New acquisitions weigh on Hemas 1Q bottom line
The recent new acquisitions weighed on the bottom line of the diversified conglomerate Hemas PLC during the quarter ended June 30, 2018 (1Q19), the interim financial accounts released to the Colombo Stock Exchange showed.
The earnings for the quarter under review fell 20.2 percent year-on-year (YOY) to Rs.554.3 million, on revenue of Rs.13.5 billion, up 21.3 percent YOY.
The earnings per share for the period fell to 96 cents, from Rs.1.21.
Hemas Group CEO Steven Enderby said the reduced interest income due to the utilization of cash reserves to acquire Atlas Axillia was a key reason for the reduction in earnings during the quarter.
The finance income for the quarter under review fell 57 percent YOY to Rs.95.4 million.
He also identified higher interest costs relating to higher working capital due to the strong growth in pharmaceutical distribution and loan financing for the group’s new logistics park as another key reason that hampered the group bottom line.
The finance costs for the period rose 66 percent YOY to Rs.119.21 million.
“All three of these investments should contribute to earnings from 3Q,” Enderby said.
The group operating profit for the quarter under review grew only by 3.5 percent YOY to Rs.895.7 million.