Brand loyalty key in tough times: Nictus

The furniture, motor and carpet retailer reported solid results for the year ended March, with headline earnings per share rising to 29.12 cents from 19.05 cents previously.

Nictus, who operates in SA and Namibia, said that disposable income had increased positively and the indices on the JSE performed in favour of its investments.

The group said the 12 month period since its last annual report had been a very exciting time with milestone achievements such as surpassing the previous year's record performance to reach a profit attributable to shareholders of more than R15 million, reaching its goal of almost one billion rand assets under management, accepting total responsibility for General Motors in Namibia and opening a furniture outlet in Soweto in SA.

The company's furniture and motor segments showed a 30% and 44% growth in revenue respectively, which was remarkable when compared to similar industries in SA and Namibia.

It said that 54% of the growth in the motor segment came from the increased market share through the GM Agencies in Namibia.

"In the past year, Auas Motors has become one of the sixth biggest accounts of GM in Southern Africa," Nictus said.

However, it noted that recovery of the motor trade in SA, and the after effects of the tsunami in Japan, were bound to have a negative impact on availability of stock of new vehicles and spares.

The group also upgraded its furniture outlets and said that the sound management of especially the debtors book had eventually culminated in the exceptional performance of the furniture segment.

Its chairman, JL Olivier said that Nictus had reached a stage where its success was no longer dependent on one or two persons, but on a solid asset base and the remarkable team of executive directors and top management, who lead from the front.

Looking ahead, it said trading conditions were expected to remain difficult, while external factors such as oil prices and food inflation affected its target markets.

However, Nictus added that it had an experienced and focused management team that was committed to maintaining the sustainability of the group.

"Brand loyalty plays an increasingly important role in tough times, and the group has a portfolio of well established brands with a loyal customer base," it added.