Keeping our eye on the next level - John Keells Holdings PLC · Corporate Social Responsibility Out...
Transcript of Keeping our eye on the next level - John Keells Holdings PLC · Corporate Social Responsibility Out...
I N T E R I M C O N D E N S E D F I N A N C I A L S T A T E M E N T S T H R E E M O N T H S E N D E D 3 0 T H J U N E 2 0 1 3
JOHN KEELLS
HOLDINGS PLC
Keep ing our e ye on th e n ex t l e v e l
Keep ing our e ye on th e n ex t l e v e l
Chairman’s Message 1
Consolidated Income Statement 3
Consolidated Statement of
Comprehensive Income 4
Consolidated Statement of
Financial Position 5
Consolidated Statement of
Cash Flow 6
Consolidated Statement of
Changes in Equity 8
Company Income Statement 9
Company Statement of
Comprehensive Income 10
Company Statement of Financial
Position 11
Company Statement of Cash Flow 12
Company Statement of
Changes in Equity 13
Operating Segment Information 14
Notes to the Interim Condensed
Financial Statements 16
Interim Financial Statements l 1
Chairman’s Message Financial Information
CHAIRMAN’S MESSAGE
Dear Stakeholder,
The profit attributed to the equity holders for the first quarter
of the financial year 2013/14 at Rs.1.59 billion reflects a
4 per cent decrease over the corresponding period in the
previous financial year.
The Group profit before tax (PBT) for the first quarter of the
financial year 2013/14 at Rs.2.20 billion was a decrease of
8 per cent over the PBT of Rs.2.40 billion recorded in the
corresponding period in the previous financial year.
The revenue for the first quarter of the financial year
2013/14 of Rs.20.01 billion remained in line with the
revenue recorded during the same period last year.
The results of the first quarter of the financial year are a
reflection of current macroeconomic challenges emanating
from the decisive actions taken by the Government, including
the implementation of cost based electricity pricing, over the
past year to stabilise an over-heated economy and reduce
the budget deficit. Whilst these macroeconomic factors
may have a negative impact on the performance of the
Group in the short term, we believe that your Group is well
positioned to capitalise on the emerging growth opportunities
because of its strong fundamentals and we, therefore, remain
optimistic of the future. Single digit inflation, lower interest
rates and the planned mega infrastructure developments
are expected to translate into increased demand which will
contribute positively to economic growth.
Taking this view of the future, your Company has announced
an integrated resort development, subject to the Project
Company, Waterfront Properties (Private) Limited, receiving
all the requisite approvals and your Company receiving
shareholder approval, where necessary. The Project Company
has entered into an agreement with the Board of Investment
of Sri Lanka (BOI) as a precursor to facilitating the requisite
approvals. Subsequent to the signing of the BOI agreement,
the first Gazette as per the Strategic Development Projects
Act was published by the Government on the 18th of July.
The Waterfront Project is an integrated resort located at
Glennie Street/Justice Akbar Mawatha and consists of
multiple businesses including a luxury hotel, convention
center, entertainment and gaming facilities, international
standard shopping mall, luxury condominiums, serviced
apartments and office space. The concept of integrated
resorts has gained popularity, particularly in the South East
Asian region. Sri Lanka’s proximity to these destinations
and to key source markets strengthens its offering as an
exciting, and emerging, leisure destination in South Asia.
Transportation
The Transportation industry group PBT of Rs.748 million
in the first quarter of 2013/14 was a decrease of 22 per
cent compared to the first quarter of the previous financial
year [2012/13 Q1: Rs.957 million]. The decline in PBT
was mainly on account of a lower contribution from the
bunkering business as a result of lower volumes and
reduced margins, a phenomenon experienced by the
industry globally, whilst the ports, logistics and airline
businesses also saw reductions on the back of changes
in volumes and revenues. With the completion and
commencement of operations of the South Terminal,
the capacity constraints in the Port of Colombo will be
overcome and the Port will be well geared to cater to
increased domestic and transshipment volumes.
Leisure
The Leisure industry group PBT of Rs.461 million in the
first quarter of 2013/14 was a decrease of 29 per cent over
the first quarter of the previous financial year [2012/13
Q1: Rs.648 million], primarily as a result of the lower than
expected performance of Sri Lanka Resorts with the new
resort, Cinnamon Bey, in particular, still being established
in the market. Additionally, there was an impact on lower
interest rate bearing foreign currency denominated loans
as a result of a depreciated Sri Lankan Rupee at the end
of the quarter. Whilst overall tourism arrivals to the country
continue to demonstrate growth, they have not translated
into room nights in the star category hotels. This, we
believe, is the result of a combination of the economic
issues in Europe and the lack of a focused destination
marketing and branding strategy. However, occupancy
continued to be strong in the City Hotels where we
increased our market share, while the Maldivian Resorts
sector performed well benefitting from higher average room
rates and increased occupancies.
Property
The Property industry group PBT of Rs.142 million in
the first quarter of 2013/14 was an increase of 120
per cent compared to the corresponding period in the
previous financial year [2012/13 Q1: Rs.65 million],
mainly on account of the revenue recognition cycle of the
“OnThree20” development. The super-structure of the 37
storeyed towers of OnThree20 was completed during the
quarter under review while the total number of apartments
sold is in excess of 80 per cent. Construction of the Group’s
newest residential apartment development, “7th Sense” on
Gregory’s Road, commenced during the quarter with over
50 per cent of the units sold as of-date.
Consumer Foods and Retail
The Consumer Foods and Retail industry group PBT
of Rs.249 million in the first quarter of 2013/14 was
a decrease of 36 per cent over the first quarter of the
previous financial year [2012/13 Q1: Rs.393 million].
PROGRESSIVE
2 l JOHN KEELLS HOLDINGS PLC l www.keells.com
CHAIRMAN’S MESSAGE
Whilst the soft drinks segment maintained its market share,
consumer demand was impacted by the adverse weather
conditions which prevailed in many parts of the country
and the lower discretionary expenditure. Although the ice
cream business lost volume due to the aforesaid reasons, it
increased its market share through enhanced distribution.
Keells Food Products consolidated its production by utilising
the increased capacity in the new plant in Pannala. The
Retail sector completed the roll out of its “way forward”
strategy in its remaining retail outlets. Most of the outlets
have witnessed growth during the quarter under review.
Financial Services
The Financial Services industry group PBT of Rs.259 million
in the first quarter of 2013/14 was marginally higher
compared to the corresponding period last year [2012/13
Q1: Rs.257 million]. The prevailing macro-economic
conditions resulted in modest loan growth across the
banking industry. The performance of the Bank in the first
quarter was impacted by the planned non-recurring costs
associated with the development of its positioning strategy
which will be spread throughout this financial year. The
profitability of the Insurance business was impacted by
higher claim ratios in the non-life business compared to
the previous year. The Stock Broking business increased
its market share, although overall trading activity at the
Colombo Stock Exchange was relatively low.
Information Technology
The Information Technology industry group PBT of Rs.65
million in the first quarter of 2013/14 was an increase
over the corresponding period in the previous financial
year [2012/13 Q1: Rs.6 million]. The improvement in
performance was driven primarily by the Business Process
Outsourcing (BPO) business on account of the expansion of
its client base. The Office Automation business witnessed
growth as it continued to expand its range of products.
Other, including Plantation Services
Other, comprising of Plantation Services and the Corporate
Centre, recorded a PBT of Rs.275 million in the first quarter
of 2013/14 [2012/13 Q1: Rs.72 million]. The performance
was primarily attributed to an increase in net interest
income and a decrease in exchange losses compared to the
previous year.
Sustainability Initiatives
During the quarter, the Group took further steps in
integrating sustainability within its business goals by
broadening the scope of impact assessment in the areas
of indirect energy consumption and other greenhouse gas
emissions.
The Group continues to track key indicators covering carbon
footprint, water usage, waste management, employee
health & safety and staff training. The Group’s overall
carbon footprint at an estimated 18,657 MT is an increase
of 8 per cent [2012/13 Q1: 17,234 MT], while the Group’s
water consumption at an estimated 414,934 cubic meters
is an increase of 4 per cent [2012/13 Q1: 399,197 cubic
meters] over the corresponding period last year, largely as
a result of the expanded reporting scope. The number of
occupational injuries in the Group during the first quarter
increased to 63 [2012/13 Q1: 45]. The number of hours of
training provided to staff was at approximately 12 hours per
employee [2012/13 Q1: 9 hours].
Corporate Social Responsibility
Out of 1,012 John Keells scholars of 2012/13, who
became eligible to sit for the final examination under the
John Keells English Language Scholarship Programme, a
total of 996 children passed the final examination.
The John Keells Foundation successfully coordinated a
comprehensive industrial tour of the John Keells Group for
a group of 94 undergraduates (and 04 faculty members)
of the Faculty of Management Studies and Commerce
of the University of Jaffna in June 2013. The tour was
aimed at creating greater awareness of potential career
opportunities.
Under the John Keells HIV and AIDS Awareness Campaign,
a total of 1,005 persons were educated via 14 sessions
during the quarter, including corporate staff and members
of the Sri Lanka Army.
Under the John Keells Vision Project one eye camp was
held in the first Quarter at the Navy Camp in Delft Island.
Out of a total of 500 patients registered, 70 cataract
patients were identified of whom 56 were operated. A total
of 278 spectacles were also donated.
Under the Village Adoption Programme, initial activities
benefiting different community segments are underway in
certain villages of the Mullaitivu District and Trincomalee
District in the Northern and Eastern provinces of the
country.
Susantha Ratnayake
Chairman
26 July 2013
Chairman’s Message Financial Information
Interim Financial Statements l 3
CONSOLIDATED INCOME STATEMENT
For the three months ended 30th June Note 2013 2012 Change %
Continuing operations
Sale of goods 11,321,732 11,673,741 (3)
Rendering of services 8,690,308 8,339,141 4
Revenue 20,012,040 20,012,882 -
Cost of sales (14,955,754) (14,887,228) -
Gross profit 5,056,286 5,125,654 (1)
Other operating income 340,222 408,508 (17)
Distribution expenses (837,758) (735,308) 14
Administrative expenses (2,354,227) (2,467,344) (5)
Other operating expenses (733,646) (611,430) 20
Results from operating activities 1,470,877 1,720,080 (14)
Finance cost (369,311) (465,485) (21)
Finance income 1,322,957 930,900 42
Net finance income 953,646 465,415 105
Change in insurance contract liabilities 6 (926,371) (581,827) 59
Share of results of equity accounted investees 701,570 792,917 (12)
Profit before tax 2,199,722 2,396,585 (8)
Tax expense 7 (454,473) (540,025) (16)
Profit for the period 1,745,249 1,856,560 (6)
Attributable to :
Equity holders of the parent 1,586,397 1,658,718 (4)
Non-controlling interest 158,852 197,842 (20)
1,745,249 1,856,560 (6)
Earnings per share Rs. Rs.
Basic 1.85 1.95
Diluted 1.84 1.94
Dividend per share 1.50 1.50
Note : All values are in Rupees ‘000s, unless otherwise stated.
Figures in brackets indicate deductions.
The above figures are not audited.
PROGRESSIVE
4 l JOHN KEELLS HOLDINGS PLC l www.keells.com
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the three months ended 30th June Note 2013 2012
Profit for the period 1,745,249 1,856,560
Other comprehensive income
Currency translation of foreign operations 255,915 280,110
Revaluation of land and buildings (1,865) -
Share of other comprehensive income of equity-accounted investees 194,633 316,106
Net (loss) / gain on available-for-sale financial assets 38,457 (371,558)
Tax on other comprehensive income 7 - -
Other comprehensive income for the period, net of tax 487,140 224,658
Total comprehensive income for the period, net of tax 2,232,389 2,081,218
Attributable to :
Equity holders of the parent 2,029,704 1,827,700
Non-controlling interest 202,685 253,518
2,232,389 2,081,218
Note : All values are in Rupees ‘000s, unless otherwise stated.
Figures in brackets indicate deductions.
The above figures are not audited.
Chairman’s Message Financial Information
Interim Financial Statements l 5
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30.06.2013 31.03.2013 ASSETSNon-current assetsProperty, plant and equipment 49,190,178 49,272,979 Lease rentals paid in advance 9,585,723 9,513,671 Investment property 9,316,821 9,294,936 Intangible assets 2,649,908 2,689,514 Investments in associates 16,531,774 15,724,361 Other non current financial assets 17,546,051 18,816,693 Deferred tax assets 241,207 212,227 Other non current assets 4,252,195 3,575,749 109,313,857 109,100,130 Current assetsInventories 4,083,492 3,998,900 Trade and other receivables 11,851,030 12,775,046 Amounts due from related parties 75,443 207,455 Other current assets 3,502,770 2,895,900 Short term investments 30,256,682 26,586,054 Cash in hand and at bank 4,046,762 3,554,804 53,816,179 50,018,159 Total assets 163,130,036 159,118,289 EQUITY AND LIABILITIESEquity attributable to equity holders of the parentStated capital 26,555,676 26,480,396 Capital reserves - - Revenue reserves 43,052,129 42,704,203 Other components of equity 21,077,878 20,634,571 90,685,683 89,819,170 Non-controlling interest 11,073,976 11,366,240 Total equity 101,759,659 101,185,410 Non-current liabilitiesInsurance contract liabilities 18,265,774 17,388,494 Borrowings 12,347,253 11,857,764 Deferred tax liabilities 1,242,864 1,222,210 Employee benefit liabilities 1,422,831 1,385,072 Other deferred liabilities 61,044 50,228 Other non-current liabilities 533,066 530,075 33,872,832 32,433,843 Current liabilitiesTrade and other payables 13,767,823 14,608,263 Amounts due to related parties 8,521 15,280 Income tax payable 1,096,296 981,013 Short term borrowings 2,518,313 1,853,767 Current portion of borrowings 2,928,429 3,048,936 Other current liabilities 1,897,720 1,635,534 Bank overdrafts 5,280,443 3,356,243 27,497,545 25,499,036
Total equity and liabilities 163,130,036 159,118,289
Rs. Rs.Net assets per share 105.73 104.78
Note : All values are in Rupees ‘000s, unless otherwise stated. The above figures are not audited.
I certify that the financial statements comply with the requirements of the Companies Act No.7 of 2007.
M J S RajakariarGroup Financial Controller The Board of Directors is responsible for the preparation and presentation of these financial statements.
S C Ratnayake J R F PeirisChairman Group Finance Director26 July 2013
PROGRESSIVE
6 l JOHN KEELLS HOLDINGS PLC l www.keells.com
CONSOLIDATED STATEMENT OF CASH FLOW
For the three months ended 30th June Note 2013 2012 CASH FLOWS FROM OPERATING ACTIVITIESProfit before working capital changes A 1,558,928 2,315,541 (Increase) / Decrease in inventories (84,592) 1,347,793 (Increase) / Decrease in trade and other receivables 1,132,386 438,737 (Increase) / Decrease in other current assets 313,282 229,688 (Increase) / Decrease in other non-current assets (676,446) (662,910)Increase / (Decrease) in trade and other payables (844,208) (471,994)Increase / (Decrease) in other current liabilities 255,802 14,136 Increase / (Decrease) in insurance contract liabilities 877,280 598,136 Cash generated from operations 2,532,432 3,809,127 Finance income received 1,241,994 924,957 Finance costs paid (361,788) (232,643)Dividend received - 131,189 Tax paid (1,184,895) (299,624)Gratuity paid (33,540) (14,681)Net cash flow from operating activities 2,194,203 4,318,325 CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIESPurchase and construction of property, plant and equipment (492,891) (1,057,500)Purchase of intangible assets (19,672) (3,238)Addition to investment property (21,885) (98,872)Acquisition of associates - (28,390)Proceeds from sale of property, plant and equipment and intangible assets 6,351 12,841 Proceeds from sale of financial instruments - fair valued through profit or loss 180,760 52,590 Purchase of financial instruments - fair valued through profit or loss (160,249) (84,461)(Purchase) / disposal of short term investments (net) (85,668) (1,209,570)(Purchase) / disposal of other non current financial assets (net) 1,309,099 693,367 Net cash flow from / (used in) investing activities 715,845 (1,723,233) CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIESProceeds from issue of shares 75,280 721,579 Direct cost on issue of shares (707) - Acquisition of non-controlling interest - (516)Dividend paid to equity holders of parent (1,286,460) (1,275,977)Dividend paid to shareholders with non-controlling interest (446,253) (624,516)Proceeds from long term borrowings 1,447,174 193,898 Repayment of long term borrowings (1,271,362) (875,654)Proceeds from/(repayment of) other financial liabilities (net) 664,546 (929,057)Net cash flow from / (used in) financing activities (817,782) (2,790,243) NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS 2,092,266 (195,151) CASH AND CASH EQUIVALENTS AT THE BEGINNING 16,860,241 21,518,594
CASH AND CASH EQUIVALENTS AT THE END 18,952,507 21,323,443 ANALYSIS OF CASH AND CASH EQUIVALENTSFavorable balancesShort term investments 20,186,188 20,932,609 Cash in hand and at bank 4,046,762 3,095,993 Unfavorable balances Bank overdrafts (5,280,443) (2,705,159)Total cash and cash equivalents 18,952,507 21,323,443
Note : All values are in Rupees ‘000s, unless otherwise stated. Figures in brackets indicate deductions. The above figures are not audited.
Chairman’s Message Financial Information
Interim Financial Statements l 7
For the three months ended 30th June 2013 2012 A Profit before working capital changes Profit before tax 2,199,722 2,396,585 Adjustments for: Finance income (1,322,957) (930,900) Finance cost 369,311 465,485 Share of results of equity accounted investees (701,570) (792,917) Profit on sale of non-current investments 11,461 - Depreciation of property, plant and equipment 611,222 523,092 Provision for impairment losses - 99,769 (Profit) / loss on sale of property, plant and equipment and intangible assets 11,600 (11,233) Amortisation of lease rentals paid in advance 165,835 170,826 Amortisation of intangible assets 61,946 62,293 Amortisation of other deferred liabilities (129) (128) Gratuity provision and related costs 72,032 56,609 Unrealised (gain) / loss on foreign exchange (net) 80,455 276,060 1,558,928 2,315,541
Note : All values are in Rupees ‘000s, unless otherwise stated. Figures in brackets indicate deductions. The above figures are not audited.
PROGRESSIVE
8 l JOHN KEELLS HOLDINGS PLC l www.keells.com
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Att
ribu
tabl
e to
equ
ity h
olde
rs o
f pa
rent
Sta
ted
R
eval
uatio
n F
orei
gn c
urre
ncy
O
ther
A
vaila
ble
for
R
even
ue
Tot
al
Non
-con
trol
ling
T
otal
cap
ital
res
erve
t
rans
latio
n
cap
ital
sal
e re
serv
e
res
erve
s
in
tere
st
Equ
ity
res
erve
r
eser
ves
As
at 1
Ap
ril
20
13
2
6,4
80
,39
6
17
,78
0,4
32
2
,72
9,8
57
-
1
24
,28
2
42
,70
4,2
03
8
9,8
19
,17
0
11
,36
6,2
40
1
01
,18
5,4
10
Pro
fit f
or t
he p
erio
d -
-
-
-
-
1
,58
6,3
97
1
,58
6,3
97
1
58
,85
2
1,7
45
,24
9
Oth
er c
ompr
ehen
sive
inco
me
-
(1
,86
5)
40
6,4
09
-
3
8,7
63
-
4
43
,30
7
43
,83
3
48
7,1
40
Tota
l com
preh
ensi
ve in
com
e -
(
1,8
65
) 4
06
,40
9
-
38
,76
3
1,5
86
,39
7
2,0
29
,70
4
20
2,6
85
2
,23
2,3
89
Exer
cise
of
shar
e op
tions
7
5,2
80
-
-
-
-
-
7
5,2
80
-
7
5,2
80
Dir
ect
cost
on
issu
e of
sha
res
-
-
-
-
-
(7
07
) (
70
7)
-
(7
07
)
Fina
l div
iden
d pa
id -
20
12
/13
-
-
-
-
-
(
1,2
86
,46
0)
(1
,28
6,4
60
) -
(
1,2
86
,46
0)
Sub
sidi
ary
divi
dend
to
non-
cont
rolli
ng in
tere
st
-
-
-
-
-
48
,69
6
48
,69
6
(4
94
,94
9)
(4
46
,25
3)
As
at 3
0 J
un
e 2
01
3
26
,55
5,6
76
1
7,7
78
,56
7
3,1
36
,26
6
-
16
3,0
45
4
3,0
52
,12
9
90
,68
5,6
83
1
1,0
73
,97
6
10
1,7
59
,65
9
As
at 1
Ap
ril
20
12
2
5,1
10
,52
8
9,4
87
,79
4
2,9
87
,47
6
42
8,3
65
3
22
,98
7
33
,09
2,5
50
7
1,4
29
,70
0
8,8
84
,25
2
80
,31
3,9
52
Pro
fit f
or t
he p
erio
d -
-
-
-
-
1
,65
8,7
18
1
,65
8,7
18
1
97
,84
2
1,8
56
,56
0
Oth
er c
ompr
ehen
sive
inco
me
-
-
53
7,7
88
-
(
36
8,8
06
) -
1
68
,98
2
55
,67
6
22
4,6
58
Tota
l com
preh
ensi
ve in
com
e -
-
5
37
,78
8
-
(3
68
,80
6)
1,6
58
,71
8
1,8
27
,70
0
25
3,5
18
2
,08
1,2
18
Exer
cise
of
shar
e op
tions
7
21
,57
9
-
-
-
-
-
72
1,5
79
-
7
21
,57
9
Fina
l div
iden
d pa
id -
20
11
/12
-
-
-
-
-
(
1,2
75
,97
7)
(1
,27
5,9
77
) -
(
1,2
75
,97
7)
Sub
sidi
ary
divi
dend
to
non-
cont
rolli
ng in
tere
st
-
-
-
-
-
48
,15
1
48
,15
1
(6
72
,66
7)
(6
24
,51
6)
Acq
uisi
tion,
dis
posa
l and
cha
nges
in
no
n-co
ntro
lling
inte
rest
-
-
-
-
-
8
39
8
39
(
1,3
55
) (
51
6)
As
at 3
0 J
un
e 2
01
2
25
,83
2,1
07
9
,48
7,7
94
3
,52
5,2
64
4
28
,36
5
(4
5,8
19
) 3
3,5
24
,28
1
72
,75
1,9
92
8
,46
3,7
48
8
1,2
15
,74
0
Not
e :
A
ll va
lues
are
in R
upee
s ‘0
00
s, u
nles
s ot
herw
ise
stat
ed.
Fi
gure
s in
bra
cket
s in
dica
te d
educ
tions
.
Th
e ab
ove
figur
es a
re n
ot a
udite
d.
Chairman’s Message Financial Information
Interim Financial Statements l 9
COMPANY INCOME STATEMENT
For the three months ended 30th June Note 2013 2012 Change %
Continuing operations
Rendering of services 181,687 134,905 35
Revenue 181,687 134,905 35
Cost of sales (99,008) (85,378) 16
Gross profit 82,679 49,527 67
Dividend income 2,191,598 2,360,046 (7)
Other operating income 2,350 4,928 (52)
Administrative expenses (295,253) (292,176) 1
Other operating expenses (9,574) (9,092) 5
Results from operating activities 1,971,800 2,113,233 (7)
Finance cost (90,959) (151,937) (40)
Finance income 384,722 281,732 37
Net finance income 293,763 129,795 126
Profit before tax 2,265,563 2,243,028 1
Tax expense 7 (32,532) (4,752) 585
Profit for the period 2,233,031 2,238,276 -
Rs. Rs.
Dividend per share 1.50 1.50
Note : All values are in Rupees ‘000s, unless otherwise stated.
Figures in brackets indicate deductions.
The above figures are not audited.
PROGRESSIVE
10 l JOHN KEELLS HOLDINGS PLC l www.keells.com
COMPANY STATEMENT OF COMPREHENSIVE INCOME
For the three months ended 30th June Note 2013 2012
Profit for the period 2,233,031 2,238,276
Other comprehensive income
Net (loss)/gain on available-for-sale financial assets 43,481 (314,681)
Tax on other comprehensive income 7 - -
Other comprehensive income for the period, net of tax 43,481 (314,681)
Total comprehensive income for the period, net of tax 2,276,512 1,923,595
Note : All values are in Rupees ‘000s, unless otherwise stated. Figures in brackets indicate deductions. The above figures are not audited.
Chairman’s Message Financial Information
Interim Financial Statements l 11
COMPANY STATEMENT OF FINANCIAL POSITION
As at 30.06.2013 31.03.2013
ASSETS
Non-current assets
Property, plant and equipment 70,038 75,309
Intangible assets 82,143 74,004
Investments in subsidiaries and joint ventures 26,522,694 26,641,307
Investments in associates 9,821,364 9,821,364
Other non current financial assets 1,774,566 1,710,653
Other non current assets 10,310 10,310
38,281,115 38,332,947
Current assets
Trade and other receivables 1,057,226 994,862
Amounts due from related parties 557,072 518,084
Other current assets 388,063 384,966
Short term investments 13,624,488 12,551,540
Cash in hand and at bank 586,128 63,159
16,212,977 14,512,611
Total assets 54,494,092 52,845,558
EQUITY AND LIABILITIES
Stated capital 26,555,676 26,480,396
Revenue reserves 21,168,327 20,221,756
Other components of equity 126,938 83,457
Total equity 47,850,941 46,785,609
Non-current liabilities
Borrowings 3,212,279 3,752,621
Employee benefit liabilities 137,753 134,075
3,350,032 3,886,696
Current liabilities
Trade and other payables 241,213 229,990
Amounts due to related parties 12,679 13,156
Current portion of borrowings 1,308,636 1,314,424
Other current liabilities 8,102 105,478
Bank overdrafts 1,722,489 510,205
3,293,119 2,173,253
Total equity and liabilities 54,494,092 52,845,558
Rs. Rs.
Net assets per share 55.79 54.58
Note : All values are in Rupees ‘000s, unless otherwise stated.
The above figures are not audited.
I certify that the financial statements comply with the requirements of the Companies Act No.7 of 2007.
M J S Rajakariar
Group Financial Controller
The Board of Directors is responsible for the preparation and presentation of these financial statements.
S C Ratnayake J R F Peiris
Chairman Group Finance Director
26 July 2013
PROGRESSIVE
12 l JOHN KEELLS HOLDINGS PLC l www.keells.com
COMPANY STATEMENT OF CASH FLOW
For the three months ended 30th June 2013 2012 CASH FLOWS FROM OPERATING ACTIVITIESProfit before tax 2,265,563 2,243,028 Finance income (384,722) (281,732) Dividend income (2,191,598) (2,360,046) Finance cost 90,959 151,937 Depreciation of property, plant and equipment 6,041 6,520 Profit on sale of property, plant and equipment (4) (2,696) Amortisation of intangible assets 5,961 4,376 Provision for impairment losses 118,613 99,769 Gratuity provision and related costs 6,198 5,686 Profit before working capital changes (82,989) (133,158)
(Increase) / Decrease in trade and other receivables (36,885) 559,119(Increase) / Decrease in other current assets (2,165) (85,377) Increase / (Decrease) in trade and other payables 10,747 (43,993)Increase / (Decrease) in other current liabilities (97,376) (2,127) Cash generated from operations (208,668) 294,464 Finance income received 384,722 255,981 Finance expenses paid (87,552) (64,430)Dividend received 2,218,061 2,369,445 Tax paid (33,461) (12,946)Gratuity paid (2,519) (2,518)Net cash flow from operating activities 2,270,583 2,839,996
CASH FLOWS FROM/ (USED IN) INVESTING ACTIVITIESPurchase and construction of property, plant and equipment (769) (804)Purchase of intangible assets (14,099) - Increase in interest in subsidiaries - (15,526)Increase in interest in associates - (28,389)Proceeds from sale of property, plant and equipment 4 6,696 (Purchase)/disposal of short term investments (net) 4,469,699 (1,510,948)(Purchase)/disposal of other non current financial assets (net) (20,431) 3,946Net cash flow from/(used in) investing activities 4,434,404 (1,545,025)
CASH FLOWS FROM / (USED IN) FINANCING ACTIVITIESProceeds from issue of shares 75,280 721,579 Dividend paid (1,286,460) (1,275,977)Repayment of long term borrowings (640,475) (664,176)Net cash flow from / (used in) financing activities (1,851,655) (1,218,574)
NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS 4,853,332 76,397
CASH AND CASH EQUIVALENTS AT THE BEGINNING 5,433,342 8,919,099
CASH AND CASH EQUIVALENTS AT THE END 10,286,674 8,995,496
ANALYSIS OF CASH & CASH EQUIVALENTSFavorable balancesShort term investments 11,423,035 8,983,135 Cash in hand and at bank 586,128 61,594 12,009,163 9,044,729 Unfavorable balancesBank overdrafts (1,722,489) (49,233)Total cash and cash equivalents 10,286,674 8,995,496
Note : All values are in Rupees ‘000s, unless otherwise stated. Figures in brackets indicate deductions. The above figures are not audited.
Chairman’s Message Financial Information
Interim Financial Statements l 13
COMPANY STATEMENT OF CHANGES IN EQUITY
Stated Available for Revenue Total
capital sale reserve reserves Equity
As at 1 April 2013 26,480,396 83,457 20,221,756 46,785,609
Profit for the period - - 2,233,031 2,233,031
Other comprehensive income - 43,481 - 43,481
Total comprehensive income - 43,481 2,233,031 2,276,512
Exercise of share option 75,280 - - 75,280
Final dividend paid - 2012/13 - - (1,286,460) (1,286,460)
As at 30 June 2013 26,555,676 126,938 21,168,327 47,850,941
As at 1 April 2012 25,110,528 229,595 15,754,217 41,094,340
Profit for the period - - 2,238,276 2,238,276
Other comprehensive income - (314,681) - (314,681)
Total comprehensive income - (314,681) 2,238,276 1,923,595
Exercise of share option 721,579 - - 721,579
Final dividend paid - 2010/11 - - (1,275,977) (1,275,977)
As at 30 June 2012 25,832,107 (85,086) 16,716,516 42,463,537
Note : All values are in Rupees ‘000s, unless otherwise stated.
Figures in brackets indicate deductions.
The above figures are not audited.
PROGRESSIVE
14 l JOHN KEELLS HOLDINGS PLC l www.keells.com
OPERATING SEGMENT INFORMATION
BUSINESS SEGMENTS
The following tables present revenue, profit information and segment assets regarding the Group’s operating segments.
Transportation Leisure Property Consumer Foods & Retail
For the three months
ended 30th June 2013 2012 2013 2012 2013 2012 2013 2012
External revenue 4,128,503 5,307,450 4,116,630 3,912,911 672,752 611,541 6,154,518 5,986,843
Inter segment revenue 102,988 92,194 35,438 11,649 79,234 68,528 91,660 14,997
Total Segment revenue 4,231,491 5,399,644 4,152,068 3,924,560 751,986 680,069 6,246,178 6,001,840
Eliminations of inter
segment revenue
Net Revenue
Segment result 229,709 337,965 473,645 683,531 127,376 30,809 251,964 408,164
Finance cost (12,960) (23,906) (153,437) (103,570) (17,176) (2,674) (42,734) (20,445)
Finance income 41,204 52,417 141,889 68,101 35,780 38,978 43,104 7,815
Share of results of equity
accounted investees 490,324 590,949 - - - - - -
Eliminations / adjustments (604) (588) (1,100) - (3,518) (2,427) (3,000) (3,000)
Profit / (loss) before tax 747,673 956,837 460,997 648,062 142,462 64,686 249,334 392,534
Tax expense (44,022) (71,189) (66,847) (45,006) (17,150) (22,617) (64,679) (128,172)
Profit / (loss) for the period 703,651 885,648 394,150 603,056 125,312 42,069 184,655 264,362
Segment assets 6,586,187 8,137,942 48,234,607 50,021,694 14,317,293 11,136,074 16,466,328 12,768,537
Investments in associates
Deferred tax assets
Goodwill
Other current assets
Eliminations / adjustments
Total Assets
Purchase and
construction of PPE 6,580 6,593 249,364 703,708 13,410 1,558 126,224 256,505
Addition to IA - - - - - - 2,268 623
Depreciation of PPE 19,407 23,404 320,733 252,499 5,833 2,535 168,071 146,391
Amortisation /
impairment of IA 1,207 2,950 - - - - 3,974 3,046
Amortisation of LRPA - - 162,623 170,641 - - - -
Gratuity provision and
related costs 4,061 5,210 21,821 16,901 300 300 24,171 22,547
Note : All values are in Rupees ‘000s, unless otherwise stated.
Figures in brackets indicate deductions.
The above figures are not audited.
PPE (Property, plant and equipment), IA (Intangible assets), LRPA (Lease rentals paid in advance)
Chairman’s Message Financial Information
Interim Financial Statements l 15
Financial Services Information Technology Others Group Total
2013 2012 2013 2012 2013 2012 2013 2012
2,229,523 1,997,392 1,879,275 1,431,946 830,839 764,799 20,012,040 20,012,882
26,998 24,449 75,117 72,736 141,510 144,713 552,945 429,266
2,256,521 2,021,841 1,954,392 1,504,682 972,349 909,512 20,564,985 20,442,148
(552,945) (429,266)
20,012,040 20,012,882
31,579 174,409 8,514 29,581 (108,237) (24,167) 1,014,550 1,640,292
(1) (145,338) (20,247) (15,492) (122,756) (154,060) (369,311) (465,485)
27,435 12,819 3,496 1,537 389,197 269,000 682,105 450,667
200,480 215,338 - (9,979) 10,766 (3,391) 701,570 792,917
- - 72,820 - 106,210 (15,791) 170,808 (21,806)
259,493 257,228 64,583 5,647 275,180 71,591 2,199,722 2,396,585
(65,933) (85,027) (11,585) (5,385) (184,257) (182,629) (454,473) (540,025)
193,560 172,201 52,998 262 90,923 (111,038) 1,745,249 1,856,560
28,465,997 23,378,562 3,641,604 3,283,744 24,200,021 19,860,912 141,912,037 128,587,465
16,531,774 16,640,319
241,207 163,894
950,884 717,900
3,502,770 1,708,244
(8,636) (15,201,104)
163,130,036 132,616,718
44,406 55,776 25,452 14,775 27,455 18,585 492,891 1,057,500
- - 3,305 2,615 14,099 - 19,672 3,238
37,841 36,019 29,202 32,635 30,135 29,609 611,222 523,092
47,066 46,854 3,738 5,067 5,961 4,376 61,946 62,293
- - - - 3,212 185 165,835 170,826
8,132 7,806 3,571 3,230 9,976 9,774 72,032 65,768
PROGRESSIVE
16 l JOHN KEELLS HOLDINGS PLC l www.keells.com
NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS
1 CORPORATE INFORMATION
John Keells Holdings PLC. is a public limited company incorporated and domiciled in Sri Lanka and listed on the Colombo Stock
Exchange. Ordinary shares of the Company are listed on the Colombo Stock Exchange and Global Depository Receipts (GDRs) are
listed on the Luxembourg Stock Exchange.
2 INTERIM CONDENSED FINANCIAL STATEMENTS
The financial statements for the period ended 30 June 2013, includes “the Company” referring to John Keells Holdings PLC., as the
holding company and “the Group” referring to the companies whose accounts have been consolidated therein.
3 APPROVAL OF FINANCIAL STATEMENTS
The interim condensed financial statements of the Group and the Company for the 3 months ended 30 June 2013 were authorised
for issue by the Board of Directors on 26 July 2013.
4 BASIS OF PREPARATION
The interim condensed financial statements have been prepared in compliance with Sri Lanka Accounting Standard LKAS 34 -
Interim Financial Reporting. These interim condensed financial statements should be read in conjunction with the annual financial
statements for the year ended 31 March 2013.
The presentation and classification of the financial statements of the previous year have been amended, where relevant, for better
presentation and to be comparable with those of the current year.
The interim condensed financial statements are presented in Sri Lankan Rupees and all values are rounded to the nearest thousand
except when otherwise indicated.
5 OPERATING SEGMENTS
For management purposes, the Group is organised into business units based on their products and services and has seven
reportable operating segments as follows:
Transportation Leisure
Property Consumer Foods & Retail
Financial Services Information Technology
Others
6 CHANGE IN LIFE INSURANCE CONTRACT LIABILITIES
The results of Union Assurance PLC’s life business segment is consolidated line by line into the Group’s consolidated income
statement. The change in life insurance contract liabilities represents the transfer to the Life Fund, the difference between all
income and expenditure attributable to life policy holders during the period.
7 TAX EXPENSE
Group Company
For the three months ended 30th June 2013 2012 2013 2012
Income statement
Current income tax 463,204 547,584 32,532 4,752
Deferred tax (8,731) (7,559) - -
Other comprehensive Income
Deferred tax - - - -
454,473 540,025 32,532 4,752
Chairman’s Message Financial Information
Interim Financial Statements l 17
8 RELATED PARTY TRANSACTIONS
Group Company
For the three months ended 30th June 2013 2012 2013 2012
Transactions with related parties
Subsidiaries
(Purchase) / sale of goods - - 996 (287)
(Receiving) / rendering of services - - 155,381 120,607
(Purchase) / sale of property plant & equipment - - - -
Loans given - - - 45,000
Interest received / (paid) - - - 15,791
Rent received / (paid) - - (29,012) (12,819)
Guarantees received / (paid) - - - -
Joint Ventures
(Receiving) / rendering of services 15,628 8,513 - -
Associates
(Purchase) / sale of goods 1,903 - - -
(Receiving) / rendering of services 10,527 6,924 900 -
Interest received / (paid) 43,897 111,477 19,386 71,489
Loans taken - - - -
Leases taken - - - -
Key management personnel (KMP)
(Receiving) / rendering of services - - - -
Close family members of KMP
(Receiving) / rendering of services - - - -
Companies controlled / jointly controlled / significantly
Influenced by KMP and their close family members
(Purchase) / sale of goods - - - -
Post employment benefit plan
Contributions to the provident fund 87,378 49,204 19,121 10,331
PROGRESSIVE
18 l JOHN KEELLS HOLDINGS PLC l www.keells.com
NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS
9 SHARE INFORMATION
9.1 Public share holdings
The percentage of shares held by the public as at 30 June 2013 was 98.45 % (31 March 2013 - 88.36 %).
9.2 Directors’ share holdings
The number of shares held by the Board of Directors are as follows:
As at 30-06-2013 31-3-2013
S C Ratnayake – Chairman/CEO 5,299,066 5,299,066
A D Gunewardene – Deputy Chairman 6,481,720 6,481,720
J R F Peiris 1,371,392 1,371,392
E F G Amerasinghe 5,514 5,514
T Das Nil Nil
S S Tiruchelvam 1,300 1,300
I Coomaraswamy Nil Nil
A R Gunasekara 107,866 107,866
M A Omar Nil Nil
9.3 Twenty largest shareholders of the Company are as follows:
As at 30-06-2013 31-3-2013
Number of % Number of %
shares shares % shares
1 Mr S E Captain 84,774,813 9.9% 82,431,062 9.6%
2 Broga Hill Investments Limited 84,681,555 9.9% 74,591,759 8.7%
3 Janus Overseas Fund 75,942,233 8.9% 86,536,133 10.1%
4 Paints & General Industries Limited 50,007,835 5.8% 49,086,579 5.7%
5 Deutsche Bank AG – London 33,628,953 3.9% 32,930,641 3.8%
6 Aberdeen Global-Asian Smaller Companies Fund 32,930,435 3.8% 26,563,207 3.1%
7 Melstacorp (Private) Limited 31,499,883 3.7% 31,499,883 3.7%
8 Aberdeen Global-Emerging Markets Smaller companies fund 22,990,207 2.7% 30,850,435 3.6%
9 Estate of Mr A A N De Fonseka 19,952,358 2.3% 19,952,358 2.3%
10 Aberdeen Global Asia Pacific Equity Fund 19,047,737 2.2% 19,047,737 2.2%
11 Janus Aspen series Overseas Portfolio Fund 18,303,333 2.1% 18,303,333 2.1%
12 Schroder International Selection Fund 13,531,656 1.6% 13,172,166 1.5%
13 Mr K Balendra 13,141,807 1.5% 13,141,807 1.5%
14 J P Morgan Clearing Corporation 11,365,142 1.3% 11,518,889 1.3%
15 Rubber Investment Trust Limited A/C no.1 10,991,944 1.3% 11,535,763 1.3%
16 London- Edinburgh Dragon Trust PLC 10,936,664 1.3% 10,936,664 1.3%
17 BBH-Matthews International Funds 9,556,504 1.1% 9,556,504 1.1%
18 Aberdeen Asia Pacific Fund 9,074,229 1.1% 9,074,229 1.1%
19 Mrs D Kumaranayagam 7,751,552 0.9% 7,751,552 0.9%
20 Aberdeen Institutional Commingled Funds, LLC 7,530,938 0.9% 7,325,938 0.9%
Chairman’s Message Financial Information
Interim Financial Statements l 19
9.4 Stated capital
Stated capital is represented by number of shares in issue as given below:
As at 30-06-2013 31-03-2013
Ordinary shares 856,577,088 856,112,828
Global depository receipts 1,122,069 1,129,677
9.5 Net assets per share
Net assets per share have been calculated, for all periods, based on the number of shares in issue as at 30 June 2013.
9.6 Market price per share
For the quarter ended 30th June 2013 2012
Rs. Rs.
Highest 299.80 249.70
Lowest 243.50 219.00
Last traded 251.50 247.00
10 DIVIDENDS PAID
A final dividend of Rs.1.50 per share for the financial year ended 31 March 2013 was paid on 17 June 2013.
11 DISPOSAL OF ASSOCIATE
In June 2013, as per sales and purchase agreement the Group disposed of its interest in one of its associates, namely NDO India
(Pvt) Ltd. The resultant loss of Rs.11mn has been reflected in the Consolidated Income Statement.
12 CONTINGENCIES, CAPITAL AND OTHER COMMITMENTS
There has been no significant change in the nature of the contingencies and other commitments, which were disclosed in the
annual report for the year ended 31 March 2013.
13 EVENTS AFTER THE REPORTING PERIOD
John Keells holdings PLC. (JKH) has proposed to the Government of Sri Lanka a Project, valued in excess of USD 650mn, involving
the developing, owning, managing, operating, selling, leasing and renting a luxury multi/mixed use Integrated Resort (the “Project”)
in the land owned and occupied by its subsidiaries Ceylon Cold Stores PLC (CCS), John Keells PLC (JKL), John Keells Properties
(Pvt) Ltd (JKP) and Waterfront Properties (Pvt) Ltd (WPL) in Colombo 2. John Keells Holdings PLC together with its subsidiaries CCS,
JKL and JKP will be majority shareholders in the Project Company, WPL. The Board of Directors has approved the Project subject
to the Company receiving all the necessary approvals to the satisfaction of the Board including shareholder approval as necessary.
The Project Company has already entered into an agreement with the Board of Investment of Sri Lanka to facilitate the requisite
approvals and a Gazette published on the 18 July 2013 under the Strategic Development Projects Act has made available tax, duty
and other concessions to the Project. The Board has authorized the Company to call for an EGM to seek shareholder approval of the
Investment as a Major Transaction under the Companies Act of 2007.
PROGRESSIVE
20 l JOHN KEELLS HOLDINGS PLC l www.keells.com
NOTES
Corporate Information
Name of Company
John Keells Holdings PLC
Legal Form
Public Limited Liability Company
Incorporated in Sri Lanka in 1979
Ordinary Shares listed on the
Colombo Stock Exchange
GDRs listed on the Luxembourg
Stock Exchange
Company Registration No.
PQ 14
Directors
S C Ratnayake – Chairman
A D Gunewardene – Deputy Chairman
J R F Peiris
E F G Amerasinghe
I Coomaraswamy
T Das
A R Gunasekara
M A Omar
S S Tiruchelvam
Senior Independent Director
E F G Amerasinghe
Audit Committee
A R Gunasekara – Chairman
E F G Amerasinghe
I Coomaraswamy
Human Resources and
Compensation Committee
E F G Amerasinghe – Chairman
I Coomaraswamy
A R Gunasekara
S S Tiruchelvam
Nominations Committee
T Das – Chairman
S S Tiruchelvam
S C Ratnayake
Bankers
Bank of Ceylon
Citibank N.A
Commercial Bank
Deutsche Bank A.G
DFCC Bank
DFCC Vardhana Bank
Hatton National Bank
Hongkong & Shanghai Banking
Corporation
Muslim Commercial Bank
Nations Trust Bank
National Savings Bank
Pan Asia Banking Corporation
People’s Bank
Sampath Bank
Seylan Bank
Standard Chartered Bank
Depository for GDRs
Citibank N.A
New York
Registered office of the Company
130 Glennie Street
Colombo 2, Sri Lanka
Internet: www.keells.com
Email: [email protected]
Secretaries and Registrars
Keells Consultants (Pvt) Limited
130 Glennie Street
Colombo 2, Sri Lanka
Telephone: +94 11 230 6245
Facsimile: +94 11 243 9037
Investor Relations
John Keells Holdings PLC
130 Glennie Street
Colombo 2, Sri Lanka
Telephone: +94 11 230 6165
+94 11 230 6000
Facsimile: +94 11 230 6160
Email: [email protected]
Group Sustainability and
Enterprise Risk Management
John Keells Holdings PLC
130 Glennie Street
Colombo 2, Sri Lanka
Telephone: +94 11 230 6182
Facsimile: +94 11 230 6249
Email: [email protected]
Contact for Media
Corporate Communications Division
John Keells Holdings PLC
130 Glennie Street
Colombo 2, Sri Lanka
Telephone: +94 11 230 6191
Email: [email protected]
Auditors
Ernst & Young
Chartered Accountants
P.O. Box 101
Colombo, Sri Lanka
w w w . k e e l l s . c o m