Thursday, October 21, 2010

Odel post-tax profits up 50 percent

Healthy top and bottom line growth in the second quarter of FY 2010-11, its first quarter as a listed entity, has enabled Sri Lanka’s fashion retail brand Odel to report characteristically strong results for the six months ending 30th September 2010.

According to figures filed with the Colombo Stock Exchange, the Group achieved a pre-tax profit of Rs 165 million for the half year, an increase of 65 per cent over the corresponding six months of 2009-10.

Profit after tax improved by a robust 50 per cent to Rs 100.6 million on a turnover of Rs 1.53 billion, which was up 55 per cent, the Group said.

Pre and post tax profits for the three months ending 30th September 2010 reflected increases of 74 per cent and 72 per cent respectively over the preceding quarter. The Group’s basic earnings per share for the period reviewed grew by 50 per cent to 69 cents from 46 cents for the first half of the previous year.

The Group’s post tax profit for the six months reviewed was 71 per cent of the Rs 141 million achieved for the full year in 2009-10.

Commenting on these figures, Odel founder and CEO Otara Gunewardene said: "We continue to witness significant same store growth and the addition of new stores has also contributed to this increased revenue. We are excited about the next quarter, which is seasonally our strongest, with Christmas sales usually contributing to a considerable percentage of annual sales. Two new stores that are expected to come on line before 31st March 2011 will also contribute to earnings."

With tourist arrivals to Sri Lanka rising by 44 per cent YoY during the first nine months of the year, and expected to reach a record high for 2010, Odel as the shopping destination of choice for tourists in Sri Lanka is well-positioned to benefit from peak season arrivals. Domestic consumption too remains strong amid soft inflation and sustained low interest rates, with customers eager to ‘trade up’ amid a growing feel-good factor.

Odel’s latest store at Battaramulla opened in the second quarter of the year. The company has announced that its next two stores scheduled for opening in December 2010 and March 2011 will be located at Kiribathgoda and Wattala.

The Odel chain now comprises of stores at, Alexandra Place, Maharagama, Kohuwala, Mount Lavinia, Moratuwa, Panadura, Nugegoda (Warehouse), Dickman’s Road, Ja-ela, Majestic City, Crescat (Backstage), Battaramulla and at the Bandaranaike International Airport.

In July this year, Odel offered 16.7 million ordinary shares to the public at an IPO that set a new record on the Colombo bourse for oversubscription. The Odel share commenced trading on the Colombo Stock Exchange on 4th August, 2010 and was trading at Rs 32.60 on 19th October, up 117 per cent from its issue price of Rs 15.

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