Australian e-commerce online furniture and homewares retailer Temple & Webster [ASX:TPW] released its half-year report and suffered a massive 22% loss in the aftermath.
This was due to the online seller revelling a less-than-satisfying turn in the markets as customers return to bricks-and-mortar showrooms and stores post-COVID.
The TPW share price plummeted by early afternoon Tuesday, and at $3.87 a share, the price was half that which it was a full year ago:
www.TradingView.com
Temple & Webster faces ‘most difficult period’
The group harked back to August last year, when it predicted trade for the first half of 2023 was going to be ‘the most difficult period for revenue comparisons’ with the impact of COVID-19 lockdowns reflecting on lifted restrictions and free-walking customers venturing back into the world.
Revenue for the half was down 12% on the same time last year, moving down from $235.4 million to $207 million.
Profit from ordinary activities (after tax) had fallen even further, by 46.7% from $7.3 million to $3.9 million.
As a result of an uninspired half, the company reported no dividends to be paid, recommended, or declared during the current financial period.
TPW says changes to margins, initiatives, and cost management strategies — including a 9% reduction in its workforce — improved its profitability in the half by 11.8%, despite revenue headwinds.
Sales from the 1 Jan to 5 Feb were down 7%, the prior period significantly impacted by strong ecommerce sales during Omicron, while December 2022 sales were up slightly in comparison with December 2021 — a trading period not impacted by Omicron.
TPW’s CEO Mark Coulter said:
‘We remain committed to our profitable growth strategy and will continue our focus on margin optimisation and cost management to ensure we end the year within our 3-5% EBITDA range.
‘We believe our business model, customer metrics, brand and new growth horizons position us well to navigate any trading conditions and return to a high growth business.
‘Furthermore, we have over $100m of cash to expand our roadmap of sales initiatives and pursue inorganic opportunities to support sustainable growth. Longer-term, ecommerce in the Australian furniture & homewares category remains highly under-penetrated, and we have a much larger addressable market to go after in our new target verticals.’
The group’s consolidated expenses came to a total of $32.6 million, slightly lower than the $33.9 million the same time last year as the group dialled back spending to focus on cost management.
Even so, TPW managed to push its Trade & Commercial and Home Improvement segments, which grew 17% and 12%, respectively.
TPW reported cash on hand of $102.4 million, a little above its cash and equivalents from June last year of $101 million.
Source: TPW
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