SINGAPORE - Furniture maker Koda is teaming up with Singapore trade development agency International Enterprise (IE) Singapore to double the presence of its Commune brand in China and expand into other regional markets.
The company announced this as it reported net profit slipping 5.1 per cent for its second fiscal quarter amid delayed export shipments.
Net earnings stood at US$993,000, or 1.53 US cents per share, for the three months ended Dec 31, 2017, from a year-ago profit of US$1.0 million, or 1.97 US cents per share. For the six months to end-2017, net profit was up 26.2 per cent to US$2.4 million, or 3.71 US cents per share.
Koda is declaring an interim dividend payout of 0.25 Singapore cent per share. The interim payout the year before was 0.17 Singapore cent per share, adjusted for changes in the number of issued shares.
Revenue fell 11.8 per cent for the second quarter, to US$11.9 million on lower export sales amid delayed shipments to key markets, said Koda, which counts the United States as its largest export market.
Sales of in-house brand Commune, however, grew during the period. The higher revenue contribution by Commune also helped gross profit margin to improve by five percentage points, to 34.8 per cent from 29.8 per cent.
Looking ahead, Koda expects to be profitable in fiscal 2018. The company is planning an "aggressive expansion" over the next two to three years in China, where there are 43 Commune stores. Koda also plans to introduce Commune to new markets within Asia in 2018.
In a joint announcement with IE Singapore on Tuesday (Feb 13), Commune said that it is targeting more than 100 outlets in China by 2020.
IE Singapore will work with Commune to expand into Indonesia, Taiwan and Thailand, while also supporting the development of a digital platform to complement Commune's physical presence."With the support of IE Singapore, we intend to increase sales and knowledge of our customers through digital marketing and analytics, while ensuring a seamless shopping experience online," said Commune sales and marketing director Gan Shee Wen.
Lee Yee Fung, IE Singapore's group director for the lifestyle business group, said: "The retail landscape has evolved beyond simplistic online or offline models. Progressive retailers have been systematically adding features and services at their various touchpoints to build a seamless end-to-end experience for customers... We encourage other Singapore retailers to start their digital journey to strengthen their competitiveness."