HARARE – National Tyre Service (NTS) saw a 20% decrease in volume for the three months to June largely impacted by rising prices of goods and services, agricultural inputs, and basic commodities.
In the trading update for the period, NTS said that business operations were negatively impacted as disposable income is now eroded; however, measures being implemented by the government will stabilize the local currency and build market confidence going forward.
Subsequently, the group continues to offer value added services to support retreading customers, and this resulted in a 6% increase in volumes compared to the same period last year.
During the period under review, sales volume for premium tyres significantly grew by 36% as the group implemented effective strategies to serve the market segment.
However, NTS saw a decline in overall new tyre sales volume for the first quarter by 26% to 8 786 from 11 952 and services by 18% to 19 409 from 22 527 compared to same period last year due to foreign currency inadequate affecting importation of tyres from China and India, and power outages affecting branch operations.
The group said, “key economic drivers were affected by global inflation driven by tensions in Eastern Europe. NTS recorded growth in premium new tyres and retreading volumes during the period under review, premised on availability of market driven products”.
Looking ahead, the introduction of the Mosi oa Tunya gold coins by RBZ will help NTS since it is meant to stabilize the local currency and build confidence in the market. This will increase the disposable incomes and impact NTS positively in the business operations.
The Listed NTS on the Zimbabwe Stock Exchange has its last trading price at ZWL 1 175.00c. The stock has a year-to-date gain of 86.51%, which is below the current inflation rate and has a market capitalisation of $4.75 billion.