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Sri Lanka’s Lion Brewery profits fall in Dec

ECONOMYNEXT- Lion Brewery Ceylon Plc, Sri Lanka’s largest beer manufacturer, said net profits for the December quarter fell 50 percent to 559.5 million rupees from a year earlier on brand impairment.

“However, considering the challenging operating environment of the year under review– the Easter Sunday tragedy at the commencement of the financial year and the continuous rain during most of the 3rd quarter being the most significant‐ the company’s returns maybe considered satisfactory,” the firm said in an earnings release.

Lion posted 6.90 rupees in earnings per share for the quarter. The firm’s stock closed flat at 623 rupees a share on Thursday.

The brewer, a unit of Carson Cumberbatch, earned 28.31 rupees a share for the nine months ended December on net profits of 2.3 billion rupees, down 5 percent from a year earlier.

For the December quarter, Lion’s revenue grew 6 percent to 11.6 billion rupees, while cost of sales rose at a faster 7 percent to 8.9 billion rupees, leading to gross profits growing 1 percent to 2.8 billion rupees.

The firm impaired 538.2 million rupees for brands it had incorporated in the Miller Brewery acquisition in 2015.

Finance costs fell 27 percent to 351.7 million rupees.

Lion’s long-term borrowings fell to 2.9 billion rupees at end-December from 3.3 billion rupees at end-March, while short-term borrowings grew to 6.7 billion rupees from 6.3 billion rupees.

The firm said beer prices faced an upward revision in prices in December, as the reduction in Value Added Tax was negated by a higher increase in alcohol taxes. (Colombo/Feb13/2020)

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