Access Engineering records phenomenal 118% and 73% growth in top and bottom line

Access Engineering PLC recorded an impressive growth in both top line and bottom line based on projections the company had for the nine months ended 31 December 2012.

As per the financial results released to the Colombo Stock Exchange, turnover for the nine months ended 31 December 2012 stood at Rs. 9.862 billion and Rs. 8.011 billion, which was a growth of 118% and 82% at group and company level over the corresponding period. Highways construction, building construction, water and drainage construction have contributed most to the turnover at the company level.

At group level, the company’s subsidiary Sathosa Motors PLC has contributed Rs. 1.7 billion to the top line. The company’s fully owned subsidiary, Access Realties Ltd. also contributed to the top line with a turnover of Rs. 104 million.

Stemming from the top line growth, the company’s pre-tax profit of Rs.1.888 billion and Rs. 1.634 billion witnessed a growth of 70% and 59% at group and company level. This makes Access Engineering one of the very few companies which delivered the expectations promised during the course of obtaining a listing on the national Bourse.

Access Engineering also doubled its turnover during the financial year 2011/2012 compared to 2010/2011, thus delivering on the theme of ‘New Hope’ to its multifaceted stakeholders.

‘Capacity building’ initiatives, which were earmarked, were further strengthened during the nine months ending 31 December 2012, with the company making investments to the tune of over Rs. 1 billion in property, plant and equipment. Taken together with the financial year 2011/2012, the company has made an investment over Rs. 2.5 billion in ‘capacity building’ within a period of 21 months.

At present, Access Engineering owns one of the most technically advanced and up-to-date fleets of heavy construction equipment and machinery in the country. These investments also includes the acquisition and setting up of quarries, crusher plants, concrete batching plants, asphalt plants and state-of-the-art piling equipment, through which the company has successfully consolidated its multidisciplinary activities and supply chain.

These backward integration measures have enabled the company to deliver its projects to clients well ahead of the scheduled completion dates and will be a catalyst in meeting the anticipated growth rates of the forthcoming years. Owing to the high investments taking place in the infrastructure sphere in the country and in view of the confirmed order book for the next two to three years, the company can look forward with confidence to the sustainability of its growth in the short to medium term while the Board of Directors and management have given high priority to sustainable growth.

The company’s liquidity profile is excellent at both company and group level. Operating activities of the company have generated a net cash inflow of Rs. 1,234 million with the net cash outflow from investing activities amounting to Rs. 1,354 million mainly due to the capacity building initiatives undertaken by the company.

The total asset base of the group stood at Rs. 16.1 billion. Equity attributable to equity holders of the parent was Rs. 11.99 billion which translates into a net asset per share of Rs. 11.99. Based on the nine months results, the annualised earnings per share of the group is Rs. 2.20. This makes the company’s share to trade at an earnings multiple of approximately 8.18 times, which is an approximate 49% discount to the equity market earnings multiple of 15.93 as of 31 December 2012 as reported by the CSE. The company declared an interim dividend of Rs. 0.25 per share for the year 2012/2013 payable on 28 February 2013. Access Engineering increased its ownership in its subsidiary Sathosa Motors PLC up to 84.23% during the period under review. Sathosa Motors PLC is the authorised dealer for the world-renowned Isuzu brand of motor vehicles in Sri Lanka. Since its acquisition in February 2012, Sathosa Motors PLC has contributed to both the top and bottom line of the company. The company is frequently presented with many accolades of recognition and was awarded with the much coveted ‘Excellence in Business and Financial Performances’ award, joint winners of the ‘Sector Award for Construction’ and ‘Category Award for Extra Large Category’ at the National Business Excellence Awards 2012.

Access Engineering also won the Gold Award for ‘Construction Companies’ at the Annual Report Awards 2012 and was listed in LMD Magazines 100 Most Respected entities of Sri Lanka in 2012.