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Carson Cumberbatch Group for the nine months ended December 31, 2002, has reported a notable growth in consolidated turnover and profit before tax. The main contributors to the turnover and profit were the core businesses of the company, namely brewery, investment holdings in Sri Lanka and palm oil, based in Sri Lanka and the South East Asian region. Consolidated turnover was Rs. 2.9 billion and consolidated profit after tax Rs. 429 million while the shareholders' funds including minority interest as at December 3, 2002 was Rs. 6.7 billion.

The sector was able to generate a reasonable return during the third quarter mainly due to the significant rise in palm oil prices. This trend is expected to continue during the first half of 2003. The sector turnover was Rs. 967 million and profit tax was Rs. 128 million during the period under review.

The new plantation in Indonesia which currently has an immature area representing 20% of the total planted area, will attain full maturity by the end of the year 2003/04. Income levels in the Malaysian plantations have also seen a notable growth which can be attributed to the increase in price levels, whilst the planned replanting program being done in the Malaysian plantations has been expedited in order to ensure competitiveness and productivity in the long term.

Stable economic conditions in the country, together with growth in sales, account for the improved performance for the third quarter. A turnover of Rs. 1.6 billion and profit after tax of Rs. 298 million was reported by the Brewery sector during the period under review. Subsequently to the budget proposal to issue retail licences to outlets for the sale of soft liquor, the brewery sector is looking to improve the sales volumes. Encouraged by the government's decision and being a pioneer and the market leader in this industry in Sri Lanka, the Group's brewery business continues to emphasise the need for speedier implementation of reforms in the regulation of the soft alcohol industry.

The recovery in the local stock market due to the peace initiative, new listing and growth in the economy presented more opportunities for the investment sector to enhance the value of its holdings. During the third quarter a turnover of Rs. 157 million and profit before tax of Rs. 147 million was recorded by Ceylon Guardian Investment Trust limited and its subsidiaries - the Group's investment holdings sector. The market value of the Guardian Group portfolio grew by 108% to 2.5 billion during the period under review, while market value as at March 31, 2002 stood at Rs. 1.2 billion.

With the local tourism industry showing signs of recovery the leisure sector continued to perform moderately with hotels reporting a reduction in losses. However, a significant turnaround in the industry is necessary if we are to wipe out the accumulated losses of Rs. 86.2 million. The Airlines sector has turned in an improved performance and the new representation of Transavia Airlines is expected to contribute to the future growth of this sector, a spokesman for the company said.

The real estate sector of the group turned in a satisfactory performance during the period under review. However, one of our properties continues to be affected by the closure of Janadhipathi Mawatha, which hinders our ability to attract good tenants to fill up the vacant area, he said. With the economic recovery we are looking at investing in new business ventures that will add value to our shareholders.

As one such initiative Carsons together with a consortium including John Keells Holdings Ltd and Ceylon Biscuits Ltd bid for the 40% stake in Cooperative Wholesale Establishment (CWE) which was up for privatisation.

Carsons is encouraged by the ongoing peace initiatives, the growth potential shown by Sri Lanka's economy, and the increase in investor confidence, which will provide a better foundation for businesses to operate in future, he said.

Increase in profitability for Guardian Group

The Ceylon Guardian Investment Trust Limited, (CGITL) together with its subsidiaries, reported a consolidated turnover of Rs. 157 million during the period under review and a consolidated profit after tax of Rs. 144 million.

The Group's portfolio had a market value of Rs. 2.5 billion as at December 31, 2002, compared to the market value of Rs. 1.2 billion as at March 2, 2002. The recovery in the local stock market and the growth in the economy due to the progress of the ongoing peace initiative are the main reasons for the improvement in performance. During this period the All Share Price Index and the Milanka Price Index grew 32% and 37%, respectively. The portfolio was also enhanced by the recent infusion of new funds through a rights issue.

During the nine months under review, the Company's portfolio was enhanced by acquiring shares at a cost of Rs. 147 million while the acquisitions by the Group totalled Rs. 202 million. The Group also subscribed to the IPOs of Sri Lanka Telecom Ltd and The Lanka Hospital Corporation Ltd, which were identified as stocks with attractive future potential. Shares worth Rs. 57 million were disposed during the period, by the Group enabling the Group to acquire other high performing liquid stocks at attractive prices. With the opening up of the economy and the new investment opportunities arising out of this the Guardian Group will be looking forward to the possibility of raising additional funds in order to give its shareholders optimum returns in the long run.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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