Edgars topline up 19%
LIVINGSTONE MARUFU
Listed clothing retail chain, Edgars Stores Limited’s revenue rose 19% to ZWL$1.29bn during the third quarter ended October 2021 from ZWL$1.08bn recorded during the second quarter on the back of increased sales.
The group’s cumulative units sold were 1.6m which was 15.5% ahead of last year due to increased online selling.
In a trading update for the 13 weeks ended October 10 2021, Edgars CEO Tjeludo Ndlovu said the company is taking steps to exercise rigorous management of inventory levels, closely monitor all aspects of the trade receivables portfolio and optimising its funding mix to meet the needs of the business.
“Revenue and EBITDA for the third quarter were ZWL$1.29bn against ZWL$1.08bn and ZWL$411m from ZWL$329m during the second quarter respectively,” Ndlovu said.
She said the stores were profitable to date with Edgars Chain unit sales up 14.7% to 243,311 from the second quarter and credit sales constituted 72.5% of total sales compared to 68.1% for the second quarter.
The chain closed September with stock cover of 12.5 weeks against 19.6 weeks recorded during the 2020 period.
Jet Chain unit sales went up 15.6% to 391,356 during the third quarter.
Credit sales made up 48.6% of the total sales for the quarter compared to 46.5% at the end of Quarter 2.
The chain closed September with a stock cover of 11.15 weeks against 10.52 weeks in 2020.
Financial Services income was up 21.9% in the third quarter relative to second quarter on the back of a growing debtors book which increased to ZWL$814m in the third quarter from ZWL$582m in second quarter .
The debtors book performance remained healthy, with 87.5% of the book being current compared to 86.3% in the second quarter and 78.2% in 2020, the company said.
Active accounts at 37.8% have been stable throughout the year but increased to 32.9% in September 2020.
Collections remained positive at 32.9% of the book compared to 36.7% in the second quarter.
Carousel Manufacturing Unit sales increased by 47.4% to 46,484 from 31,537 recorded in the second quarter.
Ndlovu said the management continues exploring export markets for opportunities offered by the COMESA registration received by the factory.
The loan book principal value increased by 41.8% to ZWL$101m compared to the second quarter.
She said the impact of Level IV lockdown introduced after the heightened third wave infections in June, curtailed foot traffic into stores during this trading quarter.
This led to lost sales, productive time and pressure to settle fixed operating costs including Covid-19 related expenses for the group.
Consumer confidence and spending was significantly depressed, resulting in year to date turnover falling below forecast by the end of September 2021.
As at the end of September, borrowings were ZWL$906m compared to ZWL$725m at the end of the second quarter, with the average cost of borrowing remaining largely unchanged.
The group had US$190,000 in foreign liabilities which it is able to service from existing resources.
During the quarter Jet Mutoko and Jet Hwange were opened.
In the outlook, the business is alive to opportunities presented to expand both brick and mortar and online footprint and develop a resilient business model that will withstand the impact of future shocks and disruptions.
