Abans Cool & Cool offer extended
By Ashwin Hemmathagama
The Colombo stockmarket after dipping during the week to Thursday rose on Friday amidst hectic local buying but little foreign purchases.
Brokers said the market rose on expectations that JKH would release its six-month results this week while the results of other companies were likely to follow.
The market eased earlier in the week with the All-Share Index falling by two points and the Milanka Index easing by five points by Thursday, but both indexes rose by five and ten points, respectively the following day.
On Tuesday JKH fell by Rs. 1.50 and NDB by Rs. 1.75 down due to substantial foreign sales. However, the indexes gained as results of Commercial Bank were announced.
According to the six-months ended as at September 30, 2001, the bank's net profits went up by 13.8 % to Rs. 741 mln while gross income moved up by 55.7 % to Rs. 6.5 bln.
"The market shows signs of losing some gains it made during the last few weeks on the back of some weak corporate earnings.
However, closer to the elections speculation is likely to overtake company fundamentals and we expect the market to surge ahead," a broker at S.G. Securities said.
The Ceylon Chamber of Commerce has urged the Central Bank to consider withdrawing from the Asian Clearing Union (ACU) because it is of little benefit to Sri Lankan exporters, importers and commercial banks.
The chamber said in a statement that both the Sri Lanka Banks Association and the Exporters' Association of Sri Lanka have also earlier recommended withdrawal from the ACU for the same reasons.
It said the ACU has proved to be cumbersome and has placed unnecessary constraints on exporters in terms of delayed settlement of payments particularly in respect of transactions concerning the various branches of banks in member countries.
Lanka Hospital Corporation (part of the Apollo Hospital Group of India) is setting up a Rs. 2 billion, super-specialty, 500-bed hospital in Colombo scheduled to open early next year.
The National Development Bank (NDB), the country's largest provider of project funding, on Wednesday concluded a syndicate debt package of Rs. 1 billion in long term debt to part finance the hospital.
The NDB, as lead arranger, was able to mobilise Rs. 600 million debt through a consortium of commercial banks, comprising Hatton National Bank and Seylan Bank in addition to NDB. The term funding, as well as the proposed public debenture issue of Rs. 400 will be partly guaranteed by the IFC, a member of the World Bank group. DFCC Bank is also participating in the syndicate by fully underwriting the proposed debenture issue as well as providing a partial guarantee for the same.
By Akhry Ameer
Standing from the recreation facility all one sees is mountains of containers on a six-acre land extent. Arranged in a pattern are washing bays, repair workshops, customs office and warehouse, staff rest rooms, fuel facility, a rigging facility and office.
As the trailer carrying an empty container approaches, it is checked by surveyors for damages, repairs are conducted if necessary, the inside is washed and the container is stacked away, ready to transport its next load upon request. This is the container depot of Logistics International Limited (LIL), the winner of a Sri Lanka National Quality Award for 2001.
The company talks of some of the world-renowned management techniques such as the Balanced Scorecard, Japanese 5S System of housekeeping, FIFO queues and a chalk mark system developed by the company itself. The Sunday Times Business toured this facility to ascertain what it takes to be a quality award winner in a business of its kind.
LIL, selected as the winner in the Small Scale Service Category of the Sri Lanka National Quality Awards 2001 recently, is a member of the transportation arm of the Hayleys group and serves some of the major shipping lines and container operators around the world.
The company has an on-line system that enables it not only to track its own operations, but it also provides connectivity to its international clients through a password based access system to keep them updated of the empty containers, workshop, repairs, billings, etc. The organisation's IT strength spreads to the level of clerical staff who each have an e-mail address for internal and external communication. LIL has also a revolutionised chalk mark system that enables staff to verify the status of each container on site.
The company has also adopted many practices to keep itself fine-tuned. "We operate throughout the year with a break only for May Day. We have introduced independent audits for continuous improvement and make sure that all stakeholders are involved in the operation and development of the company. Our IT system automatically triggers e-mail reports to our customers and the balanced scorecard approach we follow is available on the network to all our staff," explained Chandima Allis, General Manager of LIL.
LIL whose aim is not to be the biggest depot but the most productive, has left no stone unturned to reach the top. The company has addressed all areas and has specific plans such as staff welfare, community development, environmental orientation, disaster management and recovery, etc.
The win for LIL making it the first container depot and the first winner in the Sri Lankan shipping industry adds to one of its many firsts. The company is also the first and only container depot in Sri Lanka with the ISO 9002 Quality Management System Certification, besides being the winner of Textainer 'Depot of the Year 2000' out of 28 depots in the world's southern shipping region.
LIL has a container storage capacity of 2800 TEUS stacked up six containers high, in-house transformer generator, fuel facility, adequate container handling machinery, etc. at its facility in Welisara. It also has specific bay areas for repairs, washing, customs office, stuffing and de-stuffing warehouses, staff quarters, etc.
The company functions effectively with a team of 41 working in their different capacities and boasts of the highest number of qualified surveyors certified by the Institute of International Container Lessors (IICL), USA.
Sri Lankan tea exports up to end September this year rose by 4.3 million kg to 220 million kg from last year's 215 million, tea broker John Keells Ltd said.
Revenue earnings jumped 19 % (Rs. 7.45 billion) to Rs. 46.08 billion to September this year from Rs. 38.62 billion in the same period in 2000, it said in a report.
Bulk tea exports still account for the larger component of Sri Lanka's exports with 63.8 %, but this component has been gradually declining and giving way to the higher value segment of exported tea. Along with the increased total quantity exported, the value added component has improved to 36.2 % from 35.8 % last year.
The report said packet tea exports record the more significant increase with 28.7 %, up from last year's 24.9 %. Tea in bags and blended teas account for 4.4 % and 1.6 % of exports, respectively.
"The value added segments in total – 36.2% of exported quantity account for 45.3 % of all revenue whilst the large 63.8 %, of bulk exports, netted in only 54.7 % of the foreign exchange. In this light, it makes interesting analysis to note the vast gap between the unit values (rupee value per kg) of bulk exports, which is Rs. 179.9, with those of packetted teas – Rs. 205.9, tea bags – Rs. 469.5, instant tea – Rs. 574 and blended teas – Rs. 459.4, clearly pointing to the larger benefits to Sri Lanka from value addition," the report said.
The Commonwealth of Independent States (CIS) continued to be the largest importer, increasing their purchases to 46.6 million kg to end September, up 4.1 million kg or 9.6% from the previous year. Whilst U.A.E, Syria and Turkey rank in that order after the CIS in terms of imported volumes, it is important to note the sharp decline in the off-take by U.A.E and Turkey, recording a drop in volume by 7.6% and 18.8% respectively, the report said.
The first destination is essentially a terminal market for 'Ceylon Tea' while the latter is more of a 'gateway' to other consuming countries.
Syrian imports have steadily grown this year to register an increase by 17.1% to make a total of nearly 19 million kg. The most significant increase this year is seen from Libya. Their purchases have grown 124.5% from 4.8 million kg last year to 10.9 million kg this year, and now rank the 5th largest importing country for Sri Lanka tea.
"Most other leading buyers of our teas have maintained satisfactory levels of purchases, but Egypt is the only exception where a 62% drop is seen this year. The benefits of the COMESA membership and a bumper harvest in Kenya are attributed to this shift in their purchasing pattern," Keells said.
While global airlines are either downsizing or crashing after the US crisis, Dubai-based Emirates surprised the recession-hit industry with a stunning aircraft order worth US$15 billion.
In a dramatic gesture underlining its confidence in the entire long-term future of Dubai and air travel, the award-winning airline announced that it is acquiring 25 Boeing 777s, 22 Airbus A380s, eight Airbus A340-600s and three A330s by the end of the decade.
Emirates' initial order, signed at Britain's Farnborough Air Show in July 2000 as a Letter of Intent, was for seven A380s, making it the world's first airline to commit to the A380.
It added a further 15 A380s to give it a total fleet of 22 firm orders, valued at US$7 billion plus ten options, 25 new Boeing 777s in two versions and valued at US$6.6 billion, eight A340-600s valued at US$1 billion and three A330s valued at US$415 million.
The combined value of the 58 Boeings and Airbuses on order is $15 billion, which the airline will raise without a dollar in subsidy from any source to boost Emirates' total fleet to 100 by the year 2010. The visionary 21st century fleet plan was unveiled at Dubai's International Air Show last week opened by His Highness General Sheikh Mohammed bin Rashid al Maktoum, Crown Prince of Dubai and UAE Defence Minister, and Emirates' Chairman Sheikh Ahmed bin Saeed Al-Maktoum.
"Our unwavering aim is to make this the best place to do business, the top tourist destination and transport hub of the region and the undisputed commercial and communications capital of the Middle East. This record-breaking aircraft order is a key component in this charismatic strategy," Sheikh Mohammed said.
Sheikh Ahmed said the timing of this order — hard on the heels of recent events — was no coincidence. "We are determined not to allow present difficulties to deflect our resolve." "Short term, airlines have seen their business dip. Long term, air travel remains firmly on course to double in the next 15 years. Even today we need larger aircraft, let alone in five years when our first A380 leaves the runway at Dubai. "By 2006, as one of the world's fastest-growing and most successful airlines, we expect to be flying more than twice as many customers as we do now. To do this, we need more, larger aircraft from the two best manufacturers in the world. The arithmetic is inescapable," he said. Emirates will use the A380s on routes from Dubai to London, Frankfurt, Singapore and other cities in Europe, Asia, North America and the Pacific. Its maiden flight will not take place until 2004, leaving Emirates time to select the best engines.
The Central Bank (CB) of Sri Lanka is planning to raise a total of US$ 250 million from Sri Lanka Development Bonds (SLDBs) this year from the open market in view of fewer opportunities to raise money from donor agencies.
The first issue of SLDBs' launched by the CB on November 1 was heavily over-subscribed within the first few hours of the launch, the Bank said in a statement.
"In view of diminishing opportunities for raising further funds from international donor agencies due to competition from other developing countries at a time when long term aid flows are declining coupled with difficulties in raising additional funds from domestic markets without causing an adverse impact on domestic interest rates, it has become desirable to explore the possibility of raising funds from external sources. It is expected to collect a total of US$ 250 million from SLDBs', " the Bank said.
The CB said a total of US$ 105 million bids were received for the first tranche of US$ 50 million with the offer closing at 4.00 p.m. on November 2. The issue was subscribed by authorised Forex and Primary Dealers. "The offer will be re-open for a further tranche in the near future," the statement said.
These bonds were issued by the Central Bank of Sri Lanka on behalf of the government in terms of the Foreign Loans Act No. 29 of 1957. SLDBs' are a US-dollar denominated bond issued for the purpose of raising funds from external sources under the government's borrowing programme for the year 2001.
In the past Sri Lanka has raised funds from international markets successfully. In 1997 Citibank N.A. and ING Bank NV raised funds amounting to US$ 50 million by a Floating Rate Note of 3-year maturity. This loan has been fully paid up.
Interest on SLDBs will be paid to the registered holders semi-annually based on London Inter Bank Offered Rate (LIBOR) per annum plus a margin of 175 basis points per annum in the first year and LIBOR per annum plus a margin of 225 basis points per annum in the second year.
The minimum denomination of SLDBs will be US Dollars 100,000 and any higher denominations will be in multiples of US Dollars 10,000. SLDBs will be free of income tax and are exempted from stamp duty and withholding tax.
The Trans Asia Hotel has announced the creation of an Employee Share Trust, which will enable employees to participate in the dividend stream to shareholders.
The announcement was made at the customary annual staff service awards ceremony held on October 30. Awards were given to 54 staff members completing 15, 10 and 5 years of service to the hotel.
A hotel press release said the management attributed the improved performance of the hotel to the dedication of its staff.
It said the hotel has for long been exploring various alternate mechanisms for profit sharing with its employees in the belief that such participation will motivate employees to improve the overall results of the company.
The Industrial Technology Institute (ITI) will be one of the state sector institutions that will receive assistance from a UNIDO project for upgrading the national metrology infrastructure in Sri Lanka.
The project is a part of the UNIDO Integrated Industrial Support Programme for Sri Lanka on Quality Standardisation and Metrology. This component of the UNIDO project has the main objective of strengthening the quality standardisation and metrology capabilities in the country with particular emphasis on certification of quality and environmental management systems and development of accredited chemical microbiology laboratories, an ITI press release said.
With regard to upgrading of facilities, a fully sophisticated air-conditioning system at a cost of approximately US$ 100,000 will be installed to achieve the required temperature and humidity conditions to acceptable international levels. Equipment to the value of approximately US$ 180,000 will also be donated.
Two officers are presently obtaining training at the National Physical Laboratory in Australia in the areas of mass metrology and thermometry.
