· Total Group units sold improved by 62%
· Edgars chain volumes up 81%
· Jet chain volumes increased to 384,672
ZSE-listed, leading retailer, Edgars Stores Limited says it achieved volume growth across all its significant business units for the first quarter ended 10 April 2022 despite the challenging operating environment and the uncertainty brought about by the Russia-Ukraine conflict.
In a trading update, Chief Executive Officer, Tjeludo Ndlovu said total Group units sold during the quarter improved by 62% from 363,162 to 588,534 compared to the same period last year.
"This significant growth can be attributed to two factors: a) The COVID19 lockdown during Q1 of 2021 and b) Management's efforts in ensuring that fresher and more competitively priced merchandise is available in-store," Ndlovu said.
Edgars has several operations which include, Edgar's, Jet, Club Plus Microfinance and Carousel manufacturing.
Volumes in the Edgars chain for the quarter were up 81% with 239,055 units sold compared to 132,126 units in the comparative period while the net trading area increased from 20,814 to 21,145 square metres following the move of the Borrowdale store to a larger trading space.
"This move has resulted in wider merchandise assortment for this market with the store showing strong performance in the quarter under review. Stock covers closed at 19.7 weeks (2021:20.3 weeks)," Ndlovu said.
Total unit sales for the Jet chain were up 104% to 384,672 from 188,279 recorded in the same period last year.
"The Chain opened one new store in the quarter, in Harare CBD, taking the store count to 32 (2021: 28). Comparable unit sales growth was 86%. Stock covers closed at 17.2 weeks (2021:14.6 weeks)," Ndlovu said.
The Group's Club Plus Microfinance experienced growth in disbursements in the quarter as compared to the prior period while asset quality remained positive with over 80% of the book being current.
Carousel Manufacturing's outerwear (excluding barrier masks) unit sales for the period under review were up 48.9% to 18,924 from 12,712 in 2021.
Ndlovu said under the Carousel Manufacturing, management has embarked on various retooling and training initiatives which will result in widening of product offering, improvement in quality, productivity enhancement and an improvement in efficiencies.
He added, "The improved efficiencies will go a long way in ensuring profitability of the business. Efforts have also been made to procure critical raw materials to secure production in the third quarter and beyond. Management continues to engage new raw material suppliers to mitigate the effects of yarn shortages in the global market."
Meanwhile, the Group's active accounts for the quarter decreased from 128 200 to 127 300 with new business initiatives realising 3 052 new accounts compared to 883 opened in the same quarter last year.
The Group's debtors' collections were above expectations during the quarter, due to improved customer education about available multiple payment platforms.
"The asset quality remains firm with 85.9% (2021: 85.4 %) of our retail debtors' book in current status. Expected credit losses (ECLs) remain below the industry 5% benchmark at 3.1% (2021 3.0%)," Ndlovu said.
Going forward, Ndlovu says management continues to review working capital and financing models to capitalise on opportunities that arise in the very uncertain operating environment.
"Due to rising costs, cost containment remains a focus area. The Group seeks to increase its net trading area through the opening of new stores," he said.
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