Singer Finance net profit grows by 80% in 3Q

Monday, 20 February 2012 00:00 - - {{hitsCtrl.values.hits}}

Singer Finance announced impressive financial results for 3Q FY 2011/2012, recording a net profit before tax of Rs. 57.4 million, which is a growth of 80% over the prior year, and Rs. 154.9 million for the nine months ending in December 2011, which in turn represents a growth of 73% over the previous year.

The company’s income increased by 34% in the third quarter from Rs. 252 m to Rs. 338 m while the income for nine months ending in December 2011 increased by 25% from Rs. 725 to Rs. 903 m.

The company’s numbers were buoyed by an increase in the leasing and hire purchase portfolio, which accounted for 68% of revenue for the last quarter and 61% of revenue for the nine month period ending in December 2011.

Further augmenting the net profit before tax is the steady control of costs. CEO of Singer Finance (Lanka) PLC Shantha Wijeweera said: “We’ve displayed an admirable ability to control costs in relation to revenue, demonstrated by an operating costs-to-income ratio of 42% – down from 47% last year same quarter, and 42% – down from 44% in nine months last year.”

Further augmenting the numbers were the company’s low NPL ratio, which stood at 0.3% during the 3Q FY 2011/2012. The NPLs are among the lowest in the industry. The risk weighted capital ratio of 18.75% too is well above the minimum regulatory requirement of 10%.

Singer Finance has zero exposure to shares and the stock market and is totally unaffected by the decline in share prices experienced currently.

“During the nine month period, we added three new service providing locations to the branch network, on which two of them are in previously untapped markets such as the Northern Province (Vavuniya) and Eastern Province (Ampara),” said Wijeweera. Singer Finance (Lanka) PLC was listed on main board of Colombo stock exchange and currently 24.99% of shares are held by the public.

Singer Finance (Lanka) Plc, a subsidiary of Singer (Sri Lanka) Plc, was incorporated on 19 April 2004 to carry out finance business within the provisions of the Finance Companies Act No. 78 of 1988 as amended by Act No. 23 of 1991.

SFLP obtained the License from Central Bank of Sri Lanka to carry out finance leasing business and licensed as a registered finance company in terms of Section 2 of the Finance Companies Act No. 78 of 1988. The company’s asset base currently exceeds Rs. 6 billion.