Business

Ceylon Shipping Corporation turns tables on its financial performance

Published

5 years ago

2022/02/7

Sahan Weerasooriya

Reports loss reduction of Rs. 1.15 billion in two years

Posts Rs. 636 million profit in fist 8 months of FY 2021/22

If CSC’s fleet size is increased, country can save millions of dollars spent on ship chartering, says chairman

by Sanath Nanayakkare

The Ceylon Shipping Corporation (CSC) has made an impressive turnaround in its fortunes from a loss-making State Owned Enterprise (SOE) to a profit making SOE within two years.

In the Financial Year 2020/21, CSC has posted a profit of Rs. 636 million in the first eight months of financial year 2021/22 , changing the situation completely different from the losses it made in 2018/19 (Rs. 1,523 million) and in 2019/20 (Rs. 1,085 million) which had caused problems for them.

CSC Chairman, Wineendra S. Weeraman, told The Island Financial Review that the profit curve of CSC was a well thought out one.

“When I assumed duties as chairman of CSC in December 2019, nobody was interested in taking over the helm at the CSC under such dismal financial circumstances,” he said.

Weeraman said that he first gave priority to settling a loan of USD 75 million taken from the People’s Bank by the previous management for purchasing two ships.

“This loan was on a Treasury guarantee and I decided to clear all arrears because I didn’t want to carry it forward paying a huge interest on the loan capital. In the accounts, I saw that we had an outstanding payment amounting to Rs.1,400 million which had to be collected from Lanka Coal Company – the procurement entity of the CEB. Through an official process, I was able to recover these funds and use it to repay that loan. Whatever I had to pay I paid and I took the decision to charter out our ships at the opportune moment despite the threat of Covid-19. Those were the key decisions I took and that is how we are making profits now,” he said.

Further speaking he said:

“Currently the main business of CSC is delivering coal to Norochcholai power plant. In this connection, CSC deals with Lanka Coal Company and the Ceylon Electricity Board (CEB). The CEB charters our two bulk carriers ‘Ceylon Breeze’ and ‘Ceylon Princess’ each with 62,000 deadweight tonnage, to bring in coal to Sri Lanka from South Africa. The CEB pays us in Sri Lankan rupees when they charter our vessels, but when they charter foreign vessels for the purpose, they pay in US dollars.”

“CSC brings in one third of the total coal requirement for Norochcholai Power Plant. We can help save a massive amount of US dollar payments made as ship chartering costs if CSC has its own fleet to deliver the entire requirement of coal.”

“At the height of Covid-19, despite concerns among experts that we should keep the two ships at anchorage, upon verifying of IMO regulations and the advice of Harbour Master and Medical Officer of the Sri Lanka Ports Authority, I decided to send our ships to sea and bring in much needed foreign currency to the country, without leaving the ships idling at sea incurring losses for six months. With that operation, we were able to bring in 3 million USD within about 6 months.”

“When we charter a ship to transport coal to Norochcholai Plant, procured through Lanka Coal Company, the charter hire alone costs between US$ 1.3 million and 2.0 million on top of other costs for each charter. If we have another four vessels in our fleet, we can prevent this foreign currency outflow happening time after time.”

“If we bring the fleet up to six vessels with a tanker or two, we can bring in the entire supply of coal, rice, sugar and even petroleum products without chartering international vessels over an infinite number of years. How many millions do we pay for transportation of fuel and other commodities? Being the purchaser of these products, we should be able to dictate the terms of their transportation. We can ask them to use our vessels. If the government says all fuel imports to Sri Lanka needs to be carried on CSC vessels, then we can save a lot of millions of dollars.”

“The policymakers of the government should support us in this regard. They should support key government organisations such as CSC and put some muscle into its capacity to make it more productive in its operations and empower it to support the economy of the country in a more robust way. We have made requests to policymakers pertaining to this objective including the former chairman of CSC who could assist us in fund arrangement,” he said.

“CSC’s annual turnover is about Rs. 3.8-4.0 billion whereas Sri Lanka Port’s Authority’s annual turnover is about Rs. 55 billion. Comparatively speaking, CSC is also contributing to the economy in a notable way with the limited resources it has. The CSC has great potential for growth if it gets the necessary policy support.”

“CSC employs 125 staff in-house. On each vessel we have about 22-23 crew members – that’s about 46 on both vessels and we have a reserve pool of crew for crew changes. Our salary structure is very competitive with that of international shipping lines. We pay a ship master about USD 8,500- 9000 per month. We have to pay such salaries to ensure deployment of qualified and skilled people on board our vessels. However, the upside here is that the entire crew is Sri Lankan”.

“Before Covid when we chartered out our ships to international parties during the off-season, we earned USD 8000-13,000 per day per ship. With the spread of initial Covid wave, these prices came down to USD 6,500-7,500. After the second wave of Covid, the freight rates skyrocketed to about USD 35,000-40,000. So this is the best period for the global shipping industry and we should make the best out of this situation for CSC.”

“The greatest difficulty we have with the CEB is that we fight with them to get priority to us in charter services and they also prefer to give it to outsiders upon finding one single fault that could easily be rectified. And even after providing the services for them, they take months and years to pay our dues. Then we can’t operate maintaining a positive balance sheet.”

“I would like to urge the policymakers and top officials to take bold policy decisions to beef up the fleet of CSC.”

Talking about his future plans he said:

“There are several projects which I intend to start here. There were negotiations in 2017 – with Bangladesh Shipping Corporation to operate a feeder service here. If you take Port of Colombo, its capacity is 7 million TEUs. In Bangladesh it is 3.5 million. Twenty percent of their cargo is coming to Colombo. That is about 700,000 TEUs. Bangladesh ports are very congested. Ship owners don’t like to go there because it takes days to reach a terminal. If we sign this bilateral agreement, they are going to save on the number of days spent on transportation of their cargo. If we can sign it, CSC will be able to earn about USD 2 million per year. The SLPA also will earn from it when TEUs are brought to the Port of Colombo. It will be a win-win-win situation for all parties.”

“Bunker prices are very high here compared to Singapore. Sometimes we don’t get the bunkering business unless the prices fluctuate in a competitive manner to ship operators. If we supply them bunker off-shore or out of the port, they will prefer to get oil at a lesser price. I have submitted a proposal for a floating bunker as well.”

“And then the ferry service between Colombo and Tuticorin which was started in 2011. I am planning to resume this service. Not only Tuticorin, we can try various other ports in India.”

“Going further, I have a plan to arrange medium size cruise vessels between Colombo, Male and Goa. If we arrange these tours then everybody will find them exciting and enjoy these tours bringing us revenue.”

“CSC wants to get involved in passenger transportation as well. I have signed an agreement with Sail Lanka Yachting Group, a global company that builds yachts in Sri Lanka. They are already operating from the Colombo Port City Marina. They have agreed to manufacture bigger ships to partner with CSC’s plans for passenger transportation.”

“These are plans for the future and I have submitted them to the policymakers. If we want to make a maritime hub here, these things should be facilitated.”

“Ship repairing is another area. I also wait in queue to get CSC ships repaired. In addition to Colombo Dockyard, we need to build another dockyard, ideally in Trincomalee.”

“Finally, We need to be mindful of Sagarmala Programme which is underway in India targeted to culminate by 2035. It is designed across areas of port modernisation, new port development, port connectivity enhancement and port-linked industrialisation. One day it is going to affect us. So we need to equip all critical installations here to stay in the business and thrive in the new maritime sector emerging in the region. I appeal to the policymakers and top officials of the government to support CSC with bold policy-making for its exponential growth, bolstering key business verticals of the industry at the same time.”

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Business

IMF talks conclude without staff-level agreement as Sri Lanka prepares November Budget

Published

4 hours ago

2026/09/24

Sahan Weerasooriya

Fund says discussions will continue on policies and parameters needed to complete the Seventh Review

By Sanath Nanayakkare

Sri Lanka’s latest talks with the International Monetary Fund (IMF) have concluded without a staff-level agreement on the policies and parameters required to complete the Seventh Review of its Extended Fund Facility (EFF), leaving further discussions ahead as the government prepares its next Budget.

An IMF team led by Mission Chief Evan Papageorgiou visited Sri Lanka from September 10 to 23 for discussions on the Seventh Review and the 2026 Article IV Consultation.

The Fund said the discussions with Sri Lankan authorities had been productive, but would continue in the near term towards reaching agreement on the parameters and policies needed to complete the Seventh Review.

The outcome therefore represents a delay in reaching the formal staff-level milestone rather than a breakdown in negotiations.

The latest mission comes as Sri Lanka moves from economic stabilisation towards longer-term structural transformation, while continuing to face external shocks and domestic fiscal pressures.

The IMF said economic activity expanded by 4.2 percent in the second quarter of 2026, marking the 11th consecutive quarter of growth. At the same time, the Fund cautioned that downside risks remained, particularly amid an uncertain external environment.

Gross official reserves had risen to US$6.9 billion by the end of August, while the banking sector remained well capitalised and profitable, providing some buffers against external pressures.

A major focus of the IMF’s latest assessment was Sri Lanka’s revenue position.

The Fund said developing and implementing a strong medium-term revenue strategy would be critical to sustaining revenue mobilisation and strengthening fiscal resilience.

It stressed the need to broaden the tax base, rationalise tax exemptions and incentives, and strengthen revenue administration and compliance.

The IMF also emphasised the importance of maintaining cost-recovery energy pricing and improving the efficiency and fairness of the tax system in order to reduce fiscal vulnerabilities.

These issues assume particular significance as the government prepares its next Budget, with the authorities seeking to balance revenue mobilisation and fiscal consolidation against the need to sustain economic recovery.

The Fund’s latest position does not indicate that negotiations have broken down. Rather, the IMF has said that discussions will continue towards reaching agreement on the remaining policies and parameters required to conclude the Seventh Review.

The latest talks follow the combined Fifth and Sixth Reviews, for which IMF staff and Sri Lankan authorities reached a staff-level agreement in April, subject to completion of the remaining requirements before consideration by the IMF Executive Board.

For Sri Lanka, the immediate challenge is therefore to preserve the gains made in macroeconomic stabilisation while addressing the remaining issues under the IMF programme and preparing a Budget capable of supporting longer-term fiscal and economic resilience.

With further discussions expected in the near term, the Seventh Review remains a work in progress as Sri Lanka enters another critical stage of its economic reform programme.

Notably, the IMF has yet to publicly specify the outstanding issues that remain to be resolved.

Business

UK digital expertise and Sri Lankan business leaders unite to explore growth through technology

Published

4 hours ago

2026/09/24

Sahan Weerasooriya

British High Commissioner Andrew Patrick

British High Commissioner Andrew Patrick hosted UK digital product consultancy Apadmi at Westminster House, his official residence in Colombo, for an invite-only forum bringing together senior business leaders from across Sri Lanka’s retail, banking, telecommunications, hospitality and public sectors.

The event, “Turning Digital Assets into Growth Engines”, marked Apadmi’s first official event in Sri Lanka since establishing its Colombo office in 2025, and was delivered in partnership with the British High Commission as part of ongoing efforts to strengthen UK and Sri Lanka commercial and technology ties.

Guests were welcomed by High Commissioner Andrew Patrick, followed by a keynote from Niresh Muthuratnanandan, Head of Omni Commerce, Digital & Loyalty at Keells Supermarkets, who spoke about the launch of the Keells Nexus app and the modernisation of a loyalty programme serving 2.9 million members.

A panel discussion followed, hosted by Mark Collin, Chief Growth Officer at Apadmi, and featuring Malik Induruwana, Chief Information Officer at HSBC Sri Lanka & Maldives; Jiffry Zulfer, Founder and CEO of PickMe; Uthpala Pinnaduwahewa of Hatton National Bank; and Marcus Hadfield, Chief Strategy Officer at Apadmi.

The discussion centred on the commercial opportunity created by Sri Lanka’s rapid mobile adoption. According to [source], mobile data usage in the country reached 1.03 million terabytes in Q2 2026, a 31% increase year on year, against 29.4 million mobile subscriptions. With 71% of devices now smartphones or tablets, speakers discussed how Sri Lankan businesses could convert growing digital engagement into customer loyalty, new revenue and operational efficiency.

British High Commissioner Andrew Patrick said:

“It was a pleasure to welcome Apadmi and such a strong group of business leaders to Westminster House for this event. The UK and Sri Lanka have a longstanding partnership, and digital innovation is an increasingly important part of that relationship. Apadmi’s decision to establish a base in Colombo reflects the confidence that UK companies have in Sri Lanka’s digital economy, and I look forward to seeing this partnership continue to grow to the benefit of both our countries.”

Mark Collin, Chief Growth Officer at Apadmi, said:

“Being hosted by the British High Commission was a real privilege, and a fitting way to mark the next stage of our commitment to Sri Lanka. To bring leaders from Keells, HSBC, PickMe and Hatton National Bank into the same room says a great deal about the ambition here. We opened our Colombo office because we believe Sri Lanka is at a genuine turning point; the talent is exceptional, and we are proud to be building here for the long term.”

Business

Planters’ Association Chairman proposes 5-point plan for industry revival at 172nd AGM

Published

4 hours ago

2026/09/24

Sahan Weerasooriya

Seated from left to right: newly elected Deputy Chairman of the Planters’ Association of Ceylon (PAC), Binesh Pananwala; Secretary General, Lalith Obeyesekere; newly elected Chairman, Shanaka Samaradiwakara; Governor of the Central Bank of Sri Lanka, Dr. Nandalal Weerasinghe; and Chairman of the Sri Lanka Tea Board, Raj Obeyesekere.

Malwatte Valley Plantations PLC Director / CEO, Shanaka Samaradiwakara was appointed as Chairman of the Planters’ Association of Ceylon (PAC), while Kahawatte Plantations PLC Director / CEO Binesh Pananwala, was appointed as Deputy Chairman at the Association’s 172nd Annual General Meeting (AGM) on 19 September at the Cinnamon Grand.

The event was graced by Central Bank of Sri Lanka Governor, Dr. Nandalal Weerasinghe and Sri Lanka Tea Board Chairman, Raj Obeyesekere as Chief Guest and Guest of Honour respectively.

In his inaugural address, Samaradiwakara outlined a five-point vision for the plantation sector, focusing on value addition, research and development, land-use and productivity, irrigation and long-term security of tenure. He emphasised that the future of commercial agriculture in Sri Lanka would hinge on how effectively all industry stakeholders could work together, while maintaining clear understanding of the ground realities faced by producers.

Value-added tea accounted for more than 50% of total tea export volumes in 2025. Samaradiwakara noted Regional Plantation Companies (RPCs) have accounted for the majority of that volume through continuous investments, including most recently in matcha, green tea and artisanal teas.

In that context, he sought the support of the Sri Lanka Tea Board and the export sector to protect this emerging high value segment, given that significant quantities of green tea and other high-value teas remain unsold at auction while similar products continue to enter the country. “We respectfully request the authorities to review this matter and introduce appropriate measures to support domestic production and value addition,” he stated.

On research and development, he observed that commercially viable alternatives to several essential crop protection products remain limited. Accordingly, he called on the Tea, Rubber and Coconut Research Institutes to lead the development of practical, scientifically proven alternatives, while stressing that disease threatening the rubber industry requires immediate attention. “We cannot afford to repeat the experience of the coffee industry, where coffee blight devastated the sector,” he added.

Turning to issues around land-use policies and productivity, he noted that RPCs have diversified for over two decades in response to changing rainfall patterns, introducing crops such as oil palm, pepper and avocado. He warned that these investments are increasingly threatened by unsupportive policy, agricultural theft and crop damage by wild animals, costing companies millions of rupees each month in security. “It is imperative that these investments are protected through strong enforcement, appropriate regulatory reforms, and effective measures to address both agricultural theft and crop damage,” he noted. On irrigation, he appealed to the Government to relax archaic restrictions on groundwater use and simplify approvals for drilling tube wells in order to enhance climate resilience.

Addressing security of tenure, he highlighted that replanting often takes more than a decade to generate meaningful revenue, and that uncertainty over lease extensions is making it harder for RPCs to attract foreign direct investment and long-term financing. “If we are to attract fresh capital, accelerate replanting, modernise our plantations and improve productivity, security and certainty of tenure are mandatory,” he added.