Photo by: Duane daws
After some years of static growth and marginal declines, and now in its fortieth year of operation, JSE-listed Verimark on Tuesday reported “one of its best” financial outcomes for the year ended February 28, aided by sales price increases and the strengthening of the rand.
Verimark’s headline earnings and headline earnings a share surged more than 200% to a respective R25.9-million and 24c apiece for the year under review.
Basic earnings a share for the 2017 financial year increased 207.7% to 24c, compared with 7.8c in the prior year.
The Michael van Straaten-led Verimark declared a dividend of 11.3c a share for 2017 – 205% up on the 3.7c declared in the prior year.
The group’s revenue edged up 1.9% to R439.1-million in 2017, from R430.8-million in the previous year, Verimark FD Bryan Groome said during a presentation at the group’s Randburg headquarters on Tuesday.
Profit before tax increased from R13.1-million last year to R37.3-million during the year under review, while operating profit jumped 101.1% to R35.8-million.
“The volatility of the rand was a concern for all importing retailers, with an exchange rate of R16.14 to the dollar at the start of the financial year, largely owing to the external and political factors that contributed to a tough first six months’ trading,” Van Straaten added.
It became necessary for Verimark to increase its selling prices in mid-February 2016, hitting sales in the first half of the year.
However, the strengthening of the rand against foreign currencies in the half of the year resulted in a positive impact on import-related businesses and retail as a whole, which was complemented by cost containment, new products, operational efficiencies, improved use of working capital and overall efficient cash management.