Edgars profits $4m, predicts tough 2014

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CLOTHING retail group Edgars Stores Limited has predicted a tough 2014 after posting a $4,2 million after tax profit for the full year to December 31, 2013 despite poor sales over the festive season.
The profit was a 12 percent increase over the prior year and the group expects a slight increase to $4,7 million in the current financial year by tightening costs and increasing its  product offering.
Group managing director Linda Masterson told an analyst briefing in Harare that the debtors book was healthy at $23,5 million and that accounts were  198,000 – an increase of nine percent from 2012, with about 70 percent of them active.
Provision for doubtful debts was 2, 2 percent of the book.
“We are quite happy with the quality and performance of our book,” said Masterson.
In 2013, the group increased its footprint by opening nine outlets to 49 stores. Lower December sales saw the group fail to achieve targets.
The Edgars chain grew sales by five percent to $51,4 million, representing 80 percent of the group retail sales, of which 72 percent were through credit.
Its low cost outlet Jet Stores posted results which were below expectations.  Sales increased by 17 percent to $13 million but the profit decreased by 40 percent to $522,527 from $869,224 the previous year.
This decrease in the profit was partly attributable to a start-up costs associated with the opening of four branches to bring the total number of outlets to 23.
Masterson said she expects a slow start in the current financial year with a slight improvement towards the end.
“We will be giving our customers more value and wider choice. Greater leverage is being placed on partners for sourcing merchandise which will lead to greater desirability of assortments. We believe these are the factors that would give us growth,” Masterson said.Advertisement