Sri Lanka’s JAT Holdings records highest ever PAT during the third quarter (Q3) of FY 2021/22 - Opportunity Sri Lanka
Sri Lanka’s JAT Holdings records highest ever PAT during the third quarter (Q3) of FY 2021/22

Sri Lanka’s JAT Holdings records highest ever PAT during the third quarter (Q3) of FY 2021/22

The Morning: JAT Holdings PLC has delivered a rise in group profit after tax (PAT) of 232%, during the third quarter (Q3) of FY 2021/22, despite subdued market conditions while recording the highest-ever PAT.
It is against the same period in the year prior, to Rs. 717 million for the quarter, while PAT for the trailing 12-months (TTM) stood at Rs. 1,102 million. Export revenue share also rose to 22% of total revenue, against 9% achieved during the year prior.

Discussing the financial performance of the company, JAT Holdings PLC Director and Chief Executive Officer (CEO) Nishal Ferdinando said: “It is with great pleasure that we present investors with the solid results we’ve achieved over the last quarter, just six months since our initial public offering (IPO). These metrics were achieved amidst a subdued market environment and other challenges, volatile exchange rates, and a scarcity of materials in the global market. However, we adapted to the market conditions and remained agile, maintaining our gross profit margins. We also leveraged on our strong supplier relations and continuous improvements to our production processes through the implementation of lean and six sigma principles to maintain our gross profit targets.”

The nine months under review also witnessed revenues rise 72%, while gross profit margins of the company remained steady at over 30%. Investors will also be pleased to note that EPS (of trailing 12 months) stood at Rs. 2.16. This resilient financial performance comes as the company begins Q4, which has demonstrated to be the best quarter for JAT Holdings and the total coatings industry and accounts for as much as 45% of PAT historically due to seasonal factors.

Commenting on the company’s immediate future plans, JAT Holdings PLC Founder and Managing Director (MD) Aelian Gunawardene added: “At this rate, we’re on track to meet our Rs. 1.2 billion PAT target for the current financial year. As a result of our strong financial performance, we have also been able to secure stocks of raw materials and other items for at least the next five months, which gives us flexibility amidst the current challenges facing imports. Furthermore, we are very enthusiastic about Q4 as we know it to historically be the most profitable quarter for us due to seasonality. Thus, backed by the resilient performance we have delivered over a challenging Q3, investors can look forward to an even more robust and rewarding performance during Q4. We expect to end FY 2021/22 having met all targets and exceeding expectations in every way. Furthermore, our R&D plant, which is scheduled to be fully functional by Q2 of FY23, will help to further boost our gross profit margins, enabling us to deliver exceptional value to our investors well into the future.”

OSL take:

Many Sri Lankan businesses recorded growth and profits despite facing challenges posed by the global Covid 19 pandemic. It is a clear indication of the strength and growth of the country’s private sector as well as the business conducive environment in the country. Sri Lanka is also engaged in an aggressive development programme while also positioning the country as an emerging business destination in the South Asian region. These moves have been further supported by Sri Lanka’s geographical positioning in the Indian Ocean and the many trade agreements as well as concessions enjoyed by the country. With Sri Lanka’s economy treading a growth path showing a steady expansion in all key economic sectors, foreign businesses/investors could confidently explore the growing business/investment opportunities in Sri Lanka.

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Article Code : VBS/AT/09022022/Z_4

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