Online Reporter
Business Writer
OK Zimbabwe Limited’s loss more than doubled to US$25 million for the year ended March 2025, following a revenue plunge of over 50 percent, weighed down by supply chain disruptions and intensifying competition from the informal market.
The retail giant had recorded a net loss of US$12,4 million for the financial year ended 31 March 2024.
Revenue fell by 52 percent to US$245 million during the period under review, compared to the previous year.
However, the group is now on a recovery path, and both the board and management remain confident that the organisation will achieve its goal of delivering consistent shareholder returns in the medium term.
This comes as OK Zimbabwe is preparing for an additional capital raise of US$10,5 million through the sale of immovable properties, with several offers under consideration.
Earlier, the company raised US$20 million via a rights offer, as management sought to mobilise resources to rebuild supply chains and settle mounting debts.
The group attributed the sharp revenue decline to a combination of factors, including limited trading due to stockouts and increased competition from informal players who operate with minimal regulatory oversight.
Supply chain disruptions were a major challenge during the reporting period, as delays in settling supplier accounts led to withheld deliveries and demands for upfront payments, which constrained operations.
“Revenue decline is attributed to supply chain disruption and heightened competition from the informal sector, compounded by exchange rate controls that distorted pricing. Supply chain disruptions were a result of the group failing to settle suppliers’ accounts on time, leading to some withholding deliveries while others demanded payment upfront. These challenges resulted in the group’s operational capacity being impacted negatively.
“The recovery of the group has started, but it will take some time to return to normal operations. The board and management are confident that with proper focus and diligence, the ultimate goal of delivering consistent shareholder returns in the medium term is attainable,” said OK Zimbabwe chairman Mr Herbert Nkala in a statement accompanying the group’s financial results for the year to March 2025.
OK Zimbabwe said the disruptions severely affected its operational capacity, leading to reduced production efficiency and lower output across several business units.
Following a comprehensive impairment review of all cash-generating units (CGUs), the company recognised an impairment charge of US$10.3 million, as the recoverable values of certain CGUs fell below their carrying amounts.
Despite these setbacks, the group recorded a net exchange gain of US$13,5 million, primarily from the remeasurement of monetary liabilities following the devaluation of the Zimbabwean dollar, which helped correct pricing distortions.
However, the gain was insufficient to offset the impact of reduced revenues and impairments, resulting in a net loss of US$25 million for the year.
“As a result of the factors highlighted, the group recorded a significant loss for the year of US$25 million.”
The group remains focused on stabilising its operations through tighter cost control measures, improved supplier engagement, and exploring new revenue streams to enhance resilience in a challenging operating environment.
The company also noted a decline in retail skills, as trained and experienced personnel left for better opportunities. It now plans to retrain existing staff to improve customer service and raise performance standards.
Zimbabwe’s largest retailer is facing significant operational and financial challenges due to a combination of supply chain disruptions, broader economic pressures and high operating costs.
