Sri Lanka was one of the few economies to record positive growth in 2009/10 despite the residues of the conflict, the global financial crisis and the recession, Chairman of John Keells Holdings (JKH) Susantha Ratnayake said in the company’s annual report this week, adding that with the end of the war, double digit growth is a real possibility if the right enabling environment is created.
According to the annual report, JKH Group profit after tax attributable to equity holders increased by 10% for the year ended 31 March 2010 to Rs.5.20 billion over the corresponding period in 2009. Group revenue for the full year increased by 17% to Rs.47.98 billion while cash earnings per share increased by 54% to Rs.12.04. The total shareholder return for the year under review was 198% and the net cash flow from operating activities increased by 136% to Rs.9.79 billion.
Mr. Ratnayake noted that although the company’s overall financial results in 2009/10 exceeded the previous year’s results and exceeded original expectations, what is highlighted is the fact that profit after tax in the third and fourth quarter of 2009/10 grew by 57% and 35% respectively. He said this positive momentum, when viewed together with the political, economic and business stability which have been attained following the clear and overwhelming electoral mandate received by President Mahinda Rajapaksa and his government, gives the company confidence to state that Sri Lanka is on the threshold of unprecedented development. The JKH Group is also well positioned, both in organizational and financial capability, to play an important role in this national journey.
Transportation remained the main contributor to the Group’s after tax profits, contributing 41% to the Group’s profitability with a 38% increase in profits to Rs.2.28 billion. The Group’s profits were mainly driven by the operations of South Asia Gateway Terminals (SAGT) at the Colombo port where throughput grew 7% year on year to Rs.1.88 million. With the anticipated growth in infrastructure projects and trade volumes and the accelerated development in the north and east, Mr. Ratnayake stated that the outlook for the ports, shipping and logistic businesses are bullish.
Leisure recorded a significantly improved performance with tourist arrivals increasing following the end of hostilities. Mr. Ratnayake noted in his statement that the leisure industry group contributed 24% to Group revenue and 18% to Group profitability with profit after tax of Rs.973 million having increased sevenfold from the previous year.