LISTED tyre manufacturer and distributor, National Tyre Services (NTS) has credited the stabilising economic environment for its 34% growth recorded during the just-ended financial year.
Presenting the group’s performance for the period ended March 31 2021, the NTS chairperson Rutenhero Moyo credited interventions made by the monetary regulator for assisting in the company’s turnaround strategy.
“Measures taken by the Reserve Bank of Zimbabwe (RBZ) on 23 June 2020, which comprised introduction of a foreign currency auction system, were critical in stabilising the economy from the ravages of inflation and high foreign exchange rates during the second half of the year,” he said.
“These developments coupled with the support from our bankers were instrumental in positively turning around the business which resulted in improved demand, increased inventories and in turn, improved sales.”
During the period under review, NTS sales grew by 8% to $554 million up from $512 million due to the implantation of the turnaround strategy buoyed by the right product mix which saw gross profit surging by 93% to $249 million.
Total assets growth of 16% was achieved mainly from improved bank balances, an increase in inventories and growth in capital expenditure.
Revenue from rendering services reached $33.8 million up from $8.1 million.
However, the NTS board deemed it prudent not to declare a dividend due to an uncertain operating environment and the need to finance increased working capital requirements as well as fund essential projects that will enhance service delivery and improve competitiveness.
“National Tyre Services remains optimistic of a continued uptrend in sales, despite foreign currency challenges. For survival, the company will continue to pursue various avenues and options availed by authorities to boost foreign currency reserves in order to restock whilst also constantly reviewing its strategies to remain competent,” added Moyo.