First Capital 1H profit impressive

First Capital Holdings PLC has reported profit before tax of Rs 157 million on income of Rs 657 million for the six months ending September 30, 2011, a period of relatively subdued trading for its primary dealership First Capital Treasuries.

According to income statements released to the Colombo Stock Exchange, the First Capital Group's net profit for the period was Rs 118 million, and profit attributable to equity holders of the parent company was Rs 114.3 million.

These income and profit figures, although lower than those of the corresponding six months of 2010-11, were well above budgeted targets for the first half of the current financial year, a spokesman for the Group said.

He explained that income and profit figures in the corresponding six months of the preceding financial year had been boosted by extraordinary factors.

In 1H 2010-11 First Capital Holdings achieved exceptional gains of Rs 192 million from bonds as a result of falling interest rates.

Profits were further enhanced by a tax reversal of Rs 443 million following a Board of Review decision in a subsidiary's favour.

In the comparatively 'settled' conditions for trading in government securities in the review period, gains from bonds totalled a moderate Rs 36 million, the spokesman said.

However, other areas of income, such as fee income from the structuring and placement business of First Capital Limited have shown noteworthy growth in the six months reviewed, during which fee income nearly quadrupled to Rs 44.4 million, he said.

Similarly margin trading income from First Capital Markets almost doubled to Rs 61 million in the first half of 2011-12, the spokesman said.