Revealing its financial performance for the first three months of the 2019/20 financial year, during the period ended 30th June 2019, the LVL Group reported a drop in revenue to LKR 51 million from LKR 114 million achieved during the corresponding period in the previous year. The revenue decline is attributable to a dip in the income of its subsidiary company by LKR 62 million, to LKR 34 million from LKR 96 million. The subsidiary companies, which comprise Kadawala, Sapthakanya and Campion hydro power plants, faced a drop in energy generation during the period April to June 2019. The combined power generation of the hydro power plants was 2,203 MWh representing a drop of 64% compared to 6,174 MWh during the same period in the previous year due to the extraordinary dry weather conditions that prevailed during the period.
Meanwhile, operating expenses dropped to LKR 31 million compared to LKR 34 million during the same period last year while Operating profit stood at LKR 20 million compared to LKR 81 million last year owing to the decline in subsidiary company income.
However, share of profit from associate companies recorded an increase of LKR 7 million to LKR 192 million from LKR 185 million in the corresponding period last year. The improvement was due to higher contribution from wind power plants compared to the previous year. The contribution from hydro power plants operated by associate companies was also less this year with a 55% decline in generation to 5,354 MWh during the period April to June 2019 from 12,010 MWh during the same period in 2018.
On the back of increased borrowings in May 2019 to fund the investment in the new thermal power plant being constructed in Feni, Bangladesh, the interest cost for the quarter increased to LKR 72 million from LKR 34 million in the corresponding quarter last year. As a result, Profit before tax for the period decreased to LKR 141 million compared to LKR 232 million in the same period last year.
The tax charge for the quarter also increased to LKR 30 million from LKR 11 million for the same period last year due to increase in withholding tax attributable to dividends received by the company. Accordingly, profit for the period was LKR 110 million compared to LKR 221 million in the corresponding period last year. Profit attributable to equity holders of the company for the period was LKR 113 million compared to LKR 212 million for the same period last year reflecting a decline in EPS to LKR 19 cents from LKR 36 cents. Meanwhile, the LVL Group remains optimistic about picking up momentum in the remaining months of the financial year.
LVL Energy Fund PLC is a subsidiary of Lanka Ventures PLC. It operates seven hydro power projects in Sri Lanka with a total capacity of 19.4 MW and two wind power projects with an installed capacity of 15.3 MW in Kalpitiya. LVL Energy Fund PLC was incorporated in June 2006 as a subsidiary of Lanka Ventures PLC with an initial capital of Rs. 300 million. The main objective of the company was to invest in projects in the power and energy sector in Sri Lanka and across the region. Up to June 2016 the company held several rounds of fund raising which culminated in a total fund base of Rs. 2,636 million by 31st March 2017. Thereafter the company held an IPO to raise a further capital of Rs. 1,200 million and obtained a listing for shares at the Colombo Stock Exchange. The company remains a well-diversified entity with investments in renewable and thermal power projects in Sri Lanka, Bangladesh and Nepal, and is set to help usher in a new era of sustainable energy use.