Hemas delivers Rs 78.8 bn revenue reaffirming its resilience

Hemas Holdings PLC (HHL) accomplished a solid performance for the financial year 2021/2022 despite a challenging environment, to record a cumulative Group revenue of Rs. 78.8 billion, an increase of 22.2 per cent over the prior year.The overall cumulative operating profits of Rs 6.8 billion reflected a growth of 11.9 per cent over previous year, whilst the Group earnings of Rs. 4.2 billion is an increase of 30.6 per cent. The first half performance was hindered by the islandwide lockdowns stemming from the rapid spread of the Delta variant. Whilst the second half presented unprecedented challenges in terms of foreign exchange liquidity, unsustainable government debt, currency depreciation, volatility in global commodity prices, soaring inflation, and rising interest rates. In such extreme adverse operating conditions, the country spiralled into an economic crisis, resulting in supply disruptions of essentials such as power, gas and fuel which led to civil unrest amidst high inflationary pressure.

In the backdrop of economic and political instability, anchoring on its strength of operating in defensive industries coupled with strong liquidity position, HHL continued to stay agile resulting in the reaffirmation of “AAA (lka)- Outlook Stable” Fitch rating for the Group, for the third consecutive year.Strong performance in Home and Personal Care (HPC) Sri Lanka, Learning Segment and the Healthcare sector drove revenue growth of 27.2 per cent for the quarter over the same period last year. However, the operating profit growth was restricted to 16.0 per cent with the intensifying pressure on margins across most of the businesses due to input cost inflation and challenges relating to foreign exchange volatility. Group recorded an operating profit of Rs. 1.5 billion for the quarter over Rs. 1.3 billion recorded last year. The earnings growth of Rs. 203.0 million is an increase of 23.6 per cent over the same period last year.  Earnings per Share improved to Rs. 7.12 from Rs. 5.46.