malvernmugadzikwa
Business Writer
OK Zimbabwe saw its sales value increase two fold as inflation hits 191,6 percent in the period ending June 30, 2022.
For the first quarter ended June 30, 2022, the group’s sales volumes grew by 1 percent over the prior year. In the same vein, sales value increased by 237 percent from the prior year in historical terms and 40 percent in inflation-adjusted terms.
OK Zimbabwe chief executive, Maxen Karombo said; “Our stores were reasonably stocked during the quarter, although we continued to experience temporary supply gaps on some key volume drivers.
“Profit margins were consistent with the prior year and in line with the group’s plans for the current year.”
While the foreign exchange market is very volatile, the government introduced the willing buyer, willing seller interbank exchange rate system, which formal businesses are required to comply with.
“It is not as attractive to the market compared to the rest that is offered in the alternative and hugely unregulated market,” he said.
“So this continues to impact on our competitiveness of US dollar prices in our stores and ultimately impacts on the capacity for us to generate our own foreign currency for local sales.”
On the parallel market, one US dollar can sell for $900x. Officially, the Zimbabwean dollar is trading at $416.28 against the greenback.
“The market is desperately waiting for a foreign exchange market system that is market determined and stable. This will allow everyone in the supply chain easier planning scope for easier planning and businesses that can be largely predetermined in line with company strategies,” Karombo added.
In terms of the outlook, the group expects inflation headwinds to dominate the trading environment in the short term.
At the AGM, directors’ fees were approved at $48,5 million and auditors’ fees at $30 million.
Bongani Ndlovu