Simbisa to open 73 new stores as revenue surges

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  • 18 new stores were opened in Q1
  • Regional deliveries up 50%
  •  Zim’s operations revenue grew on improved customer count
  • Easing of lockdown restrictions raised regional customer count by 37%

Harare – Diversified retail group, Simbisa Brands says is working on opening 73 new stores in the remaining nine months of the financial year to end June 2022 as it continues to grow the group’s footprint and create value for stakeholders, Group chief executive officer, Basil Dionisio said in a trading update.

In addition to this, the group is making significant capital investment in upgrading the Zimbabwe Operations’ Central Kitchen and Central Stores to increase storage capacity and further automate the production process.

In a trading update for the first quarter ended 30 September 2021, Dionisio said the Group will continue to explore potential investment opportunities that would be value accretive to Simbisa’s shareholders, with a particular focus in its largest regional market, Kenya.

For this quarter alone, the Group opened 18 new stores, three in Zimbabwe and also invested in one mobile truck while other stores were opened in its regional markets with Kenya dominating on having eight new stores.

The Group’s revenue for the quarter under review grew by 74% compared to the same period last year.

Zimbabwe’s operations revenue increased by 57% driven by a 29% increase in customer counts versus the prior year period due to the easing of COVID-19 restrictions.

However, counter trading hours in Zimbabwe remained below 52% capacity due to sustained nationwide curfews that were in place during the quarter under review and seating capacity which was restricted to 50%.

“The impact was most significant on Simbisa Zimbabwe’s casual dining brands,” Dionisio said in a statement accompanying the financials.

During the review period, the Group’s customer counts in the regional business surged by 37% compared to the same period in 2020.

 The 37% growth was obtained on the back of a recovery in trading activity as COVID-19 restrictions eased in the period under review.

In Kenya, trading hours remained 20% below full capacity and losses were offset by other markets including Mauritius, Ghana and Zambia which resumed operations at full capacity, although seating restrictions were still in Zambia.

The Group closed the quarter with an operating profit of 15%, an improvement from the prior year’s 10% due to the increased turnovers against a carefully managed cost-base while the regional businesses’ operating profit margins grew to 14% from a prior year figure of 9%.

Going forward, the strategic focus will be to grow the delivery business in the rest of the region and in Zimbabwe particularly, where deliveries contributed just 2% during the period against Kenya’s 24% growth.

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