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Listed firms earnings declined by 9.6% to Rs.45.8Bn in Sep quarter

Earnings of listed companies in the September quarter have declined by 9.6% to Rs.45.8 billion largely owing to a weaker performance by Insurance, Consumer Services, Capital goods and Beverage and Tobacco sectors.
Analysing interim financials reported by 264 companies, First Capital Research revealed that September quarter earnings dipped by 9.6%YoY to LKR 45.8Bn primarily due to sluggish performance in Insurance (-48%YoY), Consumer Services (-495%YoY), Capital Goods (-39%YoY) and Food, Beverage and Tobacco (-12%YoY) sectors.

“However, earnings upside was witnessed in Material (108%YoY), Consumer, Durable & Apparel (+13600%YoY) and Energy (646%YoY) sectors negating the negative performance in the above-mentioned sectors,” First Capital said.

Lackluster performance in Insurance, Consumer Services and Food, Beverage and Tobacco was mainly owing to the lower consumer spending stemmed from subdued economic activities.

Insurance sector earnings recorded a substantial drop mainly due to earnings decline in AAIC (-85%YoY) from a deferred tax adjustment and UAL (-91%YoY) due to the increased transfer of insurance contract liabilities to the life fund.