Aitken Spence posts 26 pct rise in profits

Aitken Spence posted a 26 percent growth in profits attributable to shareholders in 2007/8 and said the company was eyeing opportunities to invest despite the adverse environment faced by both the national and global economies.

“We strongly believe in the country’s great potential and remain optimistic on the dawn of peace. The Sri Lankan economy has proven to be resilient and we see opportunities to continue investing heavily,” J. M. S. Brito, Deputy Chairman and Managing Director, Aitken Spence and Company PLC, said in his annual statement.

The diversified blue-chip posted a net annual profit rising 24 percent to Rs.2.8 billion while group revenue surged 39 percent to Rs.27.5 billion. Earnings per Share stood at Rs.68 while the Return on Equity was at 17 percent.

“The group which has invested in the Sri Lankan tourism industry saw restricted profitability and potential returns from its local resorts,” he said, adding that the lack of high yield travellers compounded by strong competition amongst beach properties, rising wages and energy costs further constricted profitability.

The company noted that external factors such as rising global energy prices translated into higher operational costs especially for businesses reliant on transportation related services.

Mr. Brito has said that due to escalating costs in utilities and transport, the integrated logistics and freight forwarding divisions of the group posted good profits, outperforming their competition through differentiation by means of enhanced quality and value added services offered.

“The suspension of the multi country consolidation activity outside the Port of Colombo adversely affected our integrated logistics division. This is an issue of concern as not only has this eliminated a stream of revenue to the division but to the entire country whilst having an adverse impact on the hub status of the Port of Colombo,” added Mr. Brito.

He said the oil palm cultivation had paid rich dividends during the year, with Elpitiya Plantations recording impressive yields for the crop and a healthy contribution to the company’s bottom line.