Profit up by 102pct for Sri Lanka's Lighthouse Hotel, Galle

23rd April 2010, www.lankabusinessonline.com

Lighthouse Hotel, a unit of Sri Lanka's Jetwing leisure group said profits rose 102 percent in the March quarter to 32.2 million rupees amid a pick up in tourism, interim accounts showed.

Revenues rose 34 percent to 110.3 million rupees in the quarter. Sri Lanka's peak tourism season is the European winter, Sri Lankan hotels make most of their money in the December and March quarters.

Lighthouse's full-year profits 22.6 million rupees, giving earnings per share of 49 cents for the year.

The firm is trading at around 65 rupees giving a price to earnings multiple of 132 times. The dot com type earnings multiples are reflect the current highly optimistic expectations for hotel shares.

The hotel has 63 rooms and analysts say expansion prospects are not high.

Hayleys, a listed Sri Lankan group sold out earlier in the quarter at prices over 60 rupees and the latest shareholder list shows large stakes owned by state institutions.

The two main shareholders are Jetwing Hotels Management Services (24.02 percent) and Mercantile Investments (14.36 percent).

Employees Provident, a pension fund of private citizens managed by the state now has 11.09 percent, the Bank of Ceylon 9.78 percent, National Savings Bank 4.35 percent.

Sri Lanka's state state banks, have been active players in the market in recent months, despite the government going through a cash crunch and concern being raised about renewed money printing and rising inflation.