OK Zimbabwe's Q1 revenue growth below budget, says Zireva

Published: 19 July 2013

OK Zimbabwe achieved revenue of $123.1 million which was a growth of 5.1% over same quarter of F13, CEO Willard Zireva told the AGM this morning.

"This was slightly below our rather aggressive budget which took into account anticipated national GDP growth of 5%. It is generally accepted that the country may actually have experienced zero growth or negative growth during the period," he said.

Zireva noted that OK Mart growth was slightly below the company average mainly affected by lower sales in liquor.

Gross margin for the period under review was maintained at almost the same level as in the last financial year.

"Management continues in their efforts to improve the margin through better sourcing," added Zireva.

Furthermore he stated that the focus on effective control over shrinkage continue as well as tightening the management of other overheads.

He said profit growth for the quarter is in line with sales growth "but this should improve as we go forward with all the initiatives which are in place or being worked on."

Commenting on the arrangement with South African company, Kawena (Pvt) Limited, Zireva said; "This arrangement has very exciting opportunities. In addition, we have gone into a distributorship arrangement with blanket manufacturer, Aranda from South Africa and this should add value to the company."

Zireva added that the move into financial services is in full steam and more offerings will be made and these will enhance revenues.

He noted that store refurbishment and other capital expenditure programmes continue with funding from cash generated from operations.

"The company has opened two new outlets in Q1 that is Wynne Street and Chitungwiza town centre but will be moving out of the small Rezende Street outlet end of July," he added.

Building work is in progress in Hwange and the firm is targeting to open by end of September while work is in progress to move to bigger space in Eastlea.

"Refurbishments are planned for OK Waterfalls, OK Bindura and Houghton Park and partial refurbishments for OK Gweru and Mutare," he added.

Directors' fees of $127 660 was approved while auditors Deloitte & Touche were reappointed with fees of $100 000 for audit also ratified.

- zfn