The Furnamrt revenue for the financial year ended 31st July 2014 amounts to P1.15 billion, a 7 percent increase from last year’s P1.08 billion.
The company said difficult conditions continued to prevail in the market, adding that the group’s prudent view with regards to providing for doubtful debt, especially given the performance of its competitors in the region, led to higher impairments which resulted in only a marginal increase in core operating income.
Profit after tax for the year is materially lower than last year as a result of an increased exchange loss and higher tax expense.
Financial statements signed by the Group Chairman John Mynhardt, indicated that the exchange loss on net receivables is substantially higher at P20.0m as compared to the exchange loss of P10.6m reported in the prior year. The foreign exchange loss was the result of the continued strengthening of the Pula against the South African Rand, Namibian Dollar and Zambian Kwacha during the year.
“As the foreign operations become a bigger part of the business, foreign exchange fluctuations will have a larger potential impact on results,” reads the statement.
FurnMart says the income tax expense is substantially higher at P36.9 million as compared to P18.9 million in the previous year. It is said to be mainly on account of the de-recognition of the deferred tax asset as the uncertain market conditions in RSA are likely to postpone the timeframe for recovery of the deferred tax asset and an increased tax charge in Namibia when compared to the previous year.
“The Group opened 2 Home Corp stores and 4 Furnmart stores during the period under review. Botswana, Zambia and Namibia stores have been converted to the new IT platform. The South African stores will be converted early in 2015,” reads the statement.
The Group has also indicated that it will benefit from its investment and other initiatives to enhance efficiencies in areas of in-store operations, reporting, credit follow-up and credit granting. It is also expecting the difficult trading conditions in the credit retail market to continue during the new financial year.
A close at the group’s gross final dividend of 0.72t per share was declared on 12 November, 2014 and is payable to shareholders registered on 5 December, 2014 for payment on 17 December, 2014.