Online building materials CMO suffers from challenging market and poor British weather
Listed online-only building materials firm CMO’s revenue and profits suffer a significant drop over the last financial year as the group blames a “difficult market backdrop”.
CMO Group reported on Friday morning its preliminary results which showed revenue fell by 14 per cent to £71.5m, down from £83.1m – this was across all its focus, building, plumbing and tiles. While its gross profit totalled £14.9m, down from the previous year’s figure of £16.5m.
Its earnings before interest; tax; depreciation and amortisation (EBITDA) was £0.9m, a drop from £2.1m in 2022.
The group stated that it faced a difficult market backdrop in 2023 as cost-of-living pressures and higher interest rates impacted demand in consumer markets. All while the UK experienced the wettest 18-months on record.
However, customer loyalty improved as 65 per cent of orders were from repeat customers, up from 50 per cent in 2022. While it overlayed its longer-term strategy with shorter-term strategic priorities which saw it match headcount to market demand, a cost reduction of 18 per cent achieved.
On the current market view, the group stated that the poor weather continued into Q1, and the tiles market continued to show major decline in both online and bricks and mortar segments.
But its multi-point plan developed to assist recovery of the tile business being implemented by the new management team.
And whilst market conditions are expected to remain challenging, the group said it is seeing an improving trend and some momentum in Q2 which is anticipated to continue into H2.
Dean Murray, CEO 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.”
He added that the group “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,” he added.