OK Zim sales dip 11% in third quarter
RETAIL Group, OK Zimbabwe Limited has recorded sales volume decline of 11.33 percent for the third quarter ended 31 December 2022 attributed to the decline in consumer spending.
The quarter was characterised with high annual inflation rates and liquidity constraints, resulting in dampened consumer demand.
Despite the decline in volumes, there was a revenue growth of 18.3 percent for the quarter and 28.4 percent for the nine months in inflation adjusted terms. The profit margins of the Group remained consistent with the prior year.
However, excessive power outages increased operational costs for the business as the Group heavily relied on generators and other alternative power sources.
Meanwhile, the Group said it was investing in volume recovery plans that have resulted in a growth of 3 percent recorded in December 2022.
“The Group continues investing in volume growth strategies embedded in various strategic projects which have a high potential to contribute to growth and improve the overall business performance in the last quarter of F23 and the coming financial years,” the Group said.
OK Zimbabwe finalised its acquisition of Food Lover’s Market and its subsidiaries in January this year as part of its volume growth strategic projects.
“Three stores namely Food Lover’s Market Avondale, Borrowdale and Bulawayo were added to the OK Zimbabwe Limited table and whose performance will be included in the final quarter of the Group’s financial year,” said the retailer.
The company also opened their first in-store pharmacy that operates in Glenview, trading under the Alowell Pharmacy brand.
Although the Reserve Bank of Zimbabwe reviewed interest rates down from 200 percent to 150 percent the operating environment remains fragile subject to policy changes.
Going forward, the Group urged the authorities to provide more incentives for productive sectors to invest in growth projects and stave off current operational cost increases necessitated by power shortages and exorbitant fuel costs.