INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2013 LB Finance PLC, 275/75, Prof. Stanley Wijesundara Mw., Colombo 07. Tel: 0114 521000 www.lbfinance.com
LB Finance PLC STATEMENT OF COMPREHENSIVE INCOME FOR THE 3 MONTHS ENDED VARIANCE FOR THE 6 MONTHS ENDED VARIANCE 2013.09.30 2012.09.30 % 2013.09.30 2012.09.30 % Rs.('000) Rs.('000) Rs.('000) Rs.('000) Income 2,737,682 2,720,395 1 5,894,355 5,245,151 12 Interest Income 2,560,145 2,521,352 2 5,485,808 4,838,110 13 Interest Expenses (1,801,473) (1,444,066) (25) (3,583,380) (2,685,442) (33) Net Interest Income 758,673 1,077,286 (30) 1,902,428 2,152,668 (12) Fee and Commission Income 169,256 163,993 3 332,767 331,384 0 Net Fee and Commission Income 169,256 163,993 3 332,767 331,384 0 Net gain/(loss) from trading (831) 1,445 (157) (749) 1,445 (152) Other Operating Income (net) 33,390 43,138 (23) 76,527 74,212 3 32,559 44,583 (27) 75,779 75,657 0 Total Operating Income 960,488 1,285,862 (25) 2,310,975 2,559,709 (10) Impairment (Charges) / Reversal for loans and other losses 124,948 (66,754) 287 (261,566) (207,700) (26) Net Operating Income 1,085,435 1,219,108 (11) 2,049,409 2,352,009 (13) Operating Expenses Personnel Expenses (337,139) (260,986) (29) (646,925) (506,383) (28) Depreciation of Property & Equipment (83,228) (74,403) (12) (155,996) (144,580) (8) Amortisation of Intangible Assets (2,125) (1,323) (61) (3,885) (2,667) (46) Other Operating Expenses (243,489) (229,452) (6) (486,880) (451,164) (8) Operating Profit before Value Added Tax on Financial Services 419,455 652,945 (36) 755,723 1,247,214 (39) Value Added Tax on Financial Services (13,424) (44,158) 70 (38,488) (85,449) 55 Profit before Taxation 406,032 608,787 (33) 717,235 1,161,765 (38) Income Tax Expense (115,754) (240,165) 52 (198,941) (418,539) 52 Profit after Taxation 290,277 368,622 (21) 518,294 743,226 (30) Other Comprehensive Income / (Expenses) Available for Sale Financial Assets Sri Lanka Government securities (6,392) - (1,391) - Equity Securities (20,801) 2,146 (1,069) (6,368) 6,818 (193) (27,194) 2,146 (1,367) (7,759) 6,818 (214) Income Tax (Charge) / Credit Relating to Components of Other Comprehensive Income 5,442 (601) 1,005 - (1,909) 100 Other Comprehensive Income, Net of Taxes (21,752) 1,545 (1,508) (7,759) 4,909 (258) Total Comprehensive Income, Net of Taxes 268,525 370,168 (27) 510,535 748,135 (32) Earnings Per Share (Rs) 4.19 5.32 7.48 10.73 LB Finance PLC STATEMENT OF CHANGES IN EQUITY Stated Capital Retained Earnings Statutory Reserve Investment Fund Reserve Available for Sale Reserve Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Balance as at 1 April 2013 838,282 2,852,402 1,193,051 440,801 4,065 5,328,601 Net profit for the period - 518,294 - - - 518,294 Other comprehensive income net of tax - - - - (7,759) (7,759) Transfer to Statutory Reserve - (103,659) 103,659 - - - Transfer to Investment Fund Reserve - (117,344) - 117,344 - - Dividend for 2012/13 - (450,171) - - - (450,171) Balance as at 30 September 2013 838,282 2,699,522 1,296,710 558,145 (3,694) 5,388,964 Balance as at 1 April 2012 838,282 2,075,561 852,518 201,795 (60) 3,968,096 Net profit for the period - 743,226 - - - 743,226 Other comprehensive income net of tax - - - - 4,909 4,909 Transfer to Statutory Reserve - (148,645) 148,645 - - - Transfer to Investment Fund Reserve - (117,272) - 117,272 - - Dividend for 2011/12 - (346,277) - - - (346,277) Balances as at 30 September 2012 838,282 2,206,593 1,001,163 319,067 4,849 4,369,954 Total
LB Finance PLC CASH FLOW STATEMENT 2013.09.30 2012.09.30 Cash Flows From / (Used in) Operating Activities Rs.('000) Rs.('000) Profit before Income Tax Expense 709,476 1,168,583 Adjustments for Depreciation 155,996 144,580 Amortisation of Intangible Assets 3,885 2,667 Impairment provision 261,566 207,700 Interest cost on Finance Lease 1,669 2,367 Diminution/(Appreciation) in value of investments 8,508 (18,373) Loss/(Profit) on disposal of property & equipment (1,677) (1,980) Provision/(reversal) for Defined Benefit Plans 21,721 20,693 Dividend Received (2,395) (2,329) Notional Tax Credit on Interest on Treasury Bills (18,438) (12,402) Withholding Tax attributed to Fixed Deposit & professional fees (127) (6,423) Operating Profit before Working Capital Changes 1,140,182 1,505,083 (Increase)/Decrease in Loans and Advances (525,379) (2,877,766) (Increase)/Decrease in Lease Rentals Receivable & Stock out on hire (1,667,826) (2,288,278) (Increase)/Decrease in Other Financial Assets (838,959) (79,072) (Increase)/Decrease in Other Non Financial Assets (54,122) 456,535 Increase/(Decrease) in Amounts Due to Customers 4,098,089 6,722,696 Increase/(Decrease) in Other Financial Liabilities (134,486) 310,346 Increase/(Decrease) in Other Non Financial Liabilities 27,999 (83,909) Cash Generated from Operations 2,045,498 3,665,635 Retirement Benefit Liabilities Paid (2,653) (655) Taxes Paid (363,619) (539,883) Net Cash From/(Used in) Operating Activities 1,679,226 3,125,097 Cash Flows from / (Used in) Investing Activities Acquisition of Property, Plant & Equipment (165,868) (340,659) Acquisition of Intangible Assets (11,256) (569) Proceeds from Sales of Property, Plant & Equipment 3,603 1,997 Sale/(Purchase) of financial investments- available- for- sale (867,090) (263,215) Dividend Received 2,395 2,329 Net Cash Flows from/(used in) Investing Activities (1,038,216) (600,117) Cash Flows from / (Used in) Financing Activities FOR THE 6 MONTHS ENDED Payment under Finance Lease Liabilities (8,985) (8,599) Net Cash Flow from Securitised Borrowings, Syndicated Loans and Other Bank Facilities (716,489) (1,409,520) Net Cash Flow from Debt Instruments Issued and Other borrowings (814,681) 424,379 Dividends Paid (450,171) (346,278) Net Cash Flows from/(used in) Financing Activities (1,990,326) (1,340,019) Net Increase in Cash and Cash Equivalents (1,349,316) 1,184,961 Cash and Cash Equivalents at the beginning of the year 3,141,180 470,051 Cash and Cash Equivalents at the end of the period 1,791,864 1,655,012 CASH AND CASH EQUIVALENTS IN THE CASH FLOW STATEMENT Cash & Bank Balances 819,934 658,141 Money at call and short notice 1,600,084 1,952,501 Bank Overdrafts (628,153) (955,631) Total Cash and Cash Equivalents 1,791,864 1,655,012
LB Finance PLC SEGMENTAL ANALYSIS Lease & Stock out on Hire Loans & Receivables Others Total 2013 2012 2013 2012 2013 2012 2013 2012 Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Rs.('000) Interest 3,876,746 3,076,743 1,166,221 1,483,419 442,841 277,948 5,485,808 4,838,110 Fee Based Income & others 201,219 111,434 98,002 171,334 109,325 124,273 408,546 407,041 Total Revenue 4,077,965 3,188,177 1,264,223 1,654,753 552,166 402,221 5,894,354 5,245,151 Segmental Result 1,185,680 995,917 (284,950) 290,392 25,148 128,769 925,878 1,415,078 Unallocated Expenses (177,914) (161,046) Profits from operations 747,964 1,254,032 Tax expenses (237,429) (505,897) Net profit for the period 510,535 748,135 Segment Asset 30,890,452 26,352,652 17,876,462 15,838,137 4,837,902 3,506,806 53,604,816 45,697,595 Unallocated Assets 2,698,420 2,764,121 Total Assets 56,303,236 48,461,716 Segment Liabilities 4,246,143 5,303,004 2,165,845 3,029,539 1,305,856 1,073,210 7,717,844 9,405,753 Unallocated Liabilities 43,196,428 34,686,009 Total Liabilities 50,914,272 44,091,762
3. The Commitment & Contingencies as at 30th September 2013 is Rs.643 Mn & as at 31st March 2013 is Rs.1,246Mn. For the three months ended 30th June, 2013 Information on Shares Share Price During the Quarter 30.09.2013 30.09.2012 Highest Rs. 130.00 165.00 Lowest Rs. 103.00 108.10 Closing Rs. 109.90 150.40 No of Ordinary Share Issued As At 69,257,142 69,257,142 Information on Listed Debentures Debt Equity Ratio 163.78% 156.91% Quick Asset Ratio 11.71% 9.98% Interest Cover 1.20 1.44 Interest Rate of Comparable Government Securities 11.17% 14.15% Market Price During Three Months Not Traded Not Traded Interest Yield As At Date of Last Trade Not Traded Not Traded Yield To Maturity of Trade Done Not Traded Not Traded Capital Adequacy SELECTED PERFORMANCE INDICATORS As At As At 30.09.2013 30.09.2012 Core Capital to Risk Weighted Asset Ratio (Minimum 5%) 11.52% 10.57% Total Capital to Risk Weighted Asset Ratio (Minimum 10%) 12.54% 12.40% Capital Funds to Total Deposit Liabilities Ratio 12.58% 13.75% Profitability Return on Avg Shareholders' Funds -Annualized 19.05% 35.89% Return on Avg Assets (After Tax) -Annualized 1.85% 3.28% Asset Quality (Rs.'Mn) Non-Performing Accommodation 2,083 1,145 Total Accommodations 59,632 49,541 Net Total Accommodations (Net of Allowance for Impairment Losses) 58,119 48,555 Liquidity (Rs.'Mn) EXPLANATORY NOTES 1. These Interim Financial Statement of the Company have been prepared in accordance with Sri Lanka Accounting Standards that came into effect from April 1, 2012 and comparatives (year 2012) too are reclassified and re-measured wherever necessary to conform to the current presentation. Further, these Interim Financial Statements have been prepared in complience with the requirements of Sri Lanka Accounting Standards - LKAS 34 on 'Interim Financial Reporting' & the accounting policies and methods of computation followed in preparing the above interim financial statements are the same as those disclosed in our Annual Report for the year ended 31st March 2013. 2. There have been no material events occurring after the balance sheet date that require adjustments to or disclosure in the Financial Statements except the Board of Directors has declared a final dividend of Rs.6.50/- per share totaling to Rs.450 Million on 28th May 2013. INFORMATION ON SHARES AND LISTED DEBENTURES For the Period Ended Required Minimum Amount of Liquid Asset 4,311 3,283 Available Amount of Liquid Asset 5,329 3,706 Required Minimum Amount of Government Securities 2,484 1,723 Available Amount of Government Securities 2,861 1,935
L B Finance PLC Interim Financial Statements for the period ended 30th September 2013 Additional Notes Twenty largest share holders as at 30th September 2013 Name No. of Shares (%) 1 Vallibel One PLC 35,321,200 51.000 2 Royal Ceramics Lanka PLC 18,030,788 26.034 Commercial Bank of Ceylon PLC/ 3 Esna Holdings (Pvt) Ltd 7,011,137 10.123 4 Sri Lanka Insurance Corporation Ltd - Life Fund 1,842,900 2.661 5 Mercantile Investments and Finance PLC 953,600 1.377 6 Seylan Bank PLC/Mr. W D N H Perera 631,634 0.912 7 HSBC International Nominees Ltd-SSBT- Deustche Bank 232,728 0.336 8 Mr. A A Page 157,400 0.227 9 Mr. E Bianchi 154,400 0.223 10 Mr. A M Weerasinghe 148,850 0.215 11 Mr.K D A Perera 147,733 0.213 12 Environmental Resources Investment PLC 120,488 0.174 13 Waldock Mackenzie Ltd / Mrs G Soysa 111,252 0.161 14 Mr. H A M P Algama 99,000 0.143 15 Mrs. P C Cooray 95,716 0.138 16 Mr T Jeramiah 77,582 0.112 17 Mr K Karunanayake & Ms P N Karunanayake 74,162 0.107 18 Mr P Somadasa 72,372 0.104 19 Mr. J A A S Adhihetty 53,060 0.077 20 Waldock Mackenzie Ltd / Mr K R E M D M B Jayasundara 52,642 0.076 65,388,644 94.413 Others 3,868,498 5.587 Total 69,257,142 100.000 Directors' and Chief Executive Officer's holding in shares as at 30th September 2013 Name No. of shares % Mr. Thosapala Hewage - - Mr. K D D Perera - - Mr. L N De Silva Wijeyeratne - - Mr. J A S S Adhihetty (Managing Director) 53,060 0.077 Mr. Nimal Perera/ Seylan Bank PLC Mr. Nimal Perera Mr. N Udage 631,634 4,200 0.912 0.006 Mr. B D A Perera - - Mrs. K Fernando 1,600 0.002 Mrs. Shirani Jayasekara - - Mrs. A K Gunawardhana - - PUBLIC HOLDING The percentage of shares held by the public as at 30th September 2013 is 11.82%