Free Lanka Capital Holdings profit tops Rs 1.27 b

Free Lanka Capital Holdings Ltd has reported exceptional results in the year ended March 2011.

Recording a gross revenue of Rs 6.5 billion for the Group during the financial year 2010/11 as compared with Rs 4.9 billion the previous year - a 33 percent increase, the Group's provisional financial results show a profit increase of over 300 percent.

Profit before tax amounted to Rs 1,374 million in 2010/11 as against Rs 341 million the previous year which is an increase of 303 percent. Profit after tax recorded a 319 percent increase year on year with the figure for 2010/11 at Rs 1,270 million compared to Rs 303 million in the earlier financial year.

The performance is considered as most satisfactory by financial analysts who attribute the success to increase rubber and tea prices as well as sound management of the numerous activities coming under the purview of several subsidiary companies.

The group's earnings are mainly from the plantation sector that is Maturata and Pussellawa Plantations.

These two plantations comprise around 19,000 acres of tea and 13,000 acres of rubber.

Maturata comprises 19 tea estates while Pussellawa comprises 11 tea estates and nine rubber estates and four estates with a mix of tea and rubber.

The tea produced in these estates have won many awards last year. Pussellawa also produces green tea in two factories. The company also has invested in commercial timber with over a million trees being planted on their properties.

To take advantage of high rubber prices the group has completed an aggressive replanting exercise which commenced in 2005 wherein a sum of Rs. 1 bn has been invested in new planning and replanting of rubber.

Steps have also been taken to upgrade current rotavane manufacturing methods in some of the tea factories. Utilizing existing spare capacity at its factories the company aims to increase further bought leaf intake in low grown factories. The Group is also into real estate and commercial development through Free Lanka Properties.