RETAIL and distribution company Axia Corporation said on Monday it suffered a marginal inflation adjusted decline of one percent in revenue for the full year ended June 2020 to ZWL$7.85 billion, after being hit by hyperinflation, which has reduced consumer purchasing power.
“The impact of inflationary price increases negatively affected demand, thus, turnover volumes were below those traded in the prior year resulting in a decline in revenue,” said chairman, Mr Luke Ngwerume.
The company, which is made up of appliances and furniture retailer TV Sales and Hire, Distribution Africa Group and motor vehicle parts and repairs firm Transerv, said its net profit jumped to $636.6 million from $108.2 million.
A historical final dividend of 19.16 cents was declared bringing the total dividend for the year to 23.76. Basic earnings per share jumped to 63.84 from 10.75 owing to improved profitability. In terms of divisional operations, TV Sales & Home’s turnover was 11 percent below prior year while Transerv saw volumes go down by 38 percent as a result of Covid-19 forced closures for the better part of the period.
Three new TV Sales & Home stores were opened in Harare, Rusape and Victoria Falls. Axia increased its shareholding in Transerv from 26.01 percent to 50.51 percent with effect from 1 January 2020, a stake acquired for US$900 000, Ngwerume said.
Distribution Group Africa saw its Zimbabwean operations record a 16 percent decline in turnover due to stiff competition while those in the region outside recorded an 11 percent growth in revenue.
“The growth in turnover was contributed by the acquisition of new distributorship agencies like Nestle and Blue Band in Zambia and the addition of Pro Group and Blue Band distributorship agencies in Malawi,”
Mr Ngwerume said. Axia Corporation is a subsidiary of conglomerate Innscor Africa.