1. No category

First Capital Holdings PLC
REVIEW OF OPERATIONS
First Capital Holdings PLC reported a consolidated turnover of Rs. 1.7Bn for the first half of the financial year 2014/15
compared to Rs. 910Mn for the same period last year. Consolidated profit after tax of the Group increased to Rs. 868Mn
compared to Rs. 95Mn the previous financial year.
First Capital Treasuries Limited (FCT), the Group’s primary dealer arm remained the key contributor to profits. The continued
decline in secondary market interest rates coupled with favourable macro-economic factors, especially high market liquidity
and low inflation created significant trading opportunities in Government Securities. Employing trading expertise and extensive
research, the company managed to accurately forecast yield curve movements and earn exceptional returns.
Due to its strong capitalization, stable earnings and strengthened risk management framework, FCT was rated ‘A-’ by Lanka
Rating Agency Limited and is currently the highest rated standalone Primary Dealer appointed by Central Bank of Sri Lanka.
First Capital Limited a specialist in the structuring and placement of corporate debt securities also made a note-worthy
contribution to Group performance. In the six months to 30 September the unit successfully raised over Rs. 7Bn by way of
listed debentures, securitisations and other corporate debt securities. The company managed the landmark AAA listed debenture
of Softlogic Finance PLC and structured the first ever Micro Finance backed securitisation. It was also actively involved in the
trading of listed debentures on the secondary market and in the period under review accounted for a significant share of total
trades on the Colombo Stock Exchange.
First Capital Asset Management Limited, our Wealth Management and Unit Trust offering, showed improved performance in
the first half of the financial year 2014/15. Total assets under management surpassed Rs. 3.2Bn during the period -a 200%
increase over the previous year-end. First Capital Wealth Fund, a dedicated medium term fixed income unit trust continued to
outperform the market during the 6 months under review and maintained its position as the best performing fixed income unit
trust, with a return of 25.23% p.a. over the 12 months period ended 30 September 2014. In anticipation of the growing demand
for Unit Trust investments, we have extended our offering by launching three new funds namely First Capital Fixed Income
Fund, First Capital Gilt Edged Fund and First Capital Money Market Fund. Clients can now invest exclusively in government
securities via the gilt edged fund, while investing short term surpluses in the money market fund. With these enhancements we
now offer the entire spectrum of fixed income unit trust investment solutions.
Improved performance of the Colombo Stock Market provided a boost to our stockbroking division First Capital Equities
(Private) Limited which contributed positively to group results. In the 2 nd quarter of 2014/15, the market capitalisation
surpassed Rs. 3,000Bn and the ASPI crossed the 7,000 mark.
The long and short term corporate credit ratings of First Capital Holdings PLC have been upgraded to ‘A-’ and ‘P2’ from ‘BBB+’
and ‘P2’ by Lanka Rating Agency Limited, which reflects the continuous and sustained improvements in performance, stability
and risk management aspects of the company. Continued investor confidence has enabled our market capitalization to rise
above Rs. 5Bn.
We are pleased with our performance to date but expect profits from the primary dealer arm to moderate in the second half
of the year. With interest rates currently at historical lows opportunities for exceptional gains are limited and our focus will
be on managing risk and maintaining acceptable income levels. In our other businesses the Group will continue to build on
the current growth momentum and maintain focus on corporate advisory and the broader investment banking services, as we
work towards our vision of being Sri Lanka’s leading investment bank.
(Sgd.)
Dilshan Wirasekara
Chief Executive Officer
01
First Capital Holdings PLC
01
STATEMENT OF COMPREHENSIVE INCOME
Group
July ~ September
2014
2013
Unaudited
Unaudited
For the period
April ~ September
2014
2013
Unaudited
Unaudited
Note
Income
1,121,737
417,538
1,698,947
909,831
Direct income
1,122,003
412,520
1,698,236
905,048
Direct expenses
(321,308)
(307,399)
(643,783)
(651,932)
800,695
105,121
1,054,453
253,116
(266)
5,018
711
4,783
Gain/(loss) on fair valuation of financial
investments - held for trading
255,372
(23,405)
290,921
(29,549)
Gain/(loss) on fair valuation of derivative
financial instruments
(90,162)
11,359
(66,531)
16,982
(141,046)
(43,809)
(481)
1,359
781,662
(59,153)
(2,281)
(6,665)
783
30,777
(211,464)
(46,227)
(480)
(12,114)
1,009,269
(101,848)
(2,781)
(6,665)
(5,104)
128,934
(130,680)
(1,317)
(140,646)
(33,521)
650,982
29,460
868,623
95,413
612,817
38,165
650,982
27,860
1,600
29,460
822,237
46,386
868,623
89,896
5,517
95,413
27,749
(2,313)
62,437
(20,813)
27,749
(2,313)
62,437
(20,813)
678,731
27,147
931,060
74,600
640,566
38,165
678,731
25,547
1,600
27,147
884,674
46,386
931,060
69,083
5,517
74,600
Earnings per share (Rs.)
6.05
0.28
8.12
0.89
Dividend per share (Rs.)
2.00
2.00
2.00
2.00
Net trading income
Other income / (expense)
1
Less :
Administrative expenses
Sales and distribution expenses
Specific allowance for impairment
Other operating income/(expense)
Profit before taxation
Income tax expenses
2
Profit for the period
Attributable to:
Equity - holders of the parent
Non - controlling interest
Other comprehensive income/(expense), net of income tax
Gain/(loss) on fair valuation of financial
investments - available for sale
3
Other comprehensive income/(expense), net of income tax
Total comprehensive income for the period
Attributable to:
Equity - holders of the parent
Non - controlling interest
Figures in bracket indicate deductions.
Note: All values are in Rupees ‘000 unless otherwise stated.
First Capital Holdings PLC
02
STATEMENT OF COMPREHENSIVE INCOME
For the period
Company
July ~ September
April ~ September
2014
2013
2014
2013
Note Unaudited
Unaudited
Unaudited
Unaudited
Income
25,305
312,445
66,319
320,309
Direct income
23,050
16,091
63,863
23,955
(27,509)
(15,106)
(66,307)
(21,012)
(4,459)
985
(2,444)
2,943
2,255
296,354
2,456
296,354
(1,970)
(91)
(4,265)
(3,407)
(17)
293,915
(2,674)
(70)
(93)
(2,825)
(4,256)
(108)
294,933
-
-
-
-
(4,265)
293,915
(2,825)
294,933
27,750
(2,313)
62,437
(20,813)
Other comprehensive income/(expense), net of income tax
27,750
(2,313)
62,437
(20,813)
Total comprehensive income for the period
23,485
291,602
59,612
274,120
(0.04)
2.90
(0.03)
2.91
2.00
2.00
2.00
2.00
Direct expenses
Net trading income/(expense)
Other income
1
Less :
Administrative expenses
Sales and distribution expenses
Other operating expenses
Profit/(loss) before taxation
Taxation
Profit/(loss) for the period
Other comprehensive income/(expense), net of income tax
Gain/(loss) on fair value of financial
investments - available for sale
Earnings/(loss) per share (Rs.)
Dividend per share (Rs.)
3
Figures in bracket indicate deductions.
Note: All values are in Rupees ‘000 unless otherwise stated.
03
First Capital Holdings PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Group
30-Sep-2013
31-Mar-2014
Unaudited
Audited
Company
30-Sep-2014
30-Sep-2013
Unaudited
Unaudited
36,679
77,827
10,515,012
325,750
1,774,711
456,180
610
42,416
38,513
6,000
60,829
46,409
110,808
13,491,744
38,298
19,844
11,639,241
304,938
3,276,554
755,567
65
45,416
62,549
6,000
48,173
51,516
112,770
16,360,931
10,891
366,375
1,014,651
61,092
5,600
6,000
310,872
1,098
1,776,579
5,013
324,750
526,679
92,410
6,497
5,684
6,000
310,872
2,745
1,280,650
4,330
303,938
1,480,091
263,663
5,600
6,000
310,872
1,921
2,376,415
2,752
51,303
10,810,085
626,995
154,553
13,680
11,659,368
7,775
12,368,398
1,052,435
432,032
19,040
452,248
14,331,928
399,882
4,209
19,921
536,349
960,361
462,969
12,579
636
476,184
2,184
899,176
13,325
502,624
1,417,309
227,500
811,592
1,315,957
274,910
2,629,959
92,549
2,722,508
227,500
593,699
689,909
233,285
1,744,393
87,983
1,832,376
227,500
648,793
859,019
212,473
1,947,785
81,218
2,029,003
227,500
313,808
274,910
816,218
816,218
227,500
343,681
233,285
804,466
804,466
227,500
519,133
212,473
959,106
959,106
17,416,620
13,491,744
16,360,931
1,776,579
1,280,650
2,376,415
30-Sep-2014
Unaudited
As at
31-Mar-2014
Audited
ASSETS
Cash at banks and in hand
26,839
Derivative financial instruments
Financial investments - Held for trading
13,488,199
Financial investments - Available for sale
367,375
Financial investments - Loans and receivables 2,646,859
Trade and other receivables
585,994
Group balances receivable
Non - current assets held for sale
45,416
Tax receivables
58,772
Investment in venture capital
6,000
Investment in subsidiary
Deferred tax asset
41,649
Property, plant and equipment
33,815
Intangible assets
115,702
Total Assets
17,416,620
LIABILITIES
Bank overdrafts
40,803
Derivative financial instruments
46,687
Securities sold under re-purchase agreements 12,973,027
Short term borrowings
428,629
Group balances payable
Trade and other payables
585,220
Tax payables
62,414
Retirement benefit obligations
20,983
Borrowings on debentures
536,349
Total Liabilities
14,694,112
EQUITY
Stated capital
Capital reserves
Retained earnings
Fair valuation reserve
Equity attributable to the equity - holders of the parent
Non - controlling interest
Total Equity
Total Equity and Liabilities
Note: All values are in Rupees ‘000 unless otherwise stated.
The above figures are subject to audit.
These financial statements are in compliance with the requirements of the Companies Act No. 07 of 2007.
(Sgd.)
Mangala Jayashantha
Chief Financial Officer
The Board of Directors is responsible for the preparation and presentation of these financial statements.
(Sgd.)
Manjula Mathews (Ms.)
Chairperson
(Sgd.)
Dinesh Schaffter
Managing Director
15 October 2014
Colombo
First Capital Holdings PLC
03
04
Statement of Changes in Equity
For the period ended 30 September 2014
Attributable to equity holders of parent
Group
Stated
Capital
Capital
Reserves
Retained
Earnings
As at 1 April 2013 (Audited)
Profit for the period
Other comprehensive expense, net of tax
Dividend paid
Adjustment due to acquisition
Transfer to capital reserve
As at 30 September 2013
227,500
227,500
553,704
39,995
593,699
842,508
89,896
(202,500)
(39,995)
689,909
As at 1 April 2014 (Audited)
Profit for the period
Other comprehensive income, net of tax
Dividend paid
Transfer to capital reserve
As at 30 September 2014
227,500
227,500
648,793
-
859,019
822,237
(202,500)
(162,799)
1,315,957
162,799
811,592
Fair
Valuation
Reserve
Total
Non controlling
Interest
Total
Equity
254,098
(20,813)
233,285
1,877,810
89,896
(20,813)
(202,500)
1,744,393
77,348
5,517
(16,554)
21,672
87,983
1,955,158
95,413
(20,813)
(219,054)
21,672
1,832,376
212,473
62,437
274,910
1,947,785
822,237
62,437
(202,500)
2,629,959
81,218
46,386
(35,055)
92,549
2,029,003
868,623
62,437
(237,555)
2,722,508
For the period ended 30 September 2014
Stated
Capital
Retained
Earnings
Fair Valuation
Reserve
Total
Equity
As at 1 April 2013 (Audited)
Profit for the period
Other comprehensive expense, net of tax
Dividend paid
As at 30 September 2013
227,500
227,500
251,248
294,933
(202,500)
343,681
254,098
(20,813)
233,285
732,846
294,933
(20,813)
(202,500)
804,466
As at 1 April 2014 (Audited)
Loss for the period
Other comprehensive income, net of tax
Dividend paid
As at 30 September 2014
227,500
227,500
519,133
(2,825)
(202,500)
313,808
212,473
62,437
274,910
959,106
(2,825)
62,437
(202,500)
816,218
Company
Figures in bracket indicate deductions.
Note: All values are in Rupees ‘000 unless otherwise stated.
05
First Capital Holdings PLC
04
CASH FLOW STATEMENT
For the period
Group
April ~ Sep
2014
Cash flows from operating activities
Interest receipts and gains realised
1,698,236
Interest payments and other direct cost
(610,058)
Other receipts/(payments)
1,576
Cash payments to employees and suppliers
(253,728)
Operating profit before changes in operating assets and liabilities
836,026
(Increase)/decrease in financial investments
- Held for trading and loans and receivables
(928,342)
(Increase) / decrease in trade and other receivables
169,093
Decrease in group balances receivable
65
Increase / (decrease) in trade and other payables
50,201
Increase in group balances payable
Increase / (decrease) in other short term borrowings
(623,806)
Increase/ (decrease) in borrowings against re-purchase agreements
604,629
Cash generated from operations
107,866
Tax paid
Gratuity paid
Net cash flow from operating activities
Cash flow from investing activities
Purchase of property, equipment and intangible assets
Investment in subsidiary company
Proceed from sale of property plant and equipment
Dividend received
Net cash flow from investing activities
Cash flow from financing activities
Dividend paid
Dividend paid to shareholders with non-controlling interest
Borrowings on Debentures
Net cash flow from financing activities
Net cash inflow/(outflow) for the period
Cash and cash equivalents at the beginning of the period (Note A)
Cash and cash equivalents at the end of the period (Note B)
Note A
Cash at banks and in hand
Bank overdrafts
Note B
Cash at banks and in hand
Bank overdrafts
2013
Company
April ~ Sep
2014
2013
904,181
(574,880)
863
(100,125)
230,039
63,863
(32,582)
375
(2,014)
29,642
23,955
(21,012)
(3,541)
(598)
1,281,455
102,543
616
(126,527)
47,524
(1,038,263)
497,387
465,440
202,571
6,593
4,209
(899,176)
399,883
209,162
(357,158)
(90,234)
6,401
187
351,902
(89,500)
(494)
107,372
(58,111)
439,276
209,162
(89,500)
(6,318)
4,500
2,083
265
(18,428)
(185,000)
4
4,163
(199,261)
2,083
2,083
296,354
296,354
(202,500)
50,376
(152,124)
(202,500)
(16,554)
(219,054)
(202,500)
(202,500)
(202,500)
(202,500)
(44,487)
30,523
(13,964)
20,961
12,966
33,927
8,745
2,146
10,891
4,354
659
5,013
38,298
(7,775)
30,523
18,304
(5,338)
12,966
4,330
(2,184)
2,146
659
659
26,839
(40,803)
(13,964)
36,679
(2,752)
33,927
10,891
10,891
5,013
5,013
Figures in bracket indicate deductions.
Note: All values are in Rupees ‘000 unless otherwise stated.
First Capital Holdings PLC
06
LIST OF TWENTY MAJOR SHAREHOLDERS
List of twenty major shareholders
Names of shareholders
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
No. of Shares
as at 30 September 2014
Dunamis Capital PLC
Seylan Bank PLC/ Dunamis Capital PLC
Commercial Bank of Ceylon PLC/ Dunamis Capital PLC
HSBC International Nominees Ltd
- SSBT Deustche Bank AG Singapore A/C No. 1
Seylan Bank PLC/ Janashakthi Limited
HSBC International Nominees Limited
- UBS AG Singapore Branch (EX SBC)
Janashakthi Insurance PLC (Shareholders)
Nuwara Eliya Property Developers (Private) Limited
Mr. Kankanamge Sunil Dharmabandu Senaweera
Mr.Arunasalam Sithampalam
Mr. Charitha Prasanna De Silva
Merchant Bank of Sri Lanka PLC/ Mr. J Hewa Wanigathunga
People’s Leasing & Finance PLC/ HI Line Trading (Private) Limited
Commercial Bank of Ceylon PLC/ Janashakthi Limited
Commercial Bank of Ceylon PLC/ Mr. U.C. Bandaranayake
Timex Garments (Private) Limited
Mr. Hans Anton Van Starrex
Mr. Kumudu Chanda Amaradasa
Mr. Nagen Dayaranjan Kurukulasuriya
Dr. Subashi Nemindi Samarasinghe
Directors’ shareholding
Name of the Director
Ms. Manjula Mathews
Mr. Dinesh Schaffter
Mr. Nihara E. Rodrigo
Mr. Eardley Perera
Ms. Minette Perera
Mr. Nishan Fernando
No. of Shares
as at 30 September 2014
Nil
Nil
5,000
Nil
Nil
Nil
Public holding as a percentage of issued share capital is 25.01%.
Number of shareholders representing the public holding is 5,839.
07
First Capital Holdings PLC
Holding (%)
45,626,756
25,400,000
4,891,692
45.06
25.09
4.83
2,416,310
1,967,000
2.39
1.94
1,100,000
1,000,000
970,000
396,000
339,000
335,000
309,406
305,000
300,703
275,000
252,383
237,283
229,000
208,836
200,616
86,759,985
1.09
0.99
0.96
0.39
0.33
0.33
0.31
0.30
0.30
0.27
0.25
0.23
0.23
0.21
0.20
85.70
NOTES TO THE FINANCIAL STATEMENTS
1.
Other Income (Group)
For the period
Dividend income
Miscellaneous income / (expense)
Other Income (Company)
For the period
Dividend income
Miscellaneous income
2.
Income Tax Expenses (Group)
For the period
Current tax expenses
Deferred tax expenses
Taxes on Dividend
July - September
2014
2013
Rs.
Rs.
2,083
4,163
(2,349)
855
(266)
5,018
April - September
2014
2013
Rs.
Rs.
2,083
4,162
(1,372)
621
711
4,783
July - September
2014
2013
Rs.
Rs.
2,083
296,354
172
2,255
296,354
April - September
2014
2013
Rs.
Rs.
2,083
296,354
373
2,456
296,354
July - September
2014
2013
Rs.
Rs.
64,563
833
6,524
484
59,593
130,680
1,317
April - September
2014
2013
Rs.
Rs.
74,529
3,838
6,524
2,066
59,593
27,617
140,646
33,521
3.
Gain on fair valuation of financial investments - available for sale amounting to Rs. 27.7 Mn has been recognised
during the quarter ended 30 September 2014 and relates to the company’s equity stake in Orient Finance PLC (A loss of
Rs. 2.3 Mn was recognised during quarter ended 30 September 2013).
4.
Net Assets per Share
As at 30 September
Group
Company
5.
2014
Rs.
25.97
8.06
2013
Rs.
17.23
7.95
2014
Rs.
57.40
20.30
55.10
2013
Rs.
19.90
14.00
14.80
Market Price per Share
For the period ended 30 September
Highest market price recorded
Lowest market price recorded
Closing market price recorded
6.
The above figures are provisional and subject to audit. The same accounting policies as in the Annual Report for the
year ended 31 March 2014 have been followed in the preparation of the above financial statements.
7.
The presentation and classification of figures for the corresponding period of the previous year have been reclassified
to be comparable with those of the current year where necessary.
8.
The number of shares represented by Stated Capital as at 30 September 2014 is 101,250,000 shares (As at 30 September
2013 - 101,250,000 shares).
9.
There have been no significant changes in the nature of the contingent liabilities, which were disclosed in the Annual
Report for the year ended 31 March 2014 (As at 30 September 2013 - Nil)
10. There have been no material events subsequent to the reporting date which require disclosures/adjustments in the
Interim Financial Statements.
First Capital Holdings PLC
08
NOTES TO THE FINANCIAL STATEMENTS
11.Information on Listed Debentures
Market value per Debenture
For the period ended 30 September
2014
Rs.
2013
Rs.
3 year fixed rate (13.5 % p.a. payable annually )
Highest price
Lowest price
Last traded price
108.55
108.55
108.55
N/A
N/A
N/A
4 year fixed rate (13.75 % p.a. payable annually )
Highest price
Lowest price
Last traded price
111.40
105.10
111.40
N/A
N/A
N/A
5 year fixed rate (14.00 % p.a. payable annually )
Highest price
Lowest price
Last traded price
110.34
110.34
110.34
N/A
N/A
N/A
As at
30-Sep-14
5.30
N/A
3.49
As at
30-Sep-13
6.56
N/A
1.09
As at
31-Mar-14
6.84
N/A
1.34
As at
30-Sep-14
1.15
N/A
27.01
As at
30-Sep-13
0.58
N/A
22.83
As at
31-Mar-14
1.46
N/A
6.50
3 year fixed rate (13.5 % p.a. payable annually )
4 year fixed rate (13.75 % p.a. payable annually )
5 year fixed rate (14.00 % p.a. payable annually )
As at
30-Sep-14
12.44%
12.34%
12.69%
As at
30-Sep-13
N/A
N/A
N/A
As at
31-Mar-14
13.50%
13.75%
14.00%
Yield of comparable Government Securities
(remaining maturity)
3 Year treasury bond
4 Year treasury bond
5 Year treasury bond
As at
30-Sep-14
6.22%
6.59%
6.77%
As at
30-Sep-13
N/A
N/A
N/A
As at
31-Mar-14
8.27%
8.83%
9.04%
Debt Ratios (Group)
Debt/equity ratio (times)
Quick asset ratio (times)
Interest cover (times )
Debt Ratios (Company)
Debt/equity ratio (times)
Quick asset ratio (times)
Interest cover (times )
Debenture Interest Yield
09
First Capital Holdings PLC