ODEL reports strong 1H profit growth

Sri Lanka’s internationally-acknowledged fashion retailer Odel has posted strong net profit growth in the six months ending 30 September 2011.

In results released to the Colombo Stock Exchange, Odel PLC and its subsidiaries reported profit after tax of Rs. 122 million, an improvement of 21 per cent over the first half of the previous year.

Group turnover grew 13 per cent to Rs 1.732 billion, bolstered by the consolidation of revenue from new stores in Kiribathgoda (March 2011), Kandy (May 2011) and Wattala, which opened in September, four days before the end of the review period.

The Group now comprises of 16 stores and three more are expected to be opened in the next Quarter (Q3) of the current financial year, the company said. In addition, the Group intends to expand some of its existing stores during the second half of the current financial year.

Same-store sales growth from the rest of the Odel chain also contributed to top line growth in the first half of the year.

Odel Founder and CEO Otara Gunewardene disclosed: “All of our new stores have lived up to their promise. In addition to the sales from the new stores we have been able to leverage from more effective supply chain management and a reduction in shrinkage to improve margins, resulting in a 17 per cent year on year growth in Gross Profit. We have invested in improving infrastructure and knowledge capital during the period under review, which will benefit and support the growth of the business in the months ahead.”

The Board of Directors of Odel PLC has approved an Interim Dividend of 25 cents per share, which translates to a dividend payout of 29.6 per cent based on the Interim results for the half year ended 30 September 2011.

Basic Earnings per Share for the six months grew 13 per cent to Rs. 0.84.

Since its listing on the Diri Savi Board of the CSE in July 2010, Odel has opened four new standalone stores at Battaramulla, Kiribathgoda, Kandy and Wattala,  and revamped its store at Lester James Peiris Mawatha (Dickman’s Road), Colombo 5.