Softlogic Holdings PLC has reported a group Profit Before Tax of Rs. 24 million for the financial year ending March 31, 2026, marking its return to profitability for the first time since 2019 under the leadership of Chairman and Managing Director Ashok Pathirage. The financial recovery follows years of substantial losses, including a Rs. 7.5 billion loss in the previous fiscal year, Rs. 12.6 billion in FY24, and a peak loss of Rs. 20.9 billion in the year to end-March 2023.
Audited financial statements indicate that core business models across the group remain resilient and cash-generative. Group revenue increased by 24.5% year-on-year to a 10-year high of Rs. 129 billion, compared to Rs. 103.6 billion in FY25. Gross profit rose 22% to Rs. 46 billion, while earnings before interest, tax, depreciation, and amortisation (EBITDA) expanded 43.1% to Rs. 17.8 billion from Rs. 12.5 billion—both reaching 10-year high marks. Net cash inflows from operating activities climbed 59.6% to Rs. 14 billion from Rs. 8.8 billion in FY25, reversing a Rs. 7.1 billion outflow in FY23, while cash earnings per share rose to Rs. 10.07 from Rs. 6.30.
The group has advanced a systematic debt-restructuring framework alongside primary lending institutions to convert short-term facilities into long-term structured maturities aligned with operating cash flows. Softlogic Holdings PLC secured restructuring offer letters totaling approximately Rs. 59.7 billion—comprising Rs. 47.5 billion signed as of March 31, 2026, and an additional Rs. 12.2 billion finalized prior to the Annual Report publication. The revised credit terms feature capital repayment grace periods of six, 12, and 18 months, supported by Rs. 13.2 billion in Banking Facility Support Letters. Net debt declined from Rs. 124.1 billion in FY24 to Rs. 115.9 billion in FY26, though total leverage remains elevated at approximately 6.5 times FY26 EBITDA.
Operational recalibrations have also been executed across major holdings. Development of the ODEL Mall mixed-development project was restructured into distinct phases, with Phase I structured to rely primarily on office space pre-sales without taking on new debt. In hospitality, Pullman Colombo City Centre and Pullman Bentota Resort & Spa were realigned under Accor management to boost international occupancy, enhance foreign currency inflows, and mitigate exchange rate volatility on foreign currency hospitality debt. Within the financial services division, Softlogic Life Insurance secured $15 million in long-term Tier 2 capital from institutional investors Norfund and OP Finnfund Global Impact Fund I, while Softlogic Finance PLC saw its regulatory lending restrictions lifted to rebuild its secured lending portfolio. An upcoming exercise of warrants is expected to provide further equity capital to accelerate debt reduction.
Key Developments
- Profitability Restored: Group Profit Before Tax reached Rs. 24 million in FY26, rebounding from a Rs. 7.5 billion loss in FY25 and marking the first positive pre-tax result since FY19’s Rs. 1.7 billion PBT.
- Financial Record Highs: Revenue reached a 10-year peak of Rs. 129 billion, with gross profit (Rs. 46 billion) and EBITDA (Rs. 17.8 billion) also achieving decade-long high points.
- Debt Restructuring Executed: Agreements secured for Rs. 59.7 billion in debt restructuring with grace periods spanning 6 to 18 months, reducing overall net debt to Rs. 115.9 billion.
- Hotel Management Alignment: Pullman Colombo City Centre and Pullman Bentota Resort & Spa partnered with Accor to increase international forex revenue.
- Capital and Regulatory Progress: Softlogic Life Insurance raised $15 million from Norfund and OP Finnfund Global Impact Fund I, while Softlogic Finance PLC resumed full secured lending activities following the lifting of regulatory limits.
Through operational cost control, strategic partnership adjustments, and ongoing balance sheet restructuring, Softlogic Holdings PLC continues to position its business segments for long-term financial stabilization and sustained cash generation.