Tough year sees job cuts at online building supplies firm

CMO head office

Revenues fell by 14 per cent at online building supplies firm CMO Group over the last 12 months.

The Plymouth company says it has been tough 12 months as customers continue to be hit by the ongoing cost of living crisis.

Significant cost reductions have been undertaken to offset the impact of the slower than expected start to the year.

This included a headcount reduction to 174 at the end of March, a  15 per cent reduction from the start of the year and more than 30 per cent since the peak.

CMO says it is disrupting a huge, predominantly offline, market with a digital first proposition through the widest range, specialist expertise, and helpful customer solutions.

However, it faced a difficult market backdrop in 2023 which has been well-publicised.

Cost-of-living pressures and higher interest rates impacted demand in consumer markets and the UK experienced the wettest 18-months on record which had a particular impact on the domestic construction sector.

As a result, total revenue for the year fell 14 per cent to £71.5m, significantly impacted by the fall in the Tiles market.

Group revenue was up 59 per cent on pre-covid levels of £44.9m.

Gross profit totalled £14.9m compared with £16.5m in 2022.

The poor weather continued into the first quarter and the tiles market continued to show major decline in both online and bricks and mortar segments.

A multi-point plan is being developed to assist recovery of the tile business and is being implemented by the new management team.

Whilst market conditions are expected to remain challenging, the group is seeing an improving trend and some momentum which is anticipated to continue into the second half of the year.

Dean Murray, chief executive of CMO Group said: “2023 has been a difficult year for all allied to the housing industry. However, whilst CMO is not immune to this, we have focussed our energies on profitable sales and becoming a better, more efficient business which is primed to take advantage of improvements in market conditions when they materialise which we have seen signs of recently.

“We are encouraged that our SUPERSTORES have outperformed the market and that we gained market share in the second half.

“We have a proven business model and continue to deliver on the strategic roadmap set out at the time of our IPO. We remain focussed on successfully navigating what we expect to be another challenging year, but one that is beginning to show some signs of improvement. If that continues, we will benefit and return to growing our sustainable and profitable business.”