Singer in Sri Lanka
The Singer Sri Lanka group of companies (the "Sri Lanka Group") includes four public companies; Singer (Sri Lanka), Regnis (Lanka) PLC ("Regnis"), Singer Industries (Ceylon) PLC ("Industries") and Singer Finance (Lanka) PLC ("Singer Finance").
Singer Asia currently owns 86.1% of the shares of Singer Sri Lanka; the principal company in the Sri Lanka Group and the marketing arm. Singer Asia also owns controlling stakes (53% and 84%, respectively) in Regnis, a manufacturer of refrigerators, washing machines and related products, and in Industries, a manufacturer of sewing cabinets and stands and an assembler of sewing machines. A division of Singer Sri Lanka manufactures domestic and agricultural water pumps, furniture and paddy threshers, and assembles motorcycles. Singer Sri Lanka, in turn, owns 75% of the equity of Singer Finance, a finance company subsidiary with a deposit taking license. The four companies in Sri Lanka have a total of 1,717 employees. Singer Asia has operated in Sri Lanka since 1877.
The 2011 performance of the Singer Sri Lanka Group was exceptional. Revenue increased by 40.0% from prior year and results from operating activities increased by 51.2%. Net income increased from $6.3 million in 2010 to $14.5 million in 2011.
Revenue in 2011 was boosted by more buoyant economic conditions following the end of the civil war and the liberalization of government economic policies. The improved working capital and overhead management, strong installment receivables collection and lower interest rates all contributed to the net income growth.
The Sri Lanka Group's strategy is to substantially boost revenue in 2012 and later years, building on the economic recovery that started in the second half of 2010, while maintaining profit margins and the Sri Lanka Group's strong balance sheet. Singer Sri Lanka intends to increase the number of sales locations, especially in rural areas and in the recently integrated northern and eastern regions of the country, to broaden and extend the product range, and to increase the financial services product offering and coverage. Additional manufacturing capability will be added at Regnis. The Sri Lanka Group has approximately $49.1 million of unutilized, confirmed credit facilities available to help fund expansion.
Singer Sri Lanka operates:
In addition, Singer Sri Lanka has more than 704 independent dealers.
- 168 "Singer Plus" retail stores;
- 114 smaller "Singer" satellite shops;
- 14 Singer "Mega" stores, a larger format store offering a wider range of consumer durable brands and products including furniture. One of the Singer Mega stores is the largest consumer durables, department store in the country;
- 43 "Sisil World" retail stores, offering a somewhat different product and brand mix, under the Sri Lanka heritage brand Sisil; and
- 12 "Singer Homes" furniture showrooms, offering a variety of modern and traditional bedroom, dining room and occasional furniture and accessories.
Singer Sri Lanka is the largest retailer in Sri Lanka of durables for the home with an approximate 30% overall market share and very significant market shares across several product categories including a 55% market share in refrigerators, a 37% market share in washing machines, a 35% market share in televisions, as well as an 80% market share in consumer sewing machines. Sales of non-sewing products represent about 88% of Singer Sri Lanka's total sales.
Products traditionally have been sold by Singer in Sri Lanka using the Singer brand, recognized again in 2011 as one of Sri Lanka's "Superbrands", and by an A.C. Nielsen countrywide poll, as the "Most Popular Brand in Sri Lanka" for the seventh consecutive year. Singer Sri Lanka over the past several years has introduced additional brands, often under exclusive brand distribution arrangements. Singer Sri Lanka is currently the exclusive distributor or co-distributor in Sri Lanka for Hitachi, Philips, Samsung, Skyworth, TCL and Whirlpool, among others.
At the end of 2011, Singer Sri Lanka and Singer Finance had 318,589 active consumer accounts with a total installment accounts receivable, net of unearned finance charges and allowances, of $76.1 million. Only about 1.1% of these installment accounts receivable are in arrears. Singer Sri Lanka operates an active call center and has an extensive customer loyalty program.
Singer Sri Lanka has over the last several years substantially broadened its financial services offering. Customers can now pay utility and credit card bills, purchase extended warranty and consumer protection plans, purchase mobile phone uploads, receive remittances from overseas, purchase insurance or make deposits at selected Singer Sri Lanka and Singer Finance locations. During 2011, approximately 2.2 million transactions were executed involving these new financial services products, in addition to 4.0 million traditional credit transactions.
For additional information regarding Singer Asia in Sri Lanka, see the Singer Sri Lanka website: www.singersl.com and the public company annual reports of Singer Sri Lanka, Regnis, Singer Industries and Singer Finance.