Axia reports positive volume performance in Q1 FY2021 thanks to relatively stable operating environment

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  • Volume performance against the final quarter of F2020 has been very high
  • TV Sales & Home volumes closed 48% higher
  • the Group will focus heavily on re-building its volume and revenue bases in the forthcoming period

Harare – Retail and distribution company, AXIA Corporation Limited has reported a positive volume performance across its business segments during the first quarter ended 30 September 2020 (Q1 FY2021) on the back of a gradual easing of lockdown restrictions and exchange rate stability.

The main operating business units in the Axia Corporation Limited Group are TV Sales & Home (TVSH), Distribution Group Africa (DGA) and Transerv.

In a trading statement for the period under review, the Group said, “The gradual easing of lock-down restrictions has improved people movement and business trading hours resulting, to some extent, in a general upswing in recent volumes. Volume performance against the final quarter of F2020 has been very high as retail businesses only traded for 8 weeks of the 13-week final quarter of F2020”.

The Group highlighted that the introduction of the foreign currency auction system in June 2020 has been encouraging and played a critical role in stabilizing the exchange rate which has helped businesses to plan during the period.

“The Group welcomes the current stability in the exchange rate and is hopeful that this auction system will continue to be adapted to ensure that payments to foreign suppliers can be fully met,” said the Group.

First quarter volumes at TV Sales & Home closed 48% higher than the comparative quarter which led to significant growth in turnover. According to the Group, the business unit has reviewed its credit sales offering and has just launched an enhanced credit product just in time for the Black Friday and festive season promotions.

The business opened its 50th store, in Mutare, during the month of October and this is the biggest store by area.

Volumes traded by Distribution Group Africa Zimbabwe operations in F2021 were similar to those achieved in the comparative period and were 52% above those recorded for the final quarter of F2020.

“This shows stability in the volumes traded compared to last year as the period under review was characterized by relative price stability across the value chain,” the Group said.

DGA regional operations in Zambia saw first quarter volumes increasing by 5% above those attained in the comparative quarter while in Malawi, volumes went down by 17% but were 41% above those achieved in the final quarter of F2020.

According to the Group, the decline in volumes is primarily a result of grey products coming into the market at cheap prices.

Meanwhile, Transerv witnessed a decent increase in volumes over the comparative quarter attributed to prices that were relatively stable during the quarter.

Commenting on the outlook, the Group said, “Accessing foreign currency to pay foreign suppliers remains the Group’s key focus area. The Group will continue to explore ways to increase working capital funding in order to match the increased level of business activity. In addition, the Group will focus heavily on re-building its volume and revenue bases in the forthcoming period”.

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