CLOTHING retailer, Edgars Stores Limited, will remodel its business to capitalise on opportunities, after recording a 3 405% rise in profit after tax to ZWL$32,74 billion in its financial year ended January 7, 2024.
The huge increase in profit after tax was due to a net monetary gain of ZWL$142,81 billion during the period under review.
Edgars recorded the profit after tax from a 2023 comparative of ZWL$934,39 million.
In a statement accompanying its financial results for the year ended January 7, 2024, Edgars chairperson Thembinkosi Nkosana Sibanda said the consumer discretionery concern would open new stores as part of its expansion strategy.
“Management will continue to remodel the business to capitalise on opportunities that arise in the operating environment. In particular, management will focus on retooling Carousel to underpin increased production and improve operational efficiencies in order to better support the retail chains,” he said.
“In addition, cost containment efforts will be an area of key focus in order to underpin the long-term viability of the business. The group seeks to expand its geographic footprint through the opening of new stores in strategic locations. In fulfilment of our strategic thrust, we opened a new store at Ascot Shopping Centre in Bulawayo in March this year.”
He said that smart merchandise procurement and optimal inventory planning remained the key focus areas to ensure that targeted margins were achieved without compromising the merchandise quality.
“Management aims to continue improving customer experiences through updating our stores to world class standards and offering broader merchandise ranges at affordable prices and flexible credit terms,” Sibanda said.
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“The increased dollarisation in the economy is projected to assist the business through improved access to foreign currency through domestic sales to cover import requirements, which we believe will assist with improved stock availability in the shops.”
Owing to the El-Nino-induced drought for the current 2023/24 agricultural season, Edgars expects consumers to tighten their budgets as these weather conditions would reduce disposable incomes and US dollar liquidity.
Sibanda said the firm would focus on enhancing cost-competitiveness through improving value chain efficiencies.
“The group will also re-launch its Express shops, targeting the low-income segment of the economy, where it will sell for cash,” he said.
Edgars reported revenue of ZWL$294 billion during the period under review, up 70,3% from that achieved in 2023 of ZWL$172,6 billion.
This growth was attributed 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 stores.
However, total expenses rose to ZWL$152,01 billion during the period, more than double that recorded in the 2023 comparative of ZWL$66,64 billion.
But, Edgars remained liquid enough to seize market opportunities as it had ZWL$1,78 to every ZWL$ of short-term debt by the end of the reporting period.
The cushion arose due to a 142% growth in trade and other receiviables to ZWL$101,47 billion from the 2023 period. This indicated that Edgars was still accepting credit terms on its clothing products.
Total assets were recorded at ZWL$229,01 billion during the period under review, more than double the total assets in 2023.
