Hemas Holdings reports solid 3Q on strengthening consumer spend

Hemas Holdings PLC reported some solid top and bottom-line performance in the three months ended in December 2024 (3Q25) supported by better performance across its all three key business units which were helped by rising consumer spend as well as the ease in costs.

The sharp fall in the finance cost also helped the earnings due to lower interest rates while improved cash flows helped the group to cut its net debt.

The consumer products juggernaut which has diversified interest into healthcare and transportation reported revenues of Rs.33.23 billion for the October – December period, its fiscal third quarter, up 6.4 percent from the same period a year ago.

Group’s consumer brands business generated revenues of Rs.16.05 billion, up 4.0 percent from the same period in 2023. Consumer brands business comprises of three sub-segments – home and personal care, learning segment and consumer brands international.

The company said both its beauty and personal care segments experienced volume growth but the home-care segment saw a decline in the market share due to consumers trading down into generic products in some price sensitive categories.

The learning segment represented by its Atlas Axilla stationery manufacturing business met with some heightened competition from the influx of new entrants into the segment due to the easing of import restrictions and the appreciation in the rupee which brought the costs somewhat down.  

Its consumer brands international business represented by its Bangladesh operations saw the company managing to maintain its market share in its value-added-hair-oil ‘Kumarika’, in spite of the double digit inflation and the increased price sensitivity there.

The broader consumer brands segment reported an operating profit of Rs.3.20 billion for the quarter, up from Rs.3.10 billion in the same period a year ago.

The group’s healthcare segment has seen gaining momentum and recovering from the downturn in the economic crisis as the consumers are increasingly looking for affordable healthcare options.

Its pharmaceutical manufacturing business secured an extension to the buyback agreement for 2025 with new orders already confirmed. Its pharmaceutical distribution business remains the market leader.

The company’s two hospitals in Wattala and Thalawathugoda have seen a steady increase in the outpatient revenues but the in-patient revenue has seen a decline due to lower admissions, a trend which the company says, also observed across the industry.

The broader healthcare segment generated revenues of Rs.16.66 billion for the quarter, up 8.7 percent from the same period in 2023 while the operating profit has risen sharply to Rs.1.57 billion from Rs.952.16 million.
The group’s mobility business was propelled by both its maritime segment and the aviation segment. Rise in both freight rates and volumes in both imports and exports operations lifted the maritime revenues while the cargo revenues lifted the aviation segment.

This segment generated revenues of Rs. 518.67 million for the quarter, up 12.6 percent from the same period in 2023.

The operating profits too grew to Rs.346.67 million from Rs.284.12 million.

The group’s gross margin expanded by 1.6 percent to 33.1 percent while the operating margin has expanded by 2.2 percent to 14.6 percent, lifting the operating profit for the quarter by 25.7 percent to Rs.4.86 billion.
The company reported earnings of Rs.5.07 a share or Rs.3.03 billion for the quarter, compared with Rs.3.72 a share or Rs.2.22 billion in the corresponding period in 2023.

The finance cost fell sharply by 42.3 percent to Rs.399.09 million.

The company’s share ended Rs.1.00 or 0.90 percent lower at Rs.110.00 at yesterday’s close before the results were released.