Sunshine Holdings delivers record FY24 results propelled by healthcare and consumer sectors
Daily FT: Diversified Sri Lankan conglomerate Sunshine Holdings PLC has recorded resilient revenue growth amidst the backdrop of moderately stable macroeconomic conditions, reporting notable top-line and bottom-line growth during the year ended 31 March 2024.
Group’s Healthcare and Consumer sectors led growth while the healthcare segment remained the major contributor to total Group revenue in FY24. Sunshine recorded a consolidated Group revenue of Rs. 55.5 billion for the year ended 31 March, a 7% Year-on-Year (YoY) growth. Profit after tax (PAT) for the period in review increased by 66.4% to Rs. 6 billion. The gross profit also increased by Rs. 3.7 billion, representing a robust 27.6% YoY growth, primarily driven by the margin expansion in both the healthcare and consumer segments. The gross profit margin for the period stood at 31%, marking a significant improvement of 500 basis points compared to the previous year.
The Group’s robust financial performances were declared at a time when the International Finance Corporation (IFC) announced a proposed equity investment of up to Rs. 3.2 billion in its healthcare arm, Sunshine Healthcare Lanka (SHL). Subject to satisfaction of conditions, IFC will own approximately 14.7% of SHL. The investment further underscores the confidence of international agencies in Sunshine Holdings’ growth plans.
The Group’s Healthcare business emerged as the largest contributor to Sunshine’s revenue, accounting for 50% of the total, while Consumer Goods and Agribusiness sectors of the group contributed 34.8% and 15% respectively of the total Group revenue. The Group operating profit (EBIT) closed at Rs. 8.7 billion, an increase of 23.7% YoY. Additionally, the Group’s finance cost for the period in review decreased to Rs. 1.2 billion from Rs. 1.5 billion in the previous year.
Sunshine Holdings PLC Chairman Amal Cabraal remarked, “Despite the persistent economic challenges during FY24, Sunshine Group has shown remarkable resilience and agility. All key sectors have delivered robust performance. Our steadfast commitment, strategic execution, prudent fiscal management, and innovative practices have enabled us to successfully navigate the market’s complexities.”
Sunshine Holdings Group CEO Shyam Sathasivam stated, “Our achievement of crossing the Rs. 6 billion PAT mark for the first time in Sunshine Holdings’ history is a testament to the exceptional capabilities and dedication of our team. It is their commitment and spirit that have driven our business to this remarkable milestone. The Group’s robust internal processes, investments in digital capabilities, and focus on operational excellence have been pivotal in delivering this performance. I am proud of our team’s ability to adapt and excel in a challenging economic landscape, and confident that their continued resilience and ingenuity will propel us towards even greater achievements in the future.”
OSL take:
The growth in profits recorded by Sunshine’s healthcare and consumer goods is indicative of the overall expansion in Sri Lanka’s healthcare and consumer goods sectors. After facing challenging economic conditions in the past few years, key economic sectors in Sri Lanka are once again on the growth path with local businesses recording growth and profits. The country’s merchandise index has shown an overall growth in performance. With Sri Lanka working towards becoming a regional hub supported by the country’s geographical positioning in the Indian Ocean and the strong trade ties, there’s a growth in business/investment opportunities in the country, especially in the manufacturing and consumer goods segments. Given the growth and business potential in these sectors, foreign businesses/investors could confidently explore the expanding opportunities in sectors like healthcare and consumer goods. Foreign businesses could also look at forming collaborations with local businesses engaged in these sectors with the aim of further expansion.