Expolanka Holdings demonstrates resilience in Q1 FY24 while pursuing long-term vision

Colombo, July 29, 2023 – Expolanka Holdings PLC, reporting financial results for the first quarter of the 2024 financial year, that ended 30th June 2023, remained steadfast in consolidating performance and pursuing its long-term strategy. During the quarter under review, Expolanka Holdings demonstrated incredible resilience, with a revenue of Rs. 55.5 Bn and a Gross Profit of Rs. 11.2 Bn, despite persisting challenges posed by market disruptions, volatility, and uncertainty.

The large foreign earnings portfolio and foreign asset base of the group was again negatively impacted by the appreciation of the Sri Lanka Rupee which resulted in the group recording an exchange loss of Rs. 973 Mn for the quarter.

With global economies prioritizing inflation control and economic stability amid broader macroeconomic management, factors such as inflation, high interest rates, and geopolitical tensions have also curbed consumer spending, especially on discretionary items, resulting in dampened market demand.

The Logistics Sector delivered a revenue of Rs. 53.4 Bn and a Gross Profit of Rs. 10.5 Bn, whereas the Investment Sector achieved a revenue of Rs. 1.56 Bn and a Gross Profit of Rs. 222 Mn, with the export operation stabilizing and the IT business making gradual progress.

Furthermore, the Leisure Sector demonstrated robust performance with a revenue of Rs. 750 Mn, a Gross Profit of Rs. 672 Mn, and a Profit After Tax of Rs. 253 Mn. The consistent performance was led by the core corporate travel business while the inbound and leisure portfolios showed positive momentum.

Demonstrating the group’s strong quality of earnings and cash flow generation capability, a dividend of Rs. 3.48 per share was declared, amounting to a total dividend payment of Rs. 6.8 Bn. This strong liquidity position and balance sheet strength bodes well for the organization’s future success.

Amidst the downturn in the global economy, the logistics industry faced severe challenges. The pandemic-induced disruptions in demand and supply chains led to inventory overstocking and lower retail orders. Consequently, EFL Global’s volumes in both Air and Ocean portfolios were affected.

However, EFL Global proactively engaged with core customers and successfully onboarded several strategic accounts. Strategic measures including increasing wallet share from selected customers, maintaining a strong network presence, and adopting a customer-centric approach have significantly contributed to EFL maintaining its performance during the quarter. Reflecting the company’s adaptability and ability to respond effectively to market conditions, EFL Global gradually increased its Ocean Freight portfolio, which now generates more than 55% of its Revenue.

While the US market continued to be the key driver of business for EFL Global, European, and Asian trade lanes also performed to satisfaction. The company expanded its service capabilities in both origin and destination markets.

EFL Global was able to make good progress in integrating its recent strategic acquisitions into its overall operations. These acquisitions are part of the organization’s long-term strategy and is a reflection of the long-term view the organization has taken on its overall portfolio.

Under the organization’s Global Goodness banner, several Environmental, Social, and Governance (ESG) initiatives were continued, in line with the group’s overall plan. This underscores the organization’s commitment to creating positive impact in the communities it operates in.

Forging ahead, the organization remains focused on delivering long-term growth and value. As the company invests in building capabilities, infrastructure, and systems to enhance operational efficiencies, it is confident in creating sustainable value for all stakeholders in the ever-changing global environment.