daniel chigunwe
Business Writer
National Tyre Services (NTS) has reported a loss for the year ended March 31, 2024, primarily due to economic challenges and inflationary pressures.
In its financial statement released yesterday, NTS highlighted the subdued trading environment, loss of purchasing power of the local currency, and the impact of the El Niño-induced drought on foreign currency reserves.
The company also faced challenges due to depressed electricity generation.
Despite these challenges, NTS managed to increase new tyre sales volumes by 24 percent and retreading sales volumes by 10 percent compared to the previous year.
“Our solid and long-term trading relationship with our suppliers sustained business operations through seamless supply of stock.
“Although the Company closed four retail outlets at the beginning of the Financial Year, National Tyre Services managed to maintain a strong presence in affected areas through personal selling,” reads part of the statement.
However, the company incurred a loss before tax of 39,276 billion Zimbabwe dollars (inflation adjusted) up from a loss of 7,253 billion Zimbabwe dollars in the previous year.
This is after total operating expenses increased significantly (inflation adjusted) to 114 067 billion Zimbabwe dollars (2023: 66 775 billion Zimbabwe dollars).
The financial statement also revealed that the company’s sales revenue grew by 95 percent (inflation adjusted) to 259,669 billion Zimbabwe dollars and gross profit increased by 39 percent to 105,314 billion Zimbabwe dollars.
However, total operating expenses increased significantly (inflation adjusted) to 114 067 billion Zimbabwe dollars.
The company’s outlook remains positive, with the expectation that Government’s strategies to boost demand for the Zimbabwean dollar will stabilise inflationary pressures and create a conducive business operating environment.
NTS also anticipates increased demand for tyre services due to the rolling road rehabilitation programme and the upcoming peak season.
“Already, the Company has realized strong demand for Light truck and luxury motor vehicles tyres during the build up to SADC summit,” reads the statement in part.
Despite the challenges faced, NTS remains committed to offering a “balanced product portfolio of meticulously engineered tyre brands and leveraging on the growing demand for tyre services in Zimbabwe.
“We are optimistic of a return to normal peak season in the second half of the year, typically hot and rainy seasons drive demand for tyres and related services,” said NTS.
Bongani Ndlovu