Colombo Cold Stores revenue increases by 16% in FY 2018/2019, Profit After Tax down 49%

Jaykay Marketing Services generated 77% revenue

 

Sri Lanka’s leading conglomerate John Keells Holdings (JKH) owned key retail listed entity Colombo Cold Stores (CCS) consolidated revenue had increased by 16% to Rs. 59 billion with fully owned subsidiary Jaykay Marketing Services (Pvt) Ltd – JMSL accounting for approximately 77% of revenue and CCS & The Colombo Ice Company (Pvt) Ltd – CICL (Manufacturing sector) accounting for the balance. However, Annual financials highlight that the consolidated EBIDTA was recorded at Rs. 4 billion compared to Rs. 4.7 billion in previous year, recording a decline of 14%. Consolidated profit after tax for the financial year amounted to Rs. 1.3 billion, a decline of 49% compared to the previous year.

Chairman of JKH Krishan Balendra in his latest review points out that the manufacturing sector recorded a top line of Rs. 13.9 billion, which is a marginal increase of 1% which reflected the significant volume decline in the carbonated soft drinks segment despite the volume increase in the ice cream segment, whilst Subsidiary JMSL recorded a revenue of Rs. 46 billion, a growth of 21% supported by the addition of new outlets, a more relevant customer value proposition, effective loyalty programme and aggressive promotions.

In his review Balendra further outlines that consolidated gross margins reduced by 2% due to consumer spending remaining subdued necessitating a careful balance in pricing of products despite the escalation of cost pressure on raw materials and overheads due to uneven supply of materials due to adverse weather patterns, steep depreciation of the rupee and the increase in oil prices. Company’s consolidated profit before tax amounted to Rs. 2 billion, a decline of 46% as the selling, and distribution cost increased by 34% to support the branding and marketing activities of the new impulse ice cream products introduced to the market and rebranding costs of the retail business. Further the finance costs had increased by Rs. 615 million as a result of the increased borrowings obtained to fund the store expansions and the construction of the new frozen confectionery plant in the Seethawaka BOI zone.

 

– Reporting by Devendra Francis

The post Colombo Cold Stores revenue increases by 16% in FY 2018/2019, Profit After Tax down 49% appeared first on Adaderana Biz English | Sri Lanka Business News.



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