Building retailer sees profits hit by fall in consumer spending
Online building supplies retailer CMO say sales are continuing to be hit by the fall in consumer spending.
The Plymouth business has published its interim results for the second half of the year and has admitted conditions remain challenging.
Total sales were down from £41.9m to £36.9m and company had an operating loss of £500,000 compared to a £5000,000 profit in the same period last year.
The company said over the past six months, in line with its strategic priorities, it has delivered improvement in product margins, delivery costs and overhead efficiencies.
The group said it delivered a positive performance during the first half against its strategic key priorities aimed at driving profitable sales growth for the future.
Like-for-likes indicate that CMO is now outperforming the market with a more encouraging trend in the SUPERSTORES.
Volumes in the building materials market are down by 14 per cent in the first seven months of the year and forecasts for 2023 from the Construction Products Association, published in July, report a reduction of 19 per cent in newbuild housing and 11 per cent in private housing.
Consumer confidence has continued to erode with increasing interest rates and persistent high levels of inflation.
The board said that actions taken to increase margins, reduce costs and invest in enhanced digital marketing will maintain the improving sales trend and deliver profitable sales growth going forward.
Chief executive Dean Murray said: “Like many others in our industry, our experience of this period has not been easy, especially with the tile market rebalancing online versus in-person.
“We are however, seeing an improving trend in our SUPERSTORES endorsing again our business model and strategy. In the midst of difficulty lies opportunity and we have embraced our opportunity wholeheartedly, improving margins, reducing costs and working towards the next organic vertical launch. Consequently, we are a better business and in good shape to go forward.
“We remain confident in our model and in our strategy to take the business forward and to deliver profitable progress.”