John Keells Group Earns Record Profit of Rs 5.2bn After Tax

01st June 2010, www.dailynews.lk

John Keells Holdings Group revenue increased by 17 percent to Rs 47.98 billion for the year 2009/10 ended March 31, 2010. Group profit before tax (PBT) increased by 4 percent to Rs 6.54 billion. Group profit after tax (PAT) attributable to equity holders increased by 10 percent to Rs 5.20 billion.

Cash EPS increased by 54 percent to Rs 12.04.

Net cash flow from operating activities increased by 136 percent to Rs 9.79 billion. Return on equity was 10.9 percent compared to 10.6 percent in the previous year the JKH Chairman Susantha Ratnayake said.

Transportation remained the main contributor to the Group’s after tax profits, contributing 41 percent to the Group’s profitability with a PAT of Rs 2.28 billion, an increase of 38 percent. The industry group contributed 20 percent to the Group’s revenue.

The group’s profits were mainly driven by the operations of South Asia Gateway Terminals (SAGT), at the Colombo port, where the throughput grew 7 percent year on year to 1.88 million TEUs primarily due to the significant growth in demand from key customers.

Leisure recorded a significantly improved performance with tourist arrivals increasing consequent to the end of hostilities.

Overall, the Leisure industry group contributed 24 percent to the Group’s revenue and 18 percent of the Group’s profitability with a PAT of Rs 973 million, this being a sevenfold increase over 2008/09 [2008/09: Rs 128 million].

In anticipation of a rejuvenated Leisure industry in Sri Lanka, a total of over Rs. 6 billion has already been invested and/or committed by the Group.

The Property industry group contributed 3 percent to the Group’s revenue and 6 percent to the Group’s after tax profitability with Rs 342 million for the year, a 30 percent decline [2008/09: Rs 486 million].

There has been renewed interest in apartments in recent months and we are currently reviewing the plans that were shelved when demand was sluggish and are revisiting our strategy to develop the Group’s substantial land bank in Colombo, Ratnayake said.

The Consumer Foods and Retail industry group contributed 33 percent to the Group’s revenue and 2 percent to the Group’s after tax profitability with Rs 88 million, this being a 28 percent decline compared to the previous year.

The Beverages and Frozen Confectionary businesses recorded a PAT increase of 15 percent due to increased volumes in the North and the East and the Retail business.

Financial Services reported a PAT of Rs 530 million, an increase of 56 percent compared to last year.

Information Technology recorded a PAT of Rs 18 million in the current year compared to the loss of Rs 167 million in the previous financial year.

The industry group contributed 3 percent to the Group’s revenue and 0.3 percent to the Group’s after tax profitability.

Plantation Services, which is included under ‘Other’ in our segment report, recorded a PAT of Rs 275 million which is a 5 percent contribution to the Group’s profitability.

The PAT increase of 56 percent was mainly a result of higher tea and rubber prices in the international markets.

“We also acquired a stake of 24.6 percent in Central Hospital (Private) Limited through John Keells Capital. Overall, the ‘Other’ segment contributed 6 percent to Group revenue and 24 percent to the Group’s profitability, Chairman Ratnayake said.

Image: JKH Chairman, Susantha Ratnayake