Specialty retail and distribution group — Axia Corporation — experienced a rebound in sales volumes for the first quarter to September 30, 2020, thanks to the improved business environment obtaining.
While inflationary pressures remained a concern during the quarter under review, the gradual easing of lockdown restrictions improved trading hours for businesses. Additionally, transacting in foreign currency also helped mitigate liquidity constraints, while the RBZ foreign currency auction system also brought stability on the foreign currency market.
“The gradual easing of lockdown restrictions has improved people movement and business trading hours, resulting to some extent, in a general upswing in recent volumes.
“Volume performance against the final quarter of FY2020 has been very high as retail businesses only traded for eight weeks of the 13-week final quarter of FY2020,” said Axia in a trading update.
At TV Sales & Home, sales volumes closed 48 percent higher than the comparative quarter, which led to significant growth in turnover.
According to the group, the business was holding reasonably good stock balances while it was able to supply the market to meet demand and has opened its 50th branch in Mutare, during the month of October and this is the biggest by area.
“The business has reviewed its credit sales offering and has just launched an enhanced credit product just in time for the ‘Black Friday’ and festive season promotions,” said Axis.
Volumes traded by Distribution Group Africa (DGA) Zimbabwe operations in FY2021 were similar to those achieved in the comparative period and were 52 percent above those recorded for the final quarter of FY2020 reflective of the stability in the volumes traded compared to last year as the period under review was characterised by relative price stability across the value chain.
DGA regional operations recorded mixed performance. In Zambia, first-quarter volumes were 5 percent above those attained in the comparative quarter. In Malawi, first quarter volumes went down 17 percent compared to the comparative quarter but were 41 percent above those achieved in the final quarter of FY2020.
The group attributed the decline in volumes primarily to grey products coming into the market at cheap prices.
Business at Transerv witnessed a decent increase in volumes over the comparative quarter as a result of prices that were relatively stable during the quarter. The business is in the process of re-branding its Midas franchised stores to Transerv and this is scheduled for completion by end of this calendar year.
The ADCO unit will be re-branded to Transerv Diesel Services whilst Clutch & Brake Specialists (CBS) will become Transerv Clutch and Brake.
Going forward, the group is looking at exploring other ways to increase capital funding to match the increased level of business while accessing foreign currency will also remain a key focus area.
Said Axia: “In addition, the group will focus heavily on re-building its volume and revenue bases in the forthcoming period.”