Although John Keells Holdings (JKH) held readily encashable short-term investments of over Rs.17.2 billion in its books as at December 31, 2008 indicating a strong cash position, its interest bearing borrowings as at that date were running at Rs.15.1 billion, financial analysts noted.

They pointed out that while the debt was better than balanced by short-term investments, most of the borrowings were on account of loans raised to pay for tourism plant in the Maldives.

As the interest payable on foreign exchange loans raised to fund the Maldivian investment were at rates far below interest yields in Sri Lanka where the short-term investments are held, the company was at an advantage.

"In that sense JKH has a positive advantage in respect of interest earnings here," an analyst pointed out.

During the period under review, JKH realized a profit of Rs.1.2 billion from the sale of its stake in Associated Motorways (AMW) which added to its cash position.