Nov 16, 2015 (LBO) - Sri Lanka Telecom said September 2015 quarter net profit fell 70 percent to 630 million rupees from 2014, interim accounts showed.
The Company’s earnings per shares fell to 0.35 rupees for the September quarter from 1.15 rupees in 2014 while for the first nine months EPS fell 19 percent to 2.
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28 rupees, accounts filled with the Colombo Stock Exchange said.
STL’s September quarter sales grew four percent to 17.3 billion rupees.
The Company said that profits were hit by foreign exchange losses from the depreciation of the rupee and that the that a foreign exchange loss of 1.4 billion rupees was seen during the September 2015 quarter.
“Foreign currency translation losses relating to foreign currency denominated borrowings due to the sudden depreciation of the rupee against the US dollar,” the Company statement said.
“Most of the borrowings of the group are dollar denominated.
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this is what happens when companies and banks borrows in foreign currencies when they are on a weak currency environment. expect more such results specially from banks and finance institutions.
Well LKR/USD depreciation was approximately 8% yet telcos including Dialog and now SLT have posted enormously disproportionate translation losses claiming to be due to currency devaluation. This too having assumed these companies have not had any natural or dealt hedging arrangements at least in the form of USD receivables. Therefore, claiming disproportionate foreign exchange losses by no means is an excuse for mismanagement of finances or windowdressing if any.