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Business Editor
DEPRESSED demand for clothing and stock movement challenges weighed down on Edgars Stores Limited’s operations which saw profit dropping by 86 percent from $3.9 million to $548 000 during the 52 weeks period to January 8, 2017.

The retail clothing giant’s total revenue also dropped to $52,1 million from 463,9 million, said Edgars in its abridged audited results for the period that was issued yesterday.

Although total assets value plummeted to $47.8 million from $55 million in the comparable period, the firm remains viable with total liabilities at $20,7 million.

“Depressed consumer demand for clothing together with stock movement challenges we faced in the transition period from the old system to the new enterprise resource planning (ERP) solution impacted on our performance in 2016.

“Sales of merchandise for the year at $0.3 million are 19 percent below last year ($62.3m) although collection continued to show strength,” said Edgars.

It said group margins also came down by three percent from prior year due to aggressive mark downs in 2016, the impact of product mix and deliberate “right pricing”.

During 2015 and 2016 Edgars embarked on a highly focused cost cutting exercise, which yielded a $4 million difference in 2016, which affords the firm to move to 2017 with a lean business model.

In terms of retail operations Edgars chain recorded $32,2 million total sales compared to $28 million in 2015 while its Jet chain recorded $17.7 million total sales compared to $19.1 million in 2015.

The company’s manufacturing arm made a trading loss of $0.4 million during the period as a result of reduced demand from group retail operations.

Edgars also said their operations were affected by limited allocations of foreign currency to the productive sector.

On the outlook the firm says it is working on strategic initiatives aimed at laying a solid foundation for the business to achieve profitable growth with projections of improved operations and demand in 2017.