Meikles revenue up 51% on strong performance across all segments

Harare – Hospitality and retail group, Meikles Limited recorded impressive performances across all segments for the year ended 31 March 2019, with revenue scaling up 51% to RTGS$791.6 million from RTGS$524.9 million in the prior year.

Group earnings before interest, taxation, depreciation and amortisation (EBITDA) for continuing operations grew by 150% to RTGS$101.5 million from RTGS$40.6 million in the previous financial year.

Profit for the year jumped 705% to RTGS$66.0 million against RTGS$8.2 million recorded in the prior year.

Giving a highlight of segmental contributions to the Group’s financial performance, Executive Chairman, John Moxon said revenue from supermarkets trading as TM Pick n Pay increased by 53.2% to RTGS$747.3 million compared to RTGS$487.8 million in the previous year.

EBITDA increased to RTGS$69.0 million from rtgs$34.5 million in the previous comparative year.

“Increase in revenue and profit was achieved through growth in units sold and inflation induced price increases, however the segment was continuously competitive in its pricing policies,” Moxon said.

“A new branch was opened in Victoria Falls in March 2019 and upgrades of more branches have commenced,” he added.

The Group’s agriculture operations under Tanganda Tea Company Limited also performed well recording a 28% increase in revenue to RTGS$37.0 million from RTGS$28.8 in prior year while EBITDA jumped 208% to RTGS$31.7 million from RTGS$10.3 million.

“From November 2018, international bulk tea export prices that had remained firm at an average US$1.68/kg up to October 2018 started to decline by between 10% and 15% due to oversupply by Kenya,” Moxon said.

“The segment’s annual made tea production of 10,171 tonnes was commendable. Made tea production during the year ended 31 March 2018 was 10,601 tonnes,” he added.

Export earnings from the new crops being macademia nuts, avocadoes and coffee grew by 96% from US$2.3 million in the previous year to US$ million in the year under review, contributing 25% of total exports up from 13% in the prior year.

Moxon said the contribution of the new crops to the segment’s export earnings is expected to increase to 60% within three years as these crops reach maturity.

The Hospitality sector’s revenue increased by 18% to RTGS$9.1 million compared to RTGS$ 7.7 million in the previous year.

EBITDA for continuing operations increased by 136% to RTGS$8.5 million from RTGS$3.6 million in the previous year.

Moxon said Meikles Hotel now requires substantial modernisation of guest facilities as well as electro mechanical and plumbing infrastructure in line with international standards whilst the refurbishment of the Victoria Falls Hotel will commence during the last quarter of fiscal year 2019.

“Funding for these works has already been secured,” Moxon said.

The board declared a final dividend of 7.67 RTGS cents per share, bringing the total dividend for the year to 8.87 RTGS cents.

“The final dividend will amount to RTGS$20.02 million,” Moxon said.

Equity Axis News

Raynold Mhotseka

Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment.

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