The ManicaPost
A strong performance from Pick n Pay and its sister grocery retailer TM Stores saw Meikles Limited record a 10 percent growth in turnover in its supermarkets segment.
According to a results statement released by Meikles executive chairperson John Moxon, the supermarkets segment – made up of Pick n Pay and TM – posted an excellent set of results for the financial year ended March 31 2016.
“Turnover for the year grew by 10 percent to $395,3 million relative to the prior year,” said Moxon before adding that customer count had increased by 7,6 percent, leading to growth in units sold of 12,6 percent.
Moxon said the positive results came in an environment characterised by a number of impediments, mainly “sluggish” economic conditions and deflation in food prices.
“Despite the depressed macro-economic environment throughout the financial year, the average basket size increased by 3 percent in the current year,” said Moxon.
“This is an indication that customers are spending more in our stores with competitive and unique promotions,” he added.
These results came at a time when the retailer’s major competitor OK Zimbabwe reported a 5,44 percent drop in turnover to $437,5 million for the same period.
Meikles Africa runs hotels, agricultural processing and Tm Supermarkets, a retail division in which South Africa’s Pick n Pay has a 49 percent stake.
Zimbabwe’s economy is struggling, with economic performance declining and purchasing power wilting owing to companies scaling down operations and cutting salaries for employees.
Retail operators have also been forced to lower their profit margins and are required to pick half their stock from local suppliers.
Referring to the dispute between Meikles and the Zimbabwe Stock Exchange, the company said in a statement early this year: “Shareholders are advised that a basis on which funds are to be recovered has been agreed. The government has undertaken to repay the outstanding funds in terms of the Reserve Bank of Zimbabwe Debt Assumption Act.
“Negotiators in both government and the company are to be commended on the conclusion of the agreement,” Meikles said, giving no further details.
However, the company has previously said that the government was settling the money it owes the company through issuance of treasury bills.
Zimbabwe’s debt market is tainted by uncertainty over the ability to honour long-term borrowings at a time when the Government is struggling to meet its regular obligations – such as civil servants’ salary payments on time.
Despite the worries over the Zimbabwean VAT tax on the tourism industry, trading in the Meikles’ hoteling division during the year to March 31 2015 was described as “satisfactory”.- Fin24
