Edgars Stores ups performance in H1, 2019

HARARE – Clothing retailer Edgars Stores  Limited said on Friday its year to date profit after tax for the period  ending May this year shot to ZWL$8.7 million from ZWL$1.3 million in the  same period last year as the company continues to enjoy brisk sales.

Group managing director, Linda Masterson told shareholders at the  company annual general meeting that turnover was up 90 percent compared  to last year.

“June turnover was trending above 200 percent over the prior year until  the announcement of Statutory Instrument 142 after which growth slowed  down to around 100 percent,” she said in a trading update.

The government issued SI 142 of 2019 which introduced a raft of  currency reforms chiefly banning the use of foreign currencies for local  payments and re-introduction of the Zimbabwe dollar.

“We are positive that the change to the Zimbabwe dollar will bring some  stability. We are geared to take advantage of any opportunities that  arise, finance permitting,” Masterson said.

Group earnings before interest, taxation, depreciation and amortisation  surged 524 percent to ZWL$16.3 million.

Masterson said the group had re-opened its Jet Store in Kadoma in April  and was still on the hunt for a suitable site for its Edgars Store in  the same town.

“Other revamps and new stores planned for this year, funds permitting,  are Edgars Masvingo, Jet Masvingo and two to three new Jet stores,” she  said.

Masterson said finance costs shot up 80 percent over the period, with  borrowings shooting to ZWL$9.8 million from ZWL$3.5 million last year.

“We expect this (finance costs) to go up further in line with the  expected increase in the bank lending rates,” she said.

“We plan to borrow more to fund capital expenditure requirements,  growth in the micro finance unit and working capital, which has been  under pressure due to inflation.”

She said the retailer’s debtors’ book was “at its cleanest since  dollarization” while giving credit to “our credit teams and our  customers for their timely payments.”

With recent jumps in costs of borrowing and increase in inflation, the  Masterson said a review on interest rates charged on customer accounts  was underway. –New Ziana