HARARE, September 30 (The Source) – Clothing retailer, Edgars Stores’ profit plummeted by 90 percent in the six months to July from $1,1 million last year to $109,000, weighed down by retrenchment costs and low sales.
Revenue dipped by 23 percent to $23 million.
The group cut jobs and restructured its business model to lower operating costs.
“These initiatives have resulted in extra once off costs amounting to $ 0,9 million being incurred…Further retrenchment costs have been incurred in the second half of the year which period the exercise was completed at a total cost of $1,4 million,” said group chairman Themba Sibanda in a statement accompanying financial results on Friday.
Sales were 23 percent down to $22 million, with Edgars dropping 31 percent to $14,5 million. Jet sales marginally dropped 2,8 percent to $7,7 million on the back of credit accounts which now make up at 47 percent of the chain sales.
The manufacturing factory made a loss of $300,000 and the introduction of Statutory Instrument 64 of 2016, which restricts importation of fabric, affected its output.
The group reduced its borrowings by 34 percent to $15,4 million. During the half year period Edgars spent $1,3 million on capital expenditure. Total assets declined by nine percent to $50 million.