By Beaven Dhliwayo.
Harare, Zimbabwe. (News of The South)- – Edcon’s Zimbabwe based clothing retailer, Edgars Stores Limited says it has recorded stronger sales riding on a number of factors including the new political dispensation.
In a statement accompanying its results for the year ended January 7 2018, Edgars Chairperson Thembinkosi Sibanda said improvements in merchandise assortments, customer service, promotions, revamps and the new political dispensation together with utilisation of excess RTGS balances resulted in improved consumer confidence which contributed to stronger second half sales.
Sibanda said the chain’s total sales increased to $39.6 million from $33.9 million in 2016.
“Edgars Chain total sales were $39.6 million (2016:$33.9 million) and sales per square metre were $1 784 (2016: $1 467) out of 26 stores (2016:27).
“Units sold for the year were 1.9 million (2016:1.7 million), an increase of 11.8 percent,” he said.
“Edgars’ chain debtors were $17.7m (2016:18.7m), after an allowance for credit losses of $1.3m (2016:$1.8m). Net write-offs for the period averaged 6.9 percent (2016:7.9 percent) of lagged credit sales, and 0.3 percent of lagged debtors (2016:0.8 percent).”
However, Sibanda said the factory made a trading loss for the year of $0.6 million compared to 0.4 million in 2016, adding that performance was affected by supply chain constraints due to the severely restricted allocation of foreign currency for fabric.
He said $643 000 had been advanced as small loans to consumers for the last four months of the year.
Additionally, at the year end, borrowing had reduced to $4.6 million, from $11.2 million and gearing was 0.08 compared to 0.35 in 2016
“We expect borrowings to increase in the short term to finance growth of the microfinance business and fund capital expenditure to retool the factory and revamp stores.”
Meanwhile, the Group said limited allocation of foreign currency to the clothing sector is of grave concern to the Board and management and numerous measures are being pursued to mitigate this risk which will dampen growth prospects.
The Board has declared a final dividend of US 0.33 cents per share payable in respect of all ordinary shares of the Company.
“This dividend is in respect of the financial year ended 7 January 2018 and will be payable in full to all the shareholders of the Company registered at the close of business on the 27th of April 2018. The payment of this dividend will take place on or about the 11th of May 2018.The shares of the Company will be traded cum-dividend on the Zimbabwe Stock Exchange up to the market day of 24th of April 2018 and ex-dividend from the 25th of April 2018.”
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