Harare- Retail and distribution company, AXIA Corporation Limited bemoans the current operating environment in Zimbabwe for the poor performance of the Group’s various enterprises in their first quarter ended 30 September 2019.
The economic sphere in Zimbabwe has been characterized by declining disposable income, inflationary pressures and foreign currency shortages and these have led to a number of companies incuring losses, with AXIA having to adjust its prices in order to beat the pressures.
TV Sales and Home, a furniture company under the AXIA banner faced low consumer demands in the period under review resulting in it recording a 50% decline in sales volumes compared to the prior year.
On the upside, with the current shortages and high cost of accessing foreign currency that most firms are faced with, the company managed to maintain consistent supply of products and is looking into offering products that use solar as a move to provide customers with goods they can use as the country in going through a period of incessant power cuts.
In the trading report, the Group’s Chairman, Luke Ngwerume states that TV Sales and Home is currently witnessing recovery through the newly introduced extended credit sale offering.
Distribution Group Africa (DGA) Zimbabwe, another AXIA subsidiary recorded 31% year-or-year decline in volumes in the period under review, which was attributed to declining disposable income and shortage of foreign currency resulting in the company going low on the importation of stock.
The company which, which specializes in the selling of basic consumer goods is considering increasing volumes of locally produced goods in order to make up for the lost volumes.
Regionally, DGA Malawi realized a 45% increase in sales volumes, a factor attributed to acquisition of Blue Band, Pepsi and Nestle while in Zambia, the acquisition of Nestle did not do much to increase sales volumes as the company recorded a 16% decline, resulting from competition from wholesalers in certain brands.
For automotive subsidiary, Transerv product supply remained consistent despite most of the products requiring foreign currency but sales volumes declined due to the importation of stocks which resulted in cost pressures.
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