Safari has posted a good set of results again. Operating Leverage impact is apparent. The good thing is the growth in the gross margins which is a good sign in a competitive environment. YoY it has improved from 41% to 46% and Q42018 it is 47%. The Operating Margins have also improved from 7.28% to 10.16%. There is an all round improvement in margins.
The topline has grown more than the industry average (15%) at 21% YoY and 29% QonQ. VIP which usually publishes results before Safari has opted for the first time to publish results after Safari ( VIP results are tomorrow ), so one must compare performance against VIP. The growth in sales has clearly been driven by aggressive WC investments which have gone up from 112 days to 157 days so that is something to ponder over and a negative.
The incremental ROE is 15.6% which is ok and still needs a lot of improvement
All in all , its an aggressive performance in a competitive market.