By Claire Reilly
Sunbeam’s parent company, GUD Holdings, has spoken out about its annual results and the company’s performance over the last year, which saw earnings in the consumer products division (including Sunbeam and cleaning brand Oates) fall by 15 per cent.
The company today released its annual report and, despite noting that small appliances had not seen the same levels of price erosion as categories such as flat panel TVs, the company commented that the category had faced its own difficulties.
“Most individual product categories in small appliances, of which there are in excess of 30, have seen an increasing incidence of retailer own-brands and of category specialists,” the annual report read.
“When combined, these trends have worked to place extraordinary pressures on broadly-based brands such as Sunbeam. To retain its market presence Sunbeam repositioned pricing across a number of core product categories and this was successful in the business reporting stable unit sales volume over the year and the maintenance of its long-standing market leadership position in Australia.”
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The smalls brand also noted that innovation was necessary in order to able to continue meeting the needs of consumers and to adapt to the broader changes in the appliance retail industry.
“The electrical retailing industry in Australia has been undergoing substantial structural change for some years and these trends continued in 2011/12. Consumers are moving away from traditional independent electrical specialists and department stores and purchasing appliances in mass merchants and chain specialists.
“In addition to this, newer forms of distribution channels are emerging such as supermarkets and internet retailers.
“Along with changing consumer preferences and needs, the increasing brand competition and changing retail structures provide existing brands with significant extrinsic challenges.
“Sunbeam continues to invest heavily in supporting a substantial product development resource to deliver to the market products with new features contemporary design elements, utilising new and environmentally-friendly materials.”
In July, GUD Holdings posted $219.2 million in sales for the 2012 Financial Year, down 7 per cent year-on-year, while underlying earnings before interest and tax were registered at $33 million, down 15 per cent from $38.8 million in FY2011.