JKH profits up

John Keells Holdings PLC (JKH) saw a year of “ups” and “downs” on the back of challenging macro environment, according to Susantha Ratnayake, Chairman of the company, reviewing the annual results for the year ended March 31, 2008. Group profits increased 40 percent to Rs 5.52 billion in the year with revenue increasing by 27 percent to Rs. 41.81 billion in this period.

Being unable to fully achieve the high goals to increase its local and regional investments, operating assumptions and hurdle rates for local investments being difficult to establish due to the uncertainties surrounding the local operating environment and prevailing interest rates, anticipated inflation were termed as ‘downs’ by Ratnayake.

For “ups”, he highlighted focusing on building better internal structures and processes and refining the compensation and benefit schemes to attract and retain the talent required for the company’s future plans. “A number of our businesses and functions achieved significant milestones in productivity enhancement and organic expansion under the defined strategy, we gained domain knowledge and insights into identified regional countries and have created networks that would facilitate a smooth and successful entry into such countries and in the prevailing volatile global capital market conditions, we secured long term funding from the International Finance Corporation (IFC) on terms that recognised the strength and potential of the group,” he said.

He said that the escalation of the North-East conflict, rising commodity and oil prices, interest rates continuing to remain high against the backdrop of high inflation, have had varying impacts on the performance of the company’s industry groups.

“While Transportation (the main profit earner for the group contributing 53 percent of the group's post tax profits), Property, Financial Services, Plantation Services and the holding company recorded improvement in profits, Leisure, Information Technology and Consumer Foods and Retail achieved profits which were lower than that recorded during the previous year,” he added.