LankaClear sees profit growth
Ramani KANGARAARACHCHI
LankaClear (Pvt) Ltd. profit before tax grew by 32 percent despite a
decline of net revenues by 12 percent compared to the previous financial
year.
This was revealed at the Ninth LankaClear AGM held recently to
release their annual report.
Director Janakie Mampitiya, Director W A Nalini, GGC Director
Ariyaratne, Chairperson Priyantha Liyanage, Director Mala
Dayaratne, Director Angelo Fernando, Observer Upali de Silva and
CEO and General Manager Sunimal Weerasooriya. |
LankaClear CEO Sunimal Weerasooriya said the decline in the revenues
was mainly attributed to the loss in income from front-end services
provided by the Company to the Banks on cheque scanning after all banks
migrated to the CD submission mode from the physical cheque submission
mode in July 2010.
However, the company had been able to reduce the cost of sales by 33
percent due to this migration and a significant reduction in maintenance
costs, he said. The company recorded a profit before tax of Rs 162
million and a profit after tax of Rs 91 million, Weerasooriya said the
company was able to maintain an impressive net profit margin of 26
percent, which was an improvement from the previous year’s 21 percent.
The company also maintained a very healthy debt : equity ratio of 7 :
93. Earnings per share increased from Rs 5.30 to Rs 6.04 and Net Assets
per Share increased from Rs 38.72 to Rs 43.59.
The company reported that the items cleared through the Sri Lanka
Interbank Payment System (SLIPS) increased significantly by 32 percent
compared to the previous year whilst the value of SLIPS items cleared
grew by 19 percent. The total value of items cleared through SLIPS
during the financial year 2010/11 stood at Rs 346 billion.
Addressing shareholders at the AGM, LankaClear Chairperson, Priyantha
Liyanage said system improvements in both the Cheque Imaging and
Truncation System (CITS) and Sri Lanka Interbank Payment Systems (SLIPS)
resulted in significant improvements in efficiency, features and
security of transactions which benefited the Bank customers.
During the year, CITS Settlement Clearing migrated to online mode
eliminating the requirement of Banks to submit CDs in this leg of
clearing.
This resulted in LankaClear Inward Return Submission time being
advanced to 1.30 pm, facilitating the collecting Banks to give good
value to customers by 3 pm.
She said the internal efficiency improvements carried out in the Main
Clearing Leg enabled LankaClear to extend the outward item submission
time to 7 pm facilitating Banks to accept cheque deposits for T + 1
clearing up to the counter closure time of 3 pm.
She further stated that the upgrading of the SLIPS application in
September 2010 resulted in complete online submission of items and T + 0
clearing for credit transactions.
With this improvement, the Banks are now able to credit customer
accounts by 3 PM on the same day on items received by LankaClear by 12
noon and by 9 am the following day on items received by LankaClear by 6
pm.
Chairperson Liyanage also said that despite the continuous increase
of some of the operational costs, LankaClear has been able to maintain
the same tariff charged for clearing of a cheque from the inception of
CITS in 2006 to 2011 due to continuous efficiency improvements and cost
reduction measures in areas like energy and maintenance.
LankaClear is a company jointly owned by the Central Bank of Sri
Lanka and all Licensed Commercial Banks. |