JKSB Quarterly Highlights_Overseas Realty (Ceylon) PLC_1QCY16
​OSEA reported earnings of Rs.728mn (-4% YoY) for 1QCY16. The comparable performance for the year is skewed owing to the recognition of the sale of apartment units from Phase III of the Havelock City project not being realized as construction on Phase III had yet to begin. This translated in to a steep decline in total revenue (-52% YoY) with a marginal decrease in Rental Income (-2% YoY) owing to a fall in occupancy rates at the World Trade Center (WTC) and the revenue realized through the sale of apartments not being recorded for the quarter. At the time of writing, construction on both Phase III and Phase IV has been launched and is expected to be completed by CY2019 with over 50 apartment units being reserved. Despite the decline in revenue, significant expansions were seen in Gross margins (+27.3 ppts YoY to 76.9%) and Operating margins (+32.7 ppts YoY to 79.4%) which was aided by a sharp decline in Finance Costs (-44% YoY) during the quarter. An increase in Finance Income (+124% YoY) was recorded after the proceeds from the recently concluded rights issue were invested in short term instruments.
•JKSB is one of 15 founding members of the Colombo Stock Exchange with roots in share trading dating back to 1896, and is a subsidiary of John Keells Holdings PLC (JKH), the largest listed entity on the Colombo Stock Exchange with a market capitalization of US$ 1.3bn.
•JKSB’s core client base is Foreign Institutional Investors, Local Institutions and HNWI’s
•JKSB has a co-branded Research tie up with CIMB and a Research Referral agreement with Credit Suisse, along with trade execution relationships with several other global and regional securities firms.
•JKSB’s trade execution partners include Credit Suisse, CIMB, Merrill Lynch, Exotix, Daiwa, Convergex, Deutsche Asia Securities and Morgan Stanley
•JKSB is a research contributor to Bloomberg on ‘KEEL’
•The JKSB Research Universe covers 72 stocks across 15 sectors, with most Research efforts focused on approximately 45 of the more liquid counters.
•The JKSB Universe constitutes 67% of total market cap and approximately 80% of turnover at the CSE.
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