Chronicle Editor
Sikhulekelani Moyo, [email protected]
LISTED retail clothing giant Edgars Stores Limited’s manufacturing division, Carousel says the increased focus on local production has seen the company recording 17,6 percent growth in unit sales with plans in place to improve efficiency while reducing the cost of production.
In a statement accompanying the company’s nine months trading update for the period ending 8 October 2023, group chief executive officer Mr Sevious Mushosho said they were confident that turnaround initiatives are paying dividends as operating results continue to improve each month with gross profit per unit going up while cost per unit declining.
He said the business is alive to opportunities presented to expand both brick and mortar and online footprint and developing a resilient business model that will withstand the impact of future shocks and disruptions.
“The manufacturing business achieved growth in sales units of 54,6 percent to 54 835 on the prior year during the quarter under review.
“Cumulatively, unit sales were up 17,6 percent to 122 789 from 104 405 in 2022. This was achieved through giving focus to local production to achieve exclusivity and high quality,” said Mr Mushosho.
“There are plans to acquire more machines including a laser cutter to improve efficiencies, increase production capacity and reduce cost of production.”
He added that at the end of 30 September, the factory had enough stocks of raw materials to meet the increased demand from the chain stores. Orders for more fabrics were placed to cover 12 months of production for all the product ranges.
Mr Mushosho also revealed that they are planning to produce for the South African market in the coming year.
Meanwhile, the group did exceptionally well during the third quarter achieving unit sales of 649 788, which was 28,5 percent up from the same period last year’s 505 531 units.
However, Mr Mushosho said cumulatively for the nine months to 8 October, the unit sales were 2,4 percent below last year due to the currency instability experienced in the second quarter, which saw customers losing a significant part of their buying power especially the civil servants who constitute 35 percent of the business.
The Edgars chain stores achieved the third quarter unit sales of 260 043 representing a growth of 39,7 percent from the prior year. However, cumulatively for the nine months to 08 October, the chain unit sales were 2,16 percent down on the prior year.
“Revenue for the nine months was up 43,99 percent relative to the same period last year in historical terms. Credit sales constituted 63 percent of total sales compared to 54 percent in the same period last year,” said Mr Mushosho.
The Jet chain stores achieved third quarter unit sales of 334 910, which were 18 percent up on prior year units of 283 877.
Mr Mushosho said revenue for the nine months was up 47,98 percent from the previous year in the same period in historical terms. Credit sales made up 60 percent of the total sales for the quarter compared to 49 percent in the same period last year.
“In historical cost terms, finance income decreased by 32,80 percent in the nine months relative to the prior year same period.
“The Zimbabwean dollar (ZWL) book reduced to $2,67 billion from a December 2022 balance of $2,85 billion while the United States dollar book grew 50 percent on the December 2022 balance to close at US$9,50 million,” he said.
“The debtors’ book performance remained healthy, with 80,6 percent of the ZWL book being current compared to 72,4 percent in September 2022 and 61,5 percent in December 2022 while 82,2 percent of the USD book was current at the close of the quarter down from 90,4 percent as at December 2022.” — @SikhulekelaniM1.
Online Reporter