First Capital reports PAT of Rs. 339.9 m for 2013-14
Thursday, 22 May 2014 01:31
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First Capital Holdings PLC has posted profit after tax of Rs. 339.9 million for the year ending 31 March 2014, a performance which the company says was, as expected, lower than the Rs. 494 million achieved the previous year, in which Rs. 195 million had been recorded as extraordinary gains on the sale of investment securities.
Income improved by a modest 3.5% to Rs. 1.83 billion, the company said in a filing with the Colombo Stock Exchange, but net trading income fell by 4.7% to Rs. 614 million.
“Operationally, the Group has turned in a sound performance, although volumes were lower in some sectors of business due to market conditions,” First Capital Holdings Managing Director Manjula Mathews said. “Although profit before tax at Rs. 395.2 million reflects a reduction of 23.6%, discounting the one-off capital gains of 2012/13, the Group’s pre-tax profit grew by more than 20%.”
She said the Group’s largest subsidiary First Capital Treasuries Ltd. was a major contributor to the results in terms of turnover and net profit, maintaining an optimal level of trading positions throughout the year. The company seized trading opportunities that arose from three policy rate cuts in the period under review, and was also active in the structuring and placement of corporate debt securities and in investment management.
However, the Group did not see adequate trading activities in the stockbroking division and margin trading operations were also stagnant, she said. The Group’s unit trust, First Capital Wealth Fund, surpassed the Rs. 1 billion milestone at the end of the year and declared a dividend of Rs. 100 per unit for 2013/14.
Another highlight of the year reviewed was the success of First Capital Holdings PLC’s first listed debenture issue of Rs. 500 million which enhanced the company’s long term capital base and was oversubscribed within the first hour of opening.
“The Group expects continuous growth momentum in the next financial year especially in the structuring and placement of corporate debt securities as a result of the low interest rate regime and tax benefits,” Mathews said. “We will also be focusing more on corporate advisory services while managing all our risks effectively in our evolution into a fully-fledged investment bank.”
“In building for the future, we have enhanced the profile of our staff and moved our offices to a more appropriate location which has facilitated our objectives for growth. This has had an impact on our administration expenses which increased to Rs. 266.6 million from Rs. 130.9 million in the previous year. Expenses were further impacted by the consolidation of the stock broking company, First Capital Equities Ltd., which was acquired in May 2013,” she added.
First Capital Holdings PLC is the holding company of First Capital Ltd., First Capital Treasuries Ltd., First Capital Markets Ltd., First Capital Asset Management Ltd. and First Capital Equities Ltd.
The Board of Directors of First Capital Holdings PLC comprises of Deshamanya Lalith de Mel (Chairman), Manjula Mathews (Managing Director), Nihara Rodrigo, Eardley Perera, Minette Perera, Dinesh Schaffter and Nishan Fernando.
