Lankem to raise Rs.150mn rights issue

Diversified Lankem Developments PLC has resolved to raise Rs.150 million by way of a rights issue subject to shareholder approval.
A stock exchange filing by Lankem said the rights issue proceeds will be utilized to invest in its subsidiary, Agarapathana Plantations Ltd.

Accordingly, the Lankem director board has adopted a resolution to issue 60 million new ordinary shares at a price of Rs.2.50 per share in the proportion of one new share for every existing ordinary share held.
Lankem’s stated capital stands at little over Rs.1.4 billion. 
Its accumulated losses widened to Rs. 948.38 million as at December 31, 2016, from Rs. 929.57 million at the start of the financial year and its short and long-term interest bearing borrowings increased to Rs. 1.02 billion from Rs. 862.12 million during the same time span.
The net assets per share of Lankem Developments fell to Rs.7.67 at the end of the third quarter of 2017 from Rs.7.98 at the start of the financial year.
The group net profits increased 184 percent Year-on-Year (YoY) to Rs. 36.18 million during the quarter, achieved through lower cost of sales, which fell 21 percent YoY to Rs. 658.02 million while revenue fell 13 percent YoY to Rs. 738.86 million.