Edgars HY2023 Financial Results

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October 15, 2020


I am pleased to present the Edgars Stores Limited Group financial results for the 52 weeks ended 5 January 2020. The commentary on the financials is based on the inflation adjusted numbers. The historical numbers are shown as supplementary information as they have not been prepared in compliance with International Accounting Standard 29 – Financial Reporting in Hyperinflationary Economies. No opinion has been expressed by the auditors on the historical financial information.

Financial Overview

The Group’s turnover decreased by 5%, from ZWL$ 629m in the previous year to ZWL$ 595m in the current year, despite a 23% decrease in units sold. Revenue performance for the last quarter, which is usually our peak turnover period, performed below expectation mainly due to subdued consumer spending in general and challenges with mobile payment platforms. Profit after tax for the period was $17.9m, an 81% decrease from $91.8m in the same period last year. The business continues to prioritise cost containment.

The Group closed the year in an overstock position but this was fresh stock and placed the Group at an advantage for first quarter trading.

Retail Operations

Edgars Chain

The chain recorded turnover of $390m (2018: $368m) out of 26 stores (2018: 25) an increase of 6%. Units sold for the year were 1.399m (2018: 1.736m), a decrease of 19.4%. The chain’s profit to sales ratio declined to 24.1% from 27.3% in 2018. Edgars Kadoma was re-opened at a new site in November 2019, having burnt down last year.

Jet Chain

Total sales were $218.7m (2018: $245.2m) out of 27 stores (2018: 25) a decrease of 10.8%. Two new stores were opened in Banket and Chegutu. Units sold for the year were 1.797m (2018: 2.483m), a decrease of 27.6%. The Chain’s profit to sales ratio declined to 19.6% from 22.8% in 2018.

Credit Management

The quality of the Group’s debtor’s book is good with 3.0% of the book over 30 day due and 75.5% being current as at end of the year. Total active accounts were 150 817 (2018:151 522).

Edgars Chain debtors were $73.7m (2018: $123m) after an allowance for credit losses of $0.2m (2018:$3.1m). Bad debts written off net of recoveries for the period averaged 10 0.6% (2018: 1.8%) of lagged credit sales, and 0.1 % of lagged debtors (2018: 0.1%). Edgars chain active accounts as at end of December were 98 795 (2018: 102 159). Jet Chain debtors were at $20.4m (2018: $39.1m) after an allowance for credit losses of $0.1m (2018: $3.2m). Bad debts written off net of recoveries for the period equated to 0.8% (2018: 1.4%) of lagged credit sales, and 0.2% of lagged debtors (2018: 0.5%). Jet Chain active accounts as at December 2019 were 51 619 (2018: 49 548).


The factory made an operating profit of $12.6m (2018:$1.8m loss). 6% (2018: 8%) of sales were exports while 94% (2018: 92%) were made to the Edgars and Jet chains.


The microfinance business revenue declined marginally to $12.4m from $12.8m, making a profit after tax of $924k (2018: $640k loss). Loans to customers declined to $6.5m (2018: $27.1m) after an allowance for credit losses of $0.05m (2018:$0.5m).

The quality of the loan book was also good with 3.5% of the book over 30 day due and 83.5% being current a at end of December 2019. Total active loan accounts as at the end of December 2019 were 11 314 (2018: 8 111). The net loan book was $6.45m (2018: $26,6m). Bad debts written off net of recoveries for the period averaged 0.3 % of loan book (2018: 0.3%).

Financing and Cashflow

Gearing was at 0.20 (2018:0.22). The Group had US$ 219,036 in foreign liabilities as at 5 January 2020.

Executive movements

Mrs. Buhlebenkosi Mpofu leaves the Group at the end of May 2020 to pursue other opportunities after having served the Group for four years, one of which was as the Chief Finance Officer. We wish her well in her endeavours and thank her for her contribution during her tenure of service to the Group.


The tough operating environment continues to impact negatively on the Group’s growth strategy. In particular, Covid-19 pandemic, hyper inflationary The Board welcomes the new shareholder, SSCG Africa Holdings, who bought Bellfield (Pty) Limited, the Group’s major shareholder from Edcon, during the year 2019.


Owing to the impact of Covid-19 pandemic, your Company will not declare a dividend this year.


The year has seen a very challenging operational environment for the business. I take this opportunity to thank fellow Board colleagues, management and staff for their achievements in the period under review. Similarly I extend my appreciation to our loyal customers as well as our landlords, bankers and suppliers for their continued support.


Related download
Edgars 2019 Annual Report