Sri Lanka’s Melstacorp June net down 30.8-pct
ECONOMYNEXT – Profits at Sri Lanka’s listed conglomerate Melstacorp Plc fell 30.8 percent from a year earlier to 789.3 million rupees in the June 2018 quarter on rising finance costs from a surge in borrowings and losses in telecommunications and lower profits from financial services.
Melstacorp is the parent company of liquor producer listed Distilleries Company of Sri Lanka and other businesses ranging from insurance, plantations, financial services and telecommunications.
Earnings in the quarter amounted to 68 cents a share, according to interim accounts filed with the Colombo Stock Exchange.
The share closed unchanged at 50 rupees Wednesday.
Revenue grew 102 percent to 20.8 billion rupees, cost of sales increased 75 percent to 13.3 billion rupees leading to a 178 percent increase in gross profits of 7.5 billion rupees.
Net finance cost surged 941 percent to 413 million rupees as borrowings increased to 26.7 billion rupees at end June 2018, from 3.6 billion rupees a year earlier.
Administrative expenses ballooned 367.6 percent to 4.6 billion rupees.
The group’s beverages segment which includes listed Distilleries saw revenue decline 10 percent from a year earlier to 20.8 billion rupees in the June 2018 quarter, but profits grew 31 percent to 1.7 billion rupees.
Telecommunications which includes voice and broadband service provider Lanka Bell saw revenue growing 8 percent to 763 million rupees but losses deepened 22 percent to 437 million rupees.
Financial services which include businesses in insurance (Continental Insurance) reported a 12 percent decline in revenue to 751 million rupees with earnings falling 29 percent to 88 million rupees.
Tea and rubber plantations revenue grew 45 percent to 1.2 billion rupees leading to a 60 percent growth in profits to 40 million rupees.
A segment classified as other which includes a BPO, hotels, logistics, energy, textiles and media saw revenue surge to 11 billion rupees in the June 2018 quarter, up from 485 million rupees a year earlier, with combined profits of 611 million rupees, an increase of 50 percent from a year earlier. (COLOMBO, 16 August 2018)