The Investor Sentiment - Equity and investments forum for Sri Lankans
Search
 
 

Display results as :
 


Rechercher Advanced Search

Latest topics
» LIOC.N0000 (Lanka IOC PLC)
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyYesterday at 1:02 pm by LSE

» Thread for News on CSE and SL Economy
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Jan 24, 2020 10:08 am by lanka

» Gota's Era
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Jan 24, 2020 9:33 am by yellow knife

» බැඳුම්කර වංචාවේ වෝහාරික විගණන වාර්තාව පාර්ලිමේන්තුවට
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Jan 24, 2020 7:05 am by nihal123

» අසාදුගත ව්‍යාපාරිකයින්ට රජයෙන් දුන් සහනය මෙන්න
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Jan 24, 2020 6:37 am by nihal123

» SAMP.N0000 (Sampath Bank PLC)
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Jan 23, 2020 5:55 pm by NIRMALSG

» සුරැකුම්පත් කොමිසමට නව සභාපතිවරයෙක්
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 22, 2020 10:20 am by lanka

» In the Meantime, Within Our Shores !
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Jan 21, 2020 10:17 am by කිත්සිරි ද සිල්වා

» කොටස් තැරැව්කරුවෝ අගමැති මහින්ද හමුවෙති
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyMon Jan 20, 2020 9:29 pm by nihal123

» Obituary Notice.
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Jan 14, 2020 4:14 pm by ipo

» LOLC Holdings
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyMon Jan 13, 2020 6:04 pm by smallville

» SEYB.N0000 (Seylan Bank PLC)
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptySun Jan 12, 2020 10:06 pm by subash

» Happy Birthday
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptySun Jan 12, 2020 9:16 pm by lanka

» ශ්‍රී ලංකා කොටස් වෙළෙඳපොළ ඉතිහාසයේ දෙවැනි විශාලතම කොටස් ගනුදෙනුව අද
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Jan 09, 2020 9:59 pm by nihal123

» Hayleys MGT
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Jan 09, 2020 5:40 pm by subash

» Browns Investments update
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Jan 09, 2020 10:42 am by The Invisible

» Tokyo Cement
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:48 pm by The Invisible

» Lanka Tiles
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:44 pm by The Invisible

» RCL - Royal Ceramics
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:39 pm by The Invisible

» AEL Access Engineering
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:30 pm by The Invisible

» Sri Lanka central bank to develop a cost-based rate to price loans
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:21 pm by The Invisible

» Dialog Finance
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 08, 2020 10:19 pm by The Invisible

» Tourism Sector
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Jan 07, 2020 2:05 pm by nihal123

» Expolanka
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Jan 07, 2020 1:18 am by Afourer

» Cartoon Today
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyMon Jan 06, 2020 2:41 pm by කිත්සිරි ද සිල්වා

» කොළඹ කොටස් හුවමාරුවෙහි නවතම ජංගම දුරකථන යෙදුම
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptySat Jan 04, 2020 7:36 pm by spw19721

» ඉරානයට කළ ප්‍රහාරයෙන් පසු යුරෝපයේ කොටස් වෙළඳපොළ රැසක් පහළ වැටෙයි
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptySat Jan 04, 2020 1:30 pm by nihal123

» VAT අදාළ නැති කට්ටිය මෙන්න. 50,000 ක ලැයිස්තුවක්
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Jan 03, 2020 11:55 am by nihal123

» How to get Access to: 104 Technical trading experiments by HUNTER
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Jan 02, 2020 9:20 am by Admin

» ලංකාවේ ලොකුම සමාගම මෙන්න. දුම්කොළ සමාගම අභිබවමින් ජෝන් කීල්ස් යළිත් පෙරමුණට
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 01, 2020 7:48 pm by Rana

» Sri Lanka’s LOLC Prepares to Sell Its Biggest Overseas Unit
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 01, 2020 4:43 pm by nuwanmja

» Sri Lanka’s Cargills, Sampath, DFCC Bank says met lending rate ceilings
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 01, 2020 4:26 pm by NIRMALSG

» Dividend Announcement
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 01, 2020 1:16 pm by smallville

» Sri Lanka bank bad loans spike to 4.9-pct, non-banks 9.7-pct in Sept
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Jan 01, 2020 9:29 am by The Invisible

» People’s Bank, Sampath, and DFCC face penalties
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Dec 31, 2019 6:33 pm by nihal123

» NDB.N0000 (National Development Bank PLC)
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Dec 31, 2019 1:55 am by Trend

» COMB.N0000 (Commercial Bank of Ceylon PLC)
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Dec 26, 2019 9:23 pm by spw19721

» Thought for the day...
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Dec 26, 2019 3:41 pm by Topcat

» ඩොක්ටර් ඒලියන්ත වයිට්
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Dec 26, 2019 9:15 am by කිත්සිරි ද සිල්වා

» Why (Happy) People Cheat?
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Dec 25, 2019 8:34 pm by pjrngroup

» Who killed Cock Robin?
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Dec 25, 2019 8:33 pm by pjrngroup

» 65 Ways to Make Money Online
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Dec 24, 2019 9:24 am by Topcat

» සුළු හා මධ්‍ය පරිමාණ ව්‍යාපාරිකයින් ලබාගත් ණය අයකර ගැනීම අත්හිටුවන්න
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Dec 24, 2019 8:50 am by Topcat

» ACL Cables
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptySat Dec 21, 2019 5:34 am by NIRMALSG

» Sri Lanka to up employer EPF contribution to 15-pct, start social security fund
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Dec 18, 2019 2:46 pm by The Invisible

» රාජ්‍ය සමාගම් කොටස් වෙළෙඳපොළට ගෙන ආ යුතුයි
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyFri Dec 13, 2019 12:37 pm by serene

» Sri Lanka can resume high growth path, cut more taxes: Mark Mobius
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyThu Dec 12, 2019 9:29 am by The Alchemist

» රතු වැටෙනකොට
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Dec 11, 2019 2:59 pm by කිත්සිරි ද සිල්වා

» Sri Lanka interest rates should go down, currency will not fall: Mark Mobius
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyWed Dec 11, 2019 11:18 am by The Invisible

» Equation of Happiness Solved
Sri Lanka's Hemas Holdings profitability seen improving: Fitch EmptyTue Dec 10, 2019 5:23 pm by Backstage

January 2020
SunMonTueWedThuFriSat
   1234
567891011
12131415161718
19202122232425
262728293031 

Calendar Calendar

Disclaimer


Information posted in this forum are entirely of the respective members' personal views. The views posted on this open online forum of contributors do not constitute a recommendation buy or sell. The site nor the connected parties will be responsible for the posts posted on the forum and will take best possible action to remove any unlawful or inappropriate posts.
All rights to articles of value authored by members posted on the forum belong to the respective authors. Re-using without the consent of the authors is prohibited. Due credit with links to original source should be given when quoting content from the forum.
This is an educational portal and not one that gives recommendations. Please obtain investment advises from a Registered Investment Advisor through a stock broker

Sri Lanka's Hemas Holdings profitability seen improving: Fitch

Go down

Sri Lanka's Hemas Holdings profitability seen improving: Fitch Empty Sri Lanka's Hemas Holdings profitability seen improving: Fitch

Post by The Invisible on Wed Aug 22, 2018 11:27 am

ECONOMYNEXT - Fitch Ratings says Sri Lanka's Hemas Holdings profitability is expected to improve after earnings fell 20 percent in the June 2018 quarter due to a temporary dip in sales at Atlas, a stationery company it acquired earlier this year.

"The weakness in diversified conglomerate Hemas Holdings PLC's (Hemas, AA-(lka)/Stable) first-quarter financial results is temporary, and is mainly due to the cash flow seasonality of its new school stationary business," Fitch Ratings in a statement Tuesday.

The group with interests in healthcare, consumer goods and logistics acquired Atlas, a statationery manufacturer and distributor, earlier this year for 5.6 billion rupees.



The agency expects Hemas' performance to improve during the remainder of fiscal year to end 31 March 2019.

The stationary business tends to see a significant pickup in demand towards the later part of the calendar year as students return to school after the holidays, it said.



"We have maintained our expectations that the company will achieve revenue growth of 21 percent and EBITDAR margin of 13% for the full year," the ratings agency said.

Profits fell 20.2 percent from a year earlier to 554.3 million rupees in the June 2018 quarter.

"The decline in earnings is due to reduced interest income post utilisation of cash reserves to acquire stationery company Atlas in January 2018 and increased interest costs relating to higher working capital due to strong growth in pharmaceutical distribution and the loan financing for our new logistics park," Chief Executive Steven Enderby told shareholders.

Earnings were 96 cents a share in the quarter, interim results filed with the Colombo Stock Exchange showed. The share last traded at 98.30 rupees.

Hemas was trading 4 rupees lower at 90 rupees on Tuesday.

Fitch Ratings' full statement:

The weakness in Sri Lanka-based diversified conglomerate Hemas Holdings PLC's (Hemas, AA-(lka)/Stable) first-quarter financial results is temporary, and is mainly due to the cash flow seasonality of its new school stationary business, Fitch Ratings says.

The agency expects Hemas' performance to improve during the remainder of fiscal year to end 31 March 2019 (FY19), and we have therefore maintained our expectations that the company will achieve revenue growth of 21% and EBITDAR margin of 13% for the full year.

Hemas acquired its school stationary business - Atlas Axillia (Private) Limited (Atlas) - in the last quarter of FY18. The stationary business tends to see a significant pickup in demand towards the later part of the calendar year as students return to school after the holidays.

Consequently Hemas' stationary segment was only able to break even on an operating profit basis in the quarter ended 30 June 2018, compared with Fitch's expectation that this segment will contribute around LKR1.2 billion to Hemas' FY19 EBIT, which is around 25% of the group's consolidated operating profit.

Operational challenges in Hemas' fast-moving consumer goods (FMCG) business in Bangladesh also played a part in the company's underperformance in 1QFY19, although we believe that earnings from this segment should also improve.

We expect the Bangladesh operation to benefit from Hemas' investments in the distribution network and product re-launches in the past few months. The segment's top line already reflects some of these benefits, rising 6% yoy in 1QFY19, compared with a 10% decline in FY18, when the performance was weighed down by issues with its distribution channels and intensifying competition.

As a result of the above, Hemas' EBITDAR margin fell by 140 bp to 10.2% in 1QFY19 from 11.6% in 1Q18, and compared with our FY19 forecast of 13%.

The company's lease-adjusted gross debt/ trailing 12 month-EBITDAR weakened to 2.0x at end-1QFY19, which is the upper limit for its 'AA-(lka)' National Long-term Rating, from 1.7x at FYE18, but we maintain our view that leverage will recover to 1.3x by FYE19.

The depreciation of the Sri Lankan rupee and regulated pricing in Hemas' pharmaceutical distribution business may threaten the group's profitability in FY19 unless industry stakeholders are able to negotiate a better cost pass-through mechanism with the regulator.

However, this could be partly offset by continued solid performance in the logistics and maritime segment and recovery in the hotel sector, in which occupancy levels and yields show signs of improving. (COLOMBO, 21 August 2018)
The Invisible
The Invisible

Posts : 1411
Join date : 2016-11-28
Age : 40

Back to top Go down

Back to top


 
Permissions in this forum:
You cannot reply to topics in this forum