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Sunshine Holdings delivers record performance in FY24, driven by healthcare and consumer sectors

Posted on by darion

Chairman Amal Cabraal (left) and group CEO Shyam Sathasivam

  • FY24 revenue of Rs. 55.5 billion, up 7%
  • Healthcare sector revenue growth by 16.1% YoY to Rs. 27.7 billion

Sri Lankan diversified conglomerate Sunshine Holdings PLC has recorded stable revenue growth against the backdrop of moderately stable macroeconomic conditions, recording significant growth in revenues and earnings for the year ended March 31, 2024.

The Group’s Healthcare and Consumer sectors recorded growth while the healthcare segment remained the major contributor to the Group’s total revenues in FY24. Sunshine recorded consolidated Group revenues of Rs. 55.5 billion for the year ended March 31, up 7% year-on-year (YoY). Profit after tax (PAT) for the period under review increased by 66.4% to Rs 500,000. 6 billion. Gross profit also increased by PLN 3.7 billion, representing a solid growth of 27.6% year-on-year, driven primarily by margin expansion in both the healthcare and consumer segments. Gross profit margin for the period was 31%, a significant improvement of 500 basis points compared to the previous year.

The Group’s strong financial performance was announced at a time when the International Finance Corporation (IFC) announced a proposed equity investment of up to Rs. 3.2 billion in its healthcare arm, Sunshine Healthcare Lanka (SHL). Once the conditions are met, IFC will own approximately 14.7% of SHL. The investment further underlines the confidence of international agencies in Sunshine Holdings’ development plans.

The group’s healthcare business emerged as Sunshine’s largest revenue generator, accounting for 50% of total revenues, while the group’s consumer goods and agribusiness sectors contributed 34.8% and 15% of total group revenues, respectively. The Group’s operating profit (EBIT) amounted to PLN 50,000. 8.7 billion, which means an increase of 23.7% y/y. Additionally, the Group’s finance costs for the period under review decreased to Rs. 1.2 billion from rupees A year earlier 1.5 billion.

Sunshine Holdings PLC CEO Amal Cabraal noted: “Despite continued economic challenges in FY24, Sunshine Group has demonstrated remarkable resilience and agility. All key sectors performed well. Our unwavering commitment, strategic execution, prudent financial management and innovative practices have enabled us to successfully navigate the complexities of the market.”

Sunshine Holdings Group CEO Shyam Sathasivam said, “Our achievement of crossing the Rs.500 mark. 6 billion PAT marks for the first time in the history of Sunshine Holdings is a testament to the exceptional capabilities and commitment of our team. It is their commitment and spirit that has led our company to this extraordinary milestone. The Group’s robust internal processes, investment in digital capabilities and focus on operational excellence have played a key role in achieving these results. I am proud of our team’s ability to adapt and excel in a challenging economic landscape, and confident that their continued resilience and ingenuity will propel us to even greater achievements in the future.”

Healthcare

The healthcare sector recorded revenues of PLN 50,000. 27.7 billion in FY24, up 16.1% year-on-year, supported by improved performance in the medical devices and manufacturing segments. Pharma segment revenues remained flat, while the medical devices segment grew 28.1% y/y, driven by both price and volume growth. The revenues of the Healthguard Pharmacy retail segment recorded an increase of 19.2% y/y in the period in question.

Lina Manufacturing, the manufacturing arm of the Pharma Group, reported an impressive 137.4% YoY revenue growth, driven by higher volumes at its metered dose inhaler (MDI) plant. The group’s EBIT in the healthcare sector was Rs. 4.3 billion.

Consumer brands

The consumer sector, which includes both export and domestic activities, saw revenues grow by 1.6% YoY to Rs 500,000. 19.3 billion in FY24. The domestic consumer business showed impressive performance in FY24, with the Group’s consumer brands continuing to gain market share. The total tea category recorded volume growth of 10% y/y and value growth of 37.6% y/y. Revenues of the confectionery segment decreased by 7.1% y/y, despite price increases, due to a 25.7% y/y decline in volume. PAT from the Consumer segment increased significantly by 118.5% YoY thanks to the development of the domestic tea business and savings in financial costs. Revenues of the export segment decreased by 22.5% y/y due to lower tea prices and a decline in volumes in individual export markets.

Agribusiness

The Group’s agribusiness sector, represented by Watawala Plantations PLC (CSE: WATA), recorded revenues of Rs. 8.3 billion, which means a decrease of 5.1% y/y. This was due to a decline in revenues of the palm oil segment, by 9.3% y/y. However, palm oil production increased by 15.1% y/y to 15.7 million kg in the current period compared to 13.7 million kg in the same period last year. PAT of agriculture sector closed at Rs. 2.4 billion in FY24, up 2.9% YoY. Revenues of the dairy sector increased by 29.7% y/y thanks to an increase in both sales volume and milk prices.