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Fashion Fortunes

Feb 01, 2011 (LBO) - Sri Lankan fashion retailer Odel's December 2010 quarter net profit rose 35 percent to 76 million rupees from a year ago with inventory levels and borrowings also up sharply, a statement said. Sales in the quarter, usually the best because of Christmas shopping and the peak tourism season, rose 26 percent to 963 million rupees.

Earnings per share went up 35 percent to 56 cents from 41 cents the year before.

Stock market analysts said that while the profits were not strictly comparable because last year's bottom line was boosted by capital gains and asset sales, they were below expectations and the share looked expensive at over 20 times earnings.

Odel closed at 43.20 rupees Monday, down 1.50, after hitting a day's high of 46 rupees.
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"December is a good quarter for most retailers because of Christmas and in Sri Lank also because it coincides with the peak tourism season," said an analyst.

Odel's flagship branch in Ward Place and its airport store depend heavily on sales to tourists.
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"So you would expect Odel to report strong numbers," said the analyst. "The numbers are good and Odel has done well but earnings per share for the quarter are only 56 cents.

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