross revenues rose just 1.2 percent to 36.2 billion rupees, while the firm’s net revenues after excise taxes fell 0.36 percent to 12.4 billion rupees.
At company level in March 2015 quarter revenues costs rose 2.74 percent to 2.0 billion rupees as net revenues rose at a faster 6.99 percent to 4.4 billion rupees, allowing the firm to grow gross profits 10.7 percent.
The firm said net profits after tax fell 22 percent to 1.4 billion rupees. Last year’s profits were boosted by 1.0 billion rupees of non-operating income.
Distilleries Corporation group, which has interests in insurance, telecoms and plantations said profits rose 65 percent to 2.0 billion rupees.