PD Keells Limited, shortly to be renamed Kelsey Development Limited, has reported a successful year ended March 31, 2000 under its old banner during which it claimed "remarkable progress" with profit after-tax up 30% to Rs. 11.2 millions.

This company which successfully concluded the country’s first management buy out (MBO) of a listed company sees a bright future for itself under its new ownership structure with 12 of its senior management participating as equity stake owners of the company.

The company’s new Chairman, Mr. B. M. S. K. Hathotuwa, has said that "PDK is a thoroughbred from the esteemed John Keells stables, and therefore all the proven management practices, systems and controls continued to operate within the fabric of the company."

The new owners, Kelsey Holdings Limited now hold 87.8% of the company following a mandatory offer for over 2.2 million ordinary shares of the company.

Despite the last financial year being a good one, the first half of the current financial year has seen a downturn from the year under review with revenue down 43% to Rs. 70.6 million and the pre-tax profit down 84% to Rs. 0.9 million from a year earlier, the provisional half-yearly results now with shareholders reveal.

Hathotuwa has told shareholders that a committed team of professionals, well balanced with a healthy mix of youthful exuberance and experienced old hands in place, their team was even more motivated in their new role as owners of the company.

"The company can now truly exercise its entrepreneurial flare without being constrained as a part of a large conglomerate. We believe the new MBO structure will foster innovation in our people, which is vital in the new business environment we will be operating in," he said.

Hathotuwa said that the company was actively developing its trading products portfolio, carefully chosen to address specific needs in the market while being synergistic with its aluminium and property development businesses.

The company’s Managing Director/CEO Nihal Uduwara has said that the executives who participated in the MBO together with the Ayojana Fund Management (Pvt) Limited, had recognised the "tremendous potential’’ of the company. They had hoped for better growth in the construction industry during the year under review to secure adequate projects for the aluminium division. But with hardly any highrise buildings getting off the ground, they were unable to handle bigger projects. Instead they had undertaken a number of relatively small scale projects in a highly competitive environment and had "fared even better under these circumstances."

Uduwara said that they have diversified into the installation of office interior decor and promotion of a surface-finishing product with multiple applications. These areas were highly co-related to their existing products and services and have been launched without additional resources.

He thanked the board of John Keells Holdings for their advice and cooperation in making the management buy out a success and also for the continuing relationship after the buy out.

The directors as at 31.03.2000 are: Messrs. Poh Ah Tee (Chairman), V. Lintotawela, J. R. Gunaratne (Jt. M/D) and N. Uduwara.

Mr. V. Lintotawela and Mr. J.R. Gunaratne resigned from the board on 3.11.2000. Mr. Steven Enderby and Mr. Reeza Zarook were appointed to the board on 3.11.2000. Mr. Reeza Zarook resigned from the board on 13.11.2000. Mr. B. M. S. K. Hathotuwa was appointed to the board on 13.11.2000.