LOLC group pre-tax profits for the first half of 2010/11 soared to Rs. 4.5 billion with post tax profits of Rs. 3.9 billion, the company said this week.
Compared with the previous year, pre-tax profits grew by 370%. The company’s acquisitions made in the previous financial year contributed well to the bottom line along with other income, which increased by 215% to reach Rs. 2.7 billion at the end of the second quarter, it said in a statement.
Revenue of the group grew by 500% over last year, mainly contributed by the trading companies in the Brown & Co PLC cluster. “The trading profits complemented well to the group’s financial services related business income of Rs 5.8 billion, a 22% growth over last year. The borrowing costs continued to come down in line with the sliding interest rates with the group raising funds at attractive rates. This is mainly due to LOLC’s ability to source long-term funding from foreign multilateral and bilateral agencies at attractive rates contributing to the reduction in borrowing costs. The borrowing cost for the six months was 3% lower than last year and was Rs. 3 billion. This decrease is despite the increase in the quantum of borrowings,” it said.
Balance sheet growth was substantial with total assets reaching Rs. 98 billion, a 31% growth over last six months. “LOLC’s exponential growth, expansion strategy and strategic investments has positioned the Group on a strong footing for a steady stream of medium to long term sustainable profitability and this is already evident from the record increase in profits when compared with last year same period,” it said.
The Group said it’s investments in the leisure sector are going through a phase of close evaluation for positioning for the future with significant investments being committed during the next twelve to eighteen months. The capital investment envisaged for this sector is in excess of Rs. 3.5 billion and LOLC Leisure is currently negotiating with major international hoteliers to enter into strategic alliance for the management of these prime properties situated in the golden mile of the south coast of Sri Lanka.
The company is gearing up to start off the two new operations - LOLC Insurance and LOLC Securities. LOLC obtained a composite license for insurance and is expected to commence business in both life and General insurance in early next year. LOLC Securities received the stock broking license recently and is expected to commence operations again in the early part of 2011. |
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