Distilleries says cheers with Rs. 5 b pre-tax profit in nine months

Tuesday, 22 February 2011 00:11 - - {{hitsCtrl.values.hits}}

Distilleries Company of Sri Lanka (DCSL) has enjoyed a cheerful first nine months of 2010/11 financial year, with pre-tax profit topping the Rs. 5 billion mark and the bottom line surpassing Rs. 3 billion.

Consolidated pre-tax profit amounted to Rs. 5.02 billion, up by 60% from the first nine months of last year, whilst after-tax profit grew by 57% to Rs. 3.2 billion.

Net profit attributable to equity holders was Rs. 3.16 billion, up by 59% from Rs. 1.99 billion achieved in the first nine months of 2009/10 financial year.

In the quarter ended 31 December 2010, pre-tax profit was Rs. 1.9 billion, up by 56% and after tax profit amounted to Rs. 1.2 billion, an increase of 38% over the corresponding period of last financial year.

DCSL’s group turnover saw a 19% growth to Rs. 35.7 billion in the first nine months and a 27% rise in the third quarter to Rs. 13 billion. Profit from operations rose by 51% to Rs. 4.95 billion in the nine months and by 60% to Rs. 1.85 billion in the third quarter.

The DCSL accounts had benefitted from Rs. 463 million as proceeds on disposal of shares and other investments.

Group assets topped the Rs. 40 billion mark as at 31 December 2010, up from Rs. 38 billion a year earlier and Rs. 34.8 billion as at 31 March 2010. Retained earnings amounted to Rs. 19.7 billion as at end third quarter, up from Rs. 17.3 billion as at 31 March 2010.

Current liabilities rose to Rs. 15 billion as at 31 December 2010 from Rs. 9.6 billion a year earlier and Rs. 11.2 billion as at 31 March 2010. This was largely on account of interest bearing loans and borrowings of Rs. 7 billion, up from Rs. 2.6 billion and Rs. 2.9 billion respectively.

Turnover from beverages rose to Rs. 29.3 billion, up from Rs. 23.5 billion whilst this segment’s pre-tax profit was Rs. 4.3 billion up from Rs. 3 billion a year earlier. The telecommunication business (Lanka Bell) which had suffered severe losses in recent years has improved to post a pre-tax profit of Rs. 201 million in the first nine months as against a loss of Rs. 373 million a year earlier.

Turnover from the telecom business amounted to Rs. 3.5 billion, though down from Rs. 3.8 billion in the first nine months of 2009/10 financial year. This business was advertised for sale late last year though DCSL hasn’t updated on its progress.

During the quarter the Government returned Rs. 5.7 billion that was paid by DCSL subsidiary Milford Holdings (Pvt) Limited (MHL) to purchase shares in SLIC in April 2003.

Losses from diversified business rose to Rs. 109 million from Rs. 55 million.

On 10 February 2011 DCSL subsidiary Milford Holdings (Private) Limited entered into a Share Sales & Purchase Agreement with Union Bank Colombo Limited and Ennid Capital (Private) Limited to sell 51% and 19% respectively of the issued capital of National Asset Management Limited (NAMAL) pending the relevant regulatory approval for the change of ownership in NAMAL.