NATIONAL Tyre Services (NTS), a retailer of new tyres and tubes, has projected an increase in demand for tyres and related products in the build-up to general elections and the upcoming agricultural season.
Zimbabwe is set to hold elections on August 23.
In a statement accompanying financial results for the year ended March 31, 2023, chairperson Rutenhuro Moyo said the firm would focus on cost containment measures, among others, to capitalise on the projected increase in demand.
“We are projecting increased demand for tyres and related product and services pick-up in the build-up to general elections and the upcoming agricultural season,” he said.
“To capitalise on the obtaining environment, NTS will continue to focus on cost containment and enhanced market outreach programmes to increase the inventory turnover ratio and improved profitability.”
Moyo said monetary measures implemented by government to stabilise the local currency were bearing fruit, given that the local currency was firming against the United States dollar.
“Foreign currency exchange rates are stabilising on parallel and auction markets. We are cautiously optimistic of continued stability in exchange rates, which will aid planning and business growth. Industry is expecting that the current stability in power generation will continue to minimise production disruptions,” he said.
In the period under review, sales revenue grew by 21% to $4,332 billion due to the continued implementation of the turnaround strategy.
- NTS sees demand firming ahead of polls
Keep Reading
Gross profit decreased by 8% to $2,462 billion as the cost of sales increased due to higher costs of imported products.
NTS said total operating expenses were maintained at the prior levels of $2,170 billion due to cost containment measures implemented by your management.
The company incurred a loss (before tax) of $427 million (inflation-adjusted) from a profit of $1,187 billion in the previous year.
According to the company, availability of Dunlop tyres was instrumental in retaining its large corporate customer base during the year and this resulted in premium sales in units increasing by 14% over prior year.
The company said it remained viable as the competitive space continued to be crowded by entrants across the country.
Its budget brands segment was impacted by the restricted access to foreign currency which in turn affected product availability.
Retreading performance declined during the year, but the company managed to maintain presence in key retreading fleets.
