Tomei posts 14.7% increase in Q1 net profit

13 May 2019 / 14:04 H.

KUALA LUMPUR: Tomei Consolidated Bhd posted a net profit of RM2.87 million for the first quarter (Q1) ended March 31, a 14.7% increase from RM2.50 million recorded for Q1 2018.

This is despite registering a lower revenue of RM143.33 million against the RM149.95 million in the previous corresponding period.

Tomei managing director Datuk Ng Yih Pyng attributed the increased net profit to the rationalisation measures taken by the group to focus on its deficiencies, yielding better same store growth and better margins from its operations.

“We are cautiously optimistic for 2019, as the business environment is challenging at this juncture, I hope we can remain profitable and do better than last year,” he said told a press conference after its AGM today.

Ng pointed out that for the first five months of the year, the price of gold has been stable with a slight upward movement.

“As far as gold price is concerned, we will pass on (price) fluctuation to the consumers but due to accounting standards it does have a short-term impact on the margins, we believe that it is not a problem in the long-term.”

Meanwhile, Tomei announced that it is converting the four remaining “My Diamond” stores into “Goldheart” and “Tomei” outlets under its portfolio, due to a lot of overlapping among its five brands.

This is in line with the group’ realignment strategy of focusing on the productivity of retail outlet rather than outlet expansion.

“The ‘My Diamond’ brand will probably be absorbed into the group portfolio as a collection line,” said Ng.

Tomei has allocated roughly RM2 million in capital expenditure to facilitate the renovation of the four ‘My Diamond’ outlets.

Prior to the realignment strategy in 2016, the group operated about 70 stores. Currently, it has 58 outlets nationwide under various brands in its portfolio with another outlet scheduled to begin operations in Bintulu, Sarawak next month.

Moving forward, the group expects to open two to three stores a year.

Apart from physical stores, Tomei will also be focusing on its e-commerce presence. At the moment, it has an online presence on major platforms such as Zalora, Lazada and Shoppee, as well as its own online store.

According to Ng, Tomei is investing on its e-store and its sales contribution is on the upward trend with a double-digit growth per annum.

“However, the sales are still small compared to the group. It will take awhile for it to be more significant. I must say the response has been encouraging,” he added.

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