June 22, 2010 (LBO) – Sri Lankan retailer Odel said it made 141.8 million rupees in net profits last year, as sales recovered and margins improved, with money from a share issue to be used to retire debt and expand. The retail chain’s profits for the financial year ending March 2010, revealed for the first time, were up 313 percent from the year before when sales were flat because of the economic slowdown.
Odel’s sales last year rose 23.8 percent to 2.41 billion rupees, while margins increased to 5.8 percent from 1.7 percent the year before, its prospectus said.
About 150 million rupees of the initial public offer opening on July 05 will be used to expand the number of Odel outlets, and 100 million rupees to retire short-term debt, Channa Amaratunga of CT Capital, the lead managers, told media at the launch of its IPO.
Odel, a well-known Sri Lankan brand with 12 stores, serves upper and middle-class customers, about 40 percent of whom are foreign tourists and residents.
Odel plans to issue 16.7 million shares at 15 rupees a share which would push up its total share capital by 11.52 percent to 144.95 million shares.
Amaratunga said 1.2 million shares are allocated to employees, 3.0 milli