Financial Year 2023/24 – Twelve Months Performance
Snapshot of Financial and Operational Review
- Revenue grew by 6.7% to Rs. 121.6 Bn driven by the improvements in all key BUs, Despite the volume contractions in all industries across Hemas managed to outperform the market with market share increases in key segments. · Home and Personal Care Sri Lanka o Increased focus on high margin personal care segment. o Value for money offerings o Providing innovative solutions and NPDs including · Home and personal care International o Efforts to increase foot print in key markets East Africa and Middle East. o Launched new variants in those markets. · Learning Segment had a good back to school season and entered the value for money segment with Homerun · Pharmaceuticals – Increased focus on Morison branded generics · Hospitals introduced Ambulatory care and focused on improving home care and drove key anchor specialty revenues
- However, revenue growth was not up to the expected levels due to adverse impact of the macro-economic challenges.
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- Even though the country saw improvements in the external sector and progress was made in the IMF programme, consumer spending remained low. · Despite yoy contraction inflation is on an elevated base · Changes to the personal income tax laws and VAT laws (from 15%- 18%) · Increase in utility prices and fuel costs. · Healthcare Sector particularly remained challenged amidst instability and delays in Government regulatory bodies and procurement authorities.
- However, there are some green lights with interest rates slowing and exchange rates slowing. We expect these positive to result in a demand recovery in the coming quarter. |
- The businesses across the Group engaged in efficiency improvement initiatives. Allowing breathing space for the businesses to absorb increases in operating overheads.
- Working Capital optimisation which has been a key priority and this along with interest rate reductions resulted in a significant improvement in finance cost and working capital. Which intern resulted in reduced gearing and over Rs 23.2 Bn growth in operating cashflows. - Consequently, the Group reported a 43.1% growth in earnings to report highest ever earnings of Rs. 6.1 Bn for the year |
- Strong Financial position of the Group was verified by the Fitch The reaffirmation of the AAA (lka) Stable Outlook Rating by Fitch Ratings for the fifth consecutive year is a testament to the Group’s resilience and financial strength. |
- We remain cautiously optimistic about the future.
- Our Strategic priorities to drive organic and inorganic growth, · Consumer : Investing in underpenetrated segments like beauty and baby diapers, internationalisation and export footprint. · Healthcare : Developing a branded generics portfolio under the brand Morison, driving distribution capabilities, expanding in key anchor specialties, and investing in the transition to a fully-fledged tertiary hospital. · Improving the digital infrastructure and fostering a culture of data-driven decision-making will be a priority for all businesses as the
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- Group continues its 75-year-long journey in empowering lives through innovative solutions for the future. |
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