Nyashadzashe Ndoro
CHIEF REPORTER
Edgars Stores Limited (Edgars), a leading Zimbabwean clothing retailer, reported a significant increase in revenue for the year ended January 7, 2024, despite a challenging economic environment characterised by inflation and currency fluctuations.
“Throughout the financial reporting period ended 7 January, 2024, the operating environment was characterised by exchange rate volatility and incessant inflationary pressures,” said Edgars Chairman, Thembinkosi Nkosana Sibanda.
“Liquidity challenges in both the local and foreign currencies persisted throughout the year coupled with elevated interest rates.”
Edgars, however, managed to overcome these hurdles.
“The Group managed to close the period with an improved performance over the year,” stated Sibanda.
Edgars Stores Limited reported revenue of ZWL$294.0 billion, a 70.3% increase from ZWL$172.6 billion achieved in 2023.
Edgars attributed this growth to “margin improvements due to better procurement, ongoing cost management as well as other initiatives implemented by management to ensure fresher and high-quality stock availability in our stores”, Sibanda explained.
While unit sales declined by 10.8%, Edgars highlighted positive signs.
“Trading in foreign currency since April 2020 has allowed our retail chains to improve stock assortments, which in turn has increased traffic in our stores,” the report stated.
The increased availability of foreign currency through domestic sales is expected to further improve stock availability.
Edgars pointed to a “sizeable portion of our cash sales are in foreign currency,” and believes “this proportion can be increased through favourable and consistent application of regulatory policies around trading in foreign currency”.
Edgars also highlighted growth in its USD sales and loan book.
The report states: “The USD retail debtors’ book closed the period at US$12.6 million, representing a 100% growth on the prior year balance of US$6.3 million.” Club Plus Microfinance also saw its USD loan book grow by 17% to US$1.1 million.
Edgars acknowledged the headwinds caused by increased food imports and food inflation. But the company remains optimistic.
“The Group will focus on enhancing cost-competitiveness through improving value chain efficiencies,” the report said.
Edgars also plans to re-launch its Express shops, targeting the low-income segment of the economy.
“Management will continue to remodel the business to capitalise on opportunities that arise in the operating environment,” Sibanda added.
“The Group seeks to expand its geographic footprint through the opening of new stores in strategic locations.”
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