The Board of Directors is pleased to release the Edgars Stores 2018 Annual Report. Below are some excerpts from the report:-
Foreign currency shortages necessitated an import substitution program which, through the efforts of our sourcing teams, was largely successful. Despite these endeavours, local production was somewhat erratic due to the inability of our suppliers to source inputs. Imported product lines which could not be sourced locally such as cosmetics, shoes and lingerie, were more severely affected.
Despite the difficulties, trading conditions during the first 9 months of the year were good.
Mark-up action to protect stock-outs was necessitated in October when fears of a return to hyperinflation left customers frantically seeking value. Our prices did not go up by as much as some but still had the effect of dampening demand and reducing volumes. Edgars and Jet chain unit sales for the last quarter declined by 37% and 33%, respectively. Being our strongest quarter, (including the festive season) this had a negative impact on annual volumes.
While we could have achieved a better top line with improved assortments of imported lines, this proved impossible due to the constraints mentioned above, and Group revenue grew by 22% on last year to $78.1million (2017; $64.1m). Group retail unit sales declined by 11.4% for the year.
Profit for the period of $8.5m was 114% higher than the prior year ($3.98m) partly due to increased margins in the last quarter. Group margin improved to 46% (2017:43%). In November our two Kadoma stores, which premises were under lease, were destroyed by fire. Efforts are underway to reinstate both operations.
In the short term, we look forward to customer incomes being assisted somewhat by salary increases. In the longer term we look forward to the promised fiscal discipline and reforms delivering foreign investment and job creation. We will intensify our efforts in working with local suppliers to develop and improve the quality, fashionability and, importantly, on-time-delivery of wanted product.
The Board has declared a final dividend of 0.5 cents per share to shareholders reflected in the company's register on the record date being 3 May 2019. Shares will trade cum-div until 30 April 2019 and ex-div from 1 May 2019. The payment date is on or about 31 May 2019.
Shareholders will have an option to receive their dividend wholly in cash or take their dividend entitlement in the form of shares. The offer price to the shareholders has been determined by the share price on the date of the first interim announcement.
Details of the maximum number of shares each shareholder is entitled to and the procedure to be used in electing to take up this scrip dividend offer are set out in the form of election which will be posted to shareholders.
I am grateful to Board colleagues, management and staff for their dedication. I am also grateful to our customers for their loyalty and our landlords, bankers and suppliers for their continued support.