Sunshine Holdings reports strong results in FY16
Diversified conglomerate Sunshine Holdings PLC has posted profit
after tax (PAT) of Rs. 1,218 million, a 16.3% improvement year-on-year (YoY).
Net Asset Value per Share increased to Rs. 42.78 as at end of FY16,
compared to Rs. 39.24 at the beginning of the year (FY15). Earnings per
Share (EPS) too improved to Rs. 4.34 in FY16 from Rs. 3.62 in FY15.
Despite challenges, particularly in the Agribusiness sector,
Consolidated Revenue was up by 6.7% YoY to Rs. 17,422 million. Three of
the five divisions - Healthcare, Fast-Moving Consumer Goods (FMCG) and
Packaging - reported double digit growth in revenue while the Renewable
Energy division too improved its revenue. The Agribusiness sector
enhanced its PAT despite a reduction in the top-line - as part of a
strategic move to reduce volumes and further enhance focus on quality in
the Tea sub segment.
Healthcare, represented by Sunshine Holdings' fully-owned subsidiary
and one of the country's largest distributors in the healthcare space -
Sunshine Healthcare Lanka Limited (SHL) - was the main contributor to
group revenue in FY16 (accounting for 41.1% of the total).
It expanded well above the growth of the overall market. Revenue was
up by 17.9% YoY to Rs. 7,161 million in FY16 while PAT was Rs. 327
million, an improvement of 41.2% YoY.
The FMCG sector, represented by Watawala Tea Ceylon Limited (WTC),
the country's largest branded tea company, reported a revenue of Rs.
3,440 million for FY16, a growth of 18.0% YoY. This was on the back of
price and volume growth, the latter largely driven by Watawala Tea - the
country's single largest tea brand. PAT from FMCG grew 7.7% YoY, to Rs.
423 million in FY16.
Agribusiness, represented by Watawala Plantations PLC - the country's
largest manufacturer of Palm Oil and one of the largest Regional
Plantation Companies (RCPs) - saw its PAT expand to Rs. 518 million, up
by 32.5% YoY.
The increase in profitability of the sector, despite severe
challenges, was a result of a prudent strategic move by Watawala
Plantations to cut down on its output of tea (which translated into
reduction in revenue), and to curtail losses by further improving
"Sunshine Holdings takes much pride in this strong financial
performance, particularly since it represents bottom line growth across
all our business segments, despite significant challenges in some
sectors," Group Managing Director, Sunshine Holdings, Vish Govindasamy
In FY16 the FMCG segment invested Rs. 88 million on international
expansion and the international marketing team will be leveraged to
expand the lucrative export business.
Members of the Sunshine Holdings Group have also succeeded in
attracting substantial Foreign Direct Investment (FDI) recently to
further enhance and expand operations. The Group set up a commercial
dairy operation in March 2016 - Watawala Dairy Ltd., with Duxton Asset
Management, with a USD 3 million FDI infusion from the latter.