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Edgars bemoans drop in sales

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A SLUMP in formal employment in the country negatively affected Zimbabwe Stock Exchange-listed Edgars Stores’ December sales which saw the clothing outlet not attaining its budget projections.

Nqobile Bhebhe
Chief Reporter

The after-tax profit recorded was $4,4 million. In a statement accompanying the group’s financial results, the clothing retailer chairman Themba Sibanda said while the 2014 outlook appeared difficult, the group would continue to seek and exploit opportunities to achieve profitable growth.

“The group’s footprint was increased through the opening of nine new outlets to close the year with 49 stores,” he said.

“The performance of our business is largely dependent upon the level of formal sector employment.

“These factors, against a background of a shrinking economy, negatively impacted our December sales which were lower than expected.

“This resulted in us not achieving the budget as anticipated in our promise made at mid-year. Profit after tax of $4 238 188 is 12% above last year”.

Edgars chain sales grew by 5% to $51,4 million which represents 80% of the group’s retail sales of which 72% were credit sales from $869 224. Jet stores posted results which were below expectations. Sales increased by 17% to $13 million, but the profit decreased by 40% to $522 527 from a high of $869 224.

“This decrease in the profit is partly attributable to start-up costs associated with the opening of new branches,” Sibanda said.

According to the results, the number of debtors grew to 197 932, which is an increase of 9%.

“Average handovers were 0,3% and 1,4% of lagged debtors and credit sales respectively. Provision for doubtful debts was 2,2% of total debtors which stood at $23 551 537 at year end.

“We are happy with the quality and performance of our book,” Sibanda said.

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