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Aitken Spence records profit of Rs. 4.2 billion in 2019-2020 amidst unprecedented challenges

26 May

The year under review experienced two black swan events with their distinctive and severe impacts within the space of one year. Aitken Spence PLC remained resilient despite these challenges due to the Group’s diversified business portfolio and strategic direction.

The Group’s financial performance for the twelve months ending 31st March 2020 recorded a year-on-year profit-before-tax of Rs. 4.2 billion compared Rs. 7.3 billion last year.

Despite considerable economic headwinds the organisation’s agile strategy was reflected in the earnings from the overseas businesses that contributed 39% compared to 43% last year. This underlined the exceptional relationships that have been built with global industry players across the key sectors. The Group’s businesses from the domestic market derived 61% earnings of the Group’s PBT for 2019/2020 compared to 57% in the previous year.

The total revenue of the Group ending 31st March 2020 was Rs. 53.5 billion, a 4% drop from the previous year, primarily due to a reduction of revenue from the Tourism sector which was affected by the significant impacts mentioned above. However, the drop was compensated by the commencement of the operations during the third quarter of the year of Heritance Aarah, the flagship hotel in the Maldives.

The total assets of the Group increased by 14% to Rs. 140 billion. The Group invested Rs. 10 billion in capital expenditure across many sectors with the highest investment incurred in the power generation segment to fund the construction of the pioneering waste to energy power project, the first of its kind in Sri Lanka. This reflects the organisation’s confidence in its future earnings growth capacity.

The Group’s expansion increased to 9 countries as the Maritime & Freight Logistics sector re-established its presence in South Africa whilst the Tourism sector commenced operations in Myanmar during the year.

The launch of Heritance Aarah was a key milestone in the Tourism portfolio as it was the first time that the Heritance brand was launched overseas. Heritance Aarah is the first LEED certified building in the Maldives reflecting their commitment to sustainable and energy efficient design. Heritance Aarah has also set the bar for culinary excellence in this popular tourist destination emerging victorious in the World Culinary Olympics in Germany, having also won the Maldivian and Sri Lankan competitions during the year.

The Tourism sector recorded a loss before tax of Rs. 15.3 million compared to a profit of Rs. 3.1 billion last year. This sector was hardest hit by the Easter terror attacks at the beginning of the year with dramatic declines in tourist arrivals in the following months. Overall, performance of the overseas Tourism sector was dampened by the increased depreciation and interest costs related to Heritance Aarah which is inevitable due to the capital intensive and long-term nature of the industry.

Heritance Kandalama and Heritance Tea Factory made profits despite the setbacks. This was owing to the differentiated marketing strategy that helped to mitigate losses, carving out a niche that could be finetuned to enhance yields over time. Aitken Spence Travels handled around 14% of organised tourist arrivals to country underlying its position as the market leader and providing a healthy contribution to the Group and the country, to accelerate and strengthen the recovery of this key economic sector. Additionally, Airline General Sales Agency business added another regional passenger carrier to its portfolio which is expected to commence operations in the new financial year.

The Maritime & Freight Logistics sector contributed an outstanding profit before tax of Rs. 2.25 billion which was once again the largest contributor accounting for 54% of the Group profits. The resumption of operations in South Africa, completed a short-term assignment which supported the performance of the sector.

The Sri Lankan operations of the Maritime & Freight Logistics sector also recorded an increase in operating profits despite a significant decline in trade volumes due to global trade tensions and import restrictions. Integrated logistics performed very well by securing new multinational clients through service excellence.

The Strategic Investments sector recorded PBT of Rs. 1.7 billion compared to Rs. 1.8 billion last year. Steady progress has been made in the country’s first waste to energy power plant although the final commissioning is likely to be delayed given the challenges with the current situation. Apparel had improved efficiencies and had a good year but witnessed a drawback due to the impact of COVID-19 at the end of the financial year. The printing and packaging segment continued to differentiate itself in the market leveraging its sustainable printing agenda but was adversely impacted due to higher costs of paper leading to narrower margins and the cessation of operations in the latter part of March following the lockdown imposed in the country.

The Group’s investment in the printing & packaging segment in the South Pacific region is nearing completion and is expected to commence full scale operations soon. This strategic investment will support the printing and packaging segment’s aspirations to expand services in the South Pacific region using its expertise in sustainable printing to differentiate their value proposition.

Performance of the plantations segment was commendable despite the lower prices of tea experienced throughout the financial year due to its business diversification strategy. Escape Theme Parks signed an agreement to develop a park in Devithurai estate making Elpitiya Plantations the first Regional Plantation Company to embark on a non-agri diversification project of this scale.

The Services sector performance was commendable recording PBT of Rs. 298 million compared to Rs. 269 million last year. The insurance segment performed remarkably well and no major impact from COVID-19 is expected for this segment. The elevators segment secured a large number of contracts but may experience delays in installations as the market may be impacted due to the COVID-19 related economic downturn. Despite work remittances to the country declining during the financial year, the Money transfer segment of the Group performed well due to operational efficiencies.

“As we emerge from the great lockdown of our time to a world that has changed significantly, it is crucial that we are prepared for a paradigm shift within the Group to seize new opportunities by responding to changing demand dynamics. Plans are taking shape to ‘Realign, Reinvent and Relaunch’ our businesses to be even more relevant to society’s changing needs to deliver sustainable growth in earnings to our shareholders, upholding the Spensonian legacy of adapting to thrive,” stated Dr. Parakrama Dissanayake, Deputy Chairman and Managing Director of Aitken Spence PLC.

Aitken Spence PLC won the Best Corporate Citizen Sustainability Award 2019 for the third successive year and has been ranked among the Top 10 Best Corporate Citizens of Sri Lanka for an unprecedented 14 consecutive years.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in hotels, travels, maritime, freight and logistic solutions, plantations, power generation, financial outsourcing, insurance, printing, apparel and other services.

Aitken Spence PLC: Revenue grows 3.3% to Rs. 43.8 Bn, amidst challenging times, in the 9 months ended December 2019

11 Feb

The leading blue-chip conglomerate, Aitken Spence PLC remained resilient during a difficult period through its diversity of investments in eight countries, thereby recording favourable results for the nine months ended December 2019.

Amidst challenging times, revenue of the Group grew by 3.3% to Rs. 43.8 billion for the period ended December 2019. The Group’s EBITDA for the nine months remained stable at Rs. 6.8 billion.

Close to 57% of the Group’s PBT of Rs. 2.4 billion was generated through its investments overseas for the nine months ended December 2019.

The Group recorded a profit from operations of Rs. 3.7 billion compared to Rs. 4.6 billion recorded the previous year for the nine months under review. This was primarily due to the significant foreign exchange gains recorded in the previous year due to the 17.4% depreciation of the Sri Lankan rupee as against a 3.1% depreciation during the current year. Profit from operations of the Group stood at Rs.1.8 billion for the third quarter under review.

The Maritime & Freight Logistics sector performed exceptionally well recording a 20.6% growth in profits over the previous year. The Integrated Logistics and Maritime segments continued their exceptional performance recording significant improvement in profits. However, the Group’s freight segment did not come up to expectations mainly due to intense competition and lower yields.

The Tourism sector continued to be affected from the April aftermath during the reporting period, due to the downturn the industry witnessed in the early part of the financial year. The Maldivian hotels sector continued its healthy performance though somewhat subdued due to the initial losses incurred due to partial closure of 100 rooms for refurbishment during the period.

Notwithstanding the many obstacles witnessed by the local tourism industry, the Group’s Destination Management segment maintained its market share of tourist arrivals to the country whilst upholding its position as the market leader, in this segment.

The Tourism industry in Sri Lanka had seen a steady recovery following the Easter Sunday attacks, with tourists’ arrivals considerably improving during the last few months of 2019. However, the unfortunate outbreak of the coronavirus (2019-nCov) is dampening the recovery efforts of the country with cancellations being witnessed and the overall lack of interest in travel.

The Strategic Investments sector contributed Rs. 815 million towards the Group PBT. The Group’s investment in Printing in Fiji, is yet to bear fruition with considerable cost still being incurred on restructuring and revamping its operations. The lower prices recorded for tea resulted in the decline of the performance of the plantation segment compared to the previous year though remaining profitable.

The Services sector contributed 11.1% of the Group’s PBT and recorded a 5.0% growth in Profit Before Tax over the previous year.

The Group’s first Heritance Property in the Maldives; Heritance Aarah commenced commercial operations on 1st October 2019. This 150-room property recorded healthy levels of occupancy during the first months of operations and shows immense potential to command higher rates in the coming years. Following the ingrained ethos of sustainability at Aitken Spence, Heritance Aarah is the first property in the Maldives to receive the Leadership in Energy and Environmental Design (LEED) Gold certification.

Steady progress is seen in the construction of the country’s first waste to energy power plant which is projected for completion shortly. Proving Aitken Spence’s commitment to the sustainable development of Sri Lanka, this pioneering venture will help solve the long outstanding waste disposal issue in Colombo city.

An associate company of Aitken Spence PLC, Elpitiya Plantations PLC has signed a memorandum of understanding (MOU) with Sim Leisure Group Ltd, a leading theme park developer and operator based in Penang, Malaysia, to set up a world-class ESCAPE theme park in the Galle region. This will promote economic development in terms of creating opportunities for local employment and boosting tourism in Sri Lanka. Construction of the theme park will commence in March 2020.

During the reporting period, Aitken Spence was awarded the Best Corporate Citizen Sustainability Award for the third consecutive year organised by the Ceylon Chamber of Commerce. Being the reigning winner of 2017 and 2018, Aitken Spence walked away with a hat trick winning the overall award along with 12 other awards in diverse categories and sectors – the highest number of awards received by a single company at the ceremony. Aitken Spence displays unparalleled commitment to sustainability as the only company to have been ranked among the Top Ten Best Corporate Citizens for 14 consecutive years.

With an indisputable repute as one of Sri Lanka’s pioneering corporates, Aitken Spence is a blue-chip conglomerate anchored to a heritage of excellence spanning over 150 years. Listed in the Colombo Stock Exchange since 1983, Aitken Spence is a responsible enterprise driven by over 14,000 employees across 16 industries in 8 countries. Creating opportunities for Sri Lanka across new frontiers, Aitken Spence PLC is an organisation committed to the development of Sri Lanka.

Aitken Spence cumulative Q2 revenue up by 8.2%

15 Nov

Against an extremely challenging macro-economic environment, the leading conglomerate Aitken Spence PLC’s Group gross revenue grew by 8.2% to Rs. 28.6 billion for the period ending 30th September ‘19. Main growth in revenue were from the strategic investments and the maritime & logistics sectors. The integrated logistics segment performed exceptionally well recording a 30% year on year growth in revenue. This momentum is expected to continue for the rest of the year. The ship agency and maritime operations segments also recorded growth in revenue. The printing and apparel manufacture segments also recorded double digit growth in revenue compared to last year.

The Group recorded an overall profit from operations of Rs. 1.9 billion for the six months ended 30th September from Rs. 2.2 billion recorded the previous year. This was a result of the downturn experienced mainly by the tourism industry, post Easter Sunday. Despite the decline faced by the tourism sector, the Group showcased its resilience and its diversity of investments, to record an overall profit-before-tax (PBT) of Rs 1.2 billion for the six months ended 30th September. The Group PBT for the comparative period in the previous year was Rs. 1.7 billion.

The Group recorded a gross revenue of Rs. 14.2 billion for the second quarter whilst its profit from operations for the quarter was Rs. 1.1 billion compared to the profit from operations of Rs. 1.4 billion recorded the previous year.

Approximately 56% of the Group’s PBT for cumulative September ‘19 was generated through its investments overseas. The main contributor towards the PBT was the maritime & logistics sector which recorded a 24.5% growth over the previous year.

The strategic investments sector contributed Rs. 677 million towards the PBT compared to Rs. 727 million in the previous year. The significantly lower tea and rubber prices, and the intense competition faced by the printing sector coupled with the costs of the recent investment in South Pacific printing contributed to this effect. The printing segment is currently in the process of revamping the machinery and technology in this facility targeting to cater to the South Pacific region.

South Asia’s first green printing facility Aitken Spence Printing renewed its carbon neutral certification for the seventh consecutive year and thereby reflecting its commitment to sustainability.

Steady progress is seen in the construction of the country’s first waste to energy power plant and is projected for commercial operations towards the end of the financial year. Aitken Spence is committed to the development of Sri Lanka and this pioneering venture will help solve both the waste disposal and energy supply challenges in the country at present.

Despite a healthy performance by the Maldivian hotels, the drag in the local tourism industry resulted in the tourism sector reporting a loss for the period. However, the Group’s iconic properties Heritance Kandalama and Heritance Tea Factory recorded positive performances despite the decline in arrivals to the country.

Aitken Spence Hotels also received 14 awards at the South Asian Travel Awards 2019 and recently walked away with the championship trophy and an impressive 130 medals at the Culinary Art Food Expo 2019. With only few months into its opening, Heritance Aarah emerged as the overall champion at the Culinary Art Food Expo 2019 and excelled at the Food & Hospitality Asia Maldives 2019 (FHAM) competition with the highest number of awards won by an individual Resort. Following the ingrained ethos of sustainability at Aitken Spence, Heritance Aarah is the first property in the Maldives to receive the Leadership in Energy and Environmental Design (LEED) Gold certification.

The Group’s destination management segment was able to maintain its market share of the arrivals to the country. The destination management segment’s Myanmar operations has obtained all licenses and has recently commenced commercial operations.

During the reporting period Aitken Spence was ranked amongst the top 10 Most Admired Companies of Sri Lanka 2019 for the second consecutive year by International Chamber of Commerce, Sri Lanka (ICCSL) and The Chartered Institute of Management Accountants (CIMA) Sri Lanka. The Company was among the top 10 of LMD’s Most Respected entities hall of fame 2019. Aitken Spence PLC was also amongst the top 10 whilst Aitken Spence Hotels won the sectoral accolade at the CMA Excellence in Integrated Reporting Awards 2019.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Financial Outsourcing, Insurance, IT, Printing and Apparel sectors. With a geographical presence in 8 countries and growing, creating opportunities for Sri Lanka across new frontiers, Aitken Spence PLC remains committed to the development of our nation.

Deshamanya D.H.S. Jayawardena –
Chairman Aitken Spence PLC

 

Dr. Parakrama Dissanayake –
Deputy Chairman and Managing Director Aitken Spence PLC

Strength in Diversity: Aitken Spence Shows Resilience with 17.5% Revenue Increase in 1Q

8 Aug

In the aftermath of the devastating events of 21st April in Sri Lanka, the first quarter of 2019 was adversely impacted. As the country copes with multiple challenges, Sri Lanka’s economic growth is forecast at 2.7% in 2019. Overall, the performance of the services sector in the country declined to 4.1% year-on-year, compared to 5.5% GDP growth last year. Among other industries, tourist arrivals to Sri Lanka in May 2019 recorded a drastic decline of 70.8% from the arrivals in May of 2018. Although the arrivals increased by 19% by June 2019, it is yet 57% less compared to the arrivals in June 2018. Earnings from the country’s agricultural exports declined during the first five months of 2019 due to poor performance observed in tea, minor agricultural products and rubber exports.

Against this challenging macroeconomic backdrop, Aitken Spence PLC reported a 17.5% growth in Group revenue during the first quarter of the year at Rs. 12.4 billion compared to Rs. 10.6 billion recorded in the previous financial year.

Aitken Spence continues to manifest its dominance in overseas markets that has generated approximately 75% of the Group’s overall profits in the first quarter of 2019 compared to 60% in the first quarter of 2018. Overseas expansion, and thereby creating opportunities in local and overseas markets, is a vital aspect of the business strategy of Aitken Spence and it has strengthened the company’s resilience amidst a turbulent economic environment.  At present, Aitken Spence has a presence in Asia, Middle East, South Pacific and Africa and the efficacy of this strategy is evident to date.

At the same time, profit-before-tax for the quarter was Rs. 475 million from Rs. 538 million over the previous year. This is after accounting for an additional charge of Rs. 36 million for the quarter, due to the adoption of the new leasing standard SLFRS 16 as required. There was no corresponding adjustment made in the previous year.

“Aitken Spence is a company that has proven that our strength is in our diversity. The devastation of the Easter attacks should motivate unity, resilience and continual progress. With normalcy being gradually restored, we are confident that business will bounce back, and our efforts will continue to this end,” said Dr. Parakrama Dissanayake, Deputy Chairman and Managing Director of Aitken Spence PLC.

“We are pleased to be seen in the forefront of showcasing business resilience amidst challenging times. Following the Easter attacks, Aitken Spence Maritime facilitated the first luxury cruise ship carrying 350 passengers to call on Sri Lankan ports and Aitken Spence Travels Cruise team was responsible for the operation of all the shore excursions for its passengers,” he added further.

The tourism sector was significantly impacted by the Easter attacks that resulted in a loss of Rs. 385 million for the quarter, over the loss of Rs. 204 million in the previous year. However, the resorts in the Maldives recorded a strong growth with the newly opened Heritance Aarah which is the first overseas operation to carry the premium brand ‘Heritance’. The hotel property recently opened in March 2019 and is the latest addition to have been ‘Gold’ certified for Leadership in Energy and Environmental Design (LEED). LEED buildings save energy, water, resources, generate less waste and support human health. Only three months into its opening, Heritance Aarah marked a landslide victory at the Food & Hospitality Asia Maldives 2019 winning 33 awards, the highest number won by an individual property.

Despite the travel advisories issued for Sri Lanka in the aftermath of the Easter attacks, the inbound tourism segment has performed well. The destination management segment has also set up a new venture in Myanmar and operations are expected to commence shortly. This is a further testament to expansion overseas which help to offset negative impacts faced in the domestic segment. Moreover, this promotes our skills and expertise in a fast-growing tourist destination such as Myanmar.

Amidst the sluggish economic growth and stiff competition, the maritime & logistics and services sectors recorded increments. The quarterly profit-before-tax of the maritime & logistics sector increased by 21% to Rs. 528 million, over the previous year. The sector’s revenue increased by 4.4% to Rs.2.8 billion, mainly driven by its overseas operations.

Strategic investments and services sectors also recorded profit growth, of 8.4% to Rs. 242 million and 11.1% to Rs. 91 million respectively, in the first quarter.

Aitken Spence PLC won the Best Corporate Citizen Sustainability Award 2018 for the second successive year, the 3rd win overall for the company, and has been ranked among the Top 10 Corporate Citizens for an unprecedented 13 consecutive years. Aitken Spence PLC has also been ranked Platinum and among the top 5 companies in the STING/ LMD Corporate Accountability Index for 6 consecutive indices. Recently, Aitken Spence was adjudged the overall winner at the ACCA Sustainability Reporting Awards for the year 2018.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Financial Outsourcing, Insurance, IT, Printing and Apparel sectors. With a geographical presence in 8 countries and growing, creating opportunities for Sri Lanka across new frontiers, Aitken Spence PLC remains committed to the development of our nation.

Deshamanya D.H.S. Jayawardena – Chairman Aitken Spence PLC

 

Dr. Parakrama Dissanayake – Deputy Chairman and Managing Director Aitken Spence PLC

 

Aitken Spence Outperforms Industry Benchmarks with 13.8% Growth in PBT in 2018/19

27 May

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aitken Spence PLC came up with yet another sustained financial performance for the twelve months ending 31st March 2019 with a 13.8% year-on-year growth in profit-before-tax from Rs. 6.4 billion to Rs. 7.3 billion, its highest ever. The leading conglomerate recorded a steady growth in several key sectors. The conglomerate capitalised on its broad-based business portfolio spread across several countries and sectors by recording an increase in its annual revenue by 5.6% from Rs. 52.7 billion to Rs. 55.7 billion whilst recording the highest ever profit-after-tax of Rs. 5.8 billion. This was an increase of 12.1% from the previous year. The resilience of the Group is demonstrated by the continuous growth in EPS which reflects the strength of the Group to face turbulence in the domestic market and yet achieving sustained economic growth during this period, due to its overseas investments.

Currently, Aitken Spence being an exceptionally diversified Group has generated 44% of its profits from businesses overseas; thus, spreading its wings across countries specially in the tourism, maritime and logistics sectors. As a result, the total assets of the Group comprise of 33% accounted by assets overseas. This is an indication of the valuable relationships that have been built with global industry players in these key sectors.

The company also witnessed a growth in revenue from the overseas operations by 9.9% to Rs.17.6 billion supported by good performances from the tourism, and maritime & logistics operations, surpassing revenue growth in the domestic market. The revenue increase in the Maldives is noteworthy as growth in room supply exceeded increase in tourist arrivals, leading to stiff competition in this attractive market. Further higher domestic volumes in the cargo business resulted in increased growth in overseas maritime and logistics operations.

Total revenue of the Sri Lankan operations also grew by 3.7% to Rs.38.1 billion. This was created by significant improvement in tourism, maritime & logistics and services sectors despite a contraction in the strategic investments sector. As a result of the outstanding growth in the key sectors, earnings before interest, tax, depreciation and amortization (EBITDA) increased by 20% to Rs.6.2 billion during the year.

The Sri Lankan hotels performed extremely well recording a profit before tax of 40.3% over the previous year, although there was an increase in room inventory in the country which created intensive competition. Moreover, the destination management business underlined their leadership position in the country by exceeding all expectations resulting in a profit before tax of over Rs. 1 billion. They also brought in over 200,000 tourists into Sri Lanka which is an exceptional achievement.

The maritime and logistics sector recorded a growth in profit of 20.9% to reach Rs. 2.1 billion. The performance of these two sectors improved due to an increase in imports, exports and transhipment volumes. In addition, the hub concept which is gaining greater appreciation and attention in Sri Lanka also contributed to improved performances in freight forwarding, courier and GSA.

The broad-based strategic investments sector delivered an exceptional profit growth of 40.2% to reach Rs.1.8 billion. This was boosted by focus on driving operational efficiencies through sustainability initiatives resulting in a turnaround in the Garments segment. The power generation segment is in the process of providing a lasting solution to the city of Colombo’s acute garbage disposal problem by constructing a state-of-the-art waste-to-energy plant. This is a pioneering venture being carried out in Sri Lanka which will be operational in the fourth quarter of 2019/20 adding 10 MWs to the national grid.

The services sector comprising the insurance business and OTIS elevators, both showed top line growth with the overall sector reaching a profit before tax of Rs. 268 million, an increase of 11.6% over the previous year. The insurance business grew as a result of increase in external trade whilst OTIS elevators saw an increase in revenue growth from projects that commenced in the prior year’s nearing completion. This is despite the downturn in the construction industry.

Overall, profit attributable to shareholders crossed the Rs. 4 billion mark for the first time to Rs. 4.1 billion, an increase of 14.5%, while earnings per share (EPS) also rose from Rs. 8.77 to Rs. 10.04.

“Despite economic headwinds in key source markets and in their respective locations of operations, we have remained resilient and it is evident in the strong financial performance clearly seen across geographies and sectors. Our continued commitment to overseas expansion is evidenced by the investment of Rs.12.6 billion in Heritance Aárah in the Maldives as it becomes the first overseas operation to carry our premium brand Heritance which has been associated only with our iconic properties in Sri Lanka. Our printing and packaging segment also made an investment in Fiji in a printing business during the financial year, giving us the opportunity to further expand our horizons in the South Pacific region,” stated Aitken Spence Deputy Chairman and Managing Director, Dr. Parakrama Dissanayake.

“Currently, our top priority is to restore confidence and normalcy. Every one of us in the organisation is committed to making a contribution to this end. Moving forward, we will continue to work together with industry bodies to support recovery at a national level, voicing our concerns and conveying those of our business partners and customers to drive change in the right direction. We also stay committed and focused on the longer term as well, investing wisely to ensure that we drive the growth momentum in the country,” he added further.

Aitken Spence PLC won the Best Corporate Citizen Sustainability Award 2018 for the second successive year and has been ranked among the Top 10 Corporate Citizens for an unprecedented 13 consecutive years.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in September 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Financial Outsourcing, Insurance, IT, Printing and Apparel sectors.

Aitken Spence Records Significant Growth

9 Feb

Aitken Spence PLC recorded impressive growth in financial results for the nine months ending on 31st December 2018 with a 21.3 per cent year-on-year growth in profits-before-tax from Rs. 3.28 bn to Rs. 3.97 bn. The leading conglomerate recorded an increase in revenue of 1.5 per cent over the previous year, from Rs. 36.2 bn to Rs. 36.7 bn for the nine-month time period.

The diversified group’s profits-before-tax increased by 52.9 per cent from Rs.1.47 bn to Rs. 2.26 bn in the third quarter, over the previous year. Revenue increased by 12.1 per cent from Rs. 12.2 to Rs. 13.7 bn.

Earnings per share for the nine months increased by 25.4 per cent from Rs. 4.31 to Rs. 5.41, while it increased by 56 per cent from Rs. 2 to Rs. 3.12 for the third quarter, year-on-year.

“We are pleased to announce that Aitken Spence has recorded considerable growth in profit-before-tax and revenue for the nine months and quarter. All our four sectors – tourism, maritime & logistics, strategic investments and services – showed significant growth in profit-before-tax and revenue during the third quarter”, said J M S Brito, Deputy Chairman and Managing Director of Aitken Spence PLC.

The tourism sector growth was driven by a strong performance by the destination management segment consisting of Aitken Spence Travels which has increased the number of tourists handled steadily over last few years. Whilst Aitken Spence resorts in the Maldives continued to perform well in spite of increased international competition, the Sri Lankan hotels segment improved its financial results over the previous year, during period under review.

The company’s latest addition to its hospitality portfolio, Heritance Aarah that presents a premium all-inclusive offering is expected to open next month as the first Heritance property in the Maldives.

The maritime & logistics sector posted growth in both top and bottom lines with improved results from maritime services, cargo and logistics segments. Aitken Spence is one of the largest integrated logistics service providers in Sri Lanka.

The strategic investments sector that includes power generation, plantations, printing and garments segments also showed considerable growth over the previous year for the period under review. The 10MW waste-to-energy project under construction is expected to help solve both the waste disposal and energy supply challenges in the country at present. The project would be equipped to convert municipal solid waste to electricity, aimed at greatly relieving the Colombo City of its waste disposal burden. The waste-to-energy plant will add to the current portfolio of hydro, thermal and wind power plants developed and run by Aitken Spence.

In a landmark move, Aitken Spence recently commenced a joint venture with Fijian Holdings – one of Fiji’s leading conglomerates – to invest in and manage the government printery in Fiji. Aitken Spence will be providing the expertise in management and leadership to upgrade the government printery with new technology to make it one of the best in the region.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Printing, Insurance and Apparel sectors. Aitken Spence is the reigning winner of the Ceylon Chamber of Commerce Best Corporate Citizen Sustainability award while being the only company in Sri Lanka to be ranked as a “Best Corporate Citizen” by Sri Lanka’s leading chamber for 13 consecutive years.

Aitken Spence Net Assets Increases to Rs. 112.30 Per Share – Improves performance in the Second Quarter

14 Nov

Leading conglomerate Aitken Spence PLC’s financial results released to the Colombo Stock Exchange revealed quarterly revenue increasing year-on-year (YoY) to Rs. 12.41 billion from Rs. 12.27 billion while revenue for the six months was Rs. 22.98 billion. The Group also recorded an improved net assets per share value of Rs. 112.30.

Profits-before-tax (PBT) for the six months ended 30th September was Rs. 1.45 bn while the quarterly PBT was recorded as Rs. 971 million, both recording decreases over the previous year. After discounting the exceptional gain on disposal of Hotel Hilltop in September 2017, the Group has recorded a PBT growth of 19% year on year in the second quarter and registered a significant improvement over the performance of the first quarter of the current financial year.

Earnings per share for the quarter was reported Rs. 1.19 while Rs. 1.71 was reported for the six months.

The tourism sector reported a decrease in profits-after-tax of Rs. 594 mn YoY. This was mainly owing to the significant gain from divesting in Hotel Hill Top that amounted to Rs. 307.6 million last year. The devaluation of the rupee had a negative impact on the translation adjustment of foreign currency loans taken by the tourism sector, which also witnessed a drop in the contribution from Meedhuparu resort in Maldives due to its investment made in the new resort Aarah. However, the revenue of the tourism sector was up 8.4 percent YoY to Rs. 12.06 billion from Rs. 11.12 billion.

During the quarter, Aitken Spence-owned Turyaa Chennai won the Leading Designer Hotel – India (South) 2018 award at the South Asia Travel Awards, while Heritance Ayurveda  Maha Gedara won the Silver Award (hotels category) for excellent contribution towards environmental conservation at the Presidential Environmental Awards conducted by Central Environmental Authority (CEA).

There were significant improvements in the maritime & logistics and services sectors. The turnaround of cargo sector and improved performance of the ship agency operation resulted in an increase in profit-before-tax for the maritime & logistics sector. The sector revenue increased by 10.2 percent to Rs. 5.62 billion from Rs. 5.10 billion. The quarterly profit-after-tax of the sector increased by 24.9 percent to Rs. 711 million from Rs. 569 million, over the previous year.

Capital expenditure incurred on the construction of Aarah resort in the Maldives and the waste-to-energy power plant in the north of Colombo resulted in an increase in property plant and equipment of the Group by approximately Rs 3.5 billion. Heritance Aarah is expected to open in February in 2019. It will be the first resort outside Sri Lanka to be branded as ‘Heritance’, introducing a premium all-inclusive offering with elegantly designed villas.

The landmark waste-to-energy project is expected help solve both the waste disposal and energy supply challenges in the country at present. The project would be equipped to convert municipal solid waste to electricity, aimed at greatly relieving the Colombo City of its waste disposal burden.

Listed in the Colombo Stock Exchange since 1983 and marking its 150th year milestone in 2018, Aitken Spence is a blue-chip conglomerate with a strong regional presence in the Hotels, Travels, Maritime Services, Logistic Solutions, Plantations, Power Generation, Financial Outsourcing, Insurance, IT, Printing and Apparel sectors. Aitken Spence is the reigning winner of the Ceylon Chamber of Commerce Best Corporate Citizen Sustainability award while being the only company in Sri Lanka to be ranked as a “Best Corporate Citizen” by Sri Lanka’s leading chamber for 12 consecutive years.