John Keells Holdings PLC (JKH) recorded a 2% year-on-year increase in group profit before tax (PBT) to Rs.7.95 billion in the second quarter of the 2026/27 financial year, while profit attributable to equity holders of the parent surged 213% to Rs.5.17 billion, reflecting improved contributions from several key business segments.

The group's PBT for the quarter ended September 30, 2026, compared with Rs.7.80 billion in the corresponding period of the previous financial year. Group profit after tax (PAT) rose 39% to Rs.5.82 billion from Rs.4.20 billion.

The sharp increase in attributable profit, which represents earnings available to shareholders of the parent company, was primarily due to the lower effective contribution from John Keells CG Auto (JKCG), in which the group holds a 50% stake.

Group earnings before interest, tax, depreciation and amortisation (EBITDA) remained broadly unchanged at Rs.18.30 billion, compared with Rs.18.36 billion a year earlier. Growth across most industry groups offset the weaker contribution from JKCG, which had benefited from exceptionally strong pent-up demand following the resumption of vehicle imports in the previous year.

For the six months ended September 30, 2026, group EBITDA increased 11% to Rs.34.65 billion, indicating improved underlying operational performance across the diversified conglomerate.

JKH said the appreciation of the Sri Lankan rupee during the quarter had a net positive impact of Rs.340 million on group PBT. Excluding net foreign exchange movements, however, PBT stood at Rs.7.61 billion, compared with Rs.8.04 billion in the corresponding quarter last year.

Transportation and property lead segment growth

The transportation sector was a major contributor to the group's operational performance, recording a 153% increase in quarterly EBITDA to Rs.4.89 billion.

The improvement was driven by a strong performance in the bunkering business, Lanka Marine Services (LMS), where volumes grew 31%, supported by higher margins, together with an increased contribution from Colombo West International Terminal (CWIT).

CWIT handled 502,351 twenty-foot equivalent units (TEUs) during the quarter, operating beyond the full utilisation of its Phase 1 capacity. The terminal also became the fastest in the Port of Colombo to handle two million TEUs, achieving the milestone within 18 months of commencing operations. Phase 2 operations have commenced, with full operations targeted for December 2026.

The property sector also recorded significant growth, with EBITDA rising to Rs.1.11 billion from Rs.196 million a year earlier. The increase was driven by profit recognition from residential and commercial unit sales at Cinnamon Life and residential sales at TRI-ZEN.

Retail performance mixed

The retail sector recorded a 53% decline in EBITDA to Rs.4.75 billion, largely reflecting a sharp moderation in the performance of JKCG following the exceptionally strong comparative period last year.

JKCG and John Keells Office Automation together recorded EBITDA of Rs.2.34 billion, down 70% from Rs.7.72 billion. The company handed over more than 2,400 vehicles during the quarter.

The supermarket business, however, maintained positive momentum, recording 13% same-store sales growth supported by higher average basket values and increased customer footfall. EBITDA improved marginally despite higher electricity and distribution costs.

Consumer Foods EBITDA increased 17% to Rs.2.00 billion, supported by volume growth of 10% in carbonated soft drinks and 7% in confectionery, alongside improved performance in convenience foods.

Leisure and financial services

The leisure sector recorded a 10% decline in EBITDA to Rs.1.28 billion, reflecting lower contributions from Colombo Hotels and Maldivian resorts, partly due to travel disruptions arising from the conflict in the Middle East. Improved profitability across Sri Lankan resorts provided some offset.

City of Dreams Sri Lanka continued its operational ramp-up, with higher hotel occupancy and average room rates supporting growth in hotel EBITDA. Its casino operations also recorded an encouraging improvement as the business progressively scaled up.

Financial Services EBITDA increased 44% to Rs.3.62 billion. The group's share of profit from Nations Trust Bank benefited from a one-off tax credit arising from the acquisition of HSBC Sri Lanka's retail banking business, although part of the benefit was offset by integration expenses. Union Assurance also recorded growth in gross written premiums, driven by renewal business.

Meanwhile, the group's other businesses, including IT and plantations, recorded a 38% increase in EBITDA to Rs.647 million.

Interim dividend declared

The board of John Keells Holdings has declared a first interim dividend of 10 cents per share, payable on or before December 2, 2026.

The company also noted the recent upgrade of Sri Lanka's sovereign credit rating by Fitch Ratings to 'B-' from 'CCC+', describing it as a significant milestone reflecting progress in restoring macroeconomic stability.