Harare – Edcon’s Zimbabwe based clothing retailer, Edgars Stores Limited says revenue for the 26 weeks ended July 8 2018 grew from $24.7 million to $32.1 million riding on the back of growth in sales.

The Group said despite the challenging environment characterised by foreign currency shortages and the threats this has on margins and merchandise assortments, sales of merchandise has grown from $24.1 million in the half year to June 2017 to $31.1 million in the same period in 2018, which is an increase of 29 percent.

In a statement accompanying the group’s financial results Edgars Chairperson Thembinkosi Sibanda said the Group’s profit before tax increased by 200 percent from $0.9 million in 2017 to $2.6 million in 2018 driven predominantly by growth in sales.

Sibanda said Edgars Chains’ total sales were $19.5 million compared to $15.8 million and sales per square metre were $1 958 compared to $1 502 the prior period out of 26 stores.

“The Jason Moyo branch (Bulawayo) is currently being revamped and the Masvingo branch is planned for a revamp in the second half of the year. Units sold for the six months were 0.8 million compared to 0.77 million units last year, which is an increase of 4 percent and the chain profitability decreased to 23 percent from 26 percent in 2017.”

In the period under review, Sibanda said at Jet Chain total sales were $12 million compared to $8.7 million and sales per square metre were $2 966 compared to $2 103  out of 25 stores.

“The Marondera branch was revamped during the period under review and the Masvingo branch is planned to revamp in the second half of the year. Units sold for the year were 1.05 million compared to 0.94 million last year, an increase of 12 percent, and the chain profitability increased to 17 percent from 16 percent in 2017.”

During the period under review, Edgars Chain debtors were $16.8 million compared to $16.3 million last year, after an allowance for credit losses of $0.8 million.

Net right-offs for the period at Edgars Chain averaged 2.1 percent compared to 8.7 percent last year, of lagged credit sales, and a 0.4 percent of lagged debtors compared to 1 percent last year.

Edgars Chain active accounts at June 2018 were 102 874 compared to 110 325 prior year.

In the period under review, Jet Chain debtors were at $4.9 million compared to $4.5 million last year, after an allowance for credit losses of $0.48 million.

Jet chain active accounts at June 2018 were 49 548 compared 45 5 prior year.

Edgars said the reduction in finance income is due to the fact that the arrears amounts of its customers are down on the prior year.

In the period under review the factory made a loss of $0.3 million after once off terminal benefits of $0.2 million compared to $0.3 million last year.

“We believe the reduced cost structure will align with the with the export initiatives being pursued.”

On microfinance, Edgars said the new division grew from a loan book $0.6 million at December 2017 to $2.6 million at June 2018. Total revenue of $0.5 million has been earned for the six months and the division made a profit before tax of $62 000 after $88 000 allowance of credit losses.

In its outlook the Group said, “We are well poised to take advantage of an upswing in economic activity and should achieve original forecast by year end. We continue engaging our bankers in sourcing foreign currency to clear our balance sheet.”

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