• Turnaround Performance: Meikles reported a recovery in Q3, with revenue increasing 44% year-on-year, reversing a 20% decline in the first half
• Supermarket Recovery: TM Pick n Pay supermarket division rebounded from a $4 million loss, achieving an 8% rise in sales volumes in Q3, supported by improved stock availability
• Hospitality Sector Growth: The hospitality division saw a 44% revenue increase in Q3, driven by resilient demand, improved tourism, and domestic spending

Harare- Meikles Limited showcased a notable recovery in its third quarter ended 30 November 2024, reversing the underperformance seen in the first half of FY2025.

This turnaround was driven primarily by improved sales and profitability across key business units, particularly its supermarkets and hospitality sectors.

The group’s flagship supermarket division, trading as TM Pick n Pay, rebounded from a $4 million loss during the HY period, with sales volumes rising 8% year-on-year in Q3 and 2% cumulatively over the nine-month period.

This growth was attributed to enhanced stock availability across all stores, which helped stabilise operations.

However, USD revenue collections for the supermarket segment remained flat at 17% year-on-year in Q3, though they improved marginally to 21% over the nine-month period, suggesting persistent challenges in currency dynamics or pricing strategies despite volume gains. 

The hospitality sector also contributed to the recovery, with revenue increasing to 44% in Q3 (up from 42% in the prior year) and maintaining a 44% cumulative growth rate over nine months (compared to 41% in the same period last year).

This steady performance highlighted resilient demand in the sector, likely supported by improved tourism and domestic spending.

At the group level, revenue surged 44% year-on-year in Q3, offsetting the 20% decline witnessed during the first half.

Cumulatively, revenue growth for the nine-month period reached 7%, marking a significant recovery trajectory. Profitability saw a dramatic turnaround, with the group posting a profit of ZWG73.4 million in Q3 compared to a loss of ZWG4.5 million in the same period last year.

For the nine-month period, profit after tax (PAT) surged 87% to ZWG67.9 million, a stark contrast to the ZWG5.6 million reported in the preceding six months ended August 2024. 

The recovery was underpinned by operational improvements, particularly in supermarkets, where restocked inventories drove sales volumes, and in hospitality, where demand remained robust.

However, the disparity between USD revenue stagnation and surging ZWG profits highlighted the impact of inflation adjustments and currency volatility in the economy.

While the ZWG figures reflect accounting adjustments for inflation, the stagnant USD revenues reflects external risks, such as exchange rate pressures and reduced foreign currency inflows.

The Q3 performance offers cautious optimism, but long-term stability hinges on navigating currency challenges and maintaining operational efficiency across its diversified portfolio amid rising informlisation.

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