Softlogic revenue hits Rs. 15.2 b

• Growth resilient despite reducing purchasing power and inclement weather 

 Revenue growth of 6.2% to Rs. 15.2 billion in 1QFY18 from Rs. 14.3 billion in 1QFY17 was resilient despite tightened monetary policy, contracting purchasing power and inclement weather, all contributing to lacklustre demand, Softlogic Holdings Plc said in its latest results report. 

The prime contributors to the group’s topline were Retail (32.0%), ICT (25.6%), Healthcare Services (19.9%), Financial Services (16.7%) and Automobile (3.0%). 

The leisure sector is expected to improve its contribution and reduce its overall losses in the period to come with Mövenpick Hotel’s monthly trajectory of occupancy, improving as anticipated. 

Intermittent full occupancy in today’s context in both hotels – Centara Ceysands Resort & Spa and Mövenpick Hotel Colombo– augurs well for the sector.

Gross Profit improved strongly by 21.2% to Rs. 5.4 billion, reflecting a GP margin improvement from 31.5% in 1QFY17 to 35.9% in 1QFY18. Group synergies and economies of scale helped profitability.

The healthcare sector was a key contributor to Gross Profit growth during the period, with increasing demand and bed occupancy at the organisation’s four hospitals augmenting performance in an unprecedented manner.

Operating profit increased 34.5% to Rs. 1.8 billion during the first three months of the financial year. An improvement in operating profit margins from 9.6% in the comparative quarter to 12.2% was witnessed in 1QFY18. The group’s continuous focus on cost discipline and efficiency measures led to improvements in cost margins. 

Operational expenses increased 17.5% to Rs. 4 billion. Distribution costs declined 21.6% to Rs. 667.8 million while administrative costs registered an increase of 30.6% to Rs. 3.3 billion during the quarter particularly due to the new city hotel.

EBITDA for the quarter improved a strong 37.2% to Rs. 2.5 billion from Rs. 1.8 billion in 1QFY17. Finance Expenses increased 39.6% to Rs. 1.3 billion during the quarter owing primarily to increasing interest rates.

Profit before tax improved 8.8% to Rs. 659.6 million, pushing the profit after taxation for the first three-months of FY2017/18 to Rs. 429.6 million after a tax charge of Rs. 230 million (Rs. 99.1 million in 1QFY17).