Cold Stores income up, profit down in 1Q
View(s):Ceylon Cold Stores (CCS) saw its 1Q18 revenue up by 20 per cent year on year (YoY) but its gross profit was down by 6 per cent for the same period, the company’s interim results showed.
In the said quarter, CCS’s manufacturing sector net profit and revenue were down YoY to Rs. 3,383,238 and Rs. 698,504 million, respectively.
The retail sector revenue and net profit were up YoY at Rs. 9 billion and Rs. 277 million.
In the last quarter (in early June) A.R. Rasiah, having served the CCS board for over 12 years, resigned.
CCS used capital expenditure (funds used by a company to acquire or upgrade physical assets such as property, industrial buildings or equipment) of Rs. 778 million in 1Q18 and out of this Rs. 700 million was invested in the retail sector.
Officials say that investments in capacity expansion at CCS and store expansion at Jaykay Marketing Services (Pvt) Ltd (JMSL) significantly increased the future earnings potential of the group. CCS serves an island-wide network of over 110,000 retail outlets, 164 distributors and source from 4,461 farmers and 2,297 other suppliers.
CCS is enhancing capacity with investments of Rs. 3.8 billion in constructing a new ice cream factory and a further investment of Rs. 2.5 billion in a new bottling facility for beverages. JMSL will continue to rapidly expand its outlet footprint, whilst constructing a new distribution centre at an estimated investment of approximately Rs. 3.2 billion. The new distribution centre will consolidate both dry and fresh produce. Enabling the business to further improve its offering to our customers, achieve significant scale benefits as well as deliver operational excellence.
During the last financial year, CCS introduced new products into its portfolio, including a range of fruit drinks and successfully replaced sugar with natural sweeteners. CCS also implemented initiatives to improve its carbon footprint and water usage, according to officials,
In the last quarter CCS saw two international funds increasing stakes in its shares while another two slightly shed theirs in the company.
Standard Chartered Bank Mauritius S/A Chambers Street Global Fund, LP which had 1.11 per cent in CCS bought 1,629 168 shares and now own 2.82 per cent. CCS’s eighth largest shareholder, CB London S/A Verdipapirfondet Holberg Rurik which had some 380,044 shares (0.40 per cent) increased this to 0.20 per cent. HSBC International Nominees Ltd-Ssbt-Debutsche Bank Ag Singapore A/C 01 sold CCS shares to stand at 0.31 percent. Seylan Bank PLC/Channa Nalin Rajahmoney which had 0.20 per cent also shed 0.02 per cent to 0.18 per cent.