Cargills delivers in teeth of Easter and Covid challenges

Despite the daunting challenges presented by the Easter bomb at the beginning of the financial year and the Covid situation at year-end, Cargills (Ceylon) PLC, the country’s leading food company with 411 Food City outlets countrywide now in business, has delivered what its chairman, Mr. Louis Page, has called a commendable result in the year ended Mar. 31, 2020.

Group revenue was up over 13% to Rs. 107.05 billion, operating profit over 50.8% to Rs. 7.06 billion, and the after-tax profit over 35.7% to Rs. 2.76 billion.

The Cargills Group comprises three key operating segments – retail, food manufacturing and restaurant industries with the retaiul operations performed by Cargills Food Company (Private) Ltd. In which the International Finance Corporation, World Bank affiliate, holds an 8% equity stake.

Page reported “robust growth” in the group’s FMCG (fast moving consumer goods) segment primarily driven by the dairy sub-sector now sourcing approx. 150,000 litres of milk per day as the country’s leading milk collector.

While the retail and food manufacturing sectors had done well, restaurant performance had lagged during the period under review although consumption was favourable. The sector had been severely affected by both the Easter Sunday and Covid pandemic.

Page revealed that the listing date for the Cargills Bank which the group had launched has now been deferred for June 2021 and capital raising to meet enhanced regulatlry requirements to Dec. 2022. Thew management of the bank is now being further strengthened by external consultants to fast track the business model which will allow the bank to operate as intended, he said.

“Pushing ahead, I’m cautiously optimistic about the Bank’s future prospects,” he added.

The company has announced a final dividend of Rs. 3.20 a share on top of an interim 1.90 per share underling its capital commitment towards long-term investment which maintaining a consistent divided policy.

“The group has performed ably this past financial year even though it had been one of the more challenging ones in recent times…,” he said adding that the ongoing financial year was expected to post a “heavily skewed” first quarter (due to the pandemic) with grqadual recovery in the second quarter.

CT Holdings PLC with 68.87% is the controlling shreholder followed by Mr. VR Page (6.83%), the EPF (3.27%) and Ms. MM Page (2.23%). Other members of the Page family and related companies are among the top 20 shareholders.

The Cargills directors are: Messrs. Louis Page (Chairman), Ranjit Page (Deputy Chairman/CEO) Imtiaz Wahid (MD/Deputy CEO) Priya Edirisinghe, Sanjeev Gardiner, Sunil Mendis, Joseph Page, Errol Perera, Deva Rodrigo (retired), Y. Kanagasabai, Asoka Pieris and Indira Malwatte ( from Feb. 1,2020).