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Friday, 3 November 2017 00:00 - - {{hitsCtrl.values.hits}}
Premier blue chip John Keells Holdings (JKH) has witnessed a marginal dip in profit in the second quarter though the top line has seen good growth.
In interim results released yesterday, JKH said the cumulative Profit Before Tax (PBT) for the first half of the financial year 2017/18 at Rs. 9.04 billion was an increase of 3% over the PBT of Rs. 8.75 billion recorded in the same period of the previous financial year.
The Group PBT in the second quarter of the financial year 2017/18 amounted to Rs. 4.95 billion against the Rs. 5.17 billion recorded in the corresponding period of the previous financial year, being a decrease of 4%.
The profit attributable to equity holders in the first half at Rs. 6.56 billion is an increase of 7% over the corresponding period of the previous financial year while the Rs. 3.73 billion recorded in the second quarter is a decrease of 1% over the previous year.
Group revenue for the first half of the financial year 2017/18 rose by 16% to Rs. 56.45 billion and second quarter figure grew by 15% to Rs. 29.62 billion.
The Company PBT for the first half of the financial year 2017/18 at Rs. 5.54 billion and at Rs. 2.18 billion for the second quarter are 21% and 26%, respectively, above the corresponding periods of 2016/17.
The Transportation industry group PBT rose by 60% to Rs. 1.07 billion in the second quarter driven by the Group’s Bunkering, and Ports and Shipping businesses.
The Financial Services industry group PBT rose by 54% to Rs.376 million with Nations Trust Bank PLC (NTB) being the main contributor recording encouraging loan growth. Union Assurance PLC, aided by user-friendly paperless apps, recorded double digit growth in gross written premiums.
PBT of the Property industry gained by 10% to Rs. 57 million due to the higher rental income received from the property businesses.
The Leisure industry group PBT declined by 39% to Rs.838 million due to closure of several of its hotels for refurbishment, and the Consumer Foods and Retail industry group PBT declined by 30% to Rs. 1.12 billion in the second quarter of 2017/18.
JKH said the decline in profitability was mainly on account of the lower volumes in the Frozen Confectionery and Beverage businesses, where a continued tapering of demand was witnessed in the quarter as a result of subdued consumer discretionary spending.
The Information Technology industry group PBT was down 13% to Rs. 141 million.
Other, comprising of the Holding Company and other investments, and the Plantation Services sector recorded a PBT of Rs. 1.35 billion up by 25% from a year earlier. JKH said the increase in PBT is mainly attributable to the increase in finance income due to higher interest rates. The Plantations Services sector recorded an improvement in profitability due to improved tea prices and operational efficiencies.
