Direct Sourcing and Sale of Premium Products Boosts NTS Revenue
By Respect Gwenzi, Jul 04, 2018
HARARE-National Tyre Services Limited (NTS) revenue for the year ended March 31, 2018, surged 16 percent to 13.8 million compared to 11.9 million prior year, owing to direct sourcing with local supplies and pushing sales of premium products.
Gross profit increased by 35 percent from $2.9 million to $4 million during the period under review.
Profit before tax was $251 688, an increase of 208 percent from the previous year’s loss of $232 725.
In a statement accompanying the company’s financial results, NTS Chairman, James Moyo said the mix of budget and premium brands also ensured that out of stock situations were minimised.
He said the cash on a delivery payment system for the company’s customer base helped to cut debtors.
Moyo pointed out that generation of cash remains a paramount requirement for our industry.
Profit from operations increased to $286 486 compared to $217 889 last year.
During the period under review, the company opened a new branch in the Harare Market Square Area which it says enabled the introduction of new services – exhausts and suspension.
“The new services are on a pilot basis and if successful this service will be rolled out to all other branches,” he said.
He said given the significance of a road freight and agricultural and mining thrust in the country, the sectors will benefit from the Company’s continued offer of its retreading products.
“The company will continue offering retreading products in line with customer demands for quality and value. Cost cutting has enabled the extension of affordable prices to the market segments concerned.”
During the period under review, NTS did not declare a dividend saying there is a need to conserve working capital in a difficult trading environment.
Going forward Moyo said the significant investment the Company has undertaken in IT with the introduction of SAP, will complement the distribution footprint expansion and reposition campaign, adding that the foreign currency unavailability will remain a key success factor not only for the company but for business in general.
NTS listed on the Zimbabwe Stock Exchange, is the largest retailer of new tyres and tubes both imported and locally manufactured. Among its main activities is relugging of agriculture and earth moving tyres and the procurement of truck tyres for the Zimbabwe Transport Industry.
NTS has 13 retail outlets situated throughout the country with 4 of these being located in Harare. The Head Office is based in Graniteside, Harare. The relugging and retreading factories are situated in Harare and the procurement of truck tyres are in Harare and Bulawayo.
Equity Axis Newsdesk
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