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CLOTHING retail chain stores operator Edgars Limited posted a solid set of financial results for the half-year period to June 6, 2013 following a 17 percent jump in after-tax profit.After-tax profit came in at US$1 million as sales grew 13 percent to US$27,2 million, which helped earnings per share rise 15 percent to US44c.
Chairman Mr Thembinkosi Sibanda said the impressive 17 percent growth in after-tax profit was driven by improved merchandise and increased factory profitability.
The factory’s recovery resulted in profit before interest and tax of US$118 901 compared to the loss registered over the same period last year of US$141 664. The interim results were also positively impacted by a medium-term loan concluded in December last year, helping the firm to ease liquidity constraints.
Edgars had a solid run on all financial indicators with cash flow from operations up 2 209 percent to US$1 million while accounts grew 11 percent to 188 447. Going forward, Mr Sibanda said the Zimbabwe Stock Exchange-listed group would focus on increasing brand awareness of Jet Stores and its footprint.
“We will intensify efforts to improve product offerings and value with both retail chains while implementing tighter cost control across the board,” he said.
Mr Sibanda said unit sales within the Edgars chain stores grew 4,4 percent with profitability increasing by 23,9 percent. Turnover totalled US$22,1 million.
Growth in the Jet chain turnover amounted to 18,7 percent and contributed 18,2 percent to group turnover compared to 17 percent in the 2012 interim period.
Edgars, however, bemoaned the fact that store trading profit in the Jet chain was poorer at 4,7 percent during the 2013 interim against 10,8 percent last year.
Trade receivables were 14,7 percent up on last year from 188 447, of which 72,5 percent were active compared 74 percent active accounts last year.
Total assets increased from US$32,7 million in 2012 to US$38 million in the 2013 interim. Most of the capital expenditure was incurred on new stores and refurbishment of existing ones, improvements on IT systems, plant and equipment.
Two new stores were opened in Gokwe and Harare in June, bringing the total number of Jet stores to 18 from 14. Another Jet store was opened in July in Chipinge and there are plans to open more before the Christmas trading season.
The performance in the half-year seems quite impressive in an economy where disposable income remains subdued while competition from imports is high.
Online Reporter