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Continued profitability saw the retailer declaring an interim dividend of $0,20 per share while basic earnings per share went up 21 percent to $0,46.
Group chairman David Lake said in a statement accompanying the group’s financials, the retailer continued to import the bulk of its products owing to limited local production.
“The group continued to import most of the products sold in the stores as the local manufacturing base remained inadequate,” Lake said, adding that the retailer actively supported the Buy Zimbabwe campaign.
Buy Zimbabwe is a campaign which encourages buying and selling as well as consumption of locally produced products.
Production in the economy remains constrained by lack of capital for retooling and working capital which has resulted in industry capacity utilization declining for the first time since 2009.
“South Africa remains the major source of imported products, and prices of goods were generally stable with minimum movement linked to the Rand/US dollar exchange rate,” Lake said.
Challenges had been faced in the importation of some products such as chicken and milk, he said.
A surge in overheads as a result of an increase in employee benefits, insurance costs and transportation costs put pressure on margins, Lake said.
He said low disposable income in the economy would continue to have an impact on sales in the outlook.
“The group will continue in its endeavours to grow sales profitably with initiatives including the opening of a new store in Victoria Falls during 2012 as well as full utilization of the many modernized outlets with their extra facilities,” he said.
In the review period, OK Zimbabwe’s capital expenditure went up to $7,4 million up from $6,96 million prior year on the back of outlet refurbishments and replacement of plant and equipment.
Three branches in Chinhoyi, Kadoma and Bulawayo respectively are scheduled for refurbishments in the second half of the year while construction of a new branch in Hwange is also expected to commence. — New Ziana
Online Reporter