By Chris Nicholls
MELBOURNE: Sunbeam has increased its market share and posted double digit growth for FY08, according to parent company GUD Holdings’ latest results.
While GUD Holdings makes a point of not releasing specific numbers for Sunbeam, the umbrella consumer products division posted final earnings before interest and tax (EBIT) of $38.8 million, up 49 per cent on FY07.
Total profit for the company was up 11.1 per cent on last year to $37.4 million.
Speaking to Current.com.au, GUD Holdings managing director, Ian Campbell, said some of those figures came from strong heating product sales, with electric blankets selling at “a pretty staggering rate” due to the continued cold weather at night.
Campbell said while the company had suffered some “significant cost increases”, as forecast in May, the rising Australian dollar had shielded the company from the worst of the effects.
For the coming cooling season, Campbell also said Sunbeam would increase its range with new tower fans, part of a strategy to increase its share in the competitive market.
“We’re only on the fringe of cooling, and it’s just with fans, and it’s something that’s not a big part of our business, although I think our plans are to get a little stronger in that sector.
“Sunbeam’s had to look for some new activities, some new categories, because we’re pretty much in every category other than vacuum cleaners, so cooling is of interest to us, and the brand carries well on household electrical,” he said.
Campbell also said while the economy was “fairly dire”, the company had had a strong July.
“I have got no doubt that we are going to come under pressure at some stage for demand, but we aren’t seeing it now.”
However, he said if unemployment started to rise, “all the worst predictions [of analysts] could come true.”
He said this uncertain future was the main reason why he had offered a flat forecast for the coming financial year, with trading EBIT expected to remain steady at $63.5 million.
“That might prove to be conservative if all this stuff does happen, but it might also prove to be ambitious if it does,” he said.
“I think the real answer, to be honest, is [that] we want to see where the half year result lies and then we’re going to have far better feel for guidance.”
Campbell also said GUD would continue on its cost cutting path, with changes to stock delivery schedules to lower warehousing costs and other measures, such as designs with fewer components and changes to ravel and postage arrangements key.
He said the reduction program would “not necessarily” result in job losses.