Sri Lanka’s Hemas Holdings group revenue records a growth of 43.4% over last year during 1H22.
The Morning: Hemas Holdings announced in a statement that it posted a cumulative group revenue of Rs. 52.0 billion for the first six months of 2022 (1H22), a growth of 43.4% over last year.
It added that the group operating profit of Rs. 4.7 billion recorded a growth of 79.1% over the previous year, whilst the group earnings of Rs. 2.2 billion was an increase of 41.1%.
The group posted a revenue of Rs. 27.1 billion for the quarter, a growth of 36.8% over the same period last year, driven by defensive core sectors and improved performance of key focus areas including international business and exports. Despite the margin pressure witnessed with high input costs and supply chain challenges, the operating profit for the quarter of Rs. 2.7 billion was an increase of 74.1% against last year, in which pandemic-driven disruptions to businesses were present. The same growth momentum was not translated to earnings due to significant increase in finance cost resulting from increased borrowings to fund working capital. Group earnings stood at Rs. 1.2 billion, an increase of 21.9% over last year.
Cumulative revenue for the consumer brands sector witnessed a 47.1% growth over last year to reach Rs. 18.8 billion during the period. Revenue from the international vertical improved by over 6% against last year with the increased focus for exports in both home and personal care and learning segments. Operating profit for the period stood at Rs. 1.9 billion, a growth of over 100% against last year resulting from the revenue growth and cost optimisation initiatives. Investments made for increasing working capital requirements limited the earnings growth to 53.2% over last year.
The sector reported a revenue of Rs. 10.1 billion for the quarter, a growth of over 35% against last year. The operating profit and the earnings grew by 81.2% and 23.8% against last year to reach Rs. 1.2 billion and Rs. 616.1 million respectively. Improved performance of the learning segment contributed to the 16.1% growth in sector revenue on a quarter-on-quarter basis.
“We expect the economic pressure and uncertainty to be heightened in the quarters to come. Nevertheless, Hemas will continue to focus on the strategic pillars that enabled the group to sustain and deliver balanced growth during pressing times. Backed by a resilient core portfolio and the extensive innovation pipeline to cater to changing consumer needs, volume-driven market share gains will be prioritised by all businesses in the short-medium term,” the group stated.
“Regional expansion via internationalisation and exports will be a key focus area. On the back of the hyper inflationary environment, strategies on strengthening the group’s liquidity position via effective working capital management, increase in digitisation efforts, realising of group-wide synergies and implementing efficiency improvement initiatives will be further integrated into the business operations.
“The passion and competence of the team at Hemas is the backbone behind the success of the group. As we look forward into the future, we are positive that the group is well-positioned to steer through the near-term challenges and continue to create value whilst fulfilling our purpose to ensure every family has a better tomorrow.”
OSL take:
Sri Lanka’s private sector continues to be the country’s engine of growth with a majority of the businesses in the country recording positive growth and profits despite facing challenging conditions at present. It is also indicative of the strength and resilience of Sri Lanka’s overall economy. The country’s economy has shown great resilience through the years and is once again on the path to recovery after facing the global pandemic and its ensuing economic challenges. However, Sri Lanka is working towards becoming an emerging business destination in the South Asian region supported by the country’s geographical positioning in the Indian Ocean and the strong trade ties enjoyed by the country. The ongoing crisis has on the other hand has also opened up a host of new business opportunities covering several key economic sectors. Many foreign economic experts have already predicted a growth in Sri Lanka’s business potential. Given the positive performance of the country’s private sector and the overall economic resilience of the country, foreign businesses/investors could confidently explore the growing business/investment opportunities in Sri Lanka.
| Article Code : | VBS/AT/18112022/AT_3 |