LOLC PBT Rs. 9.3 billion
The LOLC Group continues to record steady growth in profitability,
with its core business in the financial services sector maintaining its
progressive growth in profits. The Group recorded Rs. 9.3 billion PBT
for the nine months ended December which is an excellent growth of 30%
compared with the previous year. The resultant PAT recorded a 31% growth
over the last year at Rs. 7.9 billion.
CEO LOLC
Kapila Jayawardena |
Deputy Chairman
Ishara Nanayakkara |
The financial services sector strengthened its position and remained
the main contributor to operating profits, and this had a positive
impact on the Group's performance despite lower other income recorded
for the period due to the prevailing equity market conditions.
Attractive interest rates commanded by the Group for its lending
portfolio together with effective portfolio management steered the
companies to improve their income earned from the financial services
business by 49% to Rs. 13 billion for the nine months.
Strong collections by the marketing and recoveries teams strengthened
the Group's collections ratios which are the best in the industry and
this, significantly improved the quality of the loan portfolio.
The corresponding income for the same period in 2010 was Rs. 8.8
billion.
The income growth corresponds with the focused business strategies of
Lanka ORIX Finance PLC (LOFC), LOLC Micro Credit Ltd (LOMC) and
Commercial Leasing and Finance Ltd (CLC), which is to strengthen its
presence in the North and East and to support financing activities of
the agriculture centric client segment.
The Islamic business of the Group, 'Al Falaah' made progress during
the reporting period with significant growth in the portfolio.
The borrowing costs grew by 26% corresponding with the higher quantum
of borrowing.
The additional borrowing came from several multilateral and bilateral
foreign funding partners who use the LOLC Group as their catalysts to
realize developmental roles. These funding institutions also provide
technical services assistance and global best practice knowledge
transfer.
However, the cost of funding for the Group remained competitive
relative to the interest cost volatility.
LOFC's deposit base grew by 62% compared with the previous year to
reach Rs. 23 billion.
Subsequent to the approval received from the Central Bank, CLC
converted itself to a Registered Finance Company and commenced its
savings and fixed deposits operations.
The newly setup LOLC Insurance Co. Ltd., as a composite insurer
offers both General and Life products to LOLC Group customers and other
customers. LOLC Insurance is well aligned to deliver a distinctive value
proposition to its customers through the use of the Group's extensive
branch network, which puts the company on a very strong position
compared with the competitors.
LOLC's expanded into the leisure sector two years ago, with the
acquisition of four hotels in the golden mile on the southern coast was
further strengthened by the new addition of Dickwella Resort Ltd., which
is a 77 roomed resort hotel with a stunning location deep south of the
island. The Group now holds 623 plus keys making LOLC Leisure one of the
largest leisure operators in the country.
Commenting on the outstanding performance of the Group, Group
Managing Director and CEO of LOLC Kapila Jayawardena said: "The future
trends are promising where we will continue to maintain sustainable
business growth for the long term.
We expect to see similar results in the fourth quarter where we would
see the Group's diversified portfolio perform increasingly in tandem
with the Group's core business, financial services." |
