First Capital Holdings reports 9-month NP of Rs 199 mn

Active trading strategies in the Government Securities market and strong gains from Structuring and Placement issues, have enabled First Capital Holdings PLC (FCH), to post net profit after tax of Rs 199 million for the nine months ended December 31, 2012.

In a filing with the Colombo Stock Exchange, the Group said Revenue increased by 31% to Rs 1,160 million in the period reviewed.

This increase had been mainly attributed to above average returns from the company’s government securities operations, as a result of First Capital’s ability to carry appropriate long term positions due to the strength of its capital base.

The company also raised a noteworthy Rs 5 billion for a diverse group of clients through commercial paper, debentures and securitisations in the nine months reviewed and has a fourth quarter pipeline of approximately Rs. 6 billion. First Capital’s net profit after tax for the third quarter (October – December 2012) was Rs 86 million, compared with a net loss after tax of Rs 220 million in the third quarter of 2011/12.

Earnings per share for the period was Rs 1.84 as against a loss per share of Rs 0.99 in the corresponding quarter of the previous year.

The Group's net assets per share stood at Rs 13.13 as at December 31, 2012. Commenting on the Group’s performance, Mangala Jayashantha, Chief Financial Officer of First Capital said: “First Capital’s success was largely due to its ability to maximise returns in the bond market by developing large and profitable portfolios and holding favourable positions.”

He disclosed that consequent to tax exemptions granted in the Government’s 2013 Budget, the Group would also be able to further capitalise on its corporate debt business and take advantage of the proposals in the Central Bank’s Road Map for 2013. Focusing on new business lines for the company, he said that “We will now see more opportunities in the corporate finance advisory space.

First Capital is ready to assist corporate clients with their strategic financial issues.

We are geared to work with companies to improve the odds of successful Mergers and Acquisitions (M&A), by way of fund raising in the capital markets or by providing focused and in-depth advice on M&A, both on the buy side or sell side and on other corporate finance activities.”

“Our team of experienced corporate finance professionals are working on a variety of assignments involving a broad spectrum of industries and will definitely add significant value to our clients’ initiatives,” Jayashantha added.