Odel June profit up 21% on strong sales

Odel PLC, up-market fashion and lifestyle retailer reported earnings of 16 cents a share or Rs.43.1 million for the April – June quarter, up 21 percent from a year ago supported by strong sales and other incomes, the interim financial accounts released to the Colombo bourse showed. 

The revenues rose by 12 percent year-on-year (YoY) to Rs.1.66 billion from a year ago and the other incomes jumped from Rs.548.9 million to Rs.1.5 billion for the quarter.

The retailer’s strong sales demonstrates the company’s clientele, mostly consisting of tourists and the upper middle and high income class is immune to the domestic economic cycles as several other retailers saw their performance being adversely impacted due to weak consumer demand.     
Meanwhile, the earnings before interest and tax also rose by a strong 45 percent YoY to Rs.144.7 million. 

Odel is positioning itself as a premium retailer catering to the growing affluent class as the company recently entered into an agreement to take on lease over 52,000 square feet of retail space at One Galle Face, the mixed development by Shangri La Hotels and Resorts. 

In addition, the company is also developing its 600,000 square feet megamall on the land adjoining its flagship store at Alexandra Place which is set to open doors in three years. 

Further, the company has decided to invest US $ 105.7 million in a mixed development project at Ward Place, Cololmbo 7 as a Board of Investment project. 

For this purpose, Odel PLC formed a fully owned subsidiary, Odel Properties One Private Limited with a Rs.10 million capital. 

Meanwhile, Odel’s finance cost rose by 65 percent YoY to Rs. 75.6 million as the total debt by the end of June 30 stood at Rs.2.8 billion. 

As at June 30, Softlogic group companies collectively held 97.57 stake in Odel. The company’s public  free float stood at 2.43 percent.