Edgars set for US$39m turnover

Edgars MD Linda Masterson said the company is expecting a turnover of US$39 million for the financial year ending December 31 2010 buoyed by reduced interest bills and more account holders.

According to the group’s financial statement, during the interim period ending June 30, a US$10,26 million turnover was recorded from US$1 475 million achieved during the same period last year.

A bottomline loss of US$617 722 from US$1,5 million as a result of a hefty interest bill of US$900 635 was achieved.

The group said bottomline loss was reduced to US$617 722 (loss per share of 0,25c) as a result of the deferred tax asset from last year’s losses.

Masterson said the cumulative loss of pre-tax loss of US$1 146 million at the end of June had been reduced to US$600 000 and the expectation was that it would be “gone in September or October”.

The company forecast, borrowings would peak this year to US$14 million, and was also forecasting closing debtors of US$15,9 million and stock of US$4,8 million.

“Borrowings are expected to be at US$12 million by year end when closing debtors should stand at US$21 million and stock at US$7 million,” the company said.

“Account holders should rise to over 110 000 by the end of this year compared to 38 000 in December last year, having grown strongly in recent months with 12 567 having been added in August alone and the figure was expected to stand at 78 000 by the end of September,” the company said.

Masterson forecast a rise of account holders to 140 000 by the end of 2011, compared with 200 000 in 2003, the last measurable year of normal performance when the group had 46 stores operating compared with 33 now. Accounts peaked at 244 000 in 2006. The company said there had been a 609% increase in volumes in the period, but the acceleration only happened in May when the retailer took the decision to mandatory deposits.

Turnover had amounted to US$3,9 million during the first quarter and US$6,3 million in the second quarter.

The cumulative loss of US$249 000 ballooned to over US$1,1 million after interest (at between 14%-36%) had been added in.

Borrowings had risen to US$8,409 million from US$1,2 million and were on tenures of 30 days to a year. However, following the granting of a US$3 million at 9% from Edcon, the group said it would retire all its expensive debt and look to have paper with a tenure not less than 6 months.

“On a month by month basis, sales rose 136%, and while June had been disappointing, sales were up 14% in July and over 100% in August in a 4-week month. As of Tuesday (Sept 14), sales were up 86% in September,” the group said.

Source: Zimbabwe Independent