FLCH.N0000 (F L C Holdings PLC)

[yellow knifeTop contributor]

Rothschilds were the economic Lords and were controlling the commercial world from London.


Nathan Mayer Rothschild was the figure head of the family controlling the business empire.



In 1841 the 36-year old nephew of Nathan Mayer Rothschild, Maurice (born Moritz) Worms, set sail from London for the Far East.




But it was to Ceylon that he returned, seeing there a new and potentially profitable life for himself. He bought a substantial piece of land at Pussellawa.



He now invited his brother Gabriel to join him. Gabriel had been a merchant in Paris but after the July Revolution of 1830 had joined Maurice on the London Stock Exchange. Together, they now set up as G. and M.B. Worms.



The thousand acres which he and Gabriel bought represented a promising investment and, although no evidence has yet been found, the fact that he chose to call this new estate Rothschild suggests that his London cousins had some part in the funding. The Rothschild plantation was big; the average coffee estate in Ceylon was under 200 acres. Indeed, with its neighbour, the Delta plantation, managed by the Sabonadière brothers, it was the largest on the island.



In December 1839, just a year or more before Maurice’s arrival in Ceylon, experiments were being made in the Royal Botanic Gardens at Peradeniya, just outside Kandy. A small batch of tea-seeds, sent from Assam in India, was sown



in that same year the very first commercial crop of tea from Assam had been sold on the London markets, breaking the centuries-old Chinese monopoly.


Article Information

‘Cousins in Ceylon’

Victor Gray and Ismeth Raheem explain a curious and lasting
Rothschild connection with Sri Lanka



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Sorry for the long introduction to Ceylon Tea and Rothschild connection but the same Rothschild estate now belongs to FLCH.


Yet the amazing fact is that FLCH is still a large tea producer of the country.

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[yellow knifeTop contributor]

Despite revenue the profit is shows the poor managing of the business

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[yellow knifeTop contributor]

EPS confirms the poor performance

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[yellow knifeTop contributor]

Those who try to promote FLCH often highlight Net Assets. Even Net Assets Per Share come down.

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[yellow knifeTop contributor]

Total tea production of FLCH was 12.24 Million Kilograms for 2015.

Total tea production of TPL was 7 Million Kilograms per year for 2015.

Total Revenue of TPL was4,761,101,000 and for FLCH the revenue from tea only was 4,926,528,532


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[yellow knifeTop contributor]

Total Revenue composition of FLCH

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	2015
Tea	4,926,528,532.00
Rubber	1,000,095,094.00
Coconut	17,395,285.00
Cinamon	5,499,673.00
Hydro Power	187,795,655.00
Property	31,008,853.00
Others	304,601,124.00
	6,472,926,231.00

[Hybrid]

Thanks YK for going through those 218 odd pages of the financial report for 2014/15.

I found the report overwhelming and cumbersome to digest. Your extraction and summery of the key data is appreciated.


In fact, I have quite a bit of investment in this company and with Kapila, Nanayakkara and some others who are very good professionals known for decades it should come back to profit soon.

Yes the revenue from tea exports and the valuation of the biological assets are the big concerns in the report apart from the lesser negatives.

But on the brighter side I notice that the good accounting practices have been followed and sufficient provisions have been made in the books. (Example: 2 Billion for Gratuuity and Retirement Benefits)

They are aware of the overvaluation of the trees etc and made a revaluation and adjustment accordingly.

[Hybrid]

EPS confirms the poor performance

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[yellow knifeTop contributor]

My real concern is this is the biggest revenue maker of the Plantation companies that I have evaluated so far..

Means that this has potential..

The theme of annual report fits perfectly

What we can Do?

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[yellow knifeTop contributor]

AT the moment this company is suitable for Traders only

Yet it still it has the potential if it gets into right ...hands .........

[Hybrid]

I would hire an EXPORT MANAGER with wide experience and good contacts from the FMCG sector.

Maybe even getting a expat would do.
This person has to be visiting the export markets, exibitions trade fairs and other promotional meetings.

That is a very aggressive job and requires the skills and background of a marketing manager.

Hopefully, "what can we do" statement will take effect soon!

[slstockVeteran]

FLCH is am not mistaken is one of the biggest players of Tea if not the biggest at CSE.

They have a good reserve on timber but refer to below for further
+ and -

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[HAL9000Top contributor]

AT the moment this company is suitable for Traders only

Yet it still it has the potential if it gets into right ...hands .........

Thanks for the effort. Valuable information

[LeonTop contributor]

Well done YK.

[Illusion]

Thanks YK. Superb.

[NuinthTop contributor]

Thx YK. Really appreciate ....!!!

[BackstageTop contributor]

YK, your introductory notes on companies are getting more and more interesting. Knowing the historical background, gives one a richer understanding of the company than the usual clinical , facts and figures analysis. It kind of fleshes out the bare bones. Thank you so much.

btw; The Rothschilds were known to conceal their name as and when possible. This must have been a hobby sort of fun project for them. pocket change. You , I am sure must have done done your homework on them. The first family of capital.

[yellow knifeTop contributor]

FLCH has changed the name and it will be known as Browns Capital PLC here after

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[WRRKUMARA]

another drama

[xmartTop contributor]

Thanks YK. +

you have put everything together. no question! FLCH has a great potential. look at their portfolio, Hydro, Plantation, Office Complex etc.

i had a good faith and kept buying this one. overall i gain nothing. since pros are there, shall i add my 2 cents about cons..

1. even though they have diversified, its revenue largely generate through plantations, which are unlikely turn around until 2018-2020.

2. poorly manage plantation is a nightmare.

3. lack of concern about retail investors and lack of credibility of the family management.

4. biological assets and its value as current asset or even after maturity.

anyway, FLCH may turn around and will give a massive return in due time when the time is right. but i highly doubt that the time is not right yet.

[First Guy]

FLCH (Browns Capital) divested bulk of the plantation business for a hefty profit. So balance sheet will get cleaner and might turn to profits soon. But what will they do with the cash?

[yellow knifeTop contributor]

And the owner of the biggest plantation in SL held it tight when the sector is not doing well and sold when the plantation sector is recording good profits...

Definitely Damro should be very much grateful to Browns Capital.

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Those who understand that Money itself can be utilized to make More Money will do nothing else. So Browns Capital will invest that money in Bonds.

[First Guy]

Continuing on my previous post.

FLCH will benefit by two ways. More cash and a profitable income statement. Profitable income statement itself may boost valuation for FLCH. Cash can be used in two ways. Since not much debt, dividend can be given. Anything more than 0.25/- at this stage is huge compared to current price of 1.60/-
FLCH can acquire some other business and increase profits through that. Whatever it is, I think this is worth more than 1.60/- - 2/-

Disclosure: I hold FLCH

[smallvilleTop contributor]

FLCH has been a dead share to me, from the IPO listening in 2011 at 5.0 it has only given losses. In June 2012 - July 2012 it ran giving some bargain collectors a profits but since then its downtime... since 2015 its a dead share (from 2.4 to 0. untill this news comes out (plantations bought by Damro) that takes it to 1.6-1.7.

Now FLCH got 4.694 billion solely from plantation selling, with 1,368,000,000 Nos. of Ordinary Shares, this amounts to an EPS of 3.43 alone. Then the return from AGAL sale 274 mill is an additional EPS of 0.2 (capital gains or losses from selling not calculated) The latter alone is nearly 4x last qtr EPS.

Tea, Palm Oil and Real estate were the group's greatest revenue generators. Now that Plantations are gone what will FLCH do with just Hydro, Real estate, investment, Solar?
Solar was anyway loss, Hydro was nearly a marginal profit (due to draughts from Q2 2016)
This is getting interesting...

[CKActive Member]

So small wht your idea in current price?