NTS to focus on revenue growth

Published: 23 September 2013

NTS Chief Operating Officer Tafadzwa Choto told the AGM on Friday that NTS will continue to focus on revenue growth buttressed by volume growth, focused cost management and management of collections, zfn reported.

Choto said plans are in progress to expand the distribution network although current efforts had been frustrated by what they view as selective application of town planning provisions.

However, he noted, the group is now focusing on alternative models and they are expecting this to bear fruit in the near future.

Choto said the operating environment, whilst quite stable economically they have seen a slowdown in the past couple of months.

"Liquidity conditions also continued to drag effective demand even though the appetite for credit keeps growing," he said.

Choto noted that the market space has also become crowded and they have seen a further increase in the number of traders and tyre brands, some of which are of questionable quality "which compromise road safety".

Choto told the meeting that at the end of the first quarter, revenue was 5% ahead of prior year although earnings were "a little bit behind."

He indicated that cost management initiatives have helped to keep overheads below budget.

He also stated that in terms of volumes the firm's new units have grown by 10% above the same period in prior year "although the sales mix, this time around was more skewed towards the light vehicle tyres."

The trading volumes have also gone up 8% over prior year, and according to Choto, even though they are below budget the negative performance against budget is coming from the shortage of quality casings in the market and people preferring to buy cheap tyres coming into the country.

- zfn

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