Ceylon Cold Stores PLC reported an 18 percent increase in group revenue for the three months ended June 2026 but the higher taxes and finance costs erased the earnings benefit, pushing the net profit down 3 percent year-on-year.
Group revenue rose to Rs.50.78 billion, from Rs.43.20 billion, while the operating profit increased 18 percent to Rs.2.75 billion. However, the profit attributable to the shareholders declined to Rs.1.06 billion, from Rs.1.09 billion. Earnings per share fell to Rs.1.12, from Rs.1.15.
The decline was mainly due to a 45 percent increase in the tax expense to Rs.961.2 million and a 26 percent rise in the net finance costs to Rs.727.8 million.
The group’s effective tax charge increased to about 47.5 percent of pre-tax profit, from 37.8 percent a year earlier. The finance costs rose 24 percent to Rs.747.4 million, with the interest on the short-term borrowings increasing 78 percent to Rs.215.1 million.
The profit before tax nevertheless increased 15 percent to Rs.2.02 billion, although the growth lagged the increases in the revenue and operating profit. The net profit margin narrowed to 2.09 percent, from 2.53 percent.
The gross profit rose 17 percent to Rs.6.61 billion but the gross margin edged down to 13.02 percent, from 13.13 percent. The operating margin remained broadly unchanged at 5.42 percent.
Manufacturing was the strongest contributor during the quarter. External revenue from the segment increased 23 percent to Rs.9.86 billion, while its segment result jumped 65 percent to Rs.3.06 billion.
The manufacturing profit after tax rose 67 percent to Rs.2.50 billion.
The supermarkets segment recorded a 16 percent increase in external revenue to Rs.40.92 billion. Its segment result rose by a similar 16 percent to Rs.1.76 billion but the profit after tax fell 2 percent to Rs.626.4 million.
Cash generation improved, with the net operating cash flow increasing 33 percent to Rs.4.77 billion, supported by the lower inventories and receivables. The capital expenditure on property, plant, equipment and intangible assets increased 40 percent to Rs.1.93 billion.
However, the group ended June with a net cash-equivalent deficit of Rs.10.27 billion, compared with Rs.9.55 billion at end-March, as the bank overdrafts climbed to Rs.11.81 billion.
The current liabilities exceeded the current assets by Rs.15.86 billion, widening from Rs.14.00 billion at end-March. Total equity fell 9 percent to Rs.22.59 billion, following a Rs.3.18 billion final dividend payment and a Rs.279.8 million fair-value loss recognised through other comprehensive income.
Higher taxes, finance costs weigh on Ceylon Cold Stores’ bottom line
