Hemas rebounds strongly in second half | Daily News


 

Hemas rebounds strongly in second half

Financial year 2019/20 has been the most challenging in the 70 year history of the Hemas Group with performance impacted by the aftermath of the Easter Sunday 2019 attacks coupled with the Covid-19 pandemic.

This has resulted in the Group recording consolidated revenue of Rs.61.6 billion for the 12 months ended March 31, 2020, 3.8% lower than last year. Operating profits for the financial year stood at Rs.3.6 billion, a YoY decline of 37.1% said Hemas Group Chief Executive Officer Steven Enderby. (Pictured.)

During the year, the Group continued its recovery from the aftermath of the Easter Sunday crisis with post tax profits of Rs.1.7 billion for the second half of the financial year, compared with the loss of Rs.298 million reported in the first half. This is despite the impact of Covid-19 on March 2020 performance. This improvement has been driven by the Group’s core Consumer and Healthcare businesses. The Group continued to show the same resilience as it responded to the Covid-19 pandemic with its Consumer and Healthcare businesses, which account for more than 90% of revenues and profits, showing month on month recovery in Q1 20/21. “During the first two months of Q4, our consumer businesses performed well with strong demand across all categories. Revenue across the consumer segment fell by 22.4% compared with Q4 last year.

However, operating profit grew by Rs.157.5 million over Q4 last year.” For the full year, our Consumer businesses experienced a sharp contraction in the first two quarters following the Easter Sunday attacks and a strong recovery in Q3 and Q4 until the nationwide lockdown in March. As a result, Hemas consumer sector recorded a full year revenue of Rs.23.8billion, a YoY decline of 6.8%, with sector profits of Rs.1.9 billion, a drop of 30.5% over last year. Healthcare sector recorded Q4 revenues of Rs.8.9 billion, a YoY growth of 23.7%. Operating profit was impacted by the adoption of SLFRS16 and the VRS costs at Morisons warehouse. “We have also seen net financing costs increase as capex has been incurred on Morisons new plant as it nears completion.” The financial year closed with the sector recording a consolidated revenue of Rs.31.4billion, a YoY increase of 13.4%. Operating profit grew by 3.6% whilst earnings declined by 6.5%. “Finance cost increases of 119.1million during the year were due to working capital financing at pharmaceutical distribution and the cost of constructing the new Morison manufacturing plant.” Morison PLC pharmaceutical manufacturing segment achieved revenue of Rs.2.9 billion and operating profit of Rs.260.5million for the year ended March 31, 2020. Revenue growth was 11.9% with profitability increasing by 9.2%. Hemas Leisure, Travel and Aviation business performance declined with full year revenues and earnings down by Rs.1.4 billion and Rs.479.8million compared to last year. Hemas Logistics and Maritime recorded a revenue decrease of 17.8% over last year, with revenues of Rs.2.3billion as at March 31, 2020.


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