Clothing retailer Edgars expects a flat growth in 2016 and will restructure the organisation to enhance accountability, productivity and succession planning, group managing director, Linda Masterson has said.
BY BUSINESS REPORTER
The Zimbabwe Stock Exchange-listed clothing concern saw its turnover decline by 13,6% to $63,9 million in 2015 from the previous year attributable to a drop in Edgars chain sales, which were down 24% from 2014.
“This was from the high base of extended credit having been launched in the previous year and so Edgars expected reduced turnover,” the group said.
Turnover for the Jet Chain increased by 23% to $19,1 million during the year under review from $15,6 million in 2014. This saw its contribution to consolidated group turnover increasing to 31% from 22% in 2014.
Edgars said profitability in the chain improved to 7,5% of sales up from 4,3% in 2014 on the back of credit and the benefits of scale.
“Given the macro-economic environment, the discount chain is the natural choice for cash-strapped customers. Due to the poor Christmas trading, both chains ended the year overstocked, which is being addressed and has improved since year end,” the retailer said.
Group borrowings were reduced to $18 million during the period under review from $20,3 million in 2014. Masterson said borrowing in 2016 would be around $17 million.
The group said it was geared for a leaner and more productive future, “by remaining committed to reducing costs and increasing productivity”. It said the measures would impact on 2016 profit “but ensure that we are well placed for 2017 and beyond”.