8th Jan 2024 09:21
(Alliance News) - CMO Group PLC on Monday saw shares sink after "ongoing economic challenges" to the construction sector hampered its yearly results.
Shares in the Plymouth, England-based online building materials retailer fell 13% at 24.00 pence each in London on Monday morning.
Sales for the year ended December 31 are expected to be broadly in line with expectations at around GBP71.5 million. This represents a 14% drop from CMO's 2022 revenue of GBP83.1 million in 2022.
Adjusted earnings before interest, tax, depreciation and amortisation is expected to be around GBP1.0 million for the full year, halved from GBP2.1 million a year ago.
CMO attributed these results to an ongoing discretionary consumer spending lull, leading to below average order volume in late 2023.
However, the company said that it remains "well financed", and reported a cash balance of GBP4.3 million compared to GBP6.2 million in 2022. Net debt at December 31 was GBP1.0 million.
CMO added that operational progress had improved gross production margins by 1% and that it has launched its latest landscaping superstore at the end of December.
The group's full-year results are expected to be announced at the beginning of May.
CMO Chief Executive Officer Dean Murray said: "We are continuing to deliver on our strategy to disrupt the traditional market and our strategic priorities. Our success in launching vertically integrated websites, most recently landscapingsuperstore.co.uk, continues to drive penetration and takes advantage of our differentiated proposition with unrivalled breadth of product range, supported by expert customer service. With macroeconomic headwinds continuing to impact the construction sector, we proceed with caution for the outlook for full year 2024, but remain confident in our model and strategy to take the business forward, and our ability to deliver profitable progress."
By Hugh Cameron, Alliance News reporter
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