NATIONAL Tyre Services (NTS) is optimistic that the new regulations on tax introduced by the government to enforce compliance will minimise unfair competition in the market.
The government recently introduced a raft of new tax regulations to enforce tax compliance on the informal sector, following concerns from the formal sector that not taxing the informal sector was promoting unfair competition.
In a trading update for the third quarter that ended December 31, 2023, the company secretary, Stewart Mandimika, said NTS has put in place measures for sustainability.
“NTS is focused on full business recovery premised on remodelling the business and continued implementation of a raft of cost-cutting measures introduced during the year,” Mandimika said.
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“The volatility of the foreign exchange rate continues to negatively impact price competitiveness in the market. Prices of goods and services increased towards the end of the reporting period due to high festive season demand,” Mandimika said.
“Erratic electricity generation towards the end of the year negatively affected turnaround time in our retreading factories.”
The company’s new tyre sales volumes grew by 19 percent in the quarter under review when compared to the same quarter in 2022 as NTS embarked on various marketing initiatives to improve sales.
Tyre services sales in units increased by 11 percent during the period under review when compared to the prior year with growth premised on improved volume of new tyres.
Mandimika said retreading volumes in the third quarter witnessed a slight drop of two percent when compared to the same period last year due to production disruptions caused by electricity challenges.
Zimbabwe experienced serious power cuts last year, resulting in companies losing production time and shouldering heavy operational costs.
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