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Record Profits For LB Finance

Nov 6, 2010 2:41:57 PM - thesundayleader.lk

LB Finance for the quarter (Q) ended September 30, 2010, saw net profits increase by 154% year-on-year (YoY) to Rs.220Mn and a 146% YoY increase in net profits to Rs.401Mn. for the six months ended September 30, 2010.
“Figures reported for the last Q showcase LB Finance’s sustained exemplary performance,” said Chairman Dhammika Perera. “Our success is anchored on a four decade foundation of financial stewardship. It’s our passion for what we do that enables us to achieve such heights in so little time, and our vision for the future helps us to respond unwaveringly to the confidence placed on us by our depositors and stay faithful to our stakeholders. We feel this visionary approach is instrumental to our growth.”
The company, riding a crest of a wave since business tycoon Perera took over its reigns, and what impresses industry analysts is LB Finance’s ability to consistently sustain its upward momentum even through a global recession.
The company in the Q under review saw total income increase by 31% YoY to Rs.1.298Bn., whilst total income for the six months ended September 30, 2010 increased by 26% to Rs.2.452Bn.
Interest income was reported at Rs.1.241Bn., and interest expenses at Rs.555 Mn., bringing the Q’s net interest income to Rs.686Mn, a 90% YoY increase. Net interest income for the first half (1H) ended September 30,2010 stood at Rs.1.25Bn., up 79% YoY. The company’s profit before tax for the Q stood at Rs.408Mn., a 177% YoY increase and  profit before tax, a 162% YoY increase to Rs.721Mn.The financial giant also clocked in its total assets at Rs.21.159Bn, showing a 40% YoY growth as well as a 30% YoY deposit growth to Rs.14.545Bn. LB’s total equity as at September 30, 2010 at Rs.1.989Bn. showed a 41 % YoY increase, while the company’s return on equity ratio rose to 42.85% from 23.60% in 2009, as has its return on assets ratio (after tax) from 2.38% in September 2009 to 4.44% this year.
LB Finance shares brought significant capital gains to investors at the Colombo Stock Exchange, seeing an increase in market value per share to Rs.295.70 this September from Rs.62in March 2010, with a highest price of Rs.340 this Q. Earnings per LB Finance share amounted to Rs.11.59 for the first six months of 2010, while the price-earnings ratio based on annualised earnings came to 12.76 times. Further, company’s net asset value per share stood at Rs.57.46 at the end of the Q under review, against Rs.40.89 at end September 2009.
“We have seen unprecedented growth over the past few years,” said Perera. “We are continuing to drive forward with large-scale expansion and innovative strategies that offer more appropriate financial solutions to an even greater number of the Sri Lankan public.”  With a reputation for being a groundbreaking pioneer in the industry, LB is further reinforcing its operations with several new branch openings, the most recent being in Vavuniya and Jaffna. “We are aggressively driving our expansion islandwide, particularly towards the North and East,” said Perera. “We want to take root in as many provinces as possible during this post-war period of recovery and growth, and reach out to Sri Lankans everywhere, especially those living below the poverty line. We hold steadfast to our vision of bringing more of our fellow countrymen into the formal economy.” The company is known to have assembled the most hard-nosed team of financial veterans led by Managing Director Sumith Adhihetty and consists of firebrand young professionals who bring in new thinking and the energy to thrive on the cutting-edge. LB Finance operates through an integrated branch network, offering cutting-edge solutions through services such as deposits acceptance, leasing, hire purchase, consumer durable financing, mortgage loans, pawn broking and other credit facilities.