business Sri Lanka

Union Assurance Life (UAL) reported steady progress in the life insurance business, reporting 18% growth in gross written premium compared with the previous year. Profit amounted to Rs.108 million compared with 61 million in 2016. Profit in the quarter does not include a surplus from the life business which is actuarially valued at year end.

As at March 31, 2017, UA’s life fund stood at Rs. 32 billion with a healthy solvency ratio indicating the financial strength of the business.

UA introduced a new Pension product named ‘Union Pension Advantage.’This breakthrough product offers policyholders the peace of mind of knowing that the contributions they make to their policy over their working lives will fund their retirement, and provide reassurance and support for those left behind in the event of a death.

The company also introduced a new scheme for digitally connected housewives and students pursuing academic or professional qualifications to work from home and earn an additional income, by providing protection to their friends and family. The revolutionary concept branded ‘e-Consultant - Insurance’ leverages the end to end digital sales process developed by UA and aims to attract a new breed of insurance advisors to the life insurance industry.

The Company is anchored by a team of experienced and dynamic professionals, and is backed by a strong capital base and reinsurance partnerships with highly rated global reinsurers.

Millennium Housing Developers has recorded an admirable performance recording a profit of Rs 146 million with an EPS of 1.09 for the year 2016/17.

“We are extremely pleased with the performance amid tough conditions; but this is a clear indicator of customer loyalty and confidence” said Jayantha Perera, Director Millennium Housing Developers PLC. We see tremendous potential in this sector and we plan to expand our revenue streams beyond developing neighbourhoods affirms Perera.

“We have already launched two apartment projects; Heights Edmonton and Heights Colombo 5 where the Edmonton project is fully sold out and will be ready for handing over by end of June 2017.” Heights Colombo 5 is 50% sold out where we have completed piling and the construction expected to commence shortly.

In addition we also have plans to develop 88 apartments at Rajagiriya, 50 in Nawala and 150 apartments in the administrative capital near the Water’s Edge for which the scenic properties have already been acquired. Considering the projects in hand, we see tremendous improvement in our cash flows and profitability in the next three years.

Looking in to the future MHDL will enter in to luxury beach villas and Luxury Holiday Homes at strategic locations in the hill country and coastal areas with high demand for apartments.

The12-month inflation dropped to 6.0% in May 2016, from 6.9% in April according to the Department of Census and Statics.

In May 2016, consumer prices rose 1.8%, one of the highest in prices seen in a single month in recent years.

Year-on-year inflation of food groups has increased from 8.6% in April to 9.3% in May 2017 and that of non‐food groups has decreased from 6.3% to 4.6% during this period.

For the month of May 2017, on year to year basis, contribution to inflation by food commodities was 2.70%.

The contribution of non-food items was 3.27%. This was mainly due to value change increases in groups of clothing and footwear (0.11%), furnishing household equipment and routine household maintenance (0.10%), health (0.53%), transport (0.34%), recreation and culture (0.02%), education (0.85%), restaurants and hotels (0.44%) and miscellaneous goods and services (0.52%).

The increase in the index point by 0.91% was due to the increases of food and nonalcoholic beverages items by 0.66% and non-food items by 0.25% respectively.

Sunshine Holdings PLC posted consolidated revenues of Rs. 19.2 billion for the 2016/17 financial year (FY16/17), up 10.3% Year-on-Year (YoY) leading to an improved Profit After Tax (PAT) of Rs. 1.6 billion, reflecting a 33.1% YoY improvement over the previous financial year.

Profitability was bolstered by drastic improvements in the Group’s Agri-business which recorded a 3.2% YoY increase in revenue up to Rs. 6.5 billion despite a 5.1% YoY contraction in Tea revenue in the wake of unfavorable weather conditions during the year.

The sector’s Tea Crop was affected by bad weather, even as the company continues to focus on a concerted strategy to grow quality teas to offset reductions in volumes.

“It has been a year of notable challenges in key sectors however we are pleased to note that the Sunshine Group continues to display a resilient and entrepreneurial spirit in the face of such difficulties.

During the year, our subsidiaries were able to generate significant growth, particularly as a result of some of our more recent innovations as seen in the performance of our palm oil business and our popular Healthguard franchise,” Sunshine Holdings Group Managing Director Vish Govindasamy stated.

Notably, the Palm Oil sub sector reported an increase of 43.8% YoY for FY16/17 with Palm Oil volumes rising 18.2% YoY. The company managed to obtain a higher price for its CPO during FY16/17, which positively contributed to both top line and bottom line of the Agri sector.

While escalating tea prices helped support a notable recovery in the Group’s tea sub-sector, they also resulted in increased pressure on FMCG margins during the second half of the year. Nevertheless, FMCG revenue increased by 22.5% YoY on the back of both volume and price growth, closing the year with PAT of Rs. 275 million, down 34.9% YoY.

Meanwhile, the imposition of pharmaceutical drug price controls on 48 separate molecules by the Ministry of Health over the last year continued to generate negative ramifications for Sunshine’s Healthcare segment.

However the Pharma sub-segment which represents 64% of Healthcare revenue grew at only 6% YoY, due to the impact of reduced prices leading to a sharp 36.9% YoY contraction in PAT down to Rs. 198 million. The company’s Pharma segment is the 2nd largest player in the country with 11.3% share of the market.

LOLC Group concluded an excellent year sealed by its strongest financial performance to date and for the year ended March 31, 2017, the Group recorded PBT of 24.4 billion and PAT of Rs. 20.9 billion, an increase of 106% and 124% respectively, compared to the previous year.

The consolidated gross income grew by 37% to Rs. 92 billion, while the interest income from financial services grew by 41% to Rs. 55 billion. The total assets of the Group increased to Rs. 641 billion, a growth of 69% over last year.

Despite external challenges, the Group’s resilient financial sector, led by the key players, LOLC Finance PLC (LOFC), Commercial Leasing and Finance PLC (CLC), LOLC Micro Credit Ltd (LOMC) and BRAC Lanka Finance PLC (BRAC) delivered a consistent strong financial performance.

The flagship finance company of the Group, LOFC recorded a PBT of Rs. 2.2 billion, with an asset base of Rs. 123 billion, a deposit base of Rs. 81 billion and an advances portfolio of Rs. 91 billion, thus making LOFC one of the strongest and largest NBFIs in the country.

CLC, a turnaround case study since its acquisition by LOLC in 2008, recorded PBT of Rs. 2.2 billion, with an asset base of Rs. 78 billion, a deposit base of Rs. 16 billion and an advances portfolio of Rs. 54 billion.

LOMC, the largest private sector micro credit company in the country, achievedPBT of Rs. 2.5 billion with an asset base of Rs. 63 billion and an advances portfolio of Rs. 50 billion.

Seylan Bank, an associate company of the Group contributed well to the Group’s financial performance with a contribution of Rs. 1.4 billion as profits.

The Group’s Insurance businesses, LOLC Life Assurance and LOLC General Insurance, have performed well during the year, positioning themselves among the top 10 players in both general and life business in terms of Gross Written Premiums in less than four years of operations.

The general business contributed Rs. 310 million as profits, while the Life business recorded a Rs. 320 million as surplus during the last financial year.

LOLC Cambodia PLC, the fourth largest microfinance institution in Cambodia, made significant contribution to the Group’s profit with Rs. 2.5 billion holding an asset base Rs. 42 billion, a deposit base of Rs. 5 billion and an advances portfolio of Rs. 36 billion.

LOLC Myanmar, the greenfield operation established in 2013, has demonstrated remarkable growth, reaching profitable status in just four years since commencement of business.

The profit contribution to the Group was Rs. 61 million with an asset base of Rs. 2 billion, a deposit base of Rs. 460 million and an advances portfolio of Rs. 1.6 billion.

LOLC was the first Sri Lankan organisation and the fourth international operator to commence operations in the Myanmar financial sector.

The Battery Division performed with its renowned brands such as EXIDE, LUCAS and Dagenite where EXIDE maintained its standing with 58% market share. In line with the Group’s dynamic investment management process, the Group divested two of its plantations, Agalawatte and Pussellawa, in the year under review with significant returns to shareholders.

In the meantime, the restructuring strategy adopted by the Group with the entry into the plantation sector, saw strong operational performance at Maturata plantations. Galoya Plantation continues with its sugar production and is venturing into other value added services in the medium term.

The construction arm of the group, Sierra, too completed a notable year with a profit contribution to the LOLC Group of Rs. 493 million. The Group’s Leisure portfolio made steady progress, holding four operational hotels: Eden Resort and Spa in Beruwela, Paradise Resort and Spa in Dambulla, Dickwella Resort and Spa in the deep South and Calm Resort in Pasikudah.

The demand for real estate is in a huge upward curve in Sri Lanka and this trend is likely to continue, said Executive Director, John Keels Holdings, Krishan Balendra.

Speaking at the Sri Lanka Investment and Business Conclave 2017 organised by the Ceylon Chamber of Commerce yesterday, he said that around a decade ago some 200 apartments were sold in Colombo per annum and this has now increased to around 2,000. “We see the demand further increasing.”

He said that space in Colombo is being taken for development and people who are living in large areas with gardens are now looking at selling them and moving in apartments. “A new apartment living culture is now being created.”

This has also resulted in land prices sky rocking and more apartments being built.

He also said that outside Colombo this demand is more on to the beachfront properties and they see a tenfold increase in land prices. “Most of the lands are being used for hotel projects.”

Chairman Jetwing Hotels, Hiran Cooray, said that today they are witnessing the second birth of the tourism sector after the ending of the war. He said that during bad times the hotel sector was driven by around five or six companies and in contrast today many new players have come in to the industry.

“I think Sri Lanka should be better positioned and projected. “As and when this happens all the hotel rooms can be filled.”

Meanwhile in the earlier session, the new Minister of Foreign Affairs said Ravi Karunanayaka said that several meaningful steps were taken during his time to correct some of the issues in the financial sector and these would help investors to look more positively at Sri Lanka.

He said that since day business registrations, long-term business visas, and land ownership are now in place. He also said that investments to be made in Sri Lanka are steady and they would not be tampered with for at least for another 30 years.

The Minister added that it was because the international community was satisfied with the progress that was made by the government in all sectors that the GSP Plus was re-awarded to Sri Lanka.

Minister Karunanayaka also added that they have not signed any agreements for the Hambantota Port projects. “Sri Lanka only has two options . One is to let the Hambantota Port continue as a loss-making venture and pay its losses and debt from the Colombo Port profits. The second is to go in for the Debt to Equity Swap option which China.”

He said that the second option is what the government is aiming at.

Minister of Megapolis Development and Western Development Champika Ranawaka said that development is not taking place and investors too are being looked as especially for the Light Rail link. “We are also looking at improving the waterways and canals in Colombo and also one from Mattakkuliya to Hanwella has being identified.”

The new Deputy Foreign Minister, Eran Wickramaratne, who attended the event as the former Deputy Minister of Public Enterprise Development, said that today there are signs of a reversal of the brain drain.

“This is because Sri Lanka’s can find equal job opportunities in Sri Lanka.”

He also said that the government is keen to pursue more private public partnerships and invited companies to explore this possibility. (See page ii)

Capitol Developers Limited’s latest 470 apartment twin tower project Capitol TwinPeaks announced that it has completed the Piling stage fully and that construction is progressing steadily. Work is now underway on the basement of the twin towers.

The project is well ahead of schedule, which is reflected by the fact that the groundbreaking ceremony was held not too far back in November 2016. Capitol Developers used 5 pilling machines to accelerate construction to meet scheduled completion dates of the project by 2020.

One of these pilling machines the Bauer BG 30 - is the largest piling machine of its kind in Sri Lanka and reflects the developer’s strong investment commitment. Strategically located at Staple Street, Colombo 02, the project is expected to be the most centrally located, high profile luxury residential project in the city.

Capitol Developers and Sanken Construction of the renowned Sanken Group have collaborated to create these iconic skyscrapers whilst the global design firm P&T Group of Singapore are the architects for Capitol TwinPeaks.

It is located in the heart of the city, in an elite neighbourhood, with proximity to prestigious shopping malls and other conveniences, in addition to a beautiful entry point with the lake frontage of Beira Lake.

Capitol Developers has to its credit Capitol Residencies on Dharmapala Mawatha, HR Residencies on Havelock Road, Tulasi Mahal Apartments in Jaffna, Capitol 7 on Rosmead Place, Capitol Elite on Horton Place and the business city hotel, Cinnamon Red. This newest project, Capitol TwinPeaks, a luxury apartment project, will feature a unique Sky Lounge, offering a magnificent view of Colombo, the Beira Lake, the Colombo Port City and even the coastal line and harbour.

Reference the new item published in the Daily News under the headline “Wellawatta building collapse: low quality steel, inferior concrete mixture main culprits” on May 31, ‘Daily News Business’ has mistakenly quoted State Engineering Corporation of Sri Lanka as the source.

This should be corrected as National Building Research Organisation.

State Engineering Corporation of Sri Lanka (SECSL) General Manager, Eng. D.T. Rajasekaran in a letter the Daily News states as follows. “ We (SECSL) would like to bring to your notice that State Engineering Corporation has not officially given any statement or reports to the media on the usage of steel, concrete or any other building material which was used for the construction of the above collapsed building. And we were not informed on this subject in any form before the publishing of this article.”

“We completely deny this report published in your news paper “Daily News Business” supplement on Wednesday, May 31, 2017.”

“Further, structural engineers were involved in the initial investigation of the collapsed building and the report has been submitted to the court. At this moment we cannot comment on the reason for the collapse since this is under the purview of the court.”

Melwa Steel together with a Swiss company will invest US$ 35 million to increase productivity in their factory.

An official from the company said that to accommodate this investment they would be building a new factory in Ekala.

“This new factory would be commissioned in November,” he said.

The official said that the main reason for this is to increase the growing demand they are experiencing.

Melwa Steel is the official steel supplier for many high rise buildings that are being built not only by local companies but also by foreign companies who are involved in mega construction work in various fields.

"Shangri-La Colombo and Hambantota along with Altire, Cinnamon Life, Colombo City Centre by Abans, Avia by Astoria and several other mega developments use our steel bars,” he said.

Melwa Steel recently also diversified into the tourism sector and will invest to construct six resorts for Hilton.

Hilton (NYSE: HLT) signed six management agreements recently with Melwa Hotels and Resorts Private Limited to manage three Hilton Hotels and Resorts and three ‘Double Tree by Hilton’ properties in Sri Lanka.

The projects will be completed between 2019 and 2025 and will see the addition of 800 star-class rooms to the island's hotel stock.

“These properties strategically located in the heart of key tourist destinations of Kandy, Yala, Kosgoda, Nuwara-Eliya, Colombo and Negombo will allow them to reap the full benefits of the burgeoning growth in tourism in Sri Lanka. We are pleased to be working with a partner of the experience and standing of Melwa Hotels and Resorts to advance our footprint within this dynamic country,” Guy Phillips, senior vice president, Development – Asia and Australasia, Hilton said. 

More than 133 foreign investors and business partners met 116 Lankan counterparts at the “Sri Lanka Investment & Business Conclave 2017”yesterday at Cinnamon Grand.

The event is organized by the Ceylon Chamber of Commerce, the country’s premier business Chamber. Over 700 B2B meetings took place between Sri Lankan and foreign businesses. These included infrastructure, agriculture, export manufacturing, apparels, power and energy, recycling of waste, tourism and leisure and export. Services have attracted the highest amount of overseas investor interest.

They have already scheduled B2B meetings with local counterparts. Apart from those sectors, ports and development, education, telecommunications, financial services, petroleum and related products, along with several other sectors have also gained the attention of the foreign delegates.

B2B meetings have been organized covering all thrust sectors of the local economy.The inauguration of ‘Sri Lanka Investment and Business Conclave 20017’ was held yesterday under the patronage of President Maithripala Sirisena on Monday. 

Ravi Abeysuriya, CFA, has been recognised by CFA Institute, the global association of investment professionals that sets the standard for professional excellence, by receiving the inaugural Lifetime Achievement Volunteer of the Year Award from Paul H. Smith, CFA, President and Chief Executive Officer, and Frédéric P. Lebel, CFA, Chair, Board of Governors, on May 19, at the Society Leadership Conference held in Philadelphia, Pennsylvania, USA.

Ravi was selected for this award in recognition of his exceptional performance and enduring results for CFA Sri Lanka and CFA Institute community, among 149 member societies around the world.

“The Society Excellence Awards program gives CFA Institute the opportunity to distinguish the hard work and commitment that our global network of societies demonstrates” noted Emily Dunbar, head, Global Society Relations. “With 149 societies in 73 countries and territories, CFA Institute is grateful for the thousands of CFA charterholders that generously volunteer their time and skills, and in turn, help to create a better member organisation that benefits the investment profession at a local, regional and global level.”

William Boivin, project lead for the 2017 Society Awards also said, “I am delighted that Ravi was selected as laureate for the award for his commitment to the mission and vision of CFA Institute over several decades by the panel of judges who had an overwhelming task with lengthy discussions to select from exceptional nominees. This is a significant achievement and we are all, members and CFA Institute alike, deeply grateful for his service”.

The CFA Institute Society Awards Program was established in 2006 to identify and reward efforts of societies in the delivery of the CFA Institute mission and provide value to the investment professionals they represent. This year, there were 132 nominations submitted globally in 14 award categories, representing 51 societies.

“We are delighted about the laureate for our founder President and first Charterholder, Ravi Abeysuriya’s outstanding work and dedication”, said Rachini Rajapaksa, CFA President of CFA Society Sri Lanka. "As a member society of CFA Institute, we are dedicated in our efforts help build the next generation of investment professionals to serve our members and promote the highest standards of ethics, education, and professional excellence.

We are elated by the recognition shown by CFA Institute for the commitment of the volunteers in supporting the organisation’s mission." 

Sanjay Wijemanne, the former Head of Retail Banking at Standard Chartered Bank, Sri Lanka, will join Fairway Holdings’ as Group Director of Sales and Marketing.

With his appointment, Fairway Holdings will strengthen its core management team as well as take the Group’s Sales and Marketing functions to a new dimension.

Wijemanne, a versatile banker with a wealth of experience spanning over 22 years, has a track record of initiating growth strategies and achieving exceptional results in some of the largest banking institutions in the country.

After a successful stint at HSBC where he held the positions of Head of Branches, Head of Sales and Vice President of Custody and Clearing, Wijemanne took up the post of General Manager of the Value Center at Standard Chartered Bank in 2007.

He was next appointed as the bank’s Head of Retail Banking, a position he held from 2010 to 2017. During the six years of his leadership of the retail sector, the bank attained the highest year on year sales growth rates as well as the highest ever top and bottom line in 2014.

Under his watch, Standard Chartered Bank won the prestigious “Best Retail Bank in Sri Lanka” award for 2014 awarded by The Asian Banker. Wijemanne possesses a BSc degree in Business and Finance from Mount St. Mary’s College, Maryland, USA.

SriLankan Airlines will expand its network to Yangon, capital of Myanmar, from June 1, 2017, with the commencement of a codeshare partnership with Myanmar Airways International (MAI), one of Myanmar’s best-known airlines.

SriLankan will codeshare on flights operated by MAI between Bangkok and Yangon and also Singapore and Yangon, while MAI will codeshare on flights operated by SriLankan between Colombo and Bangkok, and Colombo and Singapore. Passengers will enjoy the conveniences of the partnership such as a single ticket itinerary and interlined luggage.

SriLankan Airlines’ Chief Commercial Officer Siva Ramachandran said: “We are pleased to extend our network to Yangon, as part of our dynamic ongoing strategy of focusing on the Asia-Middle East region, which is the fastest growing market for global air travel.

Myanmar is currently experiencing considerable growth in tourism, and we are confident that the addition of Yangon will strengthen our network and help serve the needs of our customers.”

SriLankan has in recent months expanded its codeshare agreements with several other airlines in order to strengthen its network and provide enhanced travel options for its customers.

With the addition of Yangon, SriLankan’s global network will span 101 destinations in 48 countries. SriLankan is also part of the prestigious oneworld global airline alliance network which serves over 1,000 cities in 160 countries.

The knowledge and competence of the new Minister of Foreign Affairs will boost the program to implement Commercial Diplomacy - states the NCE.

The National Chamber of Exporters of Sri Lanka (NCE) which is the private sector Chamber exclusively serving Sri Lankan exporters, whose member exporters make a substantial contribution to the economic development of Sri Lanka through exports, welcomes the strategy of the Ministry of Foreign Affairs to actively engage in ‘Commercial Diplomacy’ through the Sri Lankan Missions overseas, announced by Dr. Harsha De Silva, Deputy Minister at a recent Forum of the Chamber on the GSP + facility regained by Sri Lanka. President of the NCE Ramal Jasinghe is of the view that the knowledge and competence of Ravi Karunanayake, the new Minister of Foreign Affairs will be an asset to effectively implement the programme given the vital role he has played to boost the economy of Sri Lanka as the former Minister of Finance.

According to the Deputy Minister the Sri Lankan Missions in overseas markets, especially those in the markets of vital importance to Sri Lanka to develop and expand exports, which have hitherto focused their efforts mainly on activities other than international trade will henceforth be required to focus their efforts on Commercial Diplomacy by working closely with the relevant state institutions and private business houses in their markets to promote and develop the export of Sri Lankan products and services to achieve the economic development targets of Sri Lanka.

In this regard the performance of the relevant staff in Overseas Missions will be strictly monitored related to Key Performance Indicators (KPIs) set by the Ministry of Foreign Affairs.

The World Bank expects India’s economy to expand at 7.2 per cent this fiscal, but said that the note ban temporarily disrupted growth last fiscal, which slowed to an estimated 6.8%.

“India’s economy was slowing down in early 2016-17, until the favorable monsoon started lifting the economy, but the recovery was temporarily disrupted by the government’s ‘demonetisation’ initiative,” it said in its India Development Update released on Monday.

The report comes ahead of the release of provisional estimates of national income for 2016-17 by the Central Statistics Office (CSO) on May 31. The CSO, in its advance estimates, had pegged GDP growth at 7.1% in 2016-17.

The World Bank had in January scaled down India’s growth forecast to 7% for 2016-17 and had estimated growth to rebound in 2017-18 to 7.6%.

However, it expects the economy to recover gradually and growth to increase to 7.7% in 2019-2020.

“India remains the fastest growing economy in the world and it will get a big boost from its approach to the goods and services tax,” said Junaid Ahmad, World Bank Country Director in India.According to the report, reforms such as the insolvency code and measures to deal with bad loans of public sector banks, including promulgation of the new ordinance will also be crucial to enhance growth.

It expects inflation and external conditions to remain stable this fiscal. The World Bank highlighted issues of weak private investments, low credit growth and rising anti-trade rhetoric globally as challenges to growth.

The report also stressed that job creation, especially for women, should be the next focus for the government after GST, which can boost growth into double digits.

“India has only created jobs equivalent to 0.9% of the adult population between 2005 and 2012 and most of these regular wage jobs created went to men,” it said.

India’s potential GDP growth can rise by 1% point if half the gap in female labour force participation rate (LFPR) with Bangladesh or Indonesia is closed, according to an assessment by the World Bank.

Six months after the demonetisation of high-value currency notes, the World Bank termed it “a gargantuan and unprecedented” exercise.

While it helped curb black money, the report said that the challenge will now be to sustain compliance by tax-payers as well as the shift to digital transactions from cash payments.

- Indian Express

Lanka Ashok Leyland ended another successful year with improved results touching total revenue of Rs. 11.4 billion owing to an excellent fourth quarter where revenue reached Rs 3.8 billion.

Lanka Ashok Leyland’s foray into export markets made significant gains this year which contributed in expanding the gross profit margin to 9% against 8.4% a year earlier.

Non-recurring expenses relating to tax charges and an impairment provision amounting to approximately Rs 120 mn drove up operating expenses by 44% to Rs 502.7mn from Rs 348.7mn in 2015.

Higher interest rates during the year drove up net finance expense by 64% to Rs 91.1mn against Rs 55.7mn in 2015 while interest bearing liabilities fell almost 9% to Rs 1.8bn from Rs 2 bn a year ago. Inventory levels rose 3% to Rs 3.9 bn for the same period. Profit before tax grew 12% to Rs 351.6mn compared to Rs 314.0mn posted for 2015.

Taking into consideration the non-recurring expenses and the improved performance, the board of directors has declared Rs 30 per share as a dividend representing a 20% increase over last year.

Commenting on the results, Umesh Gautam, CEO of Lanka Ashok Leyland said, “despite of frequent changes in the import duties, restricted leasing facilities and adverse market conditions, this year’s performance has been a reflection of the prudent financial management, collective effort by management and all our employees.

The bottom line remains healthy, notwithstanding the extraordinary line items on the firms’ operating expenses.

For another year, the key macro variables trended against us as average weighted lending rates rose approximately 200 basis points impacting demand while the Lankan Rupee lost around 4.5% against the US Dollar driving import prices up and negatively impacting our margins.

However the depreciation was not as severe as 2015, where the LKR fell over 9%, and we were able to navigate the risks better.

In focusing on the variables within our control, Gautam said “I am proud of the marketing team’s innovation, industry, and effort throughout the year to increase our market share and sales in the midst of a challenging environment.

Overall unit sales increased 10% year on year despite rising costs, partly driven by the construction sector which continues to be a driving contributor for national output”

We remain well capitalized as interest bearing liabilities fell almost 9% while inventories rose 3%. During the year, we were granted better terms of import through our principal Ashok Leyland, greatly helping our working capital positions.

Looking ahead, we continue to see strong demand emanating from key economic sectors such as the construction industry going into next year despite a challenging external environment for the rest. Interest rates may start to fall in the latter part of the year, however it depends on other economic factors and the success of government reform to tackle its foreign debt position. Addressing our overreliance on domestic vehicle sales as a disproportionate portion of revenue, our export push has grown over 700% in the last year and we hope to make further gains.”

Ceylinco Life has accelerated into FY 2017 posting robust income growth and exceptional profit growth for the three months ending March 31, 2017.

Sri Lanka’s life insurance leader reports that profit before tax improved by a noteworthy 51 per cent over 1Q, 2016 to Rs 822.73 million. Profit after tax for the three months, at Rs 673.34 million, reflected even higher growth of 57.8 per cent despite a 26 per cent increase in income tax for the period.

Gross written premium income was up 7.26 per cent to Rs 3.56 billion, the company said, while investment and other income grew by a remarkable 21.39 per cent to Rs 2.31 billion.

Ceylinco Life’s investment portfolio reached Rs 85.98 billion as at March 31, 2017, representing an increase of Rs 5.23 billion or 6.48 per cent since December 31,2016 and Rs 12.58 billion or 17.14% per cent over the preceding 12 months.

The company’s Life Fund stood at Rs 79.89 billion at the end of the quarter reviewed, a growth of Rs 1.97 billion or 2.53 per cent over three months.

“The figures for the first quarter are impressive, especially in the context of the prevailing volatility and uncertainty in the market,” Ceylinco Life Managing Director/CEO R. Renganathan said.

“We believe that our unrelenting focus on business fundamentals and astute investment strategies can be credited for this stellar performance.”

Ceylinco Life paid Rs 1.6 billion in net benefits and claims in the three months reviewed, a decrease of 7.81 per cent over the corresponding period of last year.

Total assets of the company grew by 5.4 per cent over the three months to Rs 101.738 billion.

At the end of the quarter under review, Ceylinco Life’s investment portfolio comprised of Government Securities (48 per cent); Fixed Deposits (13 per cent); Real Estate (9 per cent); Corporate Debt (29 per cent) and Others (1 per cent). All investments are made in conformity with the investment guidelines stipulated under the Regulation of the Insurance Industry Act No 43 of 2000 and are subject to regular monitoring by the Insurance Board of Sri Lanka (IBSL).

Ceylinco Life ended 2016 with Rs 23.43 billion in total income, with gross premium income of Rs 15 billion and investment income of Rs 8.78 billion. 

The hotels were not affected due to major floods and disasters that came to Sri Lanka. “Now the weather condition in the country is getting better,” said Minister of Tourism Development and Christian Religious Affairs, John Amaratunga at a press conference in Monara Restaurant in Colombo yesterday.

“The tourism industry was not affected by the natural disaster and there were no direct impact or losses to tourism industry,” the minister said.

The floods and landslides have affected only the interior parts of some districts of Sri Lanka. Key tourist areas patronized by foreigners, namely, the coastal belt of South, East and West, sacred city of Kandy, the cultural triangle and the commercial city of Colombo are not affected and easily accessible by road. Tourist hotels in the country are fully operational. Traveling is safe in Sri Lanka during this period but should be cautious if traveling to flood affected areas of the country.

“This year we are targeting a 2.5 million tourist arrivals”.

However Vice President of SLAITO and Managing Director, Hemas Travel Cluster, Harith Perera said that at Hemas Travels there were cancellations in arrivals to Sri Lanka by about 1to 2% due to major floods”.

“We keep getting lot of inquiries and we are trying to hold on to the bookings.”

The floods and landslides which caused damage to lives and properties in some parts of the country have spared the tourist areas of Sri Lanka. The private organizations and the UN agencies are working closely with the government’s relief efforts of coordination and mobilization of resources.

Minister of Tourism Development and Christian Religious Affairs, Janaka Sugathadasa, Chairman, Sri Lanka Tourism Development Authority (SLTDA), Paddy Withana, Director General, SLTDA, Malraj Kiriella, President - The Hotels Association of Sri Lanka, President, Sri Lanka Association of Inbound Tour Operators, business magnate Harry Jayawardena and other officials were also present at the event. 

SBI/FMO Fund and IFC, a member of the World Bank Group, will invest a total of US$ 22 million. (Rs. 3.3 bn.) in the SANASA Development Bank PLC (SDB Bank). SDB Bank is the first Licensed Specialized Bank to respond with an immediate strategy to expand its Capital to meet regulatory requirements.

FMO and SBI-FMO Fund will jointly take up 12.9% equity stake in the bank. This breakthrough partnership will boost the capital base of the bank to be well within the regulatory limits. This will help SDB Bank to reach more small businesses across the country, boosting financial inclusion.

The new investment will increase IFC`s stake in the Bank to 8.9% making them the fourth largest shareholder to date. The bank also aiming at a Rs. 100 billion balance sheet by two years.

FMO is a Dutch Development bank and its mission is to empower entrepreneurs to build a better world.

In addition to the infusion of equity FMO and SBI-FMO Fund will also jointly extend long-term Tier-2 funding of US $ 6.5 million to support new business opportunities including SME lending, Cooperative and Retail Sector.

The Bank has already made a substantial investment in organization realignment, strengthening and improving systems and processes, and is shifting to a digitalized environment with strong capabilities across these main business segments.

The GM/CEO Nimal C Hapuarachchi said,“With this new infusion of capital and long term funding, we will consolidate on gains of past performances and proactively respond to future market requirements, in order to deliver strategic objectives”.

Chairperson Samadanie Kiriwandeniya said, “We have become a more focused business, striving for long-term, responsible growth that will amalgamate profitability with nation`s development”.

“IFC’s long-standing partnership with SANASA is providing more formal financial services to under-served segments within rural micro and small businesses across Sri Lanka,” said Amena Arif, IFC Country Manager for Sri Lanka and Maldives. “This investment will help the bank further extend their reach across the country.”

Suramya Gupta, the Fund Manager for SBI-FMO Fund stated that SANASA is a 100-year-old movement touching the lives of a large section of Sri Lanka`s population and we are happy to partner them.”- SS

The State Engineering Corporation says the use of low quality steel and inferior concrete cement mixture were the two main causes of the building collapse at Wellawatta which took the lives of several workers.

The state engineering corporation issuing an official statement regarding this matter confirmed that the reason for this devastation is the use of law quality building material.

With this incident atrocities of using law quality steel in the construction industry has come to the forefront and we will ask the Sri Lanka Standers Institution to come up with a better ploy to check if inferior steel is being sold in Sri Lanka. The state must take a bigger responsibility to directly interfere to maintain the quality of industrial steel to prevent such incident in the future,” a official from the State Engineering Corporation said.

It has also come to light that a massive tax fraud in the local steel industry is causing an annual loss of nearly Rs five billion to the state. “The manufactures do not pay the NTB and VAT taxes, but the relevant authorities ignore complaints due to the gratifications they are receiving from the manufacturers,” he said.

The frauds relates mainly to reinforcing bars, where the monthly sale is around 45,000 metric tons.

Legally for each ton sold, a 2% NTB and a 15% VAT have to be paid, but the sellers failed to comply with this. The actual sales translate into a required tax payment of more than Rs. 550 million per month, but only around Rs. 250 million is paid, causing an annual loss of close to Rs. 3.6 billion to the government coffers.

In addition, sales figures of steel cage and L-angles etc. too, are manipulated to deny nearly Rs. 120 million of taxes to the government. Furthermore, the income tax is calculated according to the manipulated figures and due to this more than Rs. five billion of tax money is lost to the state.

The manufacturers also use substandard raw materials, with reinforcing bars being produced mainly using locally available steel, not the imported steel as required.

For the removal of colloquiums in the steel, they use machinery powered by sludge, not the costly electricity powered ones which is an industry norm. (VW) 

Administrative Secretary of Free Trade Zone Manufactures’ Association (FTZMA) Anura Nishantha Perera a member of FTZ TM Club has been elected as Division Director division –H-. 2017-2018 by Mike Storkey the International President of Toastmasters International who arrived in Sri Lanka to attend the Annual Conference “OVATION 207” at the Water’s Edge Hotel. He is the Chief Ambassador of Toastmasters International.

Perera has held numerous offices from club through the district level: He holds the ACS, ALB Toastmaster designation, Educational achievement in Toastmasters International. 

We are about to celebrate the first anniversary of the entry into force of the FAO Port State Measures Agreement (PSMA), the world’s first binding international treaty aimed at combating Illegal, Unreported and Unregulated Fishing (IUU Fishing).

This illegal modality accounts for around one-sixth of all fish caught in the oceans, and constitutes a great public danger as it undermines global efforts to make sure that fish – the world’s most produced, consumed and traded animal protein– is a sustainable resource for global nutrition and food security, as well as for millions of jobs.

The PSMA, which currently has 46 parties including the European Union, marks a sea change both in its legal form and in its practical potential.

Under its protocol, foreign fishing vessels must show all required operating licences, their activity logs, and submit to inspections of their catch. Port authorities are obliged to deny services to vessels in violation of the rules and to report them to other countries, making it harder for illegal operators to offload and sell the fish they catch elsewhere. FAO, which brokered the treaty, is also delivering other tools to put an end to IUU fishing. It has a new initiative to improve flag-state compliance, a new set of voluntary guidelines on Catch Documentation Schemes – a passport of sorts without which fish can lose access to markets– and is in the process on creating a transparent and comprehensive Global Record of Fishing Vessels. All of these instruments complement the PSMA.

It is noteworthy that the new treaty was in fact enhanced and expanded, not watered down, in its journey from draft text to binding law.

That clearly shows how seriously the international community supported a powerful, viable and enduring instrument to end IUU fishing.

The FAO calls upon all nations that have not yet joined the PSMA to become part of it.

As important as it is to make its remit universal, what is more important is making the new rules stick. Implementing the PSMA will require a host of actions, including streamlined cross-border real-time communications systems, national legislative reviews, and skilled inspectors capable of identifying actual fish both by species and likely age, as well as ascertaining whether the gear used to catch them is allowed.

The new rules’ ultimate strength will be determined by the weakest link, so all countries have a stake in making sure that no member lacks the technical capacity to deliver on treaty obligations. The PSMA explicitly acknowledges that developing countries and small island states may need assistance in carrying out the monitoring, control, surveillance and compliance tasks the treaty requires, and all parties have pledged to provide that assistance.

The FAO is confident that many countries will join the United States of America, Norway and Sweden, which have already confirmed their contribution to this global capacity-building programme.

The FAO is already committing substantial resources of its own to this effort.

Ocean governance is evolving quickly, and FAO has played a central role in steering capture fisheries towards sustainable management.

With the PSMA, the international community has produced a powerful, viable and enduring instrument to serve as a basis for effectively combating illegal fishing.

Commex Sri Lanka SRL, Commercial Bank’s fully-owned subsidiary in Italy for money transfers, recently appointed Air Connect Travels and Tours of Via Valeggio, Verona, as its authorised agent in the city. Commercial Bank is the first Sri Lankan bank to open a company in Italy for money transfer operations. The Bank’s Chief Operating Officer S. Renganathan and Head of Digital Banking Pradeep Banduwansa attended the inauguration of the agency service in Verona. Here Renganathan (second right) welcomes the first customer at the new agent’s office in Verona, Italy.

As part of the 7th Professional and Career Women Awards 2017, Women in Management (WIM) and IFC, a member of the World Bank Group, hosted a panel discussion ‘Women Leadership for the Changing World’ in Kandy, where five women who have championed the corporate sector as leaders, who are also WIM awardees, shared their experience in their journey to success.

This was followed by a mini awards ceremony – ‘Upcoming Women Entrepreneurs of the Year Awards 2017’, to recognize women entrepreneurs from seven districts in Sri Lanka, as to how they seized the opportunities and overcame future challenges in their careers, businesses, and everyday lives.

The discussion comprised a panel including Kasturi Chellaraja Wilson, Managing Director of Hemas Pharmaceuticals/Hemas Logistics and Maritime Cluster; Sonu Grover, Managing Director of Coca-Cola Sri Lanka; Chandi Dharmaratne, Senior Director of Human Resources for VirtusaPolaris Sri Lanka; Dayalanie Abeygunawardena, Chief Operating Officer of Janashakthi Insurance; and Ramya Weerakoon, Vice President of InfoTech – all of whom have achieved remarkably as women corporate leaders in the country.

The inspiring discussion was followed by an awards ceremony to celebrate the achievements and experiences of 13 upcoming women entrepreneurs from seven districts of Sri Lanka, namely Kandy, Anuradhapura, Mannar, Vavuniya, Hambantota, Ampara and Batticaloa.

Sulochana Segera, Founder and Chairperson of WIM said, “the Upcoming Women Entrepreneurs 2017 program is another initiative by Women in Management and IFC to highlight the inspiring stories of successful Sri Lankan women.

In fact, two of our panellists are not only distinguished in their own right, they are also winners at previous Professional and Career Women Awards, which makes their stories and advice directly relevant to participants, giving them added stature as role models to look up to.”

The 13 women entrepreneurs are:

Batticaloa - Nesaiah Seethaluxshmi (dairy farming); ML Risana (Akram Bites and Chips business venture); and Mani Manjula Manidhiwanan (‘Nachiyar’ traditional restaurant business venture); Vavuniya - Luxmanan Jegajothi (palmyrah handicrafts); Edwindias Jegajothy (business in making bags); and Suntharalingam Gantharuby (flower decorations); Hambantota - Pullaththara Widanagamage Sisiliyana (tissue culture planting); and Wasanthi Karunathilaka (Aloka Organic Food Products business venture); Anuradhapura - WTDP Anusha Priyangani Sandamali (‘Nimsara’, tailors and bridal business venture); and SPS Kumari Sumathipalage (Susil Shoe Palace); Kandy - JRJ Asanka Jayawardana (BK Prasath Building Material Suppliers business venture); Mannar - Prima Croos Gnanarajan (Riya Fruit Juices and Ice Cream business venture); and Ampara - AK Dilini Maheshika (Haddakari Batik Fashions business venture).

Prosperous Capital and Credit Limited (PCCL) has won global accolade and has being nominated for a Green Leadership award at the Asia Responsible Entrepreneurship Awards (AREA).

The awards ceremony organized by Aruna Liyanage, Senior Programme Manager, Prosperous Capital and Assurance Ltd, said that PCCL was set up just three years ago and receiving an international award speaks volumes about their success.

The project (Green Word) for which the award was won included the promotion of Green Agricultural practices.

This also included introduction of renewable energy, collecting e-waste, promoting organic farming and proper garbage recycling and disposal system.

Some of the key objectives of this award-winning project included giving support to achieve United Nations sustainable development goals, reduction of environment pollution, supporting domestic financial management, creating savings habits among people, increasing family health conditions and helping to increase their revenue and promoting organic farming.

PCCL Managing Director Madhawa Edussuriya said they are currently incorporated as a private limited company and has applied for the micro finance licence along with several other players from the Central Bank.

Edussuriya said the company which is run by a Board of veterans in the industry with over 20 years of local and foreign experience opened their first branch in Sooriyawewa, in August 2014.

“This venture can be regarded as one among the firsts in the finance industry involving a region where micro finance had not yet penetrated.” He said that they hope to open more branches in the North and East this year as they see a great demand for this model from these areas.

The awards ceremony would be held on June 1 in Thailand and is being organized by Malaysian-based Enterprise Asia, a non-governmental organization in pursuit of creating an Asia that is rich in entrepreneurship as an engine towards sustainable and progressive economic and social development within a world of economic equality.

 A 50-member high-profile delegation, led by Business Department of Liaoning Province and Shenyang Zhongqiao International Exhibition Co.Ltd, will arrive in Colombo on June 1 to attend in the Construction Expo and Chinese Commodity Fair 2017 scheduled in the BMICH.

The objective of the visit is to actively promote economic and trade cooperation between Sri Lanka and the Liaoning region of China. A powerful group with large enterprises in the subordinate seven city from Liaoning Province will be showcasing construction materials, hardware fitting, ceramics, garment, aluminum alloy material, textile, bedding and so on in the Construction Expo and Chinese Commodity Fair 2017.

The group is led by Shenyang China Council for the Promotion of International Trade. Shenyang Wuai group with 20 stalls in more than 100 kinds of products and Liaoning Zhonghe Co., Ltd will be represented for Shenyang Faku with 10 stalls and a dozen of fine ceramic will be exhibited as well.

The Construction Expo and Chinese Commodity Fair 2017 is a boost to strengthen ties between Sri Lanka and China and can be considered a significant event when the two countries celebrate the 60th anniversary of the establishment of diplomatic relations between them. Simultaneously, the event offers a great opportunity for visiting Sri Lankan enterprises to obtain a first hand view of the Chinese production and also to pursue opportunities for establishing fruitful partnerships with Sri Lankan enterprises. Liaoning Province an important part of China, the provincial capital is Shenyang. It is also an important junction in northeast China economic zone and the Bohai Economic Zone. 

The Sri Lanka Tobacco Retailers’ Association met newly appointed Finance Minister Mangala Samaraweera, at the Ministry of Finance last week, to highlight several issues facing traders and tobacco sales.

They said that the association’s membership of over 100,000 has been severely affected following the government’s price hike on tobacco products in October last year, resulting in severe losses for the trade.

This has impacted livelihoods as this also affects sales of other products, which are purchased by tobacco consumers, they said, adding that many consumers are seen switching to illicit products.

They requested that the Minister maintain prices of legal tobacco products at reasonable levels, not implement the proposed ban on stick sales and not introduce regulations that will affect their business and livelihoods in a drastic manner.

They added that tobacco traders have conducted business in an ethical manner respecting the laws and regulations with respect to the tobacco trade, and requested the Finance Minister to consider their position for future policymaking. 

Out of the microfinance borrowers over 80% of them are women, said Pres­i­dent Lanka Mi­cro­fi­nance Prac­ti­tioner’s As­so­ci­a­tion (LMFPA), M.M. At­tanayake.

He said most of these borrowing are for self employment projects and the pay back is very satisfactory. “Vertually there are no NPLs.”

“Microfinance is open to people who don’t have collateral to go into banks and we operate on two guarantors and this system is working very well,” he said. However the penetration is still around 80% and there is a lot of scope for the microfinance sector to grow. He said that for a long time they were looking at new legislation form the government to increase investment to this sector and also for some of the companies to accept deposits.

“We have asked the new finance minister to look in to this issue and introduce the much needed reforms for the industry to have a boost al­low­ing mi­cro­fi­nance op­er­a­tors to in­tro­duce some new prod­ucts such as mi­cro­fi­nance in­surance.”

“Now LMFPA is looking to receive mcro insurance regulations, access to CRIB and more which area also fundamental requirements of the industry to serve poor and low income people. We have to in­tro­duce some com­mer­cial fi­nance ac­tiv­i­ties. We have to make sure ca­pac­ity build­ing is en­sured for the suc­cess of the in­dus­try,” the LMFPA Pres­i­dent said adding “We also see a demand for micro finance from the North and East.”

Sec­re­tary Imran Nafeer said that they are now diversifying to offer credit to housing sector as well. He also said that today financial inclusion in Sri Lanka is around 82% and there is a lot of room to expand.”

LMFPA has 71 member organisations representing NGO’s, Not for Profit Companies,(NPC) Cooperatives, MFI companies, banks, finance and leasing companies, capacity development institutes and individuals dedicated to the industry.

Expolanka Holdings PLC recorded a revenue of Rs 63 billion for the twelve months ended March 31, 2017 supported by a growth of 13% and profit before tax (PBT) of Rs. 1.75 billion for the year ended 2016/2017.

Commenting on the results Hanif Yusoof, Group CEO, Expolanka Holdings PLC said, “The year has been challenging, while in our core sector logistics operating profits grew backed by solid volume growths we were unable to convert this success to net profit growth. This was largely due to write down in passive investments and impact on exchange with the strengthening of currencies in the sub-continent.”

Logistics recorded a revenue of Rs. 54 billionposting a growth of 15% in comparison to the previous financial year. The year’s positive results were mainly driven by the sustained performance of the Indian subcontinent along with market growth in Hong Kong and China.

Both ocean and air freight businesses recorded double digit volume growth driven by positive sentiments from the largest customers in the US and Europe trade lanes.

The leisure sector continued to show positive signs during the period recording a revenue of Rs 4.6 billion. Outbound ticketing operations performed well, posting a high level growth in profitability. Nevertheless, in spite of this commendable performance, the proposed exit fromits Indian ou tbound business will have an impact on future revenue.

The group aims to offset this by increasing the value propositions under the leisure umbrella,offering end to end solutions for corporate and personal travel.

Expolanka’s Investments sector recorded a revenue of Rs. 4.3 billion with the passive investments impacting on overall group profitability leading to the 14% reduction from the previous period.

“In the next financial year, we hope to focus more on high growth markets and broad base our customers and products portfolio in the Logistics sector whilst looking at increasing operational efficiency and leveraging on technology. We are getting closer to our goal of becoming a true multinational.

Expolanka Holdings PLC has been in operation since 1978 and has a workforce of over 2300 employees. Headquartered in Colombo, Sri Lanka, the Group’s network spans more than 17 countries in Asia, Africa, USA and the Middle East.

Dialog Axiata extending its successful flood relief programme in 2016, whereDialog customers donated Rs. 15 million and Dialog added a further Rs. 50 million towards helping those affected by floods and landslides, invites yet again its valued subscribers to contribute towards helping our fellow Sri Lankans affected by the ongoing natural disaster.

Mass evacuations continue in flood-hit Sri Lanka as relief items and assistance continued to pour in from all parts of the  country for those affected by the floods while several centers were set up for people to donate dry rations, food, water and medicine. Picture courtesy: (newsin.Asia)

The donations could be made via SMS, Star points or eZ cash and Dialog will triple these customer donations and contribute to flood relief activities.

This initiative is conducted in partnership with the Ministry of Defence and the Ministry of Disaster Management.

Dialog customers simply need to type DON and SMS to 7700 to contribute Rs. 50 towards this cause and Dialog will triple the customer donation by adding another Rs. 100 to contribute a total of Rs. 150 towards flood relief.

Customers are welcome to send any number of SMS for donations and these will be tripled by Dialog. Customers could also donate using Star Points by dialing #141*1# from their Dialog mobiles, or with eZ Cash by dialing #111*6# and Dialog will all triple these donations.

Customers of Etisalat and Hutch can also contribute to this programme using eZ Cash. Sri Lankans living overseas could also send in their donations by visiting www.worldremit.com.

This programme was initiated in Colombo on May 27 at the Disaster Management Centre, with senior officials from Dialog Axiata, the Ministry of Defence and the Ministry of Disaster Management. The disbursement of funds and related activities will be independently audited by PricewaterhouseCoopers. 

Successive governments have dumped employees in the Sri Lanka Ports Authority (SLPA) and have looked at SLPA as a place where they could get employment for the unemployed in the absence of real economic growth, said Managing Director SLPA, Sarathkumara Premachandra.

Speaking at the Sri Lanka Association of NVOCC agent Annual General Meeting, he said that although the government and the professionals of SLPA would like to run it with half the number employees today, this is not realistic in the current economic environment.

“Are we wrong in employing unemployed in the short term till our country can provide employment through development? Hence SLPA has been leading the biggest CSR project by creating breadwinners for well over 5,000 additional families!”

In addition to overstaffing, SLPA has to maintain a railroad with over 30 km of tracks including two locomotives and a shunting yard simply to allow the Government Railways to import occasional carriages. Premachandra said that additionally, all government agencies such as Customs are provided with facilities free of charge and even utility bills are absorbed by SLPA.

He also said that SLPA has over 600 houses for employees maintained by the Authority. “Roads inside the port from Ingurukade to Kingsbury Hotel, from Modara to the Southern Breakwater, all our ports, quays, breakwaters, harbour lighthouses around the island and other common facilities too are maintained by this workforce.”

“We generate our own electricity and this has stabilized the port during uncertain power situations. We have an understanding with CEB to help them manage crisis situations.”

Premachandra said they have a fleet of dredgers that maintain the depths of the harbours. They have engineering workshops that can turn out anything required that cannot be purchased locally. “That’s why our 33-year-old JCT cranes are working like brand new.”

He said that the ongoing project of expanding the internal port road to six lanes up to 10 km is costing them Rs. 4 billion and maintenance cost is borne by SLPA. “However 70% of the container traffic that uses the road are for SAGT and CICT.”

Loan repayment for South Port last year was Rs 1.528 billion while there are other expenses in maintaining six other harbours.

“All these require men and women. True, we have 9,500 men and women. They do not idle as some would like to accuse. They manage and operate the ports of our motherland winning accolades from the international maritime community.”

He said that despite all odds, SLPA last year made a net profit of Rs 10 billion after tax and that this was an 83% increase over the previous year in spite of Jaya Container Terminal (JCT) losing 100,000 TEU to competition.