Expolanka Holdings PLC recorded an improvement in operational profitability for the second quarter of 2016 with revenue and gross profit also recording a growth fuelled by better performance in the group’s regional markets.
According to unaudited figures released to the Colombo Stock Exchange, the company improved its operating profit due to notable performances in the logistics and leisure sectors. The 7% growth in operating profit was driven by volume growth in the US trade lane and a recovery in business from the Europe trade lane.
However, profit attributable to equity holders declined to Rs. 243 million due largely to a decline in other income resulting from a write down in passive investments and a significant drop in exchange gains in comparison to the previous year.
The revenue recorded for the second quarter of FY2016/17 increased to Rs. 16.2 billion from the 13.9 billion recorded in the same period last year, marking a 17% increase driven by the core logistics sector.
“It is noteworthy that the logistics sector performance is significant in comparison to the same period of the previous financial year which benefited from an increase in volume from our largest trade lane,” said Group CEO Hanif Yusoof.
“As we had anticipated, margins took a dip and then corrected to a more sustainable level this year. Moreover both air and ocean freight volumes have recorded a significant volume growth for the period which is very encouraging for the group as we move forward with new plans.”
The Group’s core markets in India, Bangladesh and Sri Lanka performed very well due to the recovery in business from the Europe trade lane. Far East businesses in Vietnam and Hong Kong also recorded notable performances, contributing to the overall sector growth. Operations in UAE and South Africa recorded lower profit growth primarily due to increased investments into account developments made during the period.
The leisure sector recorded a growth of over 50% from the corresponding period in the previous year. The group’s outbound business travel operations recorded a healthy growth for the period. Currently, the Group is focusing on expanding the leisure business into other verticals.
The ventures sector recorded a revenue of 1.2 billion for the quarter. Yusoof noted that the Group is currently looking at exiting from passive investments that contributed negatively to profitability whilst also ensuring an appropriate value realisation to the shareholders.
Expolanka Holdings PLC has been in operation since 1978 and has a workforce of over 2300 employees. Headquartered in Colombo, Sri Lanka, the Group’s network spans more than 20 countries in Asia, Africa, USA and the Middle East.