OK’s profit margins improve

Zimbabwe’s largest supermarket chain, OK Zimbabwe, achieved revenue of US$89 million against a budget of US$82.5 million in the three months to June 2011, representing growth of 60 per cent over corresponding period last year.

by Vusimusi Bhebhe
OK Zimbabwe anticipates further growth.
OK Zimbabwe anticipates further growth.

In a trading upmarket issued after the company’s annual general meeting last week, OK said the newly formed OK Mart stores contributed 8.3 per cent to this revenue.

“Efforts continue to improve the profit margins through better sourcing and improved participation of higher margin products. We anticipate continued good growth to half year,” the retail group said.

Gross profit margin has been maintained at 17.9 percent for the supermarkets (17.7 percent if OK Mart is included) against 17.8 percent achieved during the last financial year.

OK acquired the Zimbabwean operations of Makro in February after paying US$400,000 for the South African retail giant’s two shops in Harare and Bulawayo.

The re-branded Makro Stores are now called OK Mart and have at least 20 departments including sport, outdoor and camping, hi-tech, butchery, clothes and textiles, do-it-yourself, stationery and general groceries.

“The OK Mart operation is currently breaking even, but the outlook is improved profitability from July,” OK said.

The group also announced that it was continuing with its capital expenditure programme, with a new Bon Marche’ store to be opened shortly in Westgate Shopping Mall while Bon Marche’ Mount Pleasant would be refurbished by the end of 2011.