Furniture group, Furnmart Limited has announced that it expects more than 10 percent increase in its half-year results ended January 2017 than the previous period. This will be good news to shareholders, who last year watched by as the BSE listed group closed its operations in Zambia among others stores, citing poor performance. However, it will seem the move was not a bad one after all, as positive results have started to trickle in.
In a published statement signed by Furnmart Managing Director D S le Roux, the company advised shareholders to exercise caution when dealing in its ordinary shares until announcement of the results is made. In the same period last year(H1:2016), the group recorded P4,4million as profit, a massive 89.3 percent decline in profits due to weak currencies in South Africa and Namibia. Revenue for the previous period amounted to P622.2 million, a decrease of 5percent while the operating income of P75 .1 million was 1.3 percent lower than the prior period.
Furnmart Limited retails domestic furniture and electrical appliances through its network of stores in Botswana, South Africa and Namibia.
In the 2015 annual report released last year, the group said it expects trading conditions in the region to remain subdued for the foreseeable future.
“The economies in the region continue to be impacted by high unemployment, low consumer confidence and high levels of indebtedness.
“Maintaining real sales growth will present challenges in the short term especially given the group’s stricter credit granting criteria,” stated the management report. However, the group said despite the negative economic outlook, management believes that opportunities still exist for growth.
“The group will continue to invest in new stores in the region,” it said adding that many of these stores will be in South Africa. “The group will however be very selective with site location and capital commitment,” states Mynhardt in the report.