INTERIM FINANCIAL
STATEMENTS
For the six months ended
30th September 2024
LOLC FINANCE PLC
LOLC Finance PLC
CONTENTS
As at 30th September 2024
Page | ||
1 | Statement of Financial Position | 1 |
2 | Statement of Profit or Loss and Other Comprehensive Income | 2 |
3 | Statement of Changes in Equity | 3 |
4 | Statement of Cash flows | 4 |
5 | Operating Segments | 5 |
6 | Notes to the Interim Financial Statements | 6 |
7 | Statement of Directors' and Chief Executive Officer's holding in Shares of the Entity | 10 |
8 | Top 20 Shareholders | 11 |
LOLC Finance PLC
STATEMENT OF FINANCIAL POSITION
As at 30th September 2024
As at 30.09.2024 | As at 31.03.2024 | |
(Unaudited) | (Audited) | |
Rs. '000 | Rs. '000 | |
ASSETS | ||
Cash and bank balances | 10,897,869 | 11,486,914 |
Deposits with banks and other financial institutions | 3,759,592 | 4,060,475 |
Investment in government securities and others | 30,935,340 | 30,079,990 |
Financial assets at amortized cost : | ||
Rentals receivable on leased assets | 62,764,634 | 61,348,491 |
Loans and advances | 200,953,311 | 188,293,271 |
Investment securities | 18,046,758 | 17,723,177 |
Investment in associates | 257,459 | 249,943 |
Amount due from related companies | 122,233 | 111,146 |
Other receivables | 3,909,976 | 3,403,197 |
Inventories | 32,519 | 39,664 |
Investment properties | 48,789,754 | 48,313,343 |
Property plant and equipment | 12,306,262 | 12,362,617 |
Total assets | 392,775,708 | 377,472,229 |
LIABILITIES | ||
Bank overdraft | 5,145,009 | 5,017,647 |
Interest bearing borrowings | 18,587,545 | 20,912,613 |
Deposits from customers | 212,057,715 | 206,368,226 |
Trade payables | 609,361 | 102,869 |
Accruals and other payables | 19,130,785 | 16,001,594 |
Amount due to related companies | 417,670 | 332,082 |
Current tax payable | 2,565,976 | 2,681,710 |
Deferred tax liability | 2,999,055 | 2,999,055 |
Defined benefit obligations | 771,972 | 710,961 |
Total liabilities | 262,285,089 | 255,126,758 |
EQUITY | ||
Stated capital | 44,078,916 | 306,993,806 |
Statutory reserve | 6,291,146 | 6,291,146 |
Revaluation reserve | 1,247,188 | 1,247,188 |
Cash flow hedge reserve | 41,014 | 41,014 |
Fair Value Reserve | 302,200 | 302,200 |
Regulatory loss allowance reserve | 6,965,219 | 6,816,124 |
Merger Reserve | - | (262,914,890) |
Retained earnings | 71,564,937 | 63,568,884 |
Total equity | 130,490,620 | 122,345,471 |
Total liabilities and equity | 392,775,708 | 377,472,229 |
Net asset value per share (Rs.) | 3.94 | 3.70 |
Certification :
These financial statements have been prepared in compliance with the requirements of the Companies Act No. 7 of 2007.
Sgd.
……………………………..
(Mr.) Buddhika Weeratunga
Head of Finance
The Board of Directors is responsible for the preparation and presentation of these financial statements. Signed for and on behalf of the Board
Sgd. | Sgd. |
…………………………….. | ………………………………... |
(Mr.) Krishan Thilakaratne - Director / CEO | (Mr.) Conrad Dias - Chairman / Non Executive Director |
31st October 2024 | |
Rajagiriya (Greater Colombo) | |
Page 1 |
LOLC Finance PLC
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the six months ended 30th September 2024
For the period ended | For the quarter ended | |||||
Variance | ||||||
30.09.2024 | 30.09.2023 | 30.09.2024 | 30.09.2023 | Variance | ||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||
Rs '000 | Rs '000 | % | Rs '000 | Rs '000 | % | |
Interest income | 34,382,350 | 38,212,013 | -10% | 17,329,674 | 19,173,355 | -10% |
Interest expense | (13,582,898) | (20,103,850) | -32% | (6,442,697) | (9,587,263) | -33% |
Net interest income | 20,799,452 | 18,108,163 | 15% | 10,886,977 | 9,586,091 | 14% |
Net other operating income | 1,962,758 | 1,365,884 | 44% | 558,582 | 1,292,738 | -57% |
Total operating income | 22,762,210 | 19,474,047 | 17% | 11,445,559 | 10,878,830 | 5% |
Operating expenses | ||||||
Direct expenses excluding interest cost | (580,684) | (486,069) | 19% | (317,596) | (243,879) | 30% |
Allowance for impairment & write-offs | (1,150,244) | (2,303,572) | -50% | (126,322) | (1,574,460) | -92% |
Personnel expenses | (3,680,938) | (3,123,162) | 18% | (1,944,522) | (1,540,379) | 26% |
Depreciation | (595,703) | (344,624) | 73% | (290,407) | (198,699) | 46% |
General & administration expenses | (6,411,593) | (5,961,889) | 8% | (3,286,418) | (2,981,303) | 10% |
Profit from operations before VAT on financial services | 10,343,048 | 7,254,732 | 43% | 5,480,295 | 4,340,109 | 26% |
Value added tax on financial services | (2,205,416) | (1,719,035) | 28% | (1,205,541) | (1,071,017) | 13% |
Profit from operating activities | 8,137,632 | 5,535,697 | 47% | 4,274,754 | 3,269,092 | 31% |
Share of profit of equity accounted investee | 7,516 | 26,528 | -72% | 2,995 | 32,293 | -91% |
Profit before income tax expense | 8,145,148 | 5,562,225 | 46% | 4,277,749 | 3,301,385 | 30% |
Income tax expense | - | - | - | - | - | - |
Profit for the period | 8,145,148 | 5,562,225 | 46% | 4,277,749 | 3,301,385 | 30% |
Total other comprehensive income, net of tax | - | - | - | - | - | - |
Total comprehensive income for the period | 8,145,148 | 5,562,225 | 46% | 4,277,749 | 3,301,385 | 30% |
Basic earnings per share (Rs.) | 0.25 | 0.17 | 0.13 | 0.10 |
Figures in brackets indicate deductions.
Page 2
LOLC Finance PLC
STATEMENT OF CHANGES IN EQUITY
For the six months ended 30th September 2024
Stated Capital | Statutory | Revaluation | Cash flow | Fair Value | Regulatory loss | Merger | Retained | Total Equity | |
Reserve | Reserve | Hedge Reserve | Reserve | allowance reserve | Reserve | Earnings | |||
Rs '000 | Rs '000 | Rs '000 | Rs '000 | Rs '000 | Rs '000 | Rs '000 | Rs '000 | Rs '000 | |
Balance as at 01 April 2023 | 306,993,806 | 5,213,771 | 1,247,188 | 41,014 | 331,629 | 3,231,500 | (262,914,890) | 46,664,209 | 100,808,228 |
Total comprehensive income for the period | |||||||||
Profit for the period | - | - | - | - | - | - | - | 5,562,225 | 5,562,225 |
Total comprehensive income for the period | - | - | - | - | - | - | - | 5,562,225 | 5,562,225 |
Transactions recorded directly in equity | |||||||||
Transfer to regulatory loss allowance reserve | - | - | - | - | - | 4,059,260 | - | (4,059,260) | - |
Transfer to Statutory Reserve Fund | - | - | - | - | - | - | - | - | - |
Total transactions recorded directly in equity | - | - | - | - | - | 4,059,260 | - | (4,059,260) | - |
Balance as at 30 September 2023 | 306,993,806 | 5,213,771 | 1,247,188 | 41,014 | 331,629 | 7,290,761 | (262,914,890) | 48,167,174 | 106,370,453 |
Balance as at 01 October 2023 | 306,993,806 | 5,213,771 | 1,247,188 | 41,014 | 331,629 | 7,290,761 | (262,914,890) | 48,167,174 | 106,370,453 |
Total comprehensive income for the period | |||||||||
Profit for the period | - | - | - | - | - | - | - | 15,985,270 | 15,985,270 |
Other comprehensive income, net of income tax | |||||||||
Remeasurements of defined benefit liability - gain / (loss) | - | - | - | - | - | - | - | 19,177 | 19,177 |
Movement in fair value through OCI reserve | - | - | - | - | (29,429) | - | - | - | (29,429) |
Total other comprehensive income for the period | - | - | - | - | (29,429) | - | - | 19,177 | (10,252) |
Total comprehensive income for the period | - | - | - | - | (29,429) | - | - | 16,004,447 | 15,975,018 |
Transactions recorded directly in equity | |||||||||
Transfer to regulatory loss allowance reserve | - | - | - | - | - | (474,637) | - | 474,637 | - |
Transfer to Statutory Reserve Fund | - | 1,077,375 | - | - | - | - | - | (1,077,375) | - |
Total transactions recorded directly in equity | - | 1,077,375 | - | - | - | (474,637) | - | (602,737) | - |
Balance as at 31 March 2024 | 306,993,806 | 6,291,146 | 1,247,188 | 41,014 | 302,200 | 6,816,124 | (262,914,890) | 63,568,884 | 122,345,471 |
Balance as at 01 April 2024 | 306,993,806 | 6,291,146 | 1,247,188 | 41,014 | 302,200 | 6,816,124 | (262,914,890) | 63,568,884 | 122,345,471 |
Total comprehensive income for the period | |||||||||
Profit for the period | - | - | - | - | - | - | - | 8,145,148 | 8,145,148 |
Total comprehensive income for the period | - | - | - | - | - | - | - | 8,145,148 | 8,145,148 |
Transactions recorded directly in equity | |||||||||
Transfer to regulatory loss allowance reserve | - | - | - | - | - | 149,095 | - | (149,095) | - |
Transferred to stated capital during the year | (262,914,890) | - | - | - | - | - | 262,914,890 | - | - |
Total transactions recorded directly in equity | (262,914,890) | - | - | - | - | 149,095 | 262,914,890 | (149,095) | - |
Balance as at 30 September 2024 | 44,078,916 | 6,291,146 | 1,247,188 | 41,014 | 302,200 | 6,965,219 | - | 71,564,937 | 130,490,620 |
Page 3
LOLC Finance PLC
STATEMENT OF CASH FLOWS
For the six months ended 30th September 2024
2024 | 2023 | |
Rs '000 | Rs '000 | |
Cash flows from / (used in) operating activities | ||
Profit before income tax expense | 8,145,148 | 5,562,225 |
Adjustments for: | ||
Depreciation | 636,427 | 499,254 |
(Profit) / loss on sales of investment property and PPE | (14,518) | 7,186 |
Change in fair value of derivatives - forward contracts | - | 52,793 |
Provision for fall / (increase) in value of investments | (913,082) | (152,389) |
Fair value gains / (losses) from government securities | 405,044 | - |
Impairment provision / (reversal) for the period | 341,391 | (642,924) |
Provision for defined benefit plans | 90,000 | 68,464 |
Share profit of equity accounted investee | (7,516) | (26,528) |
Investment income | (2,014,919) | (2,470,245) |
Finance costs | 13,582,898 | 20,103,850 |
Operating profit / (loss) before working capital changes | 20,250,874 | 23,001,687 |
Change in other receivables | (420,106) | 1,185,741 |
Change in Inventories | 7,145 | 53,351 |
Change in trade and other payables | 3,637,392 | 3,187,180 |
Change in amounts due to/ due from related parties | 74,501 | (309,445) |
Change in lease receivables | (1,321,036) | 1,238,834 |
Change in loans and advances | (13,079,615) | 4,553,415 |
Change in factoring receivables | 132,497 | (219,783) |
Change in margin trading advances | (818,708) | 168,501 |
Change in fixed deposits from customers | 7,654,929 | 8,507,384 |
Change in savings deposits from customers | 2,328,233 | (2,119,311) |
Cash generated from / (used in) operations | 18,446,105 | 39,247,554 |
Finance cost paid on deposits | (16,748,338) | (19,232,991) |
Gratuity paid | (28,989) | (55,218) |
Income tax paid | (115,734) | - |
Net cash from / (used in) operating activities | 1,553,044 | 19,959,345 |
Cash flows from / (used in) investing activities | ||
Acquisition of Property, Plant & Equipment & Investment property | (1,185,269) | (891,446) |
Proceeds from sale of property, plant & equipment & investment property | 143,304 | 108,270 |
Purchase of government securities | (10,925,781) | (23,465,501) |
Proceeds from sale of government securities | 11,510,974 | 17,100,224 |
Net proceeds from investments in commercial papers | (1,199,963) | 1,209,223 |
Net proceeds from investments in term deposits | 284,433 | (6,323,789) |
Net proceeds from investments securities | 589,501 | 114,368 |
Interest received | 1,966,651 | 2,196,572 |
Net cash flows used in investing activities | 1,183,852 | (9,952,080) |
Cash flows from / (used in) financing activities | ||
Net proceeds from interest bearing loans & borrowings | (2,345,719) | (5,416,941) |
Repayment of principal portion of lease liabilities | 103,763 | 95,334 |
Finance cost paid on borrowings | (1,211,345) | (3,530,921) |
Net cash flows from / (used in) financing activities | (3,453,302) | (11,352,528) |
Net increase / (decrease) in cash and cash equivalents | (716,406) | (1,345,264) |
Cash and cash equivalents at the beginning of the year | 6,469,267 | 7,700,926 |
Cash and cash equivalents at the end of the period | 5,752,860 | 6,355,663 |
Analysis of cash and cash equivalents at the end of the period | ||
Cash and bank balances | 10,897,869 | 15,910,632 |
Bank overdraft | (5,145,009) | (9,554,969) |
5,752,860 | 6,355,663 | |
Page 4
LOLC Finance PLC
OPERATING SEGMENTS
For the six months ended 30th September 2024
SME Finance | Personal Finance | Alternate | Total | |||
Financial Services | ||||||
Rs '000 | Rs '000 | Rs '000 | Rs '000 | |||
For the six months ended 30th September 2024 | ||||||
Total revenue | 28,677,304 | 4,074,224 | 3,601,096 | 36,352,624 | ||
Inter-segmental revenue | - | - | - | - | ||
External revenue | 28,677,304 | 4,074,224 | 3,601,096 | 36,352,624 | ||
Net interest cost | (11,365,823) | (1,044,561) | (1,172,514) | (13,582,898) | ||
Profit before operating expenses | 17,311,481 | 3,029,662 | 2,428,583 | 22,769,726 | ||
Operating expenses | (9,322,074) | (856,733) | (1,090,111) | (11,268,918) | ||
Allowance for impairment & write-offs | (1,379,266) | 349,573 | (120,551) | (1,150,244) | ||
Value added tax on financial services | (1,519,263) | (420,417) | (265,736) | (2,205,416) | ||
Profit before income tax | 5,090,878 | 2,102,085 | 952,185 | 8,145,148 | ||
For the six months ended 30th September 2023 | ||||||
Total revenue | 32,677,128 | 3,603,132 | 3,324,165 | 39,604,426 | ||
Inter-segmental revenue | - | - | - | - | ||
External revenue | 32,677,128 | 3,603,132 | 3,324,165 | 39,604,426 |
Net interest cost
Profit before operating expenses
Operating expenses
Allowance for impairment & write-offs
Value added tax on financial services
(16,658,110)
16,019,018
(8,385,739)
(2,270,929)
(1,375,966)
(1,468,244)
2,134,888
(739,118)
80,561
(225,203)
(1,977,496)
1,346,669
(790,887)
(113,204)
(117,865)
(20,103,850)
19,500,575
(9,915,743)
(2,303,572)
(1,719,035)
Profit before income tax | 3,986,384 | 1,251,128 | 324,714 | 5,562,225 | ||
As at 30.09.2024 | ||||||
Total assets | 335,988,215 | 21,218,749 | 35,568,745 | 392,775,708 | ||
Total liabilities | 213,158,734 | 21,218,749 | 27,907,606 | 262,285,089 | ||
As at 31.03.2024
Total assets
Total liabilities
326,766,570 | 19,143,585 | 31,562,074 | 377,472,229 | ||
211,120,031 | |||||
19,143,585 | 24,863,142 | 255,126,758 | |||
Page 5
LOLC Finance PLC
NOTES TO INTERIM FINANCIAL STATEMENTS
As at 30th September 2024
- General
- These interim financial statements have been prepared in accordance with LKAS 34 Interim Financial Reporting and do not include all of the information required for a full set of financial statements.
- The requirements of the Colombo Stock Exchange and the Companies Act No.7 of 2007 have also been considered in preparing these financial statements
- The information for the preparation of these interim financial statements has been drawn up from the previous year's audited financial records of the Company.
- Accounting policies and methods of computation as stated in the audited financial statements for the year 2023/24 are followed in the preparation of these Interim Financial Statements.
- Interest income recognized in profit or loss using the effective interest method. The effective interest rate is the rate that exactly discounts the estimated future cash payments and receipts through the expected life of the financial asset or liability to the carrying amount of the financial asset or liability. Other operating income includes commision income, capital gains / losses arising from marked to market valuation of quoted shares held for trading purposes, dividends, fee income, collections from contracts written off and other sundry income.
- The Company's Profit Before Tax (PBT) for the period ending September 30, 2024, was Rs. 8.15 billion, reflecting a 46% increase compared to the same period last year. The net lending portfolio experienced a notable growth of Rs. 14 billion, rising from Rs. 249.6 billion to Rs. 263.5 billion during the current financial year. Additionally, the deposit base increased from Rs. 206 billion to Rs. 212 billion by September 30, 2024. Throughout this period, both interest income and interest expenses decreased due to the reduction in market interest rates. Furthermore, we successfully managed non-performing loans (NPLs) at a low rate, leading to a 50% decline in provisions compared to the previous year. We also observed a significant increase in other operating income relative to the same period last year, driven by returns generated from investments of excess funds.
- Stated Capital
The Stated Capital of the Company is represented by 33,079,212,299 ordinary shares.
3. Provision for management expenditure
All expenses related to management expenditure are fully provided for in these Interim Financial Statements.
4. Share information
Market prices of ordinary shares recorded during the quarter ended 30th September 2024 are as follows:
Rs'
6.40
6.70
4.80
5. Debenture information
The debt capital of the company comprises rated unsecured subordinated redeemable debentures fifty million (50,000,000) issued in Sep 2020. These debentures are listed in the Colombo Stock Exchange and Lanka Rating Agency rated Rs.5Bn debentures as A positive.
- | Interest rates of the debentures | |||||
Instrument type | Interest | Coupon | Interest yield as at | Yield to maturity | Interest rate of | |
frequency | ( % p.a ) | last trade | of last trade done | comparable Government | ||
Security | ||||||
Type A - 5 Years Tenor | Semi-annually | 10.50% | 10.50% | 8.86% | 12.73% | |
Type B - 5 Years Tenor | Semi-annually | 19.63% | 19.63% | 19.63% | 12.73% | |
- Market prices & issue prices | of debentures recorded during the quarter ended 30th September 2024 are as follows. | |||||
Instrument Type | Issue Price | Highest Price | Lowest Price | Last Traded Price | Last Traded Date | |
Type A - 5 Years Tenor | Rs.100.00 | Not Traded | Not Traded | Not Traded | N/A | |
Type B - 5 Years Tenor | Rs.100.00 | Not Traded | Not Traded | Not Traded | N/A | |
- Debt security related ratios | ||||||
As at 30.09.2024 | As at 31.03.2024 | |||||
Debt to equity ratio (With Deposits) | 1.81 times | 1.90 times | ||||
Quick asset ratio | 0.82 times | 0.94 times | ||||
Interest cover | 1.76 times | 1.67 times | ||||
6. | Issuer rating - Lanka Rating Agency | |||||
Lanka Rating Agency assigned the company an issuer rating of (SL) A with positive outlook.
Page 6
LOLC Finance PLC
NOTES TO INTERIM FINANCIAL STATEMENTS
As at 30th September 2024
7 Financial assets and liabilities
7.1 Accounting classifications and fair values
As at 30th September 2024
The table below sets out the carrying amounts of the Company's financial assets and financial liabilities.
Rs. '000 | |||||||
Fair value through profit | Fair value through other | Amortized cost / Not | Total Carrying | Fair value | |||
Description | Fair value | measurement | |||||
or loss | comprehensive income | measured at fair value | amount | ||||
level | |||||||
Cash and cash equivalents | - | - | 10,897,869 | 10,897,869 | 10,897,869 | ||
Deposits with banks and other financial institutions | - | - | 3,759,592 | 3,759,592 | 3,759,592 | ||
Investment in government securities and others | 15,861,134 | - | 15,074,206 | 30,935,340 | 32,014,387 | Level 1 | |
Investment securities | 17,768,430 | 277,350 | 977 | 18,046,758 | 18,046,758 | Level 1 / 2 | |
Financial assets at amortized cost | |||||||
Rentals receivable on leased assets | - | - | 62,764,634 | 62,764,634 | 63,942,454 | Level 2 | |
Loans and advances | - | - | 200,953,311 | 200,953,311 | 200,547,160 | Level 2 | |
Amount due from related companies | - | - | 122,233 | 122,233 | 122,233 | ||
Other financial assets | - | - | 1,256,416 | 1,256,416 | 1,256,416 | ||
Total financial assets | 33,629,564 | 277,350 | 294,829,239 | 328,736,153 | 330,586,869 | ||
Bank overdraft | - | - | 5,145,009 | 5,145,009 | 5,145,009 | ||
Interest bearing borrowings | - | - | 18,587,545 | 18,587,545 | 19,387,488 | Level 2 | |
Deposits from customers | - | - | 212,057,715 | 212,057,715 | 216,344,468 | Level 2 | |
Trade payables | - | - | 609,361 | 609,361 | 609,361 | ||
Accruals and other payables | - | - | 19,130,785 | 19,130,785 | 19,130,785 | ||
Amount due to related companies | - | - | 417,670 | 417,670 | 417,670 | ||
Total financial liabilities | - | - | 255,948,085 | 255,948,085 | 261,034,781 | ||
Page 7
LOLC Finance PLC
NOTES TO INTERIM FINANCIAL STATEMENTS
As at 30th September 2024
Financial assets and liabilities (Cont.)
7.1 Accounting classifications and fair values
As at 31st March 2024
The table below sets out the carrying amounts of the Company's financial assets and financial liabilities.
Rs. '000 | |||||||
Fair value through profit | Fair value through other | Amortized cost / Not | Total Carrying | Fair value | |||
Description | Fair value | measurement | |||||
or loss | comprehensive income | measured at fair value | amount | ||||
level | |||||||
Cash and cash equivalents | - | - | 11,486,914 | 11,486,914 | 11,486,914 | ||
Deposits with banks and other financial institutions | - | - | 4,060,475 | 4,060,475 | 4,060,475 | ||
Investment in government securities and others | 14,770,775 | - | 15,309,215 | 30,079,990 | 32,079,092 | Level 1 | |
Investment securities | 17,444,850 | 277,350 | 977 | 17,723,177 | 17,723,177 | Level 1 / 2 | |
Financial assets at amortized cost | |||||||
Rentals receivable on leased assets | - | - | 61,348,491 | 61,348,491 | 62,692,501 | Level 2 | |
Loans and advances | - | - | 188,293,271 | 188,293,271 | 190,368,717 | Level 2 | |
Amount due from related companies | - | - | 111,146 | 111,146 | 111,146 | ||
Other financial assets | - | - | 25,175 | 25,175 | 25,175 | ||
Total financial assets | 32,215,625 | 277,350 | 280,635,663 | 313,128,639 | 318,547,196 | ||
Bank overdraft | - | - | 5,017,647 | 5,017,647 | 5,017,647 | ||
Interest bearing borrowings | - | - | 20,912,613 | 20,912,613 | 21,306,639 | Level 2 | |
Deposits from customers | - | - | 206,368,226 | 206,368,226 | 211,227,573 | Level 2 | |
Trade payables | - | - | 102,869 | 102,869 | 102,869 | ||
Accruals and other payables | - | - | 16,103,668 | 16,103,668 | 16,103,668 | ||
Amount due to related companies | - | - | 332,082 | 332,082 | 332,082 | ||
Total financial liabilities | - | - | 248,837,106 | 248,837,106 | 254,090,478 | ||
Page 8
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