Untitled - John Keells PLC.

160 Pages·2016·3.44 MB·English

Anticipating the
future
At John Keells PLC, we believe that corporate agility,
adaptability and resilience have driven our success
for over 147 years. We have always embraced the
challenges of change, transforming and growing
through far-sighted strategies, ethical processes and
innovative new products.
Today we look to the future with confidence,
anticipating the growing value we can generate
through our disruptive approach, proactive attitude
and willingness to change.
We know we can achieve our goals in a competitive
environment, as we grow through our challenges
towards the future success we confidently anticipate
today.

Vision
To be internationally recognised as the best
Produce Broker in the world.
Mission
To retain the pre-eminent position as sri Lanka’s leading Tea
and Rubber broker; To uphold the traditions and ethics of the
Tea and Rubber trades; To ensure superior customer service
through a dedicated and motivated workforce.
VaLues
We are committed to the highest level of integrity and ethical conduct in
all our business activities.
We will look towards exceeding shareholder and customer expectations
by achieving excellence in all areas of operations.
We recognise the right of every individual to be treated with fairness,
dignity and respect and assist our employees to improve their skills and
reward their accomplishments.
We will focus on corporate social responsibility and look to protect and
safeguard the environment.
2 John Keells PlC
Contents
05
Financial Highlights
12 14
Board of Directors
Chairman’s Message
44 76 85
Corporate Governance enterprise Risk Management annual Report of the
Board of Directors
Group structure 04 statement of Directors Responsibility 91
Financial Highlights 05 independent auditor’s Report 93
Milestones 06 income statement 94
Performance Highlights 08 statement of Comprehensive income 95
an introduction to this Report 10 statement of Financial Position 96
Year at a Glance 11 statement of Changes in equity 97
Chairman’s Message 12 Cash Flow statement 98
The Board of Directors 14 notes to the Financial statements 100
senior Management Team 16 information to shareholders and investors 146
Management Discussion & analysis 17 Five Year summary 148
GRi index 37 Key Ratios and information 150
Corporate Governance 44 Glossary of Financial Terminology 152
enterprise Risk Management 76 notice of Meeting 153
audit Committee Report 82 Form of Proxy 155
annual Report of the Board of Directors 85
Annual Report 2015/16 3
G4-4
Group Structure
Company service Product
Produce
John Keells PLC
Broking
Inc 1960
ownership
Tea & Rubber
John Keells
100%
Produce
Warehousing
Warehousing
(Pvt) Ltd
Inc 2001
John Keells
Share
Stock Brokers
76% Broking Shares
(Pvt) Ltd
Inc 1979
Cataloguing Human Resources Research
Support Functions Sample Handling Finance IT services
Claim Settlements
Staff Provident Fund CSR Committee
Funds & Committees
Staff Thrift Society Fund Welfare & Recreation
Committee
4 John Keells PlC
Financial Highlights
Group Revenue Group Profits Group Assets
2014/2015 Rs.959.9 Mn 2014/2015 Rs.332.9 Mn 2014/2015 Rs.6,074 Mn
Associate
Share Broking
Produce Broking Share Broking
2015/2016
2015/2016 2015/2016 4,982
Warehousing
707 Produce Broking 63 Warehousing Rs. Mn
Rs. Mn Rs. Mn
Produce Broking
Share Broking
Warehousing
Carbon Foot Print Economic Value added Employee Composition
2014/2015 185 MT 2014/2015 Rs.1,014Mn 2014/2015 Nos. 96
Warehousing
Warehousing
Share Broking
Share Broking
2015/2016
2015/2016
Share Broking
2015/2016 96
Produce Broking 814 Nos.
196 Rs. Mn Associate
Produce Broking
MT
Produce Broking
Warehousing
Group Capital & Returns Group Assets Revenue Composition
Rs. Mn % Rs. Mn Rs. Mn
4000 4000
48
3500 3500 2012
41
3000 3000
35
2013
2500 2500
29
2000 2000 2014
23
1500 1500
16
2015
1000 1000
10
500 500
4 2016
0 0
-2 2016 2015 2014 2013 2012 0 200 400 600 800 1,000
2016 2015 2014 2013 2012
Total shareholder funds Net current assets Produce Broking and Warehousing
Profits after tax Fixed assets and investment Share Broking
Return on capital employed (%)
Growth in shareholder funds (%)
Annual Report 2015/16 5
Milestones
1870 1876 1878
edwin John came to Ceylon, a partnership styled “John This partnership was dissolved and edwin John started an
as the island was then called, Brothers and Company” was establishment of his own titled “e. John” and carried on the business
to join his brother George. formed with offices situated of produce and exchange broking. The first decade of business
Together, they established in Colombo and Kandy. of e. John was one of low activity. Villers records this period thus,
themselves as Produce and “Business in those days was very limited. Coffee had all but gone
exchange Brokers. out, Tea had not expanded sufficiently and the little business in
Chinchona was not enough to go around.” During this period,
Reginald, son of edwin John, joined his father in Ceylon.
1986 1976 1971 1970
John Keells Holdings PLC, acquired John Keells PLC., John Keells PLC., M.C. Bostock was
the controlling interest of John Keells became a People’s moved its offices to elected Chairman
PLC., M.C. Bostock retired and D.J.M. Company. Glennie street, slave of the Company.
Blackler took over as the Chairman of the island.
Company.
1990
1993 2000 2001
K. Balendra took over as Financial statements of the K. Balendra retired V. Lintotawela took over as
Chairman, the first Sri Lankan to associates Keells Realtors as Chairman on 31st Chairman on 1st January, 2001.
hold this position. John Keells Ltd., and international December 2000 John Keells PLC., incorporated
PLC., acquired controlling Tourists and Hoteliers Ltd. John Keells Warehousing (Pvt)
interests in John Keells stock were incorporated to the Ltd., a fully owned subsidiary
Brokers (Pvt) Ltd. Consolidated accounts. with B.o.i. status.
2015 2013 2011
in Compliance to the new securities The Company disposed of its The Board of Directors at a meeting held on 11th
exchange Commission directive which land at 130, Glennie street May 2011 resolved to increase the number of
came in to effect from 1st January Colombo 2. shares by way of a share sub -division in the ratio
2016 the shares of the company which of one (1) share for every one (1) share held.
were listed on the Main Board was Consequently, the number of shares after the sub
transferred to the Diri savi Board of the – division increased to 60,800,000 shares from
Colombo stock exchange. the previous 30,400,000 shares.
6 John Keells PlC
1890 1895 1948
Prospects began to Reginald John was taken e. John and Co., amalgamated with two London
improve rapidly with into the partnership of e. Tea Broking firms, William Jas and Hy Thompson
the approaching tea John and Co. By this time, and Co. and Geo White and Co. The firm was then
business. business was growing incorporated as a private limited liability company and
quite rapidly in tea, shares, the name was changed to e. John, Thompson, White
oil and exchange. and Co. Ltd.
1966 1962 1960
The initial step towards The firm moved to the e. John, Thompson, White and Co. Ltd., amalgamated with Keells
diversification of the sixth floor of the then and Waldock Ltd. The name was changed to John Keells Thompson
activities of the Company newly constructed White Ltd. This Company had its office in the National Mutual
was taken with the Ceylinco House. Insurance Company building in Chatham Street. The first Chairman
acquisition of Ceylon of the Company was Douglas armitage and on his retirement he
Mineral Waters Ltd. was succeeded by a.G.R. Willis. The Company acquired its Glennie
street premises from Dodwell and Company which were initially used
as a warehousing.
2003 2004 2005
The state of the art warehouse of John Keells The Company disposed its V. Lintotawela retired as Chairman
Warehousing (Pvt) Ltd., which is the largest investment in international on 31st December 2005 and s
hi-tech tea warehouse in this part of the Tourists and Hoteliers Ltd. Ratnayake took over as Chairman
region was commissioned for storing pre- on 01st January 2006.
auctioned produce.
2010 2007
The Board of Directors at a meeting held on 20 th July 2010 resolved to The name of the Company was
increase the number of shares by way of share sub – division in the ratio changed to John Keells PLC which is
of one (1) share for every one (1) share held. Consequently, the no of a new requirement of the Companies
shares after the sub – division increased to 30,400,000 shares from the act no. 7 of 2007.
current 15,200,000 shares.
Annual Report 2015/16 7
G4-9
Performance Highlights
Financial Highlights – Three Year Performance
Year ended 31st March 2015/2016 2014/2015 2013/2014
indicator
Earnings Highlights and Ratios
Group revenue Rs. 000's 706,664 959,925 874,797
Group profits before interest and tax (EBIT) Rs. 000's 128,648 410,622 418,499
Group profits before tax Rs. 000's 63,466 332,979 317,327
Group profits after tax Rs. 000's 54,213 231,847 215,473
Group profits attributable to shareholders Rs. 000's 52,746 217,401 150,251
earnings per share Rs. 0.87 3.58 2.47
interest cover no. of times 1.97 5.29 4.14
Return on equity % 1.62 7.06 6.66
Return on capital employed % 3.24 9.58 9.80
Balance Sheet Highlights and Ratios
Total assets Rs. 000's 4,982,427 6,074,386 5,935,864
Total debt Rs. 000's 652,115 908,330 1,079,811
number of shares in issue 000's 60,800 60,800 60,800
Total shareholder funds Rs. 000's 3,312,398 3,379,434 3,190,693
net assets per share Rs. 54.48 55.58 52.48
Debt/equity % 19.68 26.88 33.84
Debt/Total assets % 13.09 14.95 18.19
Market/ Shareholder information
Market price as at 31st March Rs. 70.00 92.00 70.00
Market capitalization Rs. 000's 4,256,000 5,593,600 4,256,000
Price earning ratio no. of times 80.69 25.73 28.34
Dividend paid Rs. 000's 228,000 206,720 212,800
Dividend per share Rs. 3.75 3.40 3.50
Dividend payout ratio % 432.26 95.09 141.70
Dividend yield % 5.36 3.70 5.00
8 John Keells PlC