Aitken Spence posted a remarkable 26% growth in profits attributable to shareholders over the previous year, despite an adverse and challenging environment faced by both the national and global economies.

In its annual results released to the Colombo Stock Exchange today for the financial year 2007/08, the diversified bluechip revealed its annual profit-after-tax figure rising 24% to Rs 2.8 b and group revenue surging 39% to Rs 27.5 b.

“Our pioneering spirit and vision enabled us to forge strategic alliances and achieve sustained growth. Through evolution and innovation, Aitken Spence has successfully gained greater profitability and market growth”, said Deputy Chairman and Managing Director of Aitken Spence & Co. PLC, J M S Brito.

Earnings per Share stood at Rs 68 while the Return on Equity was a commendable 17%.

The Group which has invested extensively in the Sri Lankan tourism industry saw restricted profitability and potential returns from its local resorts.

Mr Brito said, “However, we strongly believe in the country’s great potential and remain optimistic on the dawn of peace. The Sri Lankan economy has proven to be resilient and we see opportunities to continue investing heavily.”

He continued, “Despite growing difficulties, the Sri Lankan hotels operations posted a noteworthy decline in losses during the year which was a creditable achievement bearing in mind the low occupancies and the high debt service cost burdening the hotel properties. The lack of high yield travellers compounded by intense competition amongst beach properties, rising wages and energy costs further constricted profitability.”

Aitken Spence strengthened its overseas operations in the hospitality sector with the commencement of hotel management ventures in growing markets of India and Oman, in addition to new investments in the Maldives.

The Group’s destination management division, another industry leader, performed commendably by innovatively targeting emerging markets where travellers were less susceptible to adverse international publicity.

The company noted that external factors such as rising global energy prices translated into higher operational costs especially for businesses dependent on transportation related services.

Obtaining the principal agency of Hapag Lloyd – the world’s fifth largest Shipping Company considerably strengthened the Logistics sector’s profitability in the year under review.

Procuring a third contract with the Port of Durban, South Africa, which is Africa’s busiest, the maritime transport division put to good use its port management expertise to engage in skills transfer, port efficiency enhancement and port management services. During the year under review, the company ventured into port management consultancy services covering all ports in South Africa.

Given escalating costs in utilities and transport, the integrated logistics and freight forwarding divisions of the Group posted a commendable year of profitability, outperforming their competition through differentiation by means of enhanced quality and value added services offered.

“The suspension of the multi country consolidation activity outside the Port of Colombo adversely affected our integrated logistics division. This is an issue of concern as not only has this eliminated a stream of revenue to the division but to the entire country whilst having an adverse impact on the hub status of the Port of Colombo”, added Mr Brito.

In the Strategic Investments sector, power generation remains a strong performer. However, with limited potential at home, the Group expects future growth in the sector to originate from overseas expansion opportunities.

Aitken Spence officially opened another garment