John Keells PLC (JKL), the commodities and stock broking arm of John Keells group, turned in a net loss of Rs.11.5 million for the quarter ended March 31, 2016 (4Q16) from a net profit of Rs. 21 million posted for the same period last year, the interim results showed. The loss per share was 19 cents against an earnings per share of 35 cents a year ago.
The low tea prices coupled with the lackluster performance in the Colombo bourse and the massive jump in distribution expenses were the key contributors for the depressed performance of the company. JKL is in the business of produce broking—tea and rubber—supplying of pre-auction produce warehousing and stock broking.
The firm’s top line narrowed by 14 percent year-on-year (yoy) to Rs.159.9 million. The operating loss was Rs.72.9 million because the distribution expenses rose by a thumping 302 percent yoy to Rs.114.3 million. The segmental results showed the produce broking unit turning in a before-tax loss of Rs.40.8 million from a profit of Rs.25.1 million a year ago.
This unit earned a revenue of Rs.101.1 million, down from Rs.113.8 million. The profit of group’s warehousing business fell to Rs.3.1 million from Rs.9.4 million a year ago. This segment’s revenue was Rs.16.9 million, down from Rs.23.1 million. The share broking unit made a before tax loss of Rs.390, 000 in comparison to a profit of Rs.2.6 million during the same period last year. The revenue was Rs.41.4 million, down from Rs.47.7 million a year ago.
Meanwhile, for the year ended March 31, 2016, JKL recorded a net profit of Rs.52. 7 million, one-quarter of the profit it recorded a year ago, with an earnings per share of 87 cents. The top line too plunged by 26 percent to Rs.706.7 million. The distribution expenses rose by 185 percent to Rs.196.1 million. For the year, the produce broking unit’s before-tax profit fell steeply to just above Rs.8 million from Rs.200 million last year. The warehousing business saw its profits narrowing by 22 percent to Rs.32.4 million while share broking unit’s profits plunged to Rs.15.1 million from Rs.90 million. The firm’s board of directors last week proposed a first and final dividend of Rs.1.00 a share. As of March 31, 2016 John Keells Holdings PLC held 86.9 percent stake in the company.