Cargills (Ceylon) March quarter profit jumps 31-pct to Rs.2.63bn, driven by strong revenue growth across its retail, FMCG and restaurant operations despite cost pressures and several one-off losses during the period.
Cargills (Ceylon) March quarter profit jumps 31-pct to Rs.2.63bn amid revenue growth
Sri Lanka’s diversified conglomerate Cargills (Ceylon) PLC reported a net profit of Rs. 2.63 billion for the three months ended 31 March 2026, marking a 31 percent increase from Rs. 2.01 billion recorded during the corresponding quarter a year earlier.
The group reported earnings per share of Rs. 10.19 for the quarter. For the full financial year ended 31 March 2026, profit climbed to Rs. 10.61 billion, compared with Rs. 7.22 billion in the previous financial year, reflecting a significant improvement in overall performance.
Group revenue increased by 16.8 percent year-on-year to Rs. 69.52 billion during the March quarter, supported by growth across its core business segments. The retail business remained the largest contributor, generating revenue of Rs. 51.16 billion, up from Rs. 44.92 billion recorded in the same quarter last year.
As part of its expansion strategy within the Sri Lanka retail sector, the company opened three new outlets during the final quarter, increasing its total store network to 560 locations nationwide.
The FMCG segment also delivered strong growth, recording revenue of Rs. 14.83 billion compared to Rs. 11.69 billion a year earlier. Meanwhile, restaurant operations generated Rs. 3.53 billion in revenue, rising from Rs. 2.87 billion in the corresponding period.
The group benefited from lower borrowing costs, with net finance expenses declining to Rs. 878.5 million from Rs. 957.8 million in the previous year’s March quarter. Improved cash generation and stronger working capital management enabled the company to reduce net debt to Rs. 16.1 billion from Rs. 20.3 billion over the preceding 12 months.
This debt reduction was supported by the repayment of Rs. 4.45 billion in short-term borrowings during the year. Total short-term interest-bearing liabilities fell to Rs. 22.74 billion from Rs. 28.33 billion, strengthening the group’s balance sheet position.
According to the latest Cargills financial results, operating profit for the March quarter rose 6.8 percent to Rs. 3.41 billion, while full-year operating profit increased by 22.9 percent to Rs. 18.70 billion.
However, the quarter’s earnings were affected by several non-recurring events. The group reported losses amounting to Rs. 858 million related to property, equipment and inventory damage caused by Cyclone Ditwah. To date, insurance recoveries of Rs. 650 million have been recognized against those losses.
The company also recorded a Rs. 328 million loss following the disposal of a 6.54 percent stake in Cargills Bank PLC as part of regulatory compliance requirements.
In addition, profitability within the restaurant segment was impacted by the write-off of its investment in the TGI Fridays franchise, which ceased operations in January 2026.
Management noted that while retail profitability improved during the period, margins remained under pressure due to higher electricity tariffs and rising employee-related expenses.
Looking ahead, the company cautioned that rising energy prices and increasing consumer goods costs could place additional pressure on household spending, potentially moderating consumption growth in the coming months.
The group also highlighted broader economic risks, including exchange rate volatility and the depreciation of the Sri Lankan rupee, which could contribute to renewed inflationary pressures. Given Sri Lanka’s continued dependence on imported fuel for transportation and electricity generation, higher global energy costs remain a key concern for businesses and consumers alike.
Despite these challenges, Cargills (Ceylon) March quarter profit jumps 31-pct to Rs.2.63bn reflects the group’s resilience, supported by revenue growth, network expansion, disciplined debt management and sustained demand across its core business segments.