Sri Lanka retail chain sees upswing in December quarter
ECONOMYNEXT – Sri Lanka’s Cargills (Ceylon) Plc, the country’s largest retail chain saw revenue grow 19 percent to 18.0 billion rupees in the December 2015 quarter, indicating a strong pick-up in domestic demand.
Cost of sales rose at a slower 16.9 percent to 16.0 billion rupees and gross profits were sharply up 40 percent to 2.0 billion rupees.
The group reported earnings of 485 million rupees for the quarter (2.07 rupees per share) slightly down from 478 million rupees a year earlier. But most of last year’s profits came from a capital gain, not operating results.
In the nine months the firm reported profits of 1.2 billion rupees (earnings of 5.41 rupees per share) from losses a year earlier.
Finance costs also fell to 156 million from 208 million a year earlier.
Cargills said its restaurant business also experienced higher consumers spending with revenues of 2.1 billion rupees for the nine months and profits of 104.1 million rupees.
Sri Lanka’s economy showed signs of recovering naturally in the last quarter of 2014 from a balance of payments crisis in 2012.
However the state gave a steep salary hike to state workers in January 2015 and printed money to resist an orderly market rise in interest rates to keep the credit system and economy stable, firing another balance of payments crisis.
Sri Lanka is expected to go to the International Monetary Fund in the March quarter.