John Keells Holdings (JKH) had seen a sharp 22% dip in its attributable profits in the June quarter of the current financial year with contributions from its main business segments including transportation and property declining sharply, an interim financial statement now with shareholders revealed.

The company’s Chairman, Mr. Susantha Ratnayake, said that the group was currently reviewing its plans in the light of the new potential that had emerged as a result of the country’s success in its fight against terrorism.

"As stated in our annual report, the group has been continuously focusing on process improvement and we believe that we are well positioned both in terms of organizational capability and financial strength to be a key part of the nation’s economic development," Ratnayake said.

The leisure segment of the JKH group, though posting a Rs.47 million loss in the June quarter, had significantly improved on the loss of Rs.358 million posted a year earlier on the back of a better performance by the Maldivian resorts and Colombo city hotels.

Trans Asia Hotel is currently undergoing a complete refurbishment and re-branding and is to be re-launched as Cinnamon Lakeside next month.

"With the positive change in the environment, we are very optimistic of the potential for the tourism industry in Sri Lanka. However, the global economic environment poses some challenges for tourism, as already witnessed in the Maldives," Ratnayake said.

JKH’s consumer foods and retail sector had returned to profit in the first quarter posting a pre-tax profit of Rs.41 million against a loss of Rs.0.01 million in the comparative quarter the previous year with revenues up 18% to Rs.3.8 billion mainly as a result of the expansion of the group’s supermarket chain.

"Ceylon Cold Stores and Keells Food Products showed a significant increase in PBT compared to last year, largely due to improved efficiencies," Ratnayake said.

One of the best performing segments had been financial services with the pre-tax profit up 17% to Rs.217 million from a year earlier with the Nation’s Trust Bank being the main contributor posting a pre-tax profit of Rs.190 million despite taking a blow from an exchange trading misadventure some months ago.

Ratnayake said that John Keells Stockbrokers had also performed well as a result of increased activity on the Colombo Stock Exchange.

The company under review saw JKH posting a consolidated revenue of Rs.10.1 billion, down 9% from Rs.11.1 billion a year earlier while the group attributable profit of Rs.650.4 million was down 22% from Rs.832.5 million earned in the first quarter of the previous year.

JKH has a stated capital of Rs.22.5 billion and revenue reserves of Rs.7.7 billion. The company’s total assets ran at Rs.42.6 billion while liabilities were Rs.12.2 billion.

Net assets per share were up to Rs.49.48 from Rs.46.63 during the first quarter of the previous year while the company’s share traded at a high of Rs.145 and a low of Rs.62.50 during the quarter ended June 30, 2009. This compared to a trading range of Rs.122 to Rs.110 a year earlier.

Interest income during the first quarter was up to Rs.767.1 million from Rs.495.1 million a year earlier while finance expenses were up to Rs.428.9 million from Rs.417.3 million a year earlier.

The share results of associates too had declined to Rs.649.7 million from Rs.741 million in the first quarter of the previous year.