Hemas boosts operating profits by 51 percent

The Hemas Group posted a revenue of Rs. 12.9 b for the second quarter of 2012/13, a growth of 29.0 percent over the corresponding period of the previous year. The main contributors were Power, Healthcare and FMCG sectors, which recorded growth levels of 50.4 percent, 22.9 percent and 17.2 percent, a media release from the company stated.

Group operating profits recorded a growth of 50.6 percent, to post Rs. 1,036 m while earnings for the half-year was Rs. 705 m, a year-on-year growth of 44.9 percent. Earnings were driven by Transportation, FMCG and Healthcare sectors, whose earnings grew by 52.2 percent, 39.6 percent and 33.0 percent, and the Leisure sector which posted earnings of Rs. 42.4 m as against a loss of Rs. 32.8 m last year.

The FMCG sector recorded a growth of 17.2 percent in a slowing market, to post a revenue of Rs. 3.7 b. Sector earnings were Rs. 358 m for the half-year, a growth of 39.6 percent. Both revenue and earnings were driven by the strong performance of our Personal care and Personal wash categories.

Revenue and earnings growth was primarily driven by the performance of our Pharmaceuticals business, which benefited from the healthy growth of the market to post an increase of 21.9 percent. During the period under review its market share grew to 17.6 percent. Despite the negative impact caused by the depreciating currency the business posted a healthy profit growth of 27.0 percent.

The hospitals sector experienced a good half-year with inpatient capacity nearing 80 percent at the Wattala hospital, contributing to the increase in hospital revenue of 30.3 percent to Rs. 660 m.

The leisure sector enjoyed a good first half by recording a revenue of Rs. 656 m, a growth of 44.9 percent.

The performance of Hotel Dolphin helped the sector swing its earnings from a negative Rs. 33 m to a positive Rs. 42 m.

The transportation sector posted a top line of Rs. 465 m, a 29.4 percent growth over the previous year. This was mainly on account of strong revenue growth in the aviation and maritime segments. Sector earnings rose by 52.2 percent to Rs. 155 m during the first half of 2012.

The power sector recorded revenues of Rs. 3.1 b a growth of 50.4 percent, led by the pass through effect of increasing fuel prices of the thermal power plant, Heladhanavi.

However, the sector earnings suffered a decline of 29.6 percent, to record Rs. 87 m, hit by the low rainfall experienced in the catchment areas of our hydro power plants, which contributed 42.7 percent to earnings. Sector profitability was further depressed by the unrealised negative impact of Rs.18 m arising from a depreciating rupee on foreign exchange borrowings.