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Mernat Mafirakurewa Business Editor
ZimbabwE Stock Exchange listed clothing retail giant, Edgars Stores Limited’s profit after tax for the year to January 04, 2014 surged 12 percent to $4,2 million driven by credit sales as the poor liquidity situation continued to grip the economy.
The number of debtors accounts closed the year at 197,932 up from 181,581 in 2012.
In a statement accompanying its audited financial results, Edgars chairman Themba Sibanda said during the period under review, the group benefited from cheaper and long term finance.
“The group’s footprint was increased through the opening of 9 new outlets during the year to close the year with 49 stores. The performance of the business is largely dependent upon the level of formal employment,” said Sibanda.
“These factors against the background of a shrinking economy, negatively impacted on our December sales which were lower than expected. This resulted in us not achieving the budget as anticipated in our promise made mid-year.”
Edgars chain retail sales rose 5 percent to $51,4 million contributing as much as 80 percent to group revenues. At least 72 percent were credit sales.
The contribution of its Jet unit was below expectations despite registering sales growth as profit was down 40 percent to $522,527 compared to $869,224 the prior year.
Sibanda attributed the decline in Jet profits to start up costs after the company added four new outlets during the just-ended financial year to bring to 23 outlets in the country.
Jet Zimbabwe, formerly Express Mart, was launched in November 2011 to offer more value and variety to customers.
At least $1,8 million was spent on refurbishments and new stores.
Going forward, the group intends to upgrade its IT system into a fully integrated structure that would enable the business to interact with customers, suppliers and bankers, among other stakeholders.
As of yesterday, Edgars had a market capitalisation of $34.8 million.
derick.khumalo