Access Engineering PLC ups 1Q profit by 162% to Rs. 550 m
Access Engineering PLC, the country’s premier civil engineering company, released its interim financial statements for the three months ended 30 June recently.
Accordingly, the company has recorded an impressive after-tax profit of Rs. 550 million at the Company level for the quarter with a corresponding year-on-year (YOY) increase of 162%, indicating the bouncing back of operations despite the challenges posed by the current pandemic.
Group after-tax profits for the three months stood at Rs. 517 million against a corresponding after-tax profit of Rs. 43 million in 20/21.
The significant margin improvement was owing to all key sectors recording revenue increases during the quarter, except the automobile sector due to the Government imposed import restrictions on vehicles. Core construction activities and property sector recorded YOY increases in revenue during the quarter amounting to 56.1% and 18.9% respectively.
The performance of construction material segment was impressive too with a topline of Rs. 2.56 billion, primarily on the sale of asphalt and ready-mix concrete. There is a growing demand for construction material driven by the rural road network development project along with ADB and World Bank-funded road development programs. Expansion of the expressway network and the elevated road network is expected to create more demand for construction material in future. Today, Access Engineering is one of Sri Lanka’s largest asphalt and concrete producers with a notable market share.
The company’s core construction activities amounting to Rs. 3,284 million contributed to 46.5% of the group’s consolidated revenue with construction-related material contributing to 36.3% (Rs. 2,566 million), property 2.6% (Rs. 182 million) and automobile 14.6% (Rs. 1,028 million) respectively during the quarter.
Main construction projects that contributed to the company revenue during the quarter included the Bloemendhal Housing Project, Orugodawatta Housing project, Stadiumgama Housing Project, Elliot Place Housing Project, i – Roads project, Anuradhapura Water Supply Project, Nittambuwa Pasyala Road Project, piling and earth works for the New Terminal Building and Viaduct at Bandaranaike International Airport and the recently commenced multi-storied public car park development at Union Place. The company is also engaged in the construction of a T – Mall flyover and several foot bridges in Kenya as a part of its overseas work.
Performance of the automobile sector was hampered by the import restrictions that continued since the last financial year. This had a significant impact on the sale of new vehicles which is the core business of the said sector. Nevertheless, the new ISUZU Marine sector, workshop operations and sale of spare parts showed improvement.
The company’s two ongoing real estate projects performed well during the quarter with satisfactory sales. While Marina Square is in the process of completion of sub – structure work of all towers up to the podium levels, Capital Heights – Rajagiriya is expected to be handed over to the owners by the end of the 2021/22 financial year. Access Tower I & II, which are in the business of office and commercial space leasing, continued to experience good occupancy rates.
Gross profit for the quarter was recorded at Rs. 1,093 million and Rs. 776 million at Group and company level respectively with corresponding margins of 15.5% and 13.7%. As of 30 June, the total asset base of the company amounted to Rs. 59.70 billion and Rs. 44.88 billion at Group and company level respectively. The equity attributed to the owners of the company was recorded at Rs. 23.85 billion at the Group level, while it was Rs 22.44 billion at company level. Net asset per share of the Group and company as of 30 June stood at Rs. 23.85 and Rs. 22.44 respectively.
The company declared its first interim dividend for the 21/22 financial year amounting to Rs. 0.25 per share payable on 7 September. This is in addition to paying Rs. 500 million as dividends in 20/21.
The Board of Directors of Access Engineering PLC comprises of Chairman Sumal Perera, Managing Director Christopher Joshua, COO Rohana Fernando, Shevantha Mendis, Dharshana Munasinghe, Dilhan Perera, Shamal Perera, Ranjan Gomez, Prof. Malik Ranasinghe, Niroshan Gunaratne and Dinesh Weerakkody.