Prime Lands Residencies profit soars on healthy apartment sales

Filing its first set of financial statements with the Colombo Stock Exchange since going public last month, Prime Lands Residencies PLC reported strong revenues and profits for the financial year ended March 31, 2021 reflecting the resilience demonstrated by the country’s residential real estate sector in spite of pandemic-induced challenges.   

The market leader in affordable luxury housing reported revenues of Rs.7.73 billion in the financial year ended March 31, 2021, logging an extremely healthy 35.3 percent growth over the previous financial year. 

The company reported earnings of Rs.1.32 a share or Rs.989.3 million for the financial year compared to 17 cents or Rs.130.8 million in the previous year. 

The company announced to distribute 40 cents a share as an interim dividend to its shareholders making a total payout of Rs.375.0 million. 

Sri Lanka’s apartment sales and the broader housing market received a fresh impetus with the abolition of Nation Building Tax and the exemption of Value Added Tax on apartment sales since last year. But the biggest impact came from the lowest ever-housing mortgage rates, which was catalyst in turning it to a red-hot housing market. 
Making housing further affordable, the government and the Central Bank capped the housing mortgage rates at 7 percent per annum fixed for five years since last December, providing further relief to buyers, further rekindling hopes for developers, realtors and the broader construction sector. 

Prime Lands Residencies had an apartment inventory of Rs.11.1 billion by March-end, accounting for 86 percent of the total company assets, up from Rs.8.5 billion year ago. 

This includes the property acquired or those under construction for sale, and the completed properties for sale as part of the company’s ordinary business and does not include the ones being held for rental or capital appreciation.  

The company in May raised Rs.1.95 billion in an initial public offering of 187.5 million shares at Rs.10.40 a piece.