Truworths Limited recovered a significant chunk of debts it is owed by customers and has recorded an increase in its customer base.
The company’s chief executive officer, Temba Ndebele, on Thursday said 88% of $79 631 debt from credit customers and 81% of $26 900 debt from Topics had been recovered.
“The customer base has gone up by 36,7 % in the first quarter of the year,” said Ndebele.
For the year ending July the group had 68 024 accounts.
Ndebele said credit terms had been relaxed, with an extra month to pay, a development that is expected to improve sales and make instalments affordable.
“We are offering new credit terms. We have moved from 6 months to 7 months to allow customers to participate,” he said
The scheme is only applicable to clients who purchase items in November and December.
“We have seen an upturn in sales, but it’s still too early to establish a sustainable pattern. We believe December will be a good month for us,” said Ndebele
Truworths’ revenue for the full year to July was $22, 52 million, an increase of 71% from last year. Net income was $1, 73 million, with earnings of $0, 47c a share.
Gross profit margins, at 51, 7%, were impacted by two markdowns in March and June which totalled 4, 7%, against last year’s 1,3% and were effected to clear June stocks ahead of spring.
He said inefficiencies within the group had led to increased creditors in December and January of 14% compared to overall year growth of 48%. As a result, the group was not able to use its resources to finance creditors due to lack of merchandising.
As at June, Truworths had 338 customers who had not made payment of $79 631 and Topics had 77 customers owing $26 900.