Central Finance continues to show strong growth in 2008/09

Inspite of the uncertainty that has prevailed in the financial sector in Sri Lanka during the last quarter, Central Finance Company PLC continues to demonstrate encouraging results.

During the three months ended in March 2009, the Company maintained a steady growth in income as deposits continued to increase and profit before tax was recorded to be higher than the corresponding period the previous year.

According to the interim financial statements released for the year ending March 31 2009, total assets of the Company stood at Rs.31.3 billion compared to Rs 30.21 billion, in 2007/08.

In the last quarter during which the financial climate was not favourable, many depositors adopted a 'wait and see' attitude, but they continued to show confidence in Central Finance. As a result deposits recorded an increase of Rs1.224 billion which was 10 percent over the previous year and stood at Rs.13.467 billion at year end.

The annual results show profit before tax recording a 9.63 percent increase from Rs 1.51 billion to Rs 1.66 billion.

Higher taxation of Rs 625 million compared to Rs.467 million previously, resulted in a marginal drop in after tax profits (Rs 1.047 billion to Rs 1.035 billion).

It is significant that the billion rupee profit level has been maintained for the past four years.

Overhead cost increases have been contained to 8.74 percent ( which includes VAT on Financial Services amounting to 2.58 percent) over the corresponding period.

Funding cost has shown a further reduction of 2.83 percent quarter on quarter (December 31).

The interest expense increase as at end December was 22 percent and for the year it is down to 20 percent.

Income for the year was Rs 6.9 billion as compared with Rs 6.0 billion in the previous year, showing an increase of 14.73 percent.

A consistent policy of re-investing earnings within the business, continues to strengthen the company's capital base (shareholder funds), which is the highest in the sector, amounting Rs 7.052 Billion, which grew by Rs.887 million during the period.

The financial position of the company is reviewed annually by an internationally recognized rating institution, Fitch Ratings Lanka, which has re-affirmed the A+ (lka) rating for Central Finance.

The Company has secured this rating consistently for the last three years, and is the highest rated finance company in the country.

The company is among the top 10 highest rated financial institutions in Sri Lanka.