Powerspeed said trading recovered during the first quarter ending December 31, 2022 as compared with the previous quarter, which was not good.
In a trading update, the company said, “The group traded profitably resulting in an 8.7% growth in Shareholders’ Funds during the quarter.”
According to the company, inflationary pressures continued to push up the real costs of basic household expenses resulting in reduced disposable income and therefore less expenditure generally, including hardware products effectively shrinking the potential market.
“The resultant shrinking market has increased competitive pressures as we all fight for our share and inevitably means shrinking margins,” Powerspeed said.
The company acknowledged that controls limiting pricing ratios between ZWL and USD continue to make it expensive for customers with USD to purchase from formal retailers such as ourselves.
Powerspeed said, “This is a further incentive which is driving business from formal to informal trade, this is having a negative effect on all formal retailers, and we are no exception.”
Shortages of locally made products in general, but in particular cable, also had a negative impact on their business. Despite all these difficulties, trading volumes were up on the prior year and profitability was steady.
In December 2022 Powerspeed opened its newest and biggest branch in Avondale in Harare and the throughput there has been pleasing.
“As always, we will continue to pursue new markets, expand our branch footprint, and develop our sourcing of products directly from the best manufacturers globally,” the update said.
Powerspeed said they are confident that the economic future of Zimbabwe is positive, given the anticipated investment in mining, steel production and agriculture amongst others. As a result, the company is very optimistic about their prospects for the future – Harare