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Chairman Sumal Perera
Vice Chairman Christopher Joshua
Managing Director Rohana Fernando
Access Engineering PLC has recorded an after-tax profit of Rs. 1.05 billion for the quarter with a corresponding YoY rise of 87.1% whilst Group figure was Rs. 1.08 billion, against a corresponding quarterly after tax profit of Rs. 692 million in 2020/21.
Company after tax profits for the nine months stood at Rs. 2.22 billion, a YoY increase of 74.1%. Primarily driven by million’s stellar performance, the Group too recorded an after tax profit of Rs. 2.26 billion which was a YoY increase of 78.4%. Earnings Per Share (EPS) for the cumulative period at the Group and Company levels were recorded at Rs. 2.26 and Rs. 2.22 respectively. For the quarter the EPS were recorded at Rs. 1.07 and Rs. 1.05 respectively at Group and Company level.
Key revenue components of the group included construction (50%), construction related materials (39%), followed by automobile (9%) and property (2%). With the exception of the automobile sector, which was hampered by government-imposed vehicle import restrictions, revenue growth in other key sectors resulted in a steady margin improvement during the quarter.
Core construction activities recorded a 59.2% YoY increase in revenue during the nine months amounting to Rs. 13.8 billion. Main construction projects that contributed to million revenue during the period included the i – Roads project, Nittambuwa Pasyala Road Project, Elliot Place Housing Project, Stadiumgama Housing Project, Bloemendhal Housing Project, Piling and earth works for the New Terminal Building and Viaduct at Bandaranaike International Airport, Anuradhapura Water Supply Project and the Orugodawatta Housing project.
Million also recently commenced work on three flyovers at Gatambe, Kohuwela and Slave Island which would reduce the traffic congestion by catering to the insufficient road capacity in the respective areas. During the third quarter, million was also awarded new projects including the design and construction of the Techno Park Development at Nuwaraeliya and Rs. 3.88 billion additional work package of the Central Expressway.
From the construction front, main highlight during the quarter was the award of Rs. 43 billion contract to construct the East Container Terminal (ECT) of the Sri Lanka Ports Authority (SLPA) to the joint venture led by Access Engineering PLC along with its technical partner China Harbour Engineering (CHEC).
This is the single biggest contract awarded to a Sri Lankan-led JV to date and will be a catalyst in creating future opportunities for overseas project execution in joint partnerships in major marine construction work, for million.
Company’s current overseas project for the construction of a T – Mall flyover and several foot bridges in Kenya is presently underway and is scheduled for completion in 2022/23. The project is carried out in joint partnership with Centunion S.A. of Spain with whom Access Engineering has executed several projects in Sri Lanka.
Company’s fully-owned subsidiary Access Logistics Park Ekala Ltd. was also awarded the contract to develop a logistics park at Ekala on a Build, Operate and Transfer (BOT) model in partnership with the Urban Development Authority (UDA). Construction of this warehousing complex, which is the first of its kind in Sri Lanka, will be carried out by Access Engineering PLC and its fully-owned subsidiary Access Logistics Park Ekala Ltd.
With a top line of Rs. 10.7 billion, the construction material segment performed impressively during the nine months period owing to the sale of asphalt and ready-mix concrete. The ADB and World Bank-funded road development programs and alternative road network expansion projects are driving up demand for construction materials.
Expansion of the expressway network, including Central and Ruwanpura expressway developments and the elevated road network is expected to create more demand for construction material in future.
With a strategically positioned plant network, Access Engineering said today it is one of Sri Lanka’s largest asphalt concrete producers in the country serving a significant market segment. Million also recently built more capacity in asphalt production with the commissioning of new plants in Ganewalpola and Mathugama, latter being the largest asphalt manufacturing plant in the island.
Million expects this growth momentum to continue into the future. The segment recorded Rs. 1.38 billion in operating profits and Rs. 989 million in after tax profits with corresponding growth rates of 118.6% and 56.9% YoY respectively. Million is one of the early movers in construction material production having ventured into this segment over a decade ago. Hence million has sufficient capacity built to cater to the current growing demand with the optimum production formulas in place.
Import restrictions, which have been in place since the previous financial year, have stalled the performance of the automobile industry in general. This had a considerable influence on the selling of new vehicles, which is a core segment of Sathosa Motors PLC. Nevertheless, the new ISUZU Marine sector, workshop operations, and spare parts sales showed a marked improvement with million winning the “One Star Prize” while being placed among the top 16th in the world at “Isuzu After Sales Awards 2021”.
Sathosa Motors expanded their branch network to 10 branches by establishing three more branches during the year. The sector recorded an operating profit of Rs. 60.7 million during the 9 months period with a marginal after tax loss of Rs. 4.6 million. Sathosa Motors PLC is the market leader in the new vehicle segment of Japanese light commercial vehicles.
During the period, million's two ongoing real estate projects fared well, with above industry average sales. Capital Heights Rajagiriya is expected to be handed over to fully paid owners by the end of the 2021/22 financial year, while Marina Square has completed construction of 35% of the apartment floor levels. Access Towers I and II, which offer approximately 325,000 Sq. Ft. of Grade ‘A’ office space had very high occupancy rates during the first 9 months.
The property sector recorded a segment profit of Rs. 410.3 million during the nine months which was a 23.9% growth over the corresponding period of the previous year. This segment will be further complemented at the completion of the multi-story car park featuring 285 parking bays and over 20,000 Sq. Ft. of office and commercial space.
This is a BOT project with the UDA and upon completion the amalgamated development is expected to significantly enhance the urban landscape at Union Place WUS Logistics (Private) Limited, which is fully owned by Access Engineering PLC is expected to generate revenue in 2022/23 with the leases expected to commence shortly.
Gross profit for the quarter was recorded at Rs. 1.79 billion and Rs. 1.36 billion at Group and Company level respectively with corresponding margins of 15.8% and 13.9%. As at 31 December 2021, the total asset base of million amounted to Rs 69.6 billion and Rs 52.6 billion at Group and Company levels respectively.
The equity attributed to the owners of million was recorded at Rs 25.3 billion at the Group level while it was Rs 23.9 billion at Company level. Net asset per share of the Group and Company as at 31st December 2021 stood at Rs. 25.33 and Rs. 23.86 respectively. Million declared its first interim dividend for 2021/22 financial year amounting to Rs. 0.25 per share which was paid in full in September 2021. This is in addition to paying Rs. 500 million as dividends in June 2021.
The Board of Directors of Access Engineering PLC comprises of Chairman Sumal Perera, Executive Vice Chairman Christopher Joshua, Managing Director Rohana Fernando, Shevantha Mendis, Dharshana Munasinghe, Dilhan Perera, Shamal Perera, Ranjan Gomez, Professor Malik Ranasinghe, Niroshan Gunaratne and Dinesh Weerakkody.
