Economic uncertainty slows Softlogic Group expansion
View(s):The Softlogic Group said this week that its expansion across retail, financial services and healthcare would be considered on a “strictly case-by-case basis” due to the uncertainty in the economy and the unsettling political climate.
This is stated in the group’s 2018/2019 financial review released to shareholders this week.
Softlogic Holdings PLC is one of the largest and most diversified conglomerate in Sri Lanka with operations spanning across retail, ICT, healthcare and financial services while its non-core operations comprise automobile and leisure sectors. There are over 10,000 staff employed in over 50 Softlogic companies in Sri Lanka and Australia.
Group revenue rose by 14 per cent to Rs. 75 billion from the 2017/2018 period, gross profit was up by 17 per cent to Rs. 28 billion, total assets were Rs. 131 billion while post-tax profit rose by 30 per cent to Rs. 3 billion.
The report said that the company faced numerous challenges stemming from the external environment during the financial year 2018/19 which was worsened by political unrest during 3QF19. A general slowdown of the economy and policy uncertainty diminished business sentiment which was further exacerbated by the USD/ LKR and interest rates reaching a higher range.
“The Easter Sunday terror attacks have had a significant economic setback. The aftermath of this incident has affected our businesses with retail stores being closed during the period of unrest. The leisure sector has been devastated by lack of interest in Sri Lanka as a safe tourist destination,” it said.
The group’s Consumer Electronics division operates 208 stores across the island with a total retail space of 326,000 sq. ft.
“Softlogic is also the anchor tenant at the proposed One Galle Face at Shangri La where a total retail space of 110,000 sq. ft has been obtained. The mall is anticipated to open despite the closure of Shangri La Hotel in the upcoming months. Softlogic Restaurants will soon launch its fourth international franchise with Crystal Jade, a Singapore-based Chinese restaurant with one- MICHELIN star. The first Crystal Jade restaurant will be opened at One Galle Face by Shangri La,” the report said.
Asiri Hospital Kandy was opened in April 2019. This 190-bed private hospital equipped with state-of the- art medical technology and expertise is a first of- its-kind in the Central Province. Asiri Hospital Galle, which was acquired in November 2018, would be upgraded to include a CT and MRI by June 2019.