Hemas 2Q net profit down 14% over slowing demand, higher costs
Diversified conglomerate Hemas Holdings PLC continued to face challenges during the second quarter of the 2018 financial year (2Q18) ended September 2017, with a sharp fall in the bottom line compared to the same period last year, attributed to contractions across most of the group’s operating segments stemming from cost increases.
Net profit for 2Q18 fell 14.3 percent year-on-year (YOY) to Rs.726 million, while earnings per share fell to Rs.1.27 from Rs.1.48 YOY. The share prices of Hemas remained unchanged at Rs.130 at market close yesterday.
Hemas’ leisure, travel and aviation segment ran into a net loss of Rs.17.8 million due to a fall in occupancy at group hotels, while the consumer segment net profits fell by 20 percent YOY due to a weakening domestic market and higher distribution expenses, especially in the group’s operations in Bangladesh, according to Bartleet Religare Securities (BRS).
BRS said that the healthcare segment net profits fell in the low single-digit level due to rupee depreciation, although the pharmaceuticals manufacturing arm registered a 7 percent YOY growth in earnings. The logistics and maritime segment profits increased 78.1 percent YOY to Rs.148.5 million.
Group revenue expanded 8.6 percent YOY to Rs.11.7 billion. The healthcare segment, which accounts for nearly half of the group’s revenue, recorded Rs.5.5 billion in sales, increasing 14.1 percent YOY.