Aitken Spence profits up despite tourism challenges

Diversified blue-chip conglomerate, Aitken Spence has reported increased third quarter 2006-7 profits despite a downturn in the leisure market. In its results sent to the Colombo stock exchange, the company said it recorded an increase of 26.9% in profit before tax over the corresponding period in the previous year, while net profit attributable to shareholders increased by 35%.

The Group’s net revenue increased by 50.7% up to Rs13.68 billion for the nine months, comparative to last year. “Contribution from the Sri Lankan hotel properties declined due to increased challenges faced by the local tourism industry. The travel warnings issued by several countries subsequent to the escalation of hostilities between the government and the LTTE has had a significant effect on tourist arrivals to Sri Lanka,” Aitken Spence said in a statement.

However Deputy Chairman and Managing Director of Aitken Spence & Co., Ltd J. M. S. Brito is optimistic about the future of the industry. “While the Group has made strides in power generation, marine and financial services, our tourism sector continues to face challenging times. Although we are increasingly looking at the wider region to expand our hotel operations, we are confident about Sri Lanka’s vast potential for tourism.

We are confident that the new Minister of Tourism will lead the industry with renewed vigour and vision,” he said in the statement.
The Group’s Maldivian hotel operations, Adaaran Hotels & Resorts witnessed healthy growth, supported by the commencement of its fourth resort Adaaran Select Huduranfushi in December.

Aitken Spence became the first Sri Lankan company to venture overseas in the field of port efficiency management and training. Programs are currently being conducted successfully in the Port of Durban, South Africa. This venture has resulted in high demand from other international ports for similar services.

Further significant developments this quarter came in from the commencement of operations of Spence Shipping (Pvt) Ltd., agents for Hapag Lloyd- the Hamburg-based container liner shipping company which has a presence in more than 100 countries. During the reporting period Aitken Spence entered into a joint venture with MMBL Money Transfer, a principal agent for Western Union Money Transfer. Western Union is the global leader in money transfer services.