Online Reporter
Business Reporter
Edgars Stores Limited’s revenue for the third quarter to October 8 2024 declined by 6,81 percent following a 22,5 percent volume decline during the same period.
Volume fell from 594 593 traded units last year’s third quarter to 460 598 units during the quarter under review.
Group chief executive Mr Saviours Mushosho, in a statement of financials for the period, said margins firmed 2,81 percent during the period on the back of procurement efforts focused on bringing in high-quality merchandise that sold at competitive prices compared to last year.
“Management has continued its efforts towards ensuring that fresher, high-quality, and more competitively priced merchandise is available in-store,” he said.
Mr Mushosho said revenues for Edgars Chain for the quarter declined 9,7 percent against 22,1 percent; sales volumes declined from 255 561 units last year’s third quarter to 198 952 units this quarter.
The split between credit and cash sales remained relatively flat compared to the prior year’s third quarter at 63 percent and 37 percent, respectively.
Revenues for the Jet Chain declined 14 percent on the back of sales volume decline of 21,9 percent from 334 897 units sold in the prior year’s third quarter to 261 634 units this quarter.
At Carousel Manufacturing, units sold during the quarter increased by 70 percent to 208 838 from 122 789 achieved last year.
Mr Mushosho said the increase in the units produced and sold through the chains contributed to a 7,3 percent decline in the average cost of production.
“The sourcing of high-quality fabrics and the use of modern machines is helping to provide our customers with high-quality garments of international standards at very competitive prices produced locally.
“The retooling exercise has enabled the business to widen its product range, becoming more strategic to the chains in stock management and profitability,” he said.
The group’s financial services segment debtors’ book declined from $10,4 million on June 24 to US$10 million on September 24 as collections were higher than growth in credit sales.
Mr Mushosho said debtors’ collections were in line at 19,7 percent.
“With liquidity tightening, the business witnessed more customers opting for a longer tenure of 9 months to pay compared to 6 months to pay to enjoy lower monthly installments,” he said.
He added that the asset quality has remained firm with 77,4 percent of the book in status.
“Net debtors wrote off to lagged sales was at 3,0 percent compared to the industry standard of 5 percent.
“The business is taking an aggressive position in implementing initiatives to grow the debtors active account book,” said Mr Mushosho.
He noted that despite the challenging environment, the group seeks to continue to write good credit to new and existing customers.
Mr Mushosho said Club Plus Microfinance (MFI) has streamlined its focus and now concentrates on relatively less risky deduction-at-source loan products. The businesses’ loan portfolio increased to US$1,3 million by the close of the third quarter on the back of funding received from the group.
“Given the focus made in the first half of the year, the asset quality improved, with the MFI closing the quarter with an asset quality of 86,7 percent, against a target of 85 percent.
“Various investments in e-portals have resulted in improved efficiencies in loan approval and disbursement processes. The group sees further growth prospects for this business in the coming year,” said Mr Mushosho.
