The drop in revenues was mainly on account of reduced revenues of Heladhanavi due to the pass-through effect of lower fuel prices. Net earnings for the period declined 15.3% to Rs 317Mn, whilst quarterly earnings rose 31.2% to Rs 136Mn. Profits were impacted by planned overhaul expenses at Heladhanavi as well as operational losses at Hemas Hospitals.

The Group generated an operating cash flow of Rs 957Mn during the six months as against Rs 710Mn that was posted during the same period last year. The FMCG sector performed well to record revenues of Rs. 2.7Bn during the period, a growth of 17.1% year- on-year, whilst profits increased by 24.4% to Rs. 308.9Mn. During the quarter the company re-launched Kumarika Shampoo and strengthened its position in the laundry category through the introduction of Diva Detergent Soap.

Diva once again received accolades at the SLIM Brand Excellence Awards 2009 by winning the Gold award for the Product Brand of the year. In early October our flagship brand Baby Cheramy was re- launched and underwent a complete makeover in packaging together with the introduction of several new products. Response to the re-launch has been positive and the business hopes to further strengthen its leadership in the baby category.

The Healthcare sector recorded revenues of Rs. 2.4Bn for the six months, an increase of 32.6% over last year, whilst earnings increased 48.9% to Rs 61.7Mn. The high growth in the sector was mainly attributable to the impressive performance of Hemas Pharmaceuticals which maintained its market leadership position with a market share of 16.5% (Source: IMS).

Both Wattala and Galle hospitals are increasingly well frequented by the community and are slowly but surely building up a reputation for quality medical care. Several new initiatives and services are being planned to improve capacity utilization.

The Transportation sector recorded revenues of Rs. 331Mn and net earnings of Rs. 90.7Mn for the period ending 30 September 2009, representing declines of 8.2% and 10.2% respectively over the corresponding period last year. The main reason for the decline is attributed to the overall drop in passenger volumes.

The Leisure sector recorded revenue of Rs. 341Mn and net loss of Rs. 36.6Mn during the six months ending 30 September 2009. The adverse publicity on Sri Lanka during the early part of the year together with the recession in the main generating markets have contributed to lower arrivals when compared to the same period last year. However, the future looks promising and the business hopes to recoup much of the present losses in the coming two quarters.

Hemas Power IPO that took place in September was oversubscribed by 3.7 times at the highest offer price of Rs 20. Subsequent to the IPO, the Hemas Group now owns 75% of the Power business while the balance was taken up by a wide group of individual and institutional investors. Hemas Power PLC was able to raise Rs. 626Mn, which is expected to be invested in new power projects in the months to come.