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| Sunday, 16 May 2004 |
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| News Business Features Editorial
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Carson Cumberbatch overseas operations bring profits Carson Cumberbatch and Company Limited reported a consolidated profit before tax of Rs. 1.90 billion and Consolidated profit after tax was Rs. 1.7 billion for the year 2003/04. This profit was generated by the palm plantations, brewery and investment sectors. The key business units of the Group, Regional operations outside Sri Lanka, based in South East Asia, accounted for approximately 35% of consolidated profit before tax. The consolidated turnover was Rs. 5.9 billion. The group was successful in repaying a total of approximately Rs. 1 billion of its loan capital raised by different operating units. The resulting reduction in finance costs will lead to considerable value addition to shareholders in the future. Earnings per share for the year was Rs. 991. With the progressive maturing of its 16,000 ha plantation in Central Kalimantan, Indonesia, the overseas oil palm plantations sector became one of the highest contributors to the group results during the year. Attention to good agronomy practices contributed to improved crop levels and yields. The capacity of the oil-processing mill in Indonesia is now being enhanced to enable it to handle increased crop levels. The sale of one of the Malaysian estates, the Bukit - Darah estate is now in progress, as the property has reached its optimal market value. The sale proceeds will be re-invested in the oil palm plantations business in view of its future potential. The brewery business although recording a satisfactory growth, could not reach its optimum potential due to the stringent regulatory framework governing sales and distribution. Management focus on productivity enhancement and improving distribution levels contributed to improved performance of the sector. Carsons continues to emphasise the need for consistency in policy implementation and speedier reforms in the regulation of the soft alcohol industry in keeping with current international practice. This sector was one of the partners of the consortium that acquired a 40% stake and management of Sathosa Retail Limited. This investment is expected to add value to the brewery business by extending its retail network. Recent major capital expenditure programmes in the two core sectors amounted to Rs. 762 million for oil palm plantations and Rs. 192 million for brewery. The investment holdings sector benefited from the favourable performance of the stock market during the greater part of 2003. Its investments in well-managed companies with attractive future potential contributed to enhancing its earning potential, while selective trading for capital gains also boosted profits. Supported by better corporate performances overall, dividend incomes too supported revenues. The investment holdings portfolio, composed almost entirely of equities was valued at Rs. 6.8 billion as at the end of the year. The real estate sector improved its occupancy levels and succeeded in recording a profit growth of 69% over the previous year. Its asset base, valued at approximately Rs. 1.4 billion and the steady inflow of fixed income gave strength to the Group. Carsons expects the current financial year produce favourable results, backed by its strategy of developing its core businesses and the competencies required to sustain them. This strategy has enabled it to weather many a challenging operating environment, both here and overseas, and provide consistent returns to all its stakeholders over the long term. |
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