Corporate news

DFCC Bank profit after tax up 28% to Rs. 781m in 1H 2008

DFCC Bank's own non-audited profit after tax for the half year ended September 30, 2008 (current period) was Rs. 781 million, an increase of 28 per cent over the corresponding period (April to September 2007).

The consolidated profit attributable to equity holders after minority interest in the current period however was Rs. 974 million, a decrease of 9 per cent over the corresponding period.

The current period includes a one off capital gain of Rs. 176 million (after Financial Services VAT) arising from the disposal of a quoted share investment and reconstitution of the ownership structure of DFCC Stockbrokers (Pvt) Limited concurrent with the Bank's equity investment in Acuity Partners (Pvt) Limited, a 50-50 joint venture company on July 1, 2008. This gain is exempt from income tax. Although the Bank has recognised the full profit on transfer of shares in DFCC Stockbrokers (Pvt) Limited to Acuity Partners (Pvt) Limited, only 50 per cent of this profit is recognised in the consolidated income, since only 50 per cent of the effective ownership is transferred to the other venturer, Hatton National Bank PLC.

These adjustments are made as at September 30, 2008 but the income for three months ended September 30, 2008 derived from Acuity Partners (Pvt) Limited will only be consolidated with a three-month gap since the financial year of Acuity Partners (Pvt) Limited ends this month while the financial year of the Bank ends in March.

A legislative change that became effective from March 2008 further increased the charge for Financial Services Value Added Tax for this financial year.

The Rs. 290 million incurred for the half year was Rs. 48 Million higher than what it would have been on the basis of the previous computation methodology.

Consolidated earnings per share for the current period decreased to Rs. 7.59 from Rs. 8.58 in the corresponding period. Since the exercise price of outstanding stock options is currently higher than the market price there is no dilution of the basic earnings.

Malwatte records Rs. 542m net profit in 3 Q

Malwatte Valley Plantations PLC which has set a series of record breaking results in the recent past, has again made a record net profit of Rs. 542 million (after provision for taxes) for the third quarter ending September 30, 2008. The tea and rubber sectors contributed substantially towards this achievement, a spokesman for the company said.

He said coupled with an EPS of Rs. 24.13 per share, a net profit increase of 46% and a 60% increase in shareholders' funds over the corresponding period last year, these results are probably the best of all plantation companies so far published.

Costs have been controlled in spite of the large increases in inputs, the purchase of fertiliser alone for the period under review being over Rs. 200 Million.

These results will no doubt be somewhat eroded during the final quarter of the year due to the present crisis in the industry but innovative steps have been taken to minimise the impact, the spokesman said.

Seylan Bank launches five-year debenture issue for Rs. 1.0 billion

Seylan Bank launched the issue of unsecured subordinated redeemable Debentures amounting to Rs. 400 Million with an option to issue at the discretion of the Board, three further tranches of Rs. 200 Million each in the event the issue is oversubscribed.

These Debentures are listed on the main board of the Colombo Stock Exchange. The issue would be open for subscription from December 10. However, investments in these Debentures would be accepted at any Seylan Bank Branch during banking hours.

Vardhana Bank records 80% growth in deposits

DFCC Vardhana Bank, the commercial banking arm of the DFCC Bank has recorded an impressive growth of 80% in its deposit base as at end September 2008 compared with the figures reported on the same day of 2007.

This is the highest growth rate achieved by any bank in the country at a time when banks are facing liquidity pressures owing to declining trend in ability to save whilst credit demand has increased as a result of inflation.

Managing Director/CEO of DFCC Vardhana Bank L. G. Perera elaborated on the bank's overall performance up to quarter ended September whilst addressing major concerns facing the banking sector including Vardhana Bank.

The Net Interest Income of DFCC Vardhana Bank for the nine months ended September 30, 2008 amounted to Rs 814.4 mln. This reflects a remarkable growth of approximately 83% over the corresponding period of last year.

Total Interest income increased by 66% to Rs 2.2 bln for the nine months ended September 2008, aided by higher interest margin of 5.4% recorded in 2008 from 4% in the third quarter of 2007 in addition to increased loans and advances.

Small Hydro Power Developers officials

The following officials were elected at the Annual General Meeting of the Small Hydro Power Developers Association. S. B. Niyangoda - Secretary General - SHPDA. Office bearers: Sarath Jayathilaka - Secretary, Anil Makalande - President, Prabodha Sumanasekera - Vice President, Riyaz Sangani - Treasurer. Committee Members: Tissa Eleperuma, Sunil de Silva, Manjula Perera, Kishan Nanayakkara.

New CEO/Secretary at ICASL

The Institute of Chartered Accountants of Sri Lanka (ICASL) has appointed Aruna Alwis as CEO/Secretary from December 1.

ICASL President Nishan Fernando said, "Aruna's appointment at ICASL marks an exciting time of growth and development for ICASL regionally.

Aruna Alwis said, "I am very excited in joining ICASL, the Premier National Accountancy Body in Sri Lanka at a critical time when the Institute has a regional perspective and I am looking forward to working with its stakeholders to ensure that we develop a portfolio of services that attracts, retains and involves members at all stages of their career and supports the finance and business community".