News In Brief

Quotable Quotes

“Whom the gods wish to destroy they first make mad”-Euripedes (480-406 B.C.), from his play Alcestis (438 B.C.)

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Dr. Peter Hayes

Things Uncommon

Sri Lanka and the U.K. have many things in common in regard to education, but the same may not hold true to politics-U.K. High Commissioner Dr. Peter Hayes speaking at a function in Colombo on Tuesday.

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Power Failures

Seven days in Malaysia, some of those in its nether parts like Sarawak, where Malaysia’s indigenous people live, but not a single power failure; returned to Sri Lanka on Independence Day, and on the third day after my return, three power failures were witnessed in Mount Lavinia, my home town on the same day.

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Mr.  10%

My butcher in Wellawatte attributes corruption for the increase in beef prices from Rs. 400 to Rs. 440 a kilo, an increase which caught me unawares when I went to make my purchase last Sunday.

“Corruption is by way of having to allegedly bribe the police in the transport of this supply ‘safely,’ from its source in Anuradhapura to the market,” he said.

Government controls on cattle slaughter encourages such corruption, the cost of which is passed on to the consumer, the butcher told this reporter.

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Sriyan

Tech. Vs. Infrastructure

Technology will connect the island’s periphery with the centre faster than physical infrastructure such as roads.

* For every one U.S. dollar earned by Microsoft, its global partners earn between U.S. $ 10-22.6. That explodes the myth that Microsoft takes money out from a country. -Sriyan de S. Wijeyeratne, country Manager Microsoft Sri Lanka, speaking at a seminar here on Monday.

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1st Choice

CIMA on Monday launched its corporate partnership programme for the year, inveigling some 19 top blue chip companies under this project.

As per this arrangement, students studying for the CIMA programme are assured of placements in those companies as trainees, whilst those with CIMA qualifications will be “assured” of employment in such organizations, as and when vacancies arise.

Satchi Thomas, Managing Director Glaxo Smithkline, one of CIMA’s partners, in response to a question asked by this reporter, said that there are a number of CIMA qualified accountants serving in his organization. His first choice in recruiting an accountant is to give preference to a person with a CIMA qualification.

“This is because they are more business oriented,” he said.

When The Sunday Leader asked CIMA’s local chairman Sutheash Balasubramaniam as to why they had not partnered with any of the companies in the garment sector, he said that he was sure, that down the line, they too would partner with CIMA, under this project.

CIMA, since of late, has been calling its local heads chairmen, replacing the earlier term, “president.”

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A.T.M. Fraud

A. T.M.s were first introduced in the 1970s in the U.S.A., which technology was gradually picked-up by Europe.

When it came to A.T.M fraud, U.S. Courts placed the onus on banks to prove that the customer has in fact had withdrawn money from the A.T.M. machine, whereas, he held the position he has not. This caused a financial strain on U.S. banks.

However the legal approach in the U.K. was different. It placed the onus on the customer to prove that he hadn’t withdrawn money from the A.T.M., whereas the bank’s position was that he has.

But at present banks on both sides of the divide have put in place various security measures to prevent A.T.M. fraud. -Bruce Schneier, Chief Security Officer, British Telecom, speaking at a seminar here on Monday.

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P.A.T. Up 276%

Hayleys PLC in the third quarter  (3Q) ended December 31, 2009 saw profits grow by 275.65% year on year (y.o.y.) to Rs. 278.92 million. “A strong performance by core manufacturing business Haycarb and Dipped Products pushed earnings higher for the quarter.”

The company in the nine months ended December 31, 2009 saw profits grow by 350.69% y.o.y. to Rs. 831.51 million. (Source: John Keells Stock Brokers)

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P.a.t. Up 124%

Royal Ceramics Lanka PLC in the 3Q ended December 31, 2009 saw profits grow by 124.28% y.o.y. to Rs. 366.29 million. “Revenues have improved, indicating success of bathware expansion.”

The company in the nine months ended December 31, 2009 saw profits grow by 61.02% y.o.y. to Rs. 650.07 million.

“Margin improvements on a g.p. level drove earnings.”

The company in the nine months ended December 31, 2009 saw profits grow by 50.45% y.o.y. to Rs. 21.07 million. (Source: John Keells Stock Brokers)

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P.a.t. Rises 165%

Tea Smallholder Factories PLC in the 3Q ended December 31, 2009 saw profits grow by 164.72% y.o.y. to Rs. 22.64 million. “The company returned to profitability due to higher tea prices.”

The company in the nine months ended December 31, 2009 saw profits grow by 69.66% y.o.y. to Rs. 109.42 million.

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P.a.t. increases 21%

Harischandra Mills PLC in the 3Q ended December 31, 2009 saw profits grow by 21.07% y.o.y. to Rs. 14.61 million.

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Higher & Higher

Treasury Bill yields continued to edge up, with 91 and 182 day maturities moving up by eight and two basis points each to 8.07% and 8.95% respectively week on week at Wednesday’s primary auction, while the 364 day maturity stagnated at 9.46%.

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Inflationary Pressure

Central Bank of Sri Lanka’s (C.B.S.L.’s) Treasury (T) Bill stock in the week ended February 3, 2010 increased by Rs. 7,200 million (33.3%) to Rs. 28,580 million week on week (w.o.w.).

An increase in C.B.S.L.’s T. Bill stock means that amount of credit, in this case Rs. 7,200 million, has been extended by the Bank to the Government Treasury. This credit comes in the form of printed money to that value given by C.B.S.L. to the Government (Treasury) with no apparent value addition in the economy.

Extended credit this way fuels demand side inflationary pressure in the economy. With more money in circulation and with no apparent increase in the supply of goods and services, gives rise to inflationary pressure in the economy.

Rise in inflation means a rise in prices. Rise in prices means that it’s the fixed income earner and the poor who are worst affected. (Source of data: C.B.S.L.)

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Foreign Holdings Up

Treasury (T) bonds held by foreign investors in the week ended Wednesday increased by Rs. 10 million (0.01%) week on week to Rs. 149,650; while their holdings in T Bill outstandings increased by Rs. 120 million (0.3%) to Rs. 42,960 million. (Source: Central Bank)

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Privatization

A major airline is among three potential bidders for LOT Polish Airlines, reports Dow Jones. Privatization is not scheduled before 2011. LOT last year was near bankruptcy and will cut 400 employees by March. (Washington Aviation Summary)

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Credit Tumbles

Total number of active credit cards in November 2009 declined by 3,564 (0.4%) to 844,732 over its October 2009 figure. The decline since end December 2008 is 72,686 (7.9%).

Total credit card outstanding in end November 2009 declined by Rs. 115 million (0.4%) to Rs. 31.616 million over its end October 2009 figure. The decline since end December 2008 is Rs. 2,596 million (7.6%).

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Tea up 69%

Tea prices at the Colombo Auctions increased by 69.2% year on year (y.o.y.) U.S.$ 3.35 per kilo in November 2009, while production for last year fell by 9.1% y.o.y. to 289.8 million kilos.

Meanwhile, wheat prices in November 2009 fell by 29% y.o.y. to U.S.$ 255.7 per metric ton (p.m.t.) C&F and rice prices by 59.4% to U.S.$ 364.9 p.m.t. (C&F).

However white sugar prices increased by 48.8% y.o.y. to U.S.$ 578 p.m.t. (C&F) and crude oil prices by 15.2% to U.S.$ 79.2 per barrel (C&F) during this period. (Source: Central Bank

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No. 3

Sampath Bank PLC occupies the number three position among the country’s private commercial banks, unseating Seylan Bank PLC, which formerly held this position, in the third quarter of last year, The top two private banks in terms of asset size are Commercial Bank of Ceylon PLC and Hatton National Bank PLC respectively.

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New Markets

Sri Lanka, traditionally, has been one of CIMA’s growth markets.

But now, new markets such as China, India, Pakistan and Bangladesh are emerging-Andrew Harding, CIMA’s Employer and Strategic Development Director speaking at a function in Colombo on Monday.

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Sales Pick Up

Intel’s core i 3 processor was introduced to the local mass market on Tuesday. With computer sales in volume terms flat last year on a year on year (y.o.y.) basis. Intel’s Country Business Manager Indika De Zoysa told The Sunday Leader that there was however a 10% increase in computer sales in volume terms last month, on a y.o.y. basis.
He said that between 70-75,000 computers are sold in Sri Lanka each quarter.

Responding to a question in regard to the arrest of General Sarath Fonseka who was beaten by President Mahinda Rajapaksa in the polls recently and its impact on business, De Zoysa said that any turbulence is bad for business.

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Colombo Out

Interest in international travel is on the rise, according to U.S. travel search engine Cheapflights.com.

Data for the first three weeks of last month show a 25% increase versus the same three weeks last year.

Top search destinations include Cancun, London, Manila, Costa Rica and Frankfurt.

The volume of Cheapflights users searching for international flights from January 1-20, 2010 is up 28%, compared to searches from December 1-20, 2009, preceding heightened security concerns and policies. (Washington Aviation Summary)

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Stitching To Branding

Encouraging local fashion designers to go international and also to have exposure to foreign styles are some of the objectives of Colombo Fashion Week (C.F.W.) that concluded at a Colombo hotel last Sunday.

Styles from Spanish, Russian, Indian, Bangladeshi and from our own designers were displayed at this show, and, according to Ajay Singh, the organizer, the idea is to help local designers to go international, through tie-ups with Moscow Fashion Week, Malaysian Fashion Week and Miami Fashion Week, and from there, for their fashions to be recognized as international brands.

Among some of the V.I.P. invitees for this show were H.S.B.C.’s Premier customers who ought to have a minimum Rs. seven million worth of deposits to qualify for this category, with some 300 of those being invited for the event.

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Gleanings

Receipts protect the employer from employee thieving.

*When the seller knows more about the product than the buyer, then the good products will be driven out from the market, therefore, the buyer needs to be informed, so that he could make informed decisions.

* In Italy, to prevent tax fraud, a customer, who has purchased goods from a vendor, if found within 100 metres from where the purchase was made without a receipt, is liable for a fine-Bruce Schneier, Chief Security Officer, British Telecom, speaking at a seminar here on Monday.

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Warrants Expiry

Nations Trust Bank PLC (NTB) Warrants-2010 will cease to trade on February 22 as per the terms of the issue, NTB in a press release said.

Warrant holders are required to exercise their right to convert the Warrants to ordinary shares by March 10. Exercise price is Rs.30 per ordinary share.

NTB will mail to the holders of 2010 Warrants registered in its books at the end of trading on February 22, a detailed notice of exercise. Warrants in respect of which the right to convert into ordinary shares are not exercised by March 10, shall have no rights whatsoever thereafter.

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Carbon Credits

Ceylon Petroleum Corporation may raise furnace oil prices to twice and thrice the present level in the short and medium terms respectively due to increasing fuel prices globally.  On initiatives taken by the engineering community, several Sri Lankan industries have resolved this problem by switching to a cheaper and renewable fuel, biomass, to generate industrial heat energy.
Factories which have converted from petroleum to biomass-based fuel will be entitled to benefits from Clean Development Mechanism (C.D.M.).

Under C.D.M., factories will be able to receive “carbon credits” in proportion to the annual amount of fossil fuel replaced. These credits could be sold in the international market. This would enable such projects to obtain adequate return on their investments. Apart from gaining direct monetary benefits, such companies engaging in these ventures also gain popularity as “green companies,” thus attracting customers for their products and services.

“Economic aspects of fuel switching & the application of Carbon Credits for fuel switching project,” a Ceylon Chamber of Commerce seminar will be held tomorrow.  The Resource Person would be Science & Technology Ministry Alternative Energy Division Director P.G. Joseph.

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Buffet

Cinnamon Lakeside Colombo’s monthly Wine Buffet will be held on Wednesday.
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H.R.M. Evolution

From humble beginnings of an administration or personnel department, today, the Human Resource Management (H.R.M.) discipline has earned Board level presence and recognition. The gradual elevation to this standard has been realized through the zealous work of H.R. practitioners who had the vision to envisage the importance H.R. would have in an organisation during an era where H.R. was not considered to be of strategic influence.

With the advent of H.R.M. Awards as a national level competition to portray Sri Lankan companies’ H.R. best practices, there have been many instances where the rest of the employees of the Organisation have realized the importance of the role and function of H.R., as a result of their “H.R. Department” winning an H.R.M. award.

Association of HR Professionals have set the stage again for yet another roll out of H.R.M. awards, in the backdrop of three successfully concluded H.R.M. awards.