Dialog Finance PLC (the "Company") announced, Thursday 8th May 2025, its financial results for the quarter ended 31 March 2025.
The lending book of the Company recorded a healthy growth of 77.6% Year-on-Year ("YoY") to record net loans and advances of Rs. 6.1Bn as at 31 March 2025. The deposit base also improved significantly by 57.3% YoY, reaching Rs. 4.7Bn as at 31 March 2025, supported by strong performance in both savings deposits and fixed deposits. Driven by the growth in lending book and increase in fee income from acquiring and issuing businesses, total operating income grew by 153.3% YoY to reach Rs. 447.1Mn for the quarter ended 31 March 2025.
Supported by this strong income performance, the Company recorded a Profit before Tax of Rs. 26.7Mn for Q1 25, compared to a Loss before Tax of LKR 32.6Mn recorded in Q1 24. Deferred tax asset reversal of Rs. 20.6Mn was recognised in Q1 25, attributed to the reduction in deferred tax assets arising from the utilisation of carried forward tax losses against taxable profits generated during the period under review. Accordingly, the Company recorded a net profit of Rs. 6.1Mn for the quarter ended 31 March 2025 relative to a net loss of Rs. 32.6Mn recorded for the corresponding quarter in the previous year.
During the period under review, the Company maintained capital and liquidity levels well above the statutory minimum requirements. The Tier I capital adequacy ratio (CAR) and total CAR recorded at 25.15% as at 31 March 2025, which was well above the CBSL's prescribed minimum thresholds of 8.50% for Tier 1 CAR and 12.50% for Total CAR.
Dialog Finance PLC provides a wide range of financial products tailored to meet the needs of diverse customer segments, including consumers, retailers & merchants, and SMEs. The Company is setting itself to be at the forefront of innovation in the finance industry in Sri Lanka and has a vision to propel the nation's finance technology to a level of advancement on par with the developed world. Dialog Finance PLC recognises the need to deliver convenient, accessible, and affordable financial tools to the unbanked and underbanked segments of society and continues steadfast with its unifying mission in introducing cutting edge technology to launch industry-leading financial products and services.
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Statement of financial position
(all amounts in Sri Lanka Rupees thousands)
ASSETS
31 March 2025 31 Dec 2024 (Unaudited) (Audited)
Cash and cash equivalents
Placements with banks and financial institutions Securities purchased under repurchase agreements Financial assets al fair value through profit or loss Financial assets at amortised cost - loans and advances
Financial assets at fair value through other comprehensive income
Financial investments at amortised cost
Other assets (Note 4) Current tax receivable Right-of-use assets
Property, plant and equipment
Intangible assets Deferred tax assets Total assets
LIABILITIES
Financial liabilities at amortised cost - due to customers Financial liabilities at amortised cost - due to banks Lease liabilities
Retirement benefit obligations
569,556
171,876
490,317
3,209
6,113, 246
2,358
388,272
382,782
6,255
32,108
50,823
202,237
72,093
8,485,132
4,651,314
603,763
14,399
33,497
252,167
168,488
509,924
257,224
5,171,335
2,358
387,959
249,528
6,25536,308
53,518
197,337
92,698
7,385,099
4,044,853
100,296
40,286
11,759
Other liabilities 573,155 584,962 | ||
Total liabilities | 5,876,128 | 4,782,156 |
EQUITY | ||
Stated capital | 2,934,5B2 | 2,934,582 |
Statutory reserve fund | 16,688 | 16,688 |
Fair value through other comprehensive income reserve | 3,301 | 3,301 |
Accumulated losses (345,567) (351,628) | ||
Total equity | 2,609,004 | 2,602,943 |
Total equity and liabilities | 8,485,132 | 7,385,099 |
Net assets per share (Rs.) | 22.22 | 22.17 |
Commitments and contingencies | 527,090 | 458,542 |
The notes on pages 7 to 9 form an integral part of these financial statements. | ||
CERTIFICATION
We certify that the above Interim Financial Statements are in compliance with the requirements of the Companies Act No: 7 of 2007 and give true and fair view of the state of affairs of Dialog Finance PLC as at 31 March 2025 and its profit / (loss) for the period ended 31 March 2025.
Yasoda Sewwandi Head of Finance Date: 08/05/2025
The Board of Directors is responsible for the preparation and presentation of these financial statements. Signed for and on behalf of the Board of Directors by,
Nazee Mohame Director CEO Date: 08/ 5/2025
Renuka Fernando
Director
Date: 08/05/2025
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Statement of profit or loss and other comprehensive income (all amounts in Sri Lanka Rupees thousands)Three months ended 31 March | |||
2025 (Unaudited) | 2024 (Unaudited) | Change % | |
Interest income | 344,952 | 236,968 | 46 |
Less: Interest expense | (79,954) | (76,251) | 5 |
Net interest income | 264,998 | 160,717 | 65 |
Fee and commission income | 169,947 | 12,920 | 1215 |
Net (loss)/ profit from trading | (17) | 27 | (163) |
Other operating income | 12,219 | 2,887 | 323 |
Total operating income | 447,147 | 176,551 | 153 |
Less: Impairment charges and other losses | (45,089) | (18,682) | 141 |
Net operating income | 402,058 | 157,869 | 155 |
Less: Operating expenses | |||
Personnel expenses | (111,663) | (62,280) | 79 |
Depreciation and amortisation | (17,356) | (14,736) | 18 |
Other expenses | (218,933) | (108,129) | 102 |
Operating profit/ (loss) before taxes on financial services | 54,106 | (27,276) | 298 |
Taxes on financial services | (27,441) | (5,326) | 415 |
Profit/ (loss) before tax for the period | 26,665 | (32,602) | 182 |
Deferred tax expense | (20,604) | - | 100 |
Profit/ (loss) for the period | 6,061 | (32,602) | 119 |
Other comprehensive income | |||
Items that will not be reclassified to profit or loss: | |||
-Changes in the fair value of equity investments at fair value through other comprehensive income | - | - | - |
-Remeasurement of defined benefit Obligations | - | - | - |
-Deferred tax effect on other comprehensive income | - | - | - |
Other comprehensive income, net of tax | - | - | - |
Total comprehensive income for the period, net of tax | 6,061 | (32,602) | 119 |
Profit / (Loss) per share (Rs.) | 0.05 | (0.28) | |
Stated capital | Retained earnings / accumulated losses | Statutory reserve fund | Fair value through other comprehensive income reserve | Total | |
Balance at 1 January 2025 | 2,934,582 | (351,628) | 16,688 | 3,301 | 2,602,943 |
Profit for the period | - | 6,061 | - | - | 6,061 |
Other comprehensive income, net of tax | - | - | - | - | - |
Transfer to statutory reserve fund | - | - | - | - | - |
Total comprehensive income for the period | - | 6,061 | - | - | 6,061 |
Balance at 31 March 2025 | 2,934,582 | (345,567) | 16,688 | 3,301 | 2,609,004 |
Balance at 1 January 2024 | 2,934,582 | (309,659) | 16,688 | 3,154 | 2,644,765 |
Loss for the period | - | (32,602) | - | - | (32,602) |
Other comprehensive income, net of tax | - | - | - | - | - |
Transfer to statutory reserve fund | - | - | - | - | - |
Total comprehensive income for the period | - | (32,602) | - | - | (32,602) |
Balance at 31 March 2024 | 2,934,582 | (342,261) | 16,688 | 3,154 | 2,612,163 |
Balance at 1 April 2024 | 2,934,582 | (342,261) | 16,688 | 3,154 | 2,612,163 |
Loss for the period | - | (8,481) | - | - | (8,481) |
Other comprehensive income, net of tax | - | (886) | - | 147 | (739) |
Transfer to statutory reserve fund | - | - | - | - | - |
Total comprehensive income for the period | - | (9,367) | - | 147 | (9,220) |
Balance at 31 December 2024 | 2,934,582 | (351,628) | 16,688 | 3,301 | 2,602,943 |
Three months ended 31 March | ||
2025 | 2024 | |
(Unaudited) | (Unaudited) | |
Cash flows from operating activities | ||
Profit/ (loss) before income tax | 26,665 | (32,602) |
Adjustments for | ||
Interest expenses | 79,954 | 76,251 |
Impairment charges and other losses | 45,089 | 18,682 |
Provision for retirement benefits obligation | 2,639 | 1,584 |
Depreciation and amortization | 17,356 | 14,736 |
Interest on lease liability | 988 | 622 |
Net losses / (gains) on financial assets at fair value through profit or loss | 17 | (27) |
Cash generated from operations before changes in operating assets and liabilities | 172,708 | 79,246 |
Increase in loans and advances | (987,001) | (417,415) |
Increase in other assets | (77,974) | (14,791) |
Increase in amounts due to customers | 606,461 | 339,850 |
Increase / (decrease) in amounts due to banks | 503,467 | (502,117) |
(Decrease) / increase in other liabilities | (12,793) | 71,186 |
Cash generated from / (used in) operations | 204,868 | (444,041) |
Interest paid | (79,954) | (76,251) |
Retirement benefits paid | - | - |
Net cash generated from / (used in) operating activities | 124,914 | (520,292) |
Cash flows from investing activities Acquisition of property plant and equipment | (13,674) | (11,087) |
Acquisition of intangible assets | (4,900) | 448 |
Net investment in treasury bills | (313) | 411,139 |
Net investment in securities purchased under repurchased agreement | 19,607 | (21,040) |
Net investment in unit trust | 253,998 | 460,964 |
Net placements with banks and financial institutions | (3,388) | (55,353) |
Net cash flows from investing activities | 251,330 | 785,071 |
Cash flows from financing activities | ||
Principle element of lease payment | (6,789) | 4,291 |
Net cash (used in)/ from financing activities | (6,789) | 4,291 |
Net increase in cash and cash equivalents | 369,455 | 269,070 |
Cash and cash equivalents at the beginning of the period | 311,570 | 88,003 |
Cash and cash equivalents at the end of the period | 681,025 | 357,073 |
Analysis of cash and cash equivalents at the end of the period | ||
Cash and bank balances | 569,630 | 254,213 |
Add: Placements with financial Institutions (less than 90 days) | 111,395 | 102,860 |
681,025 | 375,073 | |
Less: Impairment provision | (112) | (67) |
680,913 | 357,006 | |
DIALOG FINANCE PLC
Financial reporting by segment (all amounts in Sri Lanka Rupees thousands)For the three months ended 31 March | Consumer Segment | MSME Segment | Treasury/investments | Unallocated | Total | |||||
2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | |
Interest Income | 174,753 | 84,663 | 141,898 | 77,512 | 28,301 | 74,793 | - | - | 344,952 | 236,968 |
Interest Expenses | (29,264) | (20,580) | (28,160) | (19,657) | (22,530) | (36,014) | - | - | (79,954) | (76,251) |
Net interest income | 145,489 | 64,083 | 113,738 | 57,855 | 5,771 | 38,779 | - | - | 264,998 | 160,717 |
Net fees and commission income | 103,369 | 20,190 | 66,578 | (7,270) | - | - | - | - | 169,947 | 12,920 |
Other income | 10,967 | 1,833 | 1,235 | 901 | - | 180 | - | - | 12,202 | 2,914 |
Operating income by segment | 259,825 | 86,106 | 181,551 | 51,486 | 5,771 | 38,959 | - | - | 447,147 | 176,551 |
Impairment (expense) / reversal | (38,433) | (3,299) | (6,833) | (15,519) | 177 | 136 | - | - | (45,089) | (18,682) |
Net operating income | 221,392 | 82,807 | 174,718 | 35,967 | 5,948 | 39,095 | - | - | 402,058 | 157,869 |
Operating expenses | (50,492) | (29,345) | (72,684) | (23,705) | - | - | (95,757) | (55,079) | (218,933) | (108,129) |
Segment result | 170,900 | 53,462 | 102,034 | 12,262 | 5,948 | 39,095 | (95,757) | (55,079) | 183,125 | 49,740 |
Personnel expenses | (111,663) | (62,280) | ||||||||
Depreciation and amortization | (17,356) | (14,736) | ||||||||
Profit / (loss) from operations | 54,106 | (27,276) | ||||||||
VAT on financial services | (27,441) | (5,326) | ||||||||
Income tax expense | (20,604) | - | ||||||||
Profit / (loss) for the period | 6,061 | (32,602) | ||||||||
Other information | ||||||||||
Balance at 31 March | ||||||||||
Segment assets | 3,032,428 | 1,822,269 | 3,080,819 | 1,619,367 | 1,625,588 | 1,935,319 | 746,297 | 458,906 | 8,485,132 | 5,835,861 |
Total assets | 3,032,428 | 1,822,269 | 3,080,819 | 1,619,367 | 1,625,588 | 1,935,319 | 746,297 | 458,906 | 8,485,132 | 5,835,861 |
Segment liabilities | 2,985,788 | 1,688,671 | 2,890,340 | 1,535,027 | - | - | - | - | 5,876,128 | 3,223,698 |
Total liabilities | 2,985,788 | 1,688,671 | 2,890,340 | 1,535,027 | - | - | - | - | 5,876,128 | 3,223,698 |
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Notes to the condensed interim financial statements (all amounts in the notes are in Sri Lanka Rupees thousands unless otherwise stated)-
Basis of preparation
The condensed interim financial statements for the three months ended 31 March 2025 of the Company have been prepared in accordance with Sri Lanka Accounting Standard LKAS 34, 'Interim Financial Reporting'. The condensed interim financial statements should be read in conjunction with the audited financial statements for the year ended 31 December 2024.
There were no changes to the accounting policies since the publication of the audited financial statements for the year ended 31 December 2024.
-
Events after the reporting period
No circumstances have arisen since the statement of financial position date which requires adjustments to or disclosures in the financial statements.
-
Contingent liabilities
There were no material contingent liabilities as at the reporting date which require adjustments to / or disclosures in the financial statements.
-
Other Assets
The Company has identified a case of external financial fraud in June 2024 and steps were taken to immediately recover a portion of funds. As at the reporting date, the gross outstanding amount to be recovered was LKR
41.4Mn and based on an assessment of recoverability, the Company has recognized a provision for loss of LKR
29.9Mn in the statement of profit or loss. Consequently, the net amount outstanding to be recovered as of the reporting date is LKR 11.5Mn, which is reported under "other assets" in the statement of financial position.
The Company has initiated legal action as per the advice of external legal counsel and currently working with law enforcement authorities to recover the remaining funds. In response to this incident, the Company has enhanced its transaction monitoring processes and has implemented measures to educate customers on safeguarding their accounts against unauthorized third-party access.
As of the reporting date, the investigation and recovery efforts are ongoing. The Company will continue to monitor the progress of these actions and will assess the recoverability of the outstanding receivables recognised at each reporting date.
- Fair value of financial instruments
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservableFor assets and liabilities that are recognized in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
Measurement criteria and the fair value | ||||||
Level 1 | Level 3 | Total | ||||
31 Mar 2025 | 31 Mar 2024 | 31 Mar 2025 | 31 Mar 2024 | 31 Mar 2025 | 31 Mar 2024 | |
Financial assets | ||||||
Financial assets at fair value through profit or loss | 3,209 | 660,854 | - | - | 3,209 | 660,854 |
Financial assets at fair value through other comprehensive income | - | - | 2,358 | 2,185 | 2,358 | 2,185 |
For the three months ended 31 March | 2025 | 2024 |
Rs. | Rs. | |
- Highest | 53.90 | 56.00 |
- Lowest | 40.00 | 45.00 |
- Last traded | 41.70 | 47.00 |
-
Twenty largest shareholders of the company
Name of Shareholders
No. of
shares
%
Holding
1
Dialog Axiata PLC
116,290,376
99.05%
2
Mr. R.C.J. Goonewardene
130,000
0.11%
3
Mr. P.S. Goonewardene JNR
127,913
0.11%
4
Dialog Finance PLC / D.M.H.B. Dasanayake
30,000
0.03%
5
Mr. P. Poongunaseelan
26,461
0.02%
6
Mr. P.S.M. Fernando
24,282
0.02%
7
Hatton National Bank PLC / Dawi Investment Trust (Pvt) Ltd
24,119
0.02%
8
Mr. W.C. Madhushanka
22,795
0.02%
9
Senkadagala Finance PLC / G.B.R.P. Gunawardana
21,191
0.02%
10
Mr. R.J.K.I. Ranathunga
21,007
0.02%
11
Mr. C.R. Narangoda
20,700
0.02%
12
People's Leasing & Finance PLC/ C.D.Kohombanwickramage
18,152
0.02%
13
Mrs. R. Ameen UR Rahman/ Mr. K.R. Ameen UR Rahman (Joint)
17,875
0.02%
14
Senkadagala Finance PLC / C.R. Narangoda
17,846
0.02%
15
Mr. M.A.T. Raaymakers
16,566
0.01%
16
Mr. M.K. Gunawardena/ M.K. Gunawardena (Joint)
16,190
0.01%
17
Citizens Development Business Finance PLC/ K.D.C. Somalatha and K. Nandasiri
15,980
0.01%
18
Mr. G.D.M. Ranasinghe/ Mrs. O.R.K. Ranasinghe (Joint)
14,029
0.01%
19
Mrs. S. Suwandaratne
13,346
0.01%
20
Mr. T.D. Mahaliyana
9,882
0.01%
116,878,710
99.56%
Others
521,156
0.44%
Total
117,399,866
100.00%
-
Directors' shareholdings
None of the Directors and their close family members held any shares in the company as at 31 March 2025.
-
Public shareholdings
Information pertaining to public shareholding is as follows:
31 March 2025
31 March 2024
Public holding percentage
0.95%
0.95%
Number of public shareholders
873
776
Float adjusted market capitalization (Rs.)
46,507,957
52,419,040
The Company is not compliant with the Minimum Public Holding requirement under option 2 of Rule 7.13.1(b) of the Listing Rules of the Colombo Stock Exchange ('CSE'). Accordingly, the Company was transferred to the Second Board on 10 February 2020.
Item | As at 31 March 2025 | As at 31 March 2024 |
Regulatory capital adequacy | ||
Tier I capital base, Rs. '000 | 2,338,816 | 2,305,390 |
Total capital base, Rs. '000 | 2,338,816 | 2,368,439 |
Risk weighted assets, Rs. '000 | 9,297,711 | 5,754,006 |
Tier I capital adequacy ratio | ||
(As a % of risk weighted assets - Minimum requirement - 8.5%) | 25.15% | 40.07% |
Total capital adequacy ratio | ||
(As a % of risk weighted assets - Minimum requirement - 12.5%) | 25.15% | 41.16% |
Capital funds to deposit liabilities ratio | 56.09% | 88.35% |
(Minimum requirement, 10%) | ||
Assets quality (quality of loan portfolio) | ||
Gross non-performing accommodations, Rs. '000 | 360,458 | 216,329 |
Gross non-performing accommodations ratio, % | 5.60% | 5.97% |
Net-non-performing accommodations ratio, % | 1.59% | 2.35% |
Profitability | ||
Net Interest margin, % | 14.44% | 11.44% |
Return on assets (before taxes), % | 2.75% | 4.99% |
Return on equity (after taxes), % | 0.94% | -2.21% |
Regulatory liquidity (Rs. '000) | ||
Required minimum amount of liquid assets | 610,615 | 340,101 |
Available amount of liquid assets | 1,431,956 | 1,241,861 |
Required minimum amount of government securities | 253,784 | 241,244 |
Available amount of government securities | 879,573 | 868,444 |
Memorandum information | ||
Number of employees | 162 | 118 |
Number of branches | 1 | 2 |
Corporate Information | |
Name of the Company | Bankers |
Dialog Finance PLC | Seylan Bank PLC |
Commercial Bank of Ceylon PLC | |
Legal Form and Stock Exchange Listing | Nations Trust Bank PLC |
A Public Quoted Company with Limited Liability which was quoted on the Diri Savi Board of the Colombo Stock Exchange on 4th October 2011 and subsequently transferred to the Second Board on 10 February 2020. | Bank of Ceylon |
Cargills Bank Ltd | |
People's Bank | |
Hatton National Bank PLC | |
Date of Incorporation | National Development Bank PLC |
25 November 1981 | DFCC Bank PLC Sampath Bank |
Auditors | |
Company Registration No. | Messrs. Deloitte partners |
PB 765 PQ | Chartered Accountants |
Board of Directors | P.O. Box 918,100 Braybrooke Place, |
Ms. Renuka Fernando (Chairperson) | Colombo 02, Sri Lanka. |
Mr. Supun Weerasinghe Ms. Lim Li San Mr. Alexander Lowback Mr. Shivaan Kanag-Isvaran Mr. Uditha Jayasinghe Mr. Nazeem Mohamed | Credit Rating AA (lka), stable outlook was affirmed by Fitch Ratings Lanka Ltd Taxpayer Identification Number (TIN) 104079687 |
Registered Office | |
No. 475, Union Place, Colombo 2 | |
Principal Office 1st Floor, 57, Srimath Anagarika Dharmapala Mawatha, Colombo 3. | |
Tel : + 94 11 4317317 | |
Fax :+ 94 11 4317335 | |
E-mail: financialservice@dialog.lk |
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