OK Zimbabwe announces the release of the analyst presentation for the unaudited results for the six months ended 30 September 2013. Below is a summary of the performance review:
Performance review
- Sales growth of 5.4% (inflation at September year on year was 0.86%; subdued GDP growth)
- decreasing demand caused by tight liquidity and limited disposable incomes
- Gross margin at 16.9% (2012 : 17.0%) – competitive pressure endures and higher consumption of low margin basic items continues. Initiatives continue to improve it through procurement.
- Net Overheads up 5.9%
- depreciation of newer equipment
- advertising and promotional expenses to compete for retail $
- more staff engaged to provide adequate service in improved facilities and broadened product offering. Financial services income is growing.
- more use of the Distribution Centre to supply branches with imported product received centrally
- High cost of utilities
- Cost of security
- Stock holding more than month forecast sales; slowdown in demand
- Capital expenditure $6.3 million (H1 F13: $7.3 million) – timing
- Cash position good – balance $15.9 million (F 13 $15.6 million)
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