Singer (Sri Lanka) PLC reported a 4 percent fall in group profit for the September quarter, as sharply higher finance costs and financial services taxes absorbed almost all of a 20 percent improvement in operating profit.

Group profit after tax eased to Rs. 1.45 billion in the three months to 30 September from Rs. 1.52 billion a year earlier, the Daily Mirror reported. Profit attributable to shareholders fell 5.5 percent to Rs. 1.36 billion, and earnings per share declined to Rs. 1.16 from Rs. 1.23.

Revenue grew 21 percent to Rs. 35.68 billion.

The gap between trading and the bottom line

The quarter’s distinguishing feature is how little of the trading improvement reached shareholders. Group operating profit rose by Rs. 628 million to Rs. 3.71 billion. Against that, net finance costs climbed Rs. 578 million to Rs. 1.05 billion — more than double the prior-year charge — and value-added tax on financial services rose Rs. 91 million to Rs. 366 million. Profit before tax consequently fell 2 percent to Rs. 2.29 billion.

Those three figures account for the outcome almost exactly: operating profit less finance costs less the financial-services VAT leaves the reported pre-tax result.

Segments moved in different directions

Financial services was the strongest performer, with revenue up 43 percent to Rs. 7.26 billion and segment profit up 48 percent to Rs. 1.93 billion — supplying more than a third of the group’s total revenue increase.

The pattern elsewhere was weaker. Home appliances, the largest segment, grew revenue 15 percent to Rs. 11.43 billion but saw profit fall 8 percent to Rs. 993 million. Consumer electronics profit dropped 28 percent to Rs. 190 million even as its turnover expanded 17 percent. Automobiles and other products revenue rose 39 percent to Rs. 4.61 billion.

Interest-bearing loans and borrowings stood at Rs. 90.22 billion at end-September, against Rs. 79.60 billion in March. Inventories rose to Rs. 41.67 billion from Rs. 34.22 billion.

For the six months, revenue rose 30 percent to Rs. 74.41 billion and profit after tax rose 20 percent to Rs. 3.69 billion.

Hayleys PLC holds 67.13 percent of the company, with Hayleys Advantis at 9.54 percent and Volanka (Pvt) Ltd at 2.98 percent.

Not reported

The filing does not explain what drove the doubling of finance costs — whether higher borrowing volumes, repricing of existing facilities, or both — though the Rs. 10.6 billion increase in interest-bearing debt since March is the obvious candidate. It gives no reason for home appliances and consumer electronics earning less on higher sales, which would point to margin compression or promotional discounting. No company official is quoted, and the Daily Mirror’s account carries no reporter byline.

A note on sourcing. This desk found no second verified newsroom carrying the result at the time of writing; EconomyNext’s rail carried no Singer item. The figures above are as reported in the single filing and have not been checked against the company’s own interim accounts.