Kalpitiya Beach Resorts denounces malicious reports

Kalpitiya Beach Resorts PLC (KBR PLC), a subsidiary of Citrus Leisure PLC, issuing a statement clarified its position with regard to the allegations levelled by the media.

“The proposed venture in Kalpitiya was held back due to the government’s proposed Kalpitiya Integrated Tourism Resort project replete with tourism infrastructure and attractions not being implemented to date.

This factor has been clearly identified as an essential component and a potential risk in the prospectus issued for the Initial Public Offering of KBR PLC,” the statement revealed.

KBR PLC is one of the three ambitious resort ventures undertaken by the group. Two of those projects, in Hikkaduwa and Waskaduwa, were completed as scheduled and are now operational, adding 200 rooms to Sri Lanka’s tourism inventory. It further said that the company has regularly made transparent disclosures regarding the postponement of the project via its annual reports, Annual General Meetings and disclosures to the CSE as early as December 20, 2013 and the shareholders have been regularly updated and been fully aware of the current status.

“The company has not commenced the project as planned because the desired occupancy levels cannot be achieved if KBR PLC were the only disproportionately large operator in the area, leading to potential significant financial losses,” it said.

“Moreover, at all times, the company has acted with the interest of commencing the project in a feasible manner; in fact, along with the architectural plans, all statutory approvals and permits relating to tourism, construction, environment and utilities, etc., have been obtained.”

It was revealed that the directors, management and senior executives of the parent company have made several efforts to attract potential partners who may assure guaranteed occupancy and access to new markets.

“As the last disclosure was made on 20.12.2013 and as per the Securities and Exchange Commission (SEC) directive dated March 20, 2015 requesting an EGM where KBR PLC could apprise shareholders of its financial position and pass a resolution on an alternative course of action, the company informed shareholders of the same by a circular dated April 7, 2015,” it said. The company, guided by the SEC, is also said to be in the process of setting out a more detailed course of action to be taken up at the EGM for shareholder approval, in the near future.