Upholstery group TCM Living has reported a decline in its first quarter with sales within its British division.
According to its latest trading Q1 2023 update, TCM Corporation, the parent company of TCM Living, which houses UK brands Alstons, Ashley Manor, Alexander & James and AMX Designs, said that total sales were down 16.5% to 1,999.30 million baht from 2,394.40 million baht.
EBITDA was 119.77 million baht, decreased from the previous year by 25.74%. Net profit recorded at 11.30 million baht compared to the net profit of 54.02 million baht in the previous year.
The group said that TCM Living met its targets for Q1/2023, but extra income and backlog orders from 2021 contributed to better-than-usual performance in Q1/2022.
Sales were down 29.36% to 1,277.47 million baht (£30.2m) from 1,808.48 million baht (£42.8m). Revenue contribution by TCM Living was replaced proportionately and stood at 63.90% in Q1/2023 compared to 75.53% in the year earlier.
The group said: “Q1 revenue reduced by 29.36% over prior year, reflecting the unusually high Q1/2022 order book that was driven by increased and pent-up demand following shipping delays experienced in the latter part of 2021 post the pandemic. Despite orders being challenged by cost-of-living crisis, the Q1 revenue levels achieved in FY2023 are in line with management expectation.
“Gross Profit contribution of TCML reduced from Q1/2022 due to lower volumes but the margins achieved increased from 16.95% as reported in the previous year to 21.66% this year. This increase reflected improved manufacturing efficiencies being achieved along with the benefit of normalised container prices positively affecting the import side of the business.
“Selling and administrative expenses increased by 6.72% over prior year due to cost-of-living increases and inflationary pressures. Once again, these costs were within management expectations. The group also incurred 20.20 million baht or £490k re-organisational costs (One-time costs) relating to the consolidation of manufacturing sites which will realise significant savings over the remainder of the year and in future years.
“After the deduction of one-time costs, financial costs, taxes and exchange rate movements, the Group returned a net profit of 7.07 million baht. Decreased by 92.39% from the net profit of 92.88 million baht in the same period of the previous year. The EBITDA was 60.73 million baht, decreased by 60.43% compared to the same period of the year 2022.”