Sri Lanka’s John Keells Holdings second quarter net edge down

JKH-john-keells-holdings

Nov 06, 2017 (LBO) – Profits at Sri Lanka’s diversified John Keells Holdings edged down in the September quarter amid higher sales costs and lower profits in the leisure and retail sectors.

Profits attributable to equity holders in the second quarter were down one percent to 3.73 billion rupees from a year earlier. The group reported earnings of 2.69 rupees per share for the quarter.

The Group revenue for the quarter was up 15 percent to 29.6 billion rupees while in the first six months it grew by 16 percent to 56.4 billion rupees.

Cost of sales increased 26 percent to 22.5 billion rupees in the September quarter while administrative expenses increased 11 percent to 3.19 billion rupees.

In the segmental analysis, leisure sector reported a profit of 838 million rupees in the second quarter which is a decrease of 39 percent over last year.

Chairman of JKH, Susantha Ratnayake said Cinnamon Dhonveli Maldives and Ellaidhoo Maldives were partially closed for refurbishments and Bentota Beach was closed for reconstruction during the quarter under review.

“These impacted the profitability in the Maldivian and Sri Lankan Resorts segments,” Ratnayake said.

“City Hotel sector witnessed a decrease in occupancies and average room rates primarily as a result of the increase in room inventory within Colombo.”

Consumer Foods and Retail industry group profit of 1.12 billion rupees in the second quarter is a decrease of 30 percent against the second quarter of previous year.

“The decline in profitability is mainly on account of the lower volumes in the frozen confectionery and beverage businesses,” he said.

“A continued tapering of demand was witnessed in the quarter as a result of subdued consumer discretionary spending.”

The Transportation industry group profit of 1.07 billion rupees in the second quarter is an increase of 60 percent over the second quarter of the previous financial year.

The increase in profitability is mainly attributable to the group’s bunkering, and ports and shipping businesses.

In June, Mack International Freight (Pvt) Ltd became a fully owned subsidiary of the group.

In September, the group acquired 50 percent stake in Baybrook Residential Properties with a total investment of 1.80 billion rupees while disposing John Keells BPO Solutions India for 633 million rupees.

JKH further invested 1.87 billion rupees in Waterfront Properties, a subsidiary involving the developing a luxury mixed use integrated resort.

John Keells Holdings declared a first interim dividend of 2 rupees per share to be paid on 23 November 2017.