Meikles profit after tax surges to 467pc

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John Moxon

Enacy Mapakame
Diversified group, Meikles Limited’s profit after tax for the half-year to September 30, 2018 surged 467 percent to $15,3 million, surpassing the $7,7 million result for the full-year ended March 30, 2018 by 99 percent on the back of growth across the firm’s business units.

Revenue for the period grew 30 percent to $330 million compared to $254 achieved in the same period in the prior year, thanks to the supermarket business.

Earnings before interest, tax, depreciation and armotisation (EBITDA) rose 107 percent to $31,5 million from $15,2 million reported in the comparable prior year period.

The supermarket business grew at a faster pace compared to other segments after revenue grew 32 percent to $306 million making the biggest contribution to group revenue followed by agriculture and hotel that contributed $16 million and $10 million respectively.

Executive chairman, John Moxon, said revenue growth at TM Supermarkets, trading as TM P n P was buoyed by growth in number of units sold.

At $21 million, the unit’s EBITDA rose 65 percent while its profit after tax jumped 107 percent to $13,9 million from comparable period’s $6,7 million.

The group is undertaking some refurbishment works at the TM P n P branches, which should be completed before commencement of the festive season.

At Tanganda, revenue grew 22 percent to $15,7 million on volumes growth. Bulk tea production rose 26 percent to 3 886 tonnes. During the period under review, average international bulk tea exports price was $1,68/kg compared to $1,65/kg in the same period in the prior year.

Macadamia nuts sales volumes grew 70 percent to 374 tonnes. At $4,82/kg, average price for macadamia nuts was 16 percent above comparative prior year period. Profit after tax at Tanganda jumped 833 percent to $5,6 million while EBITDA grew 180 percent to $8,4 million.

The hospitality segment achieved an 18 percent increase in revenue to $10,3 million on improved business. Both Meikles and Victoria Falls hotels recorded growth in revenue per average room (RevPAR) of 35 percent and 5 percent respectively underpinned by both growth in occupancy and average room rate.

After tax profit for the hospitality segment achieved a 175 percent growth to $1,4 million while EBITDA rose 62 percent to $3,4 million.

The group expects to start refurbishment of the Victoria Falls Hotel during the last quarter of the current financial year.

During the period under review, Meikles Mega Market operations closed due to capital constraints.

EBITDA for the period was $1,2 million loss and the group is working on new store models. The group anticipates to maintain the growth achieved in the first half going forward.

“The trend of greatly increased profit earned in the six months of the current financial year has continued into the first period of the second six months,” said  Moxon.

Meikles has declared an interim dividend of 1,2 cents a share.

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