Zimbabwe Stock Exchange-listed apparels maker and retailer Edgars Stores Limited’s basic earnings per share for the 26 weeks to July 7 2012 was 90% up to 0,38 cents, spurred by strong growth in retail sales.
Report by our Business Reporter Profit before tax was up 91% to $1,3 million buoyed by a growth in revenue.
Total revenue rose to $25 million from $20 million driven by the retail chain’s credit facilities and the recently launched Jet Stores.
Edgars also announced that its negotiations for long-term funding were at an advanced stage.
This development comes at a time when operations of most manufacturing companies have been hamstrung by capital constraints.
The company’s finance costs marginally retreated to $1,3 million from $1,6 million during the period under review.
“The number of debtors accounts grew to 169 717 from 158 901 at year end, which was slightly below expectation. Active accounts stood at only 74% at the end of June (FY2011:81%),” said Edgars chairman Thembinkosi Sibanda in a statement accompanying the interim results.
“Average handovers were 0,4% and 1,4% of lagged debtors and credit sales respectively, which is line with FY2011 year end.
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“Amounts due have risen and we therefore expect bad debts to be higher in the second half.
“However, these will be more than covered by our provisions which are at 2% of current debtors.”
Turnover from the 23 trading Edgars stores grew by 16,9% to $19,8 million, a figure representing 83% of total revenue.
Edgars, manufacturing unit according to Sibanda, incurred a loss of $141 424 for six months, which was better than last year by 31,2%, despite a 20% growth in units sold.
Zimbabwe’s clothing manufacturers have since the influx of cheap oriental apparels, struggled to regain their market share.
Most of the firms use antiquated machinery which in turn pushes production overheads and subsequently reduces profit margins.
