Access Engineering to move to automobile sector
Access Engineering Limited (AEL) which is on the verge of opening its
ground breaking and much anticipated Initial Public Offering on 6th
March 2012 made a foray into the automobile sector in the country via
the acquisition of the majority stake of Sathosa Motors PLC (SMOT) from
ITOCHU Corporation of Japan on 29th February 2012. AEL acquired
3,600,000 shares of SMOT at a price of Rs.235 per share on the Colombo
Stock Exchange, thus gaining the controlling interest of the latter.
SMOT, incorporated on March 11, 1982, is a public limited liability
company. However the roots of the company go back to 1962, where ISUZU
agency was secured by the Co-Operative Wholesale Establishment in 1962.
SMOT is the franchise holder for 'Isuzu' brand of vehicles and spare
parts (manufactured by M/s Isuzu Motors Ltd, Japan) in the Democratic
Socialist Republic of Sri Lanka and the Republic of Maldives. The Isuzu
range of vehicles consists of double cab pickup trucks, light duty and
heavy duty commercial vehicles, luxury passenger coaches and special
purpose vehicles such as fire trucks, logging trucks, dump trucks, water
and fuel bowsers and various other types of vehicles required in
building construction, distribution of goods etc. To date the company
has a portfolio of over 100,000 ISUZU brand motor vehicles sold over the
years. The customer portfolio of the company comprises of both private
and state sector institutions.
In ?Brands Annual? compiled by 'Brand Finance' in April 2011, on the
Most Valuable Brands in Sri Lanka for the year 2011, SMOT was ranked 88
with a brand rating of 'B'.
SMOT also holds the franchise for 'Opel' passenger cars and Opel
spare parts, manufactured by Adam Opel AG of Germany and marketed by the
General Motors Overseas Distributors Corporation. The Opel range of
vehicles mainly comprises of passenger cars and jeep type vehicles.
The head office of SMOT is located at Vauxhall Street, Colombo 02
within which the new vehicle sales showroom, spare parts stores, sales
office and, Opel and Isuzu repair workshop are located.
The company also has a spare parts outlet at Panchikawatte for the
convenience of its customers. The main workshop of the company is
located at Peliyagoda where the major portion of workshop repairs are
carried out for all models of Isuzu trucks using modern and high tech
equipment while providing technical advice to its valued clientele. The
company also has an authorized dealer network of nearly 50 dealers
Spread Island wide.
According to the provisional results of SMOT released to the Colombo
Stock Exchange for the nine months ended 31st December 2011 the company
has recorded a net turnover of Rs.1, 393 million , a 37.5% increase over
the corresponding period.
The total gross profit for the same period has been Rs. 242 million,
a 50% increase over the previous corresponding period. The company has
recorded a profit after tax of Rs. 128 million, which is a staggering
125% increase over the corresponding period.
This eventually turns out to an earnings per share of Rs. 21.22 for
the 9 months period ended 31st December 2011. The company does not have
any significant non current liabilities except for a Retirement Benefit
Obligation of approximately Rs. 21 million, thus has the ability to
leverage on its equity base of approximately Rs.550 million for
expansion purposes.
The net asset per share as at 31st December 2011 was Rs. 90.73, a 38%
increase over the corresponding figure as at 31st December 2010.
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