FURNMART PROFIT TUMBLES DESPITE RISE ON SALES

The revenue for the furniture retail group, Furnmart, for the full year to June 2023 is up, although the bottom line is down. This is on the background of tough trading economic environment which has reduced consumers’ disposable income. For the period under review, profit after tax closed at P 58.4 million, down compared to P64. 6 million reported the same period last year. Nonetheless, revenue stood at P1.5 billion, up 8.4 percent when compared to the previous reporting period. “Sales growth was primarily driven by inflation.

The pressure on the consumer’s ability to spend on non-essential durables. Gross profit margins declined, compared to the prior period. Lower shipping costs and lower supply chain inflation have started to filter through as anticipated, and as a result, during the second half of the financial year, gross profit margins improved,” said company directors. The higher gross profit, achieved through an increase in sales, was partially offset by increases in expenses and higher debtors’ impairment costs. An increase in total debtors’ costs was primarily due to an increase in the impairment provision, mainly attributed to the growth in trade receivables. Furnmart, which was once listed on the BSE, said it believes that the impairment provision is at an adequate level.

“The Pula remained strong and gained against the Rand during the financial year. As a result, the Group realised an exchange loss of P9.6m, compared to an exchange gain of P2.9m in the prior year,” said the company which operates in Botswana, Namibia and South Africa.