EDGARS Stores Limited has recorded a 22,3% growth in profits after tax to $5,2 million for the 53 weeks ending January 2015, attributed to the group’s focus on offering customers various credit options and improved services.
BY TARISAI MANDIZHA
In the same period in 2013, after tax profit was $4,2 million. Revenue was up 12,7% to $73 036 678 from $64 823 709 in the comparable period.
In a statement accompanying the group’s audited final results, Edgars Stores Limited chairperson Thembinkosi Sibanda said the launch of The Club and extended credit, in the form of the 12 months to pay option for customers, has driven the commendable 9,1% top line growth.
Sibanda said at the end of December, The Club had a membership of 87 000.
“The group achieved satisfactory results which were largely due to the group’s focus on offering our customers various credit options, improved assortments and superior customer service. In the Edgars chain these initiatives were underpinned by the re-launch of The Club which incorporated the Hospital Cash Plan,” Sibanda said.
He said profitability of the chain decreased by 6,6% mainly due to the additional discounts offered to customers during the year.
“We will continue to focus on cost control, account growth and customer service,” he said.
“Of importance was the successful management of the resultant growth in the debtor’s book. Productivity improved across the board but markdowns were high due to the need to clear aged stock.”
Sibanda said the Jet Chain contributed 21,6% to the group’s turnover as compared to 20% in 2013 while the chains turnover increased by 20% with growth at 2,4%. Profitability improved by 30,3% while stock management also improved, with the chains closing stock cover being 12,1 weeks down from 18,5 weeks at the end of 2013, Sibanda said.
Sibanda said the growth in debtors was well-managed and there was no deterioration in the quality of the book.
“By year-end we had 168 763 active accounts from 142 796 in 2013. Average gross handovers for the period amounted to 0,4% of lagged debtors and 1,9% of lagged credit sales. Recoveries averaged 42,1% from 34,6% in 2013 of bad debts handed over.