CORPORATE

Abans Finance records remarkable growth

Abans Financial Services Limited (AFSL) has recorded impressive profits for the year just ended reaping dividends from a carefully executed strategy of pursuing sustainable growth.

AFSL, a subsidiary of Abans, has reported its strongest ever position in terms of corporate earnings and financial stability.

The Company recorded enhanced pre-tax and post-tax profits in 2011 compared to results achieved a year ago.

The challenges now for AFSL is not just of vigorous growth but to work the synergies to maximise revenues and build a brand.

Strategic expansion plans saw overall leasing, hire purchase and loan advances increase by 52 percent from Rs 1.1 billion in 2010 to Rs 1.68 billion in 2011, while public deposits grew by 47 percent from Rs 1 billion to Rs 1.48 billion.

Non-performing advances declined sharply compared to the previous year. A well thought of appraisal criterion was operative in customer evaluation which resulted in strong portfolio quality.

"We were confident that our prudent strategy for corporate growth would pay off, with benefits flowing to all our stakeholders.

Our accomplishment is attributable to our team, who diligently implemented the aggressive strategy to achieve unprecedented improvement in almost all operational areas.

As a result 2011 is recorded as the best performing year in our short history," said Managing Director/Chief Executive Officer AFSL Mano Alles.

"We are now poised on an exciting new era where we will focus on executing our growth strategies.

Our plans focus on expanding our geographical presence as well as catering to new customers in emerging markets.

We intend to open five more branches this year. We will partner our clients on a mutually rewarding journey and will continue to play an integral role in supporting our customer requirements, through cutting-edge solutions, unparalleled service and ultimate customer satisfaction," she said.

Ms Alles said that the company will be seeking a listing on the Colombo Stock Exchange around June this year and thereafter propose to embark on an initial public offering.

The Company offers a robust portfolio of financial products, with an extensive outreach facilitated by Abans (Pvt) Limited of over 300 branches and a network of authorised dealers.

Hayleys posts Rs 2.1 b PBT

Hayleys PLC has reported turnover of Rs 54.4 billion and profit before tax of Rs 2.1 billion for the 12 months ending March 31.

The Blue Chip conglomerate's businesses in Agriculture, Plantations, Consumer Products and Transportation turned in significantly better results in the year concluded, while Purification and Hand Protection sustained performance in challenging operating conditions, figures filed with the Colombo Stock Exchange show.

Two businesses in Global Markets and Manufacturing - Textiles and Fibre, posted losses. The loss in the textiles business was largely due to the writing down of current assets to reflect net realisable values.

The loss in the fibre business was due mainly to debilitating raw material shortages.

Nevertheless, all business sectors, including Textiles and Fibre, reported healthy revenue growth enabling Hayleys PLC to improve its top line by 43 percent or Rs 16.4 billion, underscoring the sustainability of the group's business portfolio.

Profit before tax during the period under review was Rs 2.1 billion, while profit after tax stood at Rs 1.2 billion.

A consolidation of the Group's interests in Plantations with an increase in its stake in Talawakelle Tea Estates PLC, the forward integration made possible by its acquisition of Mabroc Teas and the acquisition of the Alumex Group had all contributed positively to the results and would be significant to future growth, Hayleys Chairman, Pandithage said.

Among the best performing sectors Agriculture, excluding plantations, contributed Rs 7.4 billion to turnover and Rs 721 million to operating profit, with growths of 27 percent and 35 percent .

The Plantations sector increased its contribution to Rs 632 million. Turnover in this sector improved by 90.5 percent to Rs 4.6 billion due to the increase in the Group's shareholding in Hayleys Plantation Services Ltd.

The turned-around Consumer Products sector achieved an 8.6 percent increase in its contribution to turnover (Rs 3.8 billion) and a 32 percent improvement in its contribution to operating profit (Rs 236.7 million).

The Transportation and Logistics sector's contribution of Rs 4.7 billion to Group turnover reflected an increase of 35 percent, while its contribution to operating profit grew 18.2 percent to Rs 558 million.

Purification Products contributed Rs 643 million to operational profit and Rs 6.3 billion to turnover, which was an improvement of 25 percent.

Nirmalapura Wind Power (Private) Limited, the subsidiary of Hayleys into electricity generation from wind power is under construction off Kalpitiya.

This 10MW power plant is expected to be in commercial operation by September, and would bring in a worthwhile contribution to the Groups' profitability, Pandithage said.

United Motors records Rs 1.38b PBT

United Motors Lanka PLC and its subsidiaries achieved a turnover of Rs.10.9 billion and recorded a pre tax profit of Rs.1.38 billion for the year ended March 31. Pre tax profit in the previous financial year was Rs.134 million.

The profit after tax of the Group amounted to Rs. 907 million in comparison to Rs.146 million in 2009/10.

United Motors Lanka PLC achieved a profit after tax of Rs. 519 million in comparison to Rs.121 million in 2009/10.

Chief Executive Officer/Executive Director United Motors Lanka PLC Chanaka Yatawara said, "This is the highest ever profit recorded by the group, where the current year profit after tax of the group and company increased by 520 percent and 328 percent as compared to the previous year".

The year under review saw a 48 percent increase in Mitsubishi vehicle sales, which was supported by increased sales of Mitsubishi spareparts and workshop services.

The increase in profitability was due to a multitude of factors, including an increase in vehicle sales due to reduced import duties on motor vehicles, reduction in interest rates, expansion of the branch network for greater accessibility of products and services, and strong cost management.

Unimo Enterprises Ltd which is a fully owned subsidiary of United Motors Lanka PLC showed a very robust turnaround, recording a sale of 1,716 units of its fast moving Perodua Viva, which is predominantly in the under 1000 cc category.

Viva sales showed an increase of 808 percent compared to last year.

Its other divisions too performed better than the previous year with an encouraging turnaround by its Chinese Division which markets JMC commercial trucks, Zotye mini sports utility vehicles and its recently launched DFSK mini trucks.

UML's main joint venture, TVS Lanka, also delivered significant profits, contributing Rs. 194 million to the Group's profit.

Issuance of permits to senior government officials is expected to bring in incremental income to United Motors and its subsidiary Unimo Enterprises Ltd. The group is also considering a state-of-the-art assembly facility for TVS Lanka which will accommodate TVS two-wheelers and three-wheelers under one roof, to be built in the company's six acre property at Kaduwela.

Unimo Enterprises Ltd is also expected to perform well in view of the spectacular demand for its Perodua vehicles, its local assembly operation for the Zotye brand and its other Chinese products that have proven to be a popular choice for commercial vehicles.

Singer 1Q revenue up 38%

Singer Sri Lanka Group said its 1st quarter revenues surpassed Rs. 5 billion, up 38percent from the corresponding period last year.

In his review of the 1st quarter performance Group Chief Executive Officer Asoka Pieris said that sound economic policies combined with a climate of peace resulted in a receptive market. Even though the company's island-wide growth had been slightly dampened by floods that ravaged the country in January and February, Singer's first quarter performance was a measure of the innate resilience of its operations and the strength of its relationship with consumers.

'The growth was low in the districts affected by the floods, but this deficit was caught up by growth in other districts.

The company's revenue growth in the Colombo district was 71 percent,' Pieris said.

This was mainly due to the reduction of the grey market and Singer's increasing focus on new lifestyle products such as LCD/LED televisions, laptops, digital cameras, double-door refrigerators and full auto-washers.

'The Cricket World Cup boosted demand for televisions. We capitalised on this demand by introducing several new models, adequate supplies and attractive sales programs.

Our television unit sales increased by 93 percent over last year's first quarter, the increases coming from LCD and LED televisions,' Pieris said. All major products - computers, air conditioners, DVD players, audio systems and small kitchen appliances - had shown significant sales growth over the previous year's first quarter.

The Group pre-tax profit grew by 60 percent to Rs.485 million, while profit after tax grew by 53 percent to Rs. 257 million.

First Capital posts healthy profits in 2010/2011

First Capital Holdings PLC has posted a healthy profit after tax for the financial year 2010/2011 of Rs. 990,260,000 compared to Rs. 682,244,000 for the previous financial year. Profits for the quarter ended March 31 were Rs. 81,299,000, an improvement of Rs. 41,264,000 for the same period the previous year. Earnings per share were Rs. 10.03 whilst Net Assets Per Share stood at Rs. 15.04.

"In the last couple of years we have seen exceptional profit growth at First Capital," a Company spokesperson said. "In 2010/11 although conditions were less conducive than those in the previous year in which a highly favourable bond trading environment resulted in exceptional profits by the Group's primary dealer arm, the Company was able to sustain its momentum helped by strong performance in all areas."

He said that profits were boosted by a one-off gain from the sale of an associate company - Kotmale Holdings PLC amounting to Rs. 180 million and a decision in the company's favour by the Inland Revenue Board of Review resulting in a tax reversal of Rs. 444 million. First Capital was gearing up for measured and steady growth, he said.

Free Lanka Capital Holdings record 303% profit

Encouraged by the buoyancy of the economy, the relatively new Free Lanka Capital Holdings Ltd has reported exceptional results in the year ended March 2011.

Recording a gross revenue of Rs 6.5 billion for the Group during the financial year 2010/11 as compared with Rs 4.9 billion the previous year - a 33 percent increase, the Group's provisional financial results show a profit increase of over 300 percent.

Profit before tax amounted to Rs 1,374 million rupees in 2010/11 as against Rs 341 million the previous year, an increase of 303 percent.

Profit after tax recorded a 319 percent increase with the figure for 2010/11 at Rs 1,270 million compared to Rs 303 million in the earlier financial year.

The success is attributed to increased rubber and tea prices as well as sound management of the numerous activities coming under the purview of several subsidiary companies.

The Group's earnings are mainly from Maturata and Pussellawa Plantations.

These plantations comprise 19,000 acres of tea and 13,000 acres of rubber. Maturata comprises of 19 tea estates while Pussellawa comprises 11 tea estates and nine rubber estates and four estates with a mix of tea and rubber.

Pussellawa produces green tea in two factories.

The company has invested in commercial timber with over a million trees being planted on their properties.

To take advantage of high rubber prices the group has completed an aggressive replanting exercise, which commenced in 2005 wherein, a sum of Rs. 1bn was invested in planning and replanting of rubber.

Steps have also been taken to upgrade current rotavane manufacturing methods in some of the tea factories.

Utilising existing spare capacity at its factories the company aims to increase further bought leaf intake in low grown factories.

Leveraging assets and opportunities available on the estates Free Lanka Capital Holdings has embarked on mini hydro power projects.

Its subsidiary Hydro Power Free Lanka generates approximately 3.2 MW of electricity in its mini hydropower plants in Sanquhar and Delta.

The company has signed a standard power purchase agreement with the Ceylon Electricity Board for two projects, Thebuwana at Kuruwita and Stellenberg at Gampola where construction has commenced. Power generation is scheduled to commence in November.

Construction of two projects at Ragala will commence soon with work to be completed by April 2012.

The Group is also into real estate and commercial development through Free Lanka Properties (Pvt) Ltd.

The first project undertaken in this sector is the development of a commercial complex in Borella with 80,000 sq. ft of rentable space.

The Company has acquired the property for this complex.

Leisure is another sector that the Group is developing through two subsidiary companies - Tea Leaf Resort Holding (Pvt) Ltd., which will develop star class boutique style hotels in Kandy and Padukka areas offering a total of 92 rooms.

The main shareholders of Free Lanka Capital Holdings are Free Lanka Capital (Pvt) Ltd. (70 percent), Browns Investments (Pvt) Ltd. (4.12 percent) and Perpetual Holdings Ltd. (4.27 percent).

Browns Investments Ltd and Perpetual Holdings Ltd own the total share capital of Free Lanka Capital (Pvt) Ltd.

Renuka posts Rs. 966m PAT for 2010/2011

Renuka Holdings PLC (RHL) has recorded an impressive turnover and profit after taxation for the year ended march 31.

The group turnover grew 100 percent to Rs. 2.95 billion compared to Rs. 1.48 billion in the corresponding period last year.

Group profit after tax rose 159 percent to Rs. 966 million of which Rs. 732 million was attributable to shareholders of Renuka Holdings PLC, while company profit after tax increased to Rs. 320.7 million compared to Rs. 165 million in the corresponding year.

This significant increase was achieved by contributions from all sectors.

Total assets of the group increased to Rs. 4.66 billion as at March 31.

Executive Director Shamindra Rajiyah said, "Total overhead decreased by 19 percent in the period primarily due to decreases in selling and distribution cost and finance expenses.

Significant reductions in finance cost of 79 percent were achieved due to lower interest rates and better cash management across group companies."

During the final quarter of 2010/2011, RHL acquired Shaw Wallace Marketing Ltd and in turn Shaw Wallace acquired several subsidiary companies.

In line with diversification, the business sectors of the group were re-classified.

Odel's PBT up 68% in 2010-11

Odel PLC, has proposed a final dividend of Rs. 0.25 per share for 2010-11, taking total dividend payout for the eight months since it was listed, to Rs. 72,475,000.

The dividend announcement coincides with the release of the company's financial statements for the 12 months ended March 31, a period of growth for the fashion and lifestyle brand.

Group pre-tax profit recorded a 68 percent increase to Rs 354.2 million over 2009-10, on turnover of Rs. 3.3 billion, which was up 37 percent.

Group profit after tax grew by 48 percent to Rs. 208.9 million in a year in which the company focused on expansion of its presence and on enhancing shareholder value.

Basic earnings per share of the group for the 12 months grew by 47 percent to Rs. 1.49 from Rs 1.01 cents for the previous year..

Dunamis Capital records strong growth in 2010/2011

Dunamis Capital PLC, the diversified business group with interests in financial services and property development reported a record Rs. 810.9 million as profits attributable to equity holders for the year ended March 31.

This was a substantial improvement from Rs. 130 million reported the previous year.

The company posted consolidated profits of Rs. 1.2 billion for the year as compared to Rs. 353.5 million the previous financial year.

At Company level, Dunamis reported profits of Rs. 153.9 million compared to a loss of Rs. 81.1 million the previous year.

Consolidated profits for the quarter ended March 31 were Rs. 41.2 million in contrast to a loss of Rs. 77.8 million for the same period the previous year.

Earnings per share were Rs. 8.08 while Net Assets Per Share stood at Rs. 11.13.

The Company, which began a process of strategic business rationalisation a few years ago as a result of which it divested several businesses, has shown a remarkable turnaround.

"We are pleased with the company's results which can be primarily attributed to strong performance from our financial services subsidiary as well as substantial one-off gains," a spokesman said.

"The divestment of Kotmale Holdings PLC added just over Rs. 400 million to the bottom line.

We are also seeing the results of past efforts to reduce debts, prune overheads, strengthen core business units and make the group leaner and more focused," he added.

"Although we are disappointed with the performance of the property development business, which fell below expectations, we are optimistic that improved performance will materialise in the current financial year.

The company is in the process of evaluating selective investments in other sectors to further enhance shareholder value", he said.

India's Tata Steel swings into full-year net profit

India's Tata Steel, the world's seventh largest steelmaker, on Wednesday swung into a full-year net profit from a loss a year earlier, as industrial demand improved and steel prices rose.

Tata Steel posted a consolidated net profit of 89.83 billion rupees ($2 billion) for the twelve months ended March, against a loss of 20.09 billion rupees a year earlier, a company statement said.

The earnings include a one-time gain of $561 million from the sale of its Teesside plant in England to Thailand's Sahaviriya Steel Industries in March.

Tata Steel shares fell 0.83 percent or 4.7 rupees to 561.5 at the Bombay Stock Exchange ahead of the results.

The company, part of the sprawling Tata Group conglomerate, became one of the world's biggest steelmakers after purchasing Anglo-Dutch company Corus for 13.7 billion dollars in 2007.

Tata Steel said earlier this month it is to axe up to 1,500 jobs at two sites in northeastern England, due to weak demand for its products in the region.

The company said it would close or mothball its Scunthorpe plant, risking the loss of 1,200 positions, and would cut another 300 posts in Teesside.

At the same time, Tata Steel has said it would invest £400 million ($649 million) in a five-year plan to try and turn around the long products business to target "high value" markets.

For the fourth quarter ended March, Tata Steel said its net profit rose 72 percent at $937 million, up from $546 million a year earlier, the company said.

"It was a good year as steel consumption in India rose, aided by strength in industrial activity," said Tata Steel managing director, H.M. Nerurkar.

"Higher selling prices and deliveries gave us a strong end to the March quarter, with one-off benefits from the completion of the Teesside sale," Tata Steel Europe Chief Executive Karl-Ulrich Köhler, said in the statement.

AFP