Challenging 3Q for SUN due to NMRA impact, 9M EPS down 12.6% YoY
• Consolidated revenue of LKR14.1billion, an increase of 10.1% YoY;
• PAT amounted to LKR1.3 billion, up 27.7% YoY, due to strong Agri performance
• Healthcare revenue up 10.5% YoY to LKR 5.8 billion revenue
• Strong growth in FMCG, revenue up 19.5% YoY to LKR 3.0 billion
• Agri revenue grew 2.7% YoY to LKR 4.7 billion
• Consolidated revenue of LKR 4.42 billion, an increase of 3.2% YoY;
• PAT amounted to LKR 402.6 million, up 3.2% YoY, with strong profitability in agri business
• Healthcare growth affected by...
...NMRA regulation to post LKR1.78 billion revenue down 3.1% YoY
• Agri revenue grew 4.9% on the back of 30% increase in Palm Oil volumes
• FMCG revenue up 18.2% YoY to LKR 1.1 billion
• However, EPS down 92.3% YoY due to NMRA impact
Sunshine Holdings PLC (CSE: SUN) reported consolidated revenues of LKR 14.1 billion for the nine months ended 31December 2016 (9MFY17), up 10.1% YoY. PAT grew 27.7%YoY to stand at LKR 1.3 billion for 9MFY17, however PATMI declined -12.6% YoY mainly due to a reduction in the Healthcare segment profits caused by the implementation of NMRA price controls.
Healthcare continued to be the largest contributor to group revenue accounting for 41%. Agri was the second largest with 34% followed by FMCG at 21% of the revenue.
For 9MFY17, PAT amounted to LKR 1,338 million up 27.7% YoY, with Profit After Tax & Minority Interest (PATMI) coming down-12.6% YoY to LKR 446 million due to loss in the Healthcare business on account of price control, with a one-time stock loss of LKR 123 million. As, a result Agri was the largest contributor to PATMI in 9MFY17 with LKR 245 million, which represents 55% of total PATMI.
Net Asset Value per share increased to LKR 45.04 as at end 9MFY17, as compared with LKR 42.78 at the beginning of the year.
Healthcare revenue for 9MFY17 grew 10.5% YoY, led primarily by growth in the retail segment accounting for 41% of group turnover for the period. EBIT margin for 9MFY17 contracted by 430 bps to 3.3%, mainly on account of price control imposed under the NMRA regulation leading to a one-time stock correction loss of LKR 123 million.
The Pharma sub-segment which represents 66.6% of Healthcare revenue grew at only 6% YoY, due to the impact of reduced prices. The company's Pharma segment is the second largest player in the country, holding 12% share of country's total market share. Growth in other sub-sectors was comprised of: Surgical (+19% YoY), Retail (+34% YoY), Diagnostics (+6% YoY), Wellness (+16% YoY).
PAT for Healthcare amounted to LKR 91 million in 9MFY17, down -66% YoY, and representing a margin of 1.6% in 9MFY17.
The FMCG sector reported revenues of LKR 3.0 billion in 9MFY17, up 19.5% YoY, on the back of both volume and price growth, accounting for 21% of group revenue for the period in review. The domestic branded tea business within the group's FMCG segment sold 2.88 million kilos of branded tea, improving 8% YoY, driven by Sunshine Group's largest brand 'Watawala Tea', and their converter brand 'Ran Kahata'.
PAT from the FMCG segment saw a contraction of 27.5% YoY, to stand at LKR 249 million in 9MFY17, with a margin of 8.3%, compared to 13.6% in the same period last year. Low tea prices in the same period last period led to the high margins in 9MFY16. 3Q performance saw rising tea prices affect margins. Business expansion investments pertaining to scaling up of the 'Zesta Connoisseur' brand across Shangri-La properties worldwide continued at a steady pace supporting positive improvements to the group's operating margins.
The Agribusiness sector represented by Watawala Plantations PLC (WATA) saw revenue growth of 2.7% YoY to LKR4.7 billion, despite a 8% YoY contraction in tea revenue. Palm Oil sub sector reported an increase of 47% YoY for 9MFY17. Tea production was affected by bad weather, even as the company continues to focus on its strategy of growing quality teas to curtail losses. Palm Oil volumes were 15% higher than the same period last year. The company managed to obtain a higher price for its CPO during 9MFY17, which positively contributed to both top line and bottom line of the Agri sector.
PAT for 9MFY17 amounted to LKR 1,014 million, against LKR 439 million in the same period last year. Growth in profits was mainly attributed to a reduction in losses in the Tea sub-sector, and a parallel increase in profits from the Palm Oil sub sector. The Tea sub-sector recorded a net loss before tax of LKR 27 million for 9MFY17 compared to a net loss of LKR 172 million in the same period last year.
Meanwhile, the Palm Oil segment, which made LKR 1,057 million PBT for 9MFY17 against LKR 575 million last year, continued to be the largest contributor to WATA profits and managed to cover the losses in Tea.
Packaging revenues amounted to LKR 251 million, down 4.2% YoY in 9MFY17, against LKR 262 million in the same period last year. PAT amounted to LKR 2.9 million in 9MFY17 lower than LKR 13 million recorded in 9MFY16.
Revenue for the Renewable Energy division amounted to LKR 68 million in 9MFY17, down 35% YoY from LKR 104 million during the same period last year as a result of the change in weather patterns. The mini-hydro plant, which is in its third year of operations, made loss of LKR 10.16 million for 9MFY17, compared to a profit of LKR 41.8 million in the same period last year.
- China to provide 90 water bowsers worth Rs 1b 2307
- Wag the Dog 2302
- A brief look at FARC’s origins in Colombia 2249
- ‘Panama Papers’ bags Pulitzer 2272
- SAITM will cooperate with Govt 2288
- dead man was near fashion mall 2319
- Japanese MPs back Lanka’s development 2283
- CB Bond earnings whitewashed – JVP 2291
- Talks to extend Lanka’s Continental Shelf 2298
- Ex-DIG and son re-remanded 2292
- Government can be sent home 2828
- GMOA flogging SAITM for Mahinda– Rajitha 2299
- Ranil invites Japan to invest in S. Asia 2270
- Somali Pirates’ Captives Back Home 2284
- Customs in Rs 8 M bust 2281
- Redefining Rape 2455
- The march of folly Our mad Cabinet system 1928
- First adventures in Europe 2013
- Inspiration for writers 1985
- Sri Lanka’s sustainable development dream 2328
- Sinhala and Tamil New Year with Easter 2184
- Filipino Oconer wins overall title 1919
- Unsporty conduct by Joes 1966
- Bertie Wijesinghe, pre-Test era Sri Lankan cricketer, dies aged 96 1942
- CEAT revs up for 2017 1930
- Palace shock Arsenal 1904
- Argentina fire coach Bauza 1928
- BCCI postpones SGM to 18 April 1899
- Murray returns from injury 1916
- New mum Azarenka to return to WTA 1877
- Galle win by 188 runs 1888
- Keeping Cool 1914
- Do the right thing and do it now! 1926
- Ravi Jayewardene Pious son of a political giant 2515
- In the heart of the old country 2340
- Sarath Weerasekera’s Geneva adventure 2167
- No moral right to play with public funds 2101
- No need for fine if route permits are issued in fair, just manner 2016
- UDA incurs Rs 330M Loss 1942
- DOUSING A MEGA SHIP FIRE 1757
- Health authorities in denial? 2247
- Minorities’ frustration a powder keg – VIDURA 2263
- Administrative powers a must for the Plantation Tamils –Radhakrishnan 1518
- Rajapaksa sought advice from McGuinness– Indika Perera 2670
- I will lead SLFP to victory in future elections – President 2045
- Hang the ‘traitors’– RTD. REAR ADMIRAL WEERASEKARA 2458
- We oppose Nationalism and Federalism – Samarasinghe 3123
- SilkAir launches direct flights to Colombo 1978
- Rupee falls on thin volumes 1952
- SriLankan, Japan Airlines add new routes 1941
- Colombo Port box volume up 5.6-pct in Jan 1933
- Private sector to transform into main domestic growth engine 1945
- Oil eases from 5-week top, rising US production weighs 1902
- Tight fiscal and monetary policies constrain SL’s growth 1932
- Shell admits dealing with money launderer 1912
- Toshiba may sell chip business to Foxconn for $27bn 1921
- Asian shares pressured by geopolitical risks; Nikkei down 0.25% 1907
- SLIM launches Certificate in Digital Marketing 1912
- Microsoft Hosts Second ‘Device Day’ in Sri Lanka 1912
- Emirates named Best Airline in the World 1892
- Turkish Airlines and social media assist Somalia 1913
- Brain cell therapy ‘promising’ for Parkinson’s disease 1909
- Trump pushed into bombing Syria 1967
- Thailand discovers Power of Women Travellers 1934
- Economics of gambling 1840
- Trans National Aural Identity 3503
- Queen Anula The Shadow of Cleopatra 3561
- Poetry and its possibilities Part 2 3561
- The Enigma of Labyrinths 3651
- From Couture to Kutir 3546
- Hybrid Sources 4936
- Offering Riddles & Enigmas 5001
- Poetry and its possibilities 5053
- With a festive bang! 1159
- Easter Fun 1153
- Arrogance and crowing is the way of the doomed 1199
- Avurudu on the streets 1207
- Tick control 1184
- Sunny Sunday on the beach 1165
- It’s time to save the world 1214
- From viewer to YouTuber! 1235
- Expert skincare and makeup 1255
- Avurudu at Induruwa 1221
- Exo 1252
- Remembering our fallen heroes 2336