MIRA INFORM REPORT

 

 

Report Date :

20.01.2011

 

IDENTIFICATION DETAILS

 

Correct Name :

CEYLON ELECTRICITY BOARD (CEB)

 

 

Formerly Known As :

DEPARTMENT OF GOVERNMENT ELECTRICAL UNDERTAKING

 

 

Registered Office :

# 50, Sir Chittampalam A. Gardiner Mawatha, Colombo 02.

 

 

Country :

Sri Lanka

 

 

Financials (as on) :

2007

 

 

Year of Establishment :

1969

 

 

Legal Form :

Body Corporate

 

 

Line of Business :

Supply of Electricity Power (Hydro, thermal & other) 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Satisfactory

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

Clear

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – June 30, 2010

 

Country Name

Previous Rating

                   (01.04.2010)                  

Current Rating

(30.06.2010)

Sri Lanka

b1

b1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

GENERAL- Basic information at a glance

Name of Subject of Inquiry

:

CEYLON ELECTRICITY BOARD (CEB)

Legal Form  & Status

:

A body corporate established in Sri Lanka under an act of Parliament No 17 of 1969 as amended by act Nos.31 of 1969 ,29 of 1979 and 32 of 1988.

Chairman

:

Vidya Amarapala

Primary Line of Business

:

 

Supply of Electricity Power (Hydro, thermal & other)  to the entire country

 

 

Head office

 

:

:

# 50, Sir Chittampalam A. Gardiner Mawatha,

Colombo 02.

Sri Lanka.

 

Tel. No: (00 94 11) 232 4471 – 8

 

Fax No: (00 94 11) 244 9572

 

E mail: dgmegp@ceb.lk

No. of Employees

:

Approximately 15,000

     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

           

COMPANY DETAILS- Registration and Shareholder Details

 

Date of Registration

:

Under Act of Parliament by way of the

Ceylon Electricity Board Act No. 17 of 1969.

Board Of Directors

As at

31st December, 2010

:

Vidya Amarapala

Chairman

Douglas Premaratne

Vice Chairman

Roshan Gunawardhane

Working

Director

Dr. Nihal Jayatilleke

Director

Amila Jayasinghe

Director

Tilak Collure

Director

Dr. S. Batagoda

 

Director

 

Secretary

:

M.S. Senaratne (Mrs)

Auditors

:

Auditor- General 

Banks

:

People’s Bank, Bank of Ceylon, Commercial bank, NTB

 

 

FINANCIAL DETAILS - Most recent available Financial Information

                     

 

Group

Board

2007

Rs. 000

2006

Rs. 000

2007

Rs. 000

2006

Rs. 000

A

Revenue

:

95,464,144

84,661,917

87,574,977

69,940,729

B

 Cost of Sales

:

(100,477,040)

(81,212,700)

(96,080,093)

(69,831,271)

C

 Gross Profit / (Loss)

:

(5,012,896)

3,449,217

(8,505,116)

109,458

D

Other Operating Income

:

9,798,981

10,223,314

9,204,604

9,572,255

E

Transmission & Distribution Cost

:

(9,448,224)

(8,023,849)

(8,618,310)

(8,000,863)

F

Others

:

(3,732,812)

(4,872,795)

(3,656,876)

(3,901,650)

G

Administrative Expenses

:

(2,731,081)

(3,213,631)

(1,533,980)

(2,382,994)

H

Profit/(Loss) from Operating Activities

:

(11,126,032)

(2,437,745)

(13,109,678)

(4,603,794)

I

Finance Cost

:

(2,024,963)

(1,895,748)

(1,702,684)

(1,521,065)

J

Amortization of Goodwill

:

-

-

-

-

K

Loss Before Tax

:

(13,150,995)

(4,333,493)

(14,812,362)

(6,124,895)

L

 

Income Tax Expense

:

 

(617,484)

 

(500,264)

 

-

 

-

 

M

 

Loss After Tax

 

 

(13,768,479)

 

(4,833,757)

 

(14,812,362)

 

(6,124,859)

 

N

 

Minority Interest

 

 

(544,732)

 

(642,287)

 

-

 

-

 

O

 

Loss for the Year

 

 

(14,313,211)

 

(5,476,044)

 

(14,812,362)

 

(6,124,859)

 

                                                                                                                                                     

 

 

Group

Board

2007

Rs. 000

2006

Rs. 000

2007

Rs. 000

2006

Rs. 000

a)

Non-current Assets

:

380,431,125

331,811,138

367,134,916

322,967,581

b)

Current Assets

:

67,328,970

43,347,866

50,475,185

32,067,650

c)

Non Current Liabilities

:

99,079,346

75,466,643

94,773,800

70,884,625

d)

Current Liabilities

:

 

 

 

 

e)

Total Liabilities

:

159,433,059

119,115,221

141,962,341

109,514,565

f)

Total Assets

:

447,760,095

375,159,004

417,610,101

355,035,231

g)

 

Net Worth

 

:

288,327,036

256,043,783

275,647,760

245,520,666

 

 

CURRENT INVESTIGATION                      

 

                CEB+

                           Logo

 

·         History.

 

The Subject Company, CEYLON ELECTRICITY BOARD (CEB), is a state owned company supplying of electricity to the whole Island. It was originally known as the “DEPARTMENT OF GOVERNMENT ELECTRICAL UNDERTAKING” and was converted to CEYLON ELECTRICITY BOARD under the Ceylon Electricity Board Act No. 17 of 1969. The board is under a statutory duty to develop and maintain an efficient, co-ordinated and economical system of electricity supply.

 

The Ceylon Electricity Board (also abbreviated as CEB), is the largest electricity company in Sri   Lanka. With a market share of nearly 100%, it controls all major functions of electricity generation, transmission, distribution and retailing in Sri Lanka.

 

It is one of the only two on-grid electricity companies in the country; the other being Lanka Electricity Company. The company earned approximately LKR110.9 billion in 2008, with a total of nearly 4.1 million consumer accounts.

 

Opened in 1969, the company now has a total installed capacity of 2,684 MW, of which approximately 1,290 MW is from thermal energy, and 1,207 MW is from hydroelectricity. Due to low wind resource, rough terrain and poor road conditions in Sri Lanka, CEB owns only one3 MW wind farm in Hambantota, known as the Hambantota Wind Farm. The farm consists of five turbines, measuring 600 KW each. CEB also manages numerous hydroelectric dams such as the Victoria Dam, and power plants such as the Norocholai Coal Power Station.

 

·   Location.

 

The Subject Company is located at #   50, Sir Chittampalam A. Gardiner Mawatha, Colombo 02.

 

·   Operational Details.

 

General

 

                  The CEB is under a statutory duty to develop and maintain an efficient, Co-ordinated and economical system of Electricity Supply. It is also the duty of the Board to generate or acquire supplies of electricity; to construct, maintain and operate the necessary works for the generation of electricity by all means, to construct, maintain and operate the necessary works for the inter-connection of Generating Stations and Sub-stations and for the transmission of electricity in bulk From Generating Stations and Sub-stations to such places as may be necessary from time to time To distribute and sell electricity in bulk.

 

The Government of Sri Lanka has approved the commencement of a coal power plant at Norachcholai in the Puttalam District and the construction work is in progress to be commissioned in 2012. When this project is implemented additional power to the National grid will be enhanced by 300 MW in phase 1 and on completion 900 MW. Completion of the Phase 1st Phase is targeted at 2011 and Final Phase at 2012. The Chinese Government has granted a soft loan of Rs 45 Billion payable in 20 years to the Sri Lankan Government.   

 

·         Country

   Sri Lanka

 

·         Employees

      The employee strength of the subject company approximately 15,000 employees.

 

·         Financial Data

   Received from Company Annual Report – 2007.

 

Following is a news item appeared on e-bizsrilanka.com  with regards to CEB:

                   

Ceylon Electricity Board losses to exceed 35 billion rupees this year

 

TUESDAY, 01 JUNE 2010 05:18

 

“The newly appointed Chairman of the Ceylon Electricity Board (CEB), Vidya Amarapala says that the operational loss of the CEB in 2010 would be something between 34 to 40 billion rupees. CEB incurred an operation loss of Rs. 7 billion in 2009.


CEB is Rs. 52 million in debt to the Ceylon Petroleum Corporation (CPC) for fuel purchased for electricity generation. Both these establishments are state-owned ventures. The senior officials of the CEB and CPC are now holding talks with the Treasury to find a way to settle these bills.


Now the CPC is supplying fuel to CEB on the condition that the overdue bills will be settled in 90 days. Monthly fuel bill of the CEB is 2.5 billion rupees. The unit price of electricity is lower than the production cost although Sri Lanka is one of the countries with the highest unit price for electricity in the region.


Recently the Power and Energy Minister Patali Champika Ranawaka pointed out that the unit cost of electricity is Rs. 17.52 which includes the cost of generation, transmission and distribution but charging only Rs. 13.11 from the customer. CEB is the biggest drain on Sri Lanka’s economy, the Minister has observed.”

     

 

 

Summary statistics Ceylon electricity board 2009

 

 

 

 

·         Trade references

 

The Government of Sri Lanka – Ministry of Power & Energy

 

·         Credit Recommendations

 

No computerised data bases exist to make checks whether the partners or the company has any legal action or lawsuit initiated against any of them but informal (but not in-depth) checks do not indicate any such cases in the public knowledge.

ANALYSIS & RATING - Appraisal and Rating of Subject Company

 

 Rating:

a) Business Scale        

Large

b) Business Trend

Growing

c) Management Capability

Above Average

d) Commercial Morality

Above Average

e) Reputation

Above Average

f) Market Situation

Monopole- (Sri Lanka Govt. owned)

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.45.38

UK Pound

1

Rs.72.71

Euro

1

Rs.61.15

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

 

 

 

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.