Edgars to spend US$5m on stores facelift

yet to be contracted for. The funds have been set aside to finance the renovation of its stores.
Mr Sibanda said this as he announced the company’s improved financial results for the full year to January 7 2012.
“All expenditure is to be financed from existing cash resources and utilisation of authorised borrowing facilities,” he said.

At about the same time last year, the clothing retailer had US$2,3 million set aside for various capital programmes. So far, US$176 000 had been spent on capital projects as the clothing group positions itself for better economic performance.
The Zimbabwe Stock Exchange-listed company said the funding would be directed at revamping its stores countrywide. Group full-year profits increased by 120 percent to US$3,3 million on higher margins and sales of high value brands.

Trading profit rose by 77 percent to US$7,5 million, but profitability was affected by a 38 percent increase in finance costs. Earnings per share for the period under review improved to US1,37c from US0,62c in the comparative period last year.
Mr Sibanda said steady growth in accounts, improved merchandise assortments and cost management, coupled with successful rebranding of Express to Jet, ensured targets were met.

“On the back of credit, Edgars chain units grew 23 percent while margins were slightly up at 53,1 percent. Chain profit grew 37,3 percent as a result of improved profitability and sale of higher value branded goods,” said Mr Sibanda. He said unit sales improved by 23 percent while margins were slightly up at 53,1 percent. Chain trading profit grew 37,3 percent.

Unit sales in Express Stores, which rebranded nine branches to Jet, increased by 16,4 percent, compared with the same period last year. Chain profitability rose by 194 percent as expenses fell.
But Edgars said its manufacturing unit incurred a loss and focus would be on accessing funding to enhance productivity.
Edgars said exports are also being pursued, despite difficulties in the market and the group was targeting breakeven this year. The retail chain said accounts grew by 43 percent while the active book stood at 81 percent. Bad and doubtful debts are fully provided.

But Mr Sibanda said he was concerned at the recent liquidity problems, but pointed out focus will be placed on steady growth.
“Our focus will be on steady growth, albeit at a slower rate, improved merchandise assortments and customer shopping experience,” he said.

The group expects improved profitability this financial year as the cost of borrowing fell from 18,2 percent early last year to 14,5 percent at the end of the period under review. Edgars said negotiations were underway to substitute short-term funding with long-term facilities.