The country’s biggest retail group, OK Zimbabwe’s revenue for the first quarter of the financial year 2019 rose 20 percent above same period last year as the group maintains the growth trajectory reported at its year end.
Briefing shareholders at the group’s annual general meeting in the capital last week, chief executive Alex Siyavora said the group was enjoying positive growth over prior year comparable period with performance ahead of budget.
The retail giant runs one of the country’s biggest annual promotion, the Grand Challenge Jackpot Promotion.
This, Mr Siyavora said, significantly contributed to the quarter’s performance.
“The growth reported at the 2018 financial year end is continuing. Revenue growth was 20 percent and it is growing ahead of increases in operating costs and that is good for profitability,” he said.
Like other companies operating in a challenging economy, OK experienced supply problems, but management is upbeat of improvements in supplies which have already been noted.
This should see the firm meet its sales targets for the next quarter as well as maintain the growth in earnings.
Analysts have already projected the retail giant’s revenue for the financial year 2019 to jump 11 percent to $651 million on the back of the anticipated robust performance in the primary sectors that drive consumer market coupled with use of plastic money.
In the financial year 2018, OK’s revenue jumped 23 percent to $582 million on substantial migration of transactions from cash dependent informal sector to the formal sector where use of plastic money has become the order of the day.
Market watchers are of the view the current momentum in the economy will remain in the near future particularly use of plastic money which will have an impact on OK’s performance.
A strong performance in 2019 is also anticipated on the back of loyalty based promotions that have remained key across the retail sector.
Mr Siyavora said the group would continue with its capital expenditure programmes with cash from internally generated funds. In line with this, the group anticipates opening a new OK store in Harare by mid-August as it consolidates its market share.
“We believe the store is in a good location and should generate good sales,” he said.
Currently, the group has 62 stores. Of these, 48 are OK stores, 8 Bon Marche’ and 6 OK Mart stores.