John Keells Holdings Posts Highest Ever Profit After Tax of Rs9.06bn with a Revenue of Rs60.5bn

21st May 2011, www.island.lk

John Keells Holdings (JKH), the diversified conglomerate, has posted the highest ever profit after-tax in the company’s history for the financial year ended March 31,2011 with a group revenue of Rs.60.5 billion, up 26% from a year earlier, and an after-tax profit of Rs.9.06 billion, up 63% from the previous year.

The group’s pre-tax profit was Rs.10.6 billion, with JKH and Dialog Axiata being the only two companies to reach this mark up to now. Analysts said that it was possible that the Carsons group too would achieve this benchmark in the financial year ended March 31, 2011.

In results filed with the Colombo Stock Exchange on Friday, JKH said that Rs.8.25 billion of these earnings translating to earnings per share of Rs.13.24, was attributable to equity holders of the parent.

JKH also announced to the CSE that it would be paying a third interim dividend of Re.1 per share on top of two interim dividends each of Re.1 per share already paid to give shareholders a return of Rs.3 per share for the year under review.

Asked why the company was not increasing its dividend payout in the context of the superior performance, a senior official company said that several projects, many of them with long gestation periods, are being looked at and the directors thought it best that the previous year’s dividend level is maintained.

``Otherwise you raise shareholder expectations that may be difficult to satisfy,’’ he said. ``We had that experience when we paid a special dividend of Rs. 2 per share a couple of years ago and many shareholders believed this would continue.’’

He said that although the dividend level was the same as in the previous year, the company was doing a share sub-division under which every three shares would be sub-divided into four.

"Once the sub-division is done, our share price would necessarily go down but shareholders, in terms of the share price of their increased shareholding, will have a substantial capital appreciation convertible to cash if they so desire," he said.

The Employees Provident Fund has increased its stake in JKH from 5.7% at the end of last year to 7.1% as at March 31, 2011 while the Insurance Corporation too owns 1.8%, same as what it held at the end of last year.

Analysts did not discount the possibility of the state sector seeking a place on the JKH board should the collective holding reach a substantial level of around 15%.

Mr. S.E. Captain remains the biggest individual shareholder of JKH with his personal holding together with those of connected parties topping 20%.

In the year under review, transportation continued to be the biggest cash cow for the group posting a pre-tax profit of Rs.3 billion for the year, up from Rs.2.3 billion a year earlier.

Leisure contributed Rs.2.5 billion, up from the previous year’s Rs.1 billion, financial services Rs.1.3 billion, up from Rs.868 million, property Rs.831 million, up from Rs.378 million, consumer foods and retail Rs.579 million, up from Rs.288 million and IT Rs.114.4 million, up from Rs.13.6 million a year earlier.

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Sri Lanka JKH Hotel to Raise Rs3.6bn to Expand as the Country Expects a Surge of Tourists After the End of a 30-Year War

21st January 2010, www.lankabusinessonline.com

The leisure unit of Sri Lanka's John Keells Holdings group is making a 3.6 billion rupee cash call to spruce up its hotels and build new ones as the country expects a surge of tourists after the end of a 30-year war.

The company said it was issuing 364 million new shares at 10 rupees each to shareholders in proportion of one for every three shares held.

"The proceeds of the Rights Issue will be utilised to fund the refurbishment of hotels in Sri Lanka as well as for new hotel projects and for the acquisition of land for new resort hotels," the group said in a statement.

JKH has earlier said it was planning to invest nearly 6.0 billion rupees during the next three years to refurbish its hotels and build new ones.

It is planning a 190 room hotel in Beruwela on which design work would be finished by next April.

The hotel is expected to cost around 1.7 billion rupees, and will be a 4-star rated hotel coming under the group's mid-market 'Chaaya' brand.

JKH has a 10-acre long stretch in Beruwala, after it bought land from Sri Lanka's Confifi group next to an existing property. JKH's Beach Hotel Bayroo, in Beruwala was damaged during the 2004 Indian Ocean Tsunami.

JKH closed its 80 room Club Oceanic Hotel in the Eastern coast of Trincomalee, to refurbish it at a cost of 400 million rupees as a 4-star rated property.

Bentota Beach Hotel, would also be refurbished towards the end of next year at cost of 800 million rupees. The 115 room property would be 5-star rated.

"If tourism arrivals increase we will be ready with rooms," Gunewardene told a forum organized by Leopard Capital, a private equity group in Colombo last year.

"Cambodia saw an exponential growth after the unrest ended. Arrivals grew from 557,000 in 200 to 2.1 million in 2008".

Sri Lanka’s annual visitors in 2009 grew from 447,890 as opposed to the 438,000 visitors from the year earlier.

By 2011 JKH would be ready to start a 100 room 5-star hotel at its existing land in Ahungalle in the south west coast. The project may cost 1.6 billion rupees.

It could also build another 4-star 120 room hotel in the East Coast on its existing or acquired property. JKH had access to property in Kuchchaveli as well as in Nilaveli.

John Keells to Invest 6BN to Upgrade and Build Hotels in Sri Lanka

22nd November 2009, www.lankabusinessonline.com

Sri Lanka's John Keells Holdings is ready to invest nearly 6.0 billion rupees over the next two to three years in upgrading and building new hotels if tourism arrivals pick up after the end of a 30-year war as expected, an official said.

Deputy chairman Ajith Gunewardene said JKH was planning a 190 room hotel in Beruwela on which design work would be finished by next April.

The hotel is expected to cost around 1.7 billion rupees, and will be a 4-star rated hotel coming under the group's mid-market 'Chaaya' brand. Its up market 5-star properties are branded Cinnamon.

JKH has a 10-acre long stretch in Beruwala, after it bought land from Sri Lanka's Confifi group next to an existing property. JKH's Beach Hotel Bayroo, in Beruwala was damaged during the 2004 Indian Ocean Tsunami.

JKH has already closed its 80 room Club Oceanic Hotel in the Eastern coast of Trincomalee to be refurbished at a cost of 400 million rupees as a 4-star rated property.

Bentota Beach Hotel, would also be refurbished towards the end of next year at cost of 800 million rupees. The 115 room property would be 5-star rated.

"If tourism arrivals increase we will be ready with rooms," Gunewardene told a forum organized by Leopard Capital, a private equity group in Colombo.

"Cambodia saw an exponential growth after unrest ended. Arrivals grew from 557,000 in 200 to 2.1 million in 2008. Sri Lanka had 438,000 tourists last year."

By 2011 JKH would be ready to start a 100 room 5-star hotel at its existing land in Ahungalle. The project may cost 1.6 billion rupees.

It could also build another 4-star 120 room hotel in the East Coast on its existing or acquired property. JKH had access to property in Kuchchaveli as well as in Nilaveli, Gunewardene said.