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POWERSPEED Electrical Limited revenue for the year to September grew 18,7 percent to $40,1 million with core turnover through Electrosales Hardware branches rising by 22 percent.
The group’s revenue growth was however diluted by an increase in operating expenses which rose to $10,6 million from $9,2 million in the comparative period last year.
Profit from operations increased 14,8 percent to $1,86 million while profit after tax grew 19,5 percent to $780 000 from $653 000 recorded the prior year.
Powerspeed managing director Mr Hilton Macklin told an analysts briefing yesterday that to increase its market share, the group will focus on improving key product availability, increasing stock turn and reducing expenses.
“We believe that our market share is still relatively low and our objective is to grow.
“We are going to do that by improving product availability with quality and value. We will try and reach more customers,” said Mr Macklin.
He said working capital is the group’s Achilles heel.
“One of our major constraints in the business is working capital. Borrowings are relatively high. Consequently, finance costs rose 24 percent to $799 000 from $645 000,” said Mr Macklin.
But the company is good shape to service the borrowings based on the initiatives it has started.
“We are comfortable that we can service our borrowings,” said Mr Macklin.
The group is targeting 10 percent net profit margin and is increasing its footprint through location and size of its branches countrywide.
“We will continue to improve our product range and will be introducing new products as we go.
“We will also be aggressive with pricing. Currently we are market leaders in terms of pricing. We will also continue reducing costs to improve our margins,” said Mr Macklin.
The group disposed of its Zambian subsidiary in July this year realising net asset value while the engineering operations continue at lower levels of throughput than before.
Online Reporter