Furniture ODM manufacturer and brand owner Koda expects to report a substantially lower profit for 1HFY2023 compared to the six months ended Dec 31, 2021, based on the preliminary review of unaudited consolidated financial results.
As it previously disclosed in its FY2022 ended June 30 results, the company has observed that the increasingly higher inventories in the US wholesale market could lead to a cyclical slowdown in furniture demand, while consumer spending switches to more services.
The company also states that high inflation, rate hikes and geopolitical tensions could further obstruct global economic recovery and affect consumer spending sentiment, while the zero-Covid approach in China during the reporting period for 1HFY2023 have continued to weigh on business recovery.
In view of these macro factors, the company has guided that market demand may soften, direct cost would rise and margins could fall.
Koda says it would disclose further details in relation to its performance in the announcement of its unaudited consolidated financial results for 1HFY2023.
Shares in Koda traded flat on Feb 6 at 34 cents.
