Wednesday Dec 11, 2024
Wednesday Dec 11, 2024
Friday, 12 July 2019 00:00 - - {{hitsCtrl.values.hits}}
Mercantile Investments and Finance PLC (MI) has just released the company’s latest Annual Report under the theme ‘A Profound Journey’.
Despite a challenging business environment for the finance company sector, the company reported a robust financial performance yet again for the FY 2018/19, posting a Net Profit Before Tax (NPBT) and Net Profit After Tax (NPAT) of Rs. 787 million and Rs. 458 million respectively.
However, the adoption of the SLFRS 9 new accounting standard and the observed slowing down of collections due to external economic factors had a direct impact on the non-performing loans and the Company’s impairment charges which increased year on year and resulted in a 8% and 11% reductions in the NPBT and NPAT respectively.
At a moment when the company celebrates 55 years in business, MI’s Annual Report reflects upon this year’s performance and the successful journey undertaken thus far, and MI’s corporate strategy in facing future sector challenges.
Managing Director Gerard Ondaatjie in his ‘Managing Director’s Review,’ said: “In this challenging backdrop, Mercantile Investments was receptive to market changes and took a proactive approach, taking steps to curtail immerging risks, whilst making necessary strategic maneuvers towards longer term organisational goals and aspirations.”
Through a committed effort, the company was able to maintain a strong capital position which is reflected from the prudential capital adequacy ratios published. The Tier 1 Core Capital Risk Ratio and the Total Risk Weighted Capital ratio stood strong at 14.98% and 16.69%, well above the enhanced BASEL II requirements of 6% and 10% respectively.
The company opened three new branches in Puttalam, Ja-Ela and Malabe in 2019 but will moreover continue to pursue its consolidation strategy of optimising the existing branches of 39 locations to maximize business opportunities, staying optimistic about a speedy revival of the existing challenging business conditions.
MI is geared with a comprehensive strategic plan for the next three years to drive its business towards a sustainable growth trajectory and in this pursuit, was also able to take appropriate measures since 2018 to enhance employee capabilities, to stay competitive and face challenges posed by the industry and the economy.
Mercantile Investments and Finance PLC is a Licensed Finance Company under the Finance Business Act No. 42 of 2011, listed on the DiriSavi Board of the Colombo Stock Exchange.
