Listed furniture retailer Pelhams Limited’s extension of credit repayment period from 18 to 24 months, strengthened market performance in the second half of its financial year ended September 30, company chairman Oliver Chidawu has said.
As Pelhams’ financial year draws to a close, he said, they will realise revenue growth after recording a profit before tax of $586 426, which is 214% up from last year.
“The focus in the last half of the year will be to grow revenue through improved credit terms, increased stock holding and improved stock mix,” he said in the company’s unaudited financial results.
Chidawu said revised credit terms have not only generated market excitement, but are expected to add impetus to the company’s general performance.
“The extended terms, which have generated market excitement, are anticipated to have a positive impact on performance in the last half of the year as the company positions itself as the credit retailer of choice,” he said.
He said their competitive credit terms had a positive impact on overall profitability.
The company’s revenue grew by 156% from the previous year’s comparative figure of $2,7 million. It was driven mainly by credit sales which increased by 239% relative to the prior year, and contributed 73% of revenue.
The solid performance, according to Chidawu, continued from the financial year ended March 31, resulting in improved product availability, quality and capacity utilisation.
He, however, noted that the capacity to borrow cheap and long-term financing remained constrained.
The growth effect, however, rubbed off onto the company’s manufacturing unit, Tradewinds, which maintained its revenue contribution.
Chidawu said prospects for the future were bright owing to improvement in levels of disposable income in the market. He noted the company was working towards maintaining its profit trend.
“However, the company continued to ride on its strong and established brands, distribution network and debtors securitisation structures to maintain the modest profitable position,” he said.