| EBITDA*
(Rs.’000) |
Quarter ended 30 June | |||
| 2024/25 | 2023/24 | Variance | % | |
| Transportation | 1,555,292 | 2,418,658 | (863,367) | (36) |
| Consumer Foods | 1,493,117 | 719,706 | 773,411 | 107 |
| Retail | 2,245,532 | 1,987,337 | 258,195 | 13 |
| Leisure | (794,380) | 283,612 | (1,077,992) | (380) |
| Property | (67,195) | 186,997 | (254,192) | (136) |
| Financial Services | 1,920,002 | 1,692,931 | 227,071 | 13 |
| Other, incl. IT and Plantations | 1,343,522 | 1,578,713 | (235,192) | (15) |
| Group | 7,695,889 | 8,867,955 | (1,172,066) | (13) |
*EBITDA includes interest income and the share of results of equity accounted investees which is based on the share of profit after tax but excludes all impacts from foreign currency exchange gains and losses (other than for equity accounted investees), to demonstrate the underlying cash operational performance of businesses.
Summarised below are the key operational and financial highlights of our performance during the quarter under review:
- Group EBITDA in the first quarter of 2024/25 recorded a decrease of 13% against the corresponding period of the previous financial year to Rs.7.70 billion. Group EBITDA includes substantial pre-opening costs pertaining to the ramp-up associated with the opening of the ‘Cinnamon Life’ hotel at ‘City of Dreams Sri Lanka’, whilst the first quarter of the previous year included a deferred tax credit at the Group’s Ports and Shipping business, South Asia Gateway Terminals (SAGT). Excluding these impacts, Group EBITDA for the first quarter of 2024/25 recorded an increase of 2% to Rs.8.47 billion [2023/24 Q1: Rs.8.34 billion].
- With Sri Lanka’s external debt restructuring progressing positively, the country rating is expected to witness an upgrade post the implementation of the international sovereign bond restructuring programme.
- The Company announced a Rights Issue in the proportion of One (1) new ordinary share for every Ten (10) Ordinary Shares in issue, at a consideration of Rs.160/- per share, to raise ~Rs.24 billion. The Rights Issue will be followed by a Sub-division of Shares in the proportion of One (1) ordinary share to Ten (10) ordinary shares.
- The finishing works at the ‘City of Dreams Sri Lanka’ integrated resort is progressing well, with the 687-key ‘Cinnamon Life’ hotel, restaurants and banquet facilities being in the final stages of fit-out to commence operations in October 2024. The remainder of the project comprising of the 113-key ‘Nuwa’ hotel, gaming operations and retail mall, will be operational, in a phased manner, with overall completion of these elements scheduled for mid-CY2025.
- Subsequent to the 20-year lease agreement for the demarcated gaming space at the ‘City of Dreams Sri Lanka’ being executed between Waterfront Properties (Private) Limited and the locally incorporated subsidiary of Melco Resorts & Entertainment Limited (Melco), Melco has mobilised the teams to commence the fit-out work of the gaming space.
- The work on the West Container Terminal (WCT-1) at the Port of Colombo is progressing well. The first batch of quay and yard cranes will arrive in August 2024, following which the commissioning and automation is expected to be completed by the third quarter of 2024/25. The first phase of the terminal is slated to be operational in the fourth quarter of 2024/25.
- Profitability at SAGT recorded an increase driven by double-digit growth in throughput, on account of both domestic and transshipment volumes.
- The Group’s Bunkering business, Lanka Marine Services (LMS) recorded double-digit volume growth during the quarter although profitability was impacted due a contraction in margins on account of volatile global fuel oil prices and intensified competition from local and regional players.
- Both the Beverages and the Frozen Confectionery businesses recorded an increase in EBITDA driven by a significant growth in margins and volumes.
- The Supermarket business recorded a strong performance during the quarter, with same store sales recording encouraging growth of 12%, driven by customer footfall growth of 12%, resulting in growth in profitability and margins.
- The performance of the Leisure industry group was impacted by the pre-opening costs pertaining to the ‘Cinnamon Life’ hotel, as stated before, together with the decline in profitability in the Group’s Maldivian resorts on account of lower occupancy. Occupancies in our Maldivian Resorts is expected to increase for the upcoming peak season based on current forward bookings and a normalised mix in arrivals.
- Nations Trust Bank PLC recorded a strong growth in profitability aided by loan growth, lower impairments and increased trading and fee income while Union Assurance PLC recorded encouraging double-digit growth in gross written premiums, driven by renewal premiums and regular new business premiums.
- The Group’s carbon footprint per million rupees of revenue decreased by 3% to 0.41 MT, and the water withdrawal per million rupees of revenue decreased by 15% to 7.46 cubic meters when compared to the corresponding quarter of the previous year.
- JKH was recognised as Sri Lanka’s ‘Most Loved Corporate Brand for 2024’ by LMD Magazine.