At the performance presentation meeting held today, Ue Furniture Co.Ltd(603600) ( Ue Furniture Co.Ltd(603600) . SH) executives replied to the associated press that the company’s production bases in Vietnam and Romania operate normally. The former has a rapid increase in production capacity, while the latter has not been directly affected by the conflict between Russia and Ukraine. At present, the industry is facing great cost pressure. The company has carried out two rounds of price adjustment, but the effect lags behind, and the short-term profit is still under pressure.
Chairman Zhang Jiayong further said that affected by multiple adverse factors, the overall export situation this year is not optimistic, and the furniture industry is no exception. In the first quarter, the overall export of the national office chair and sofa industry fell. In the face of the decline of the demand side, the company will respond with increasing market share.
Statistics show that 6036 Zoje Resources Investment Co.Ltd(002021) achieved an operating revenue of 4.659 billion yuan, with a year-on-year increase of 35.67%; The net profit attributable to the parent company was 181 million yuan, a year-on-year decrease of 22.01%, and the sales gross profit margin fell by more than 4 percentage points year-on-year, a new low in recent five years. In the first quarter of this year, the company’s operating revenue was 1.008 billion yuan, a year-on-year decrease of 5.46%; The net profit attributable to the parent company was 472566 million yuan, a year-on-year decrease of 13.55%.
It is also the main seat and sofa export. Henglin Home Furnishings Co.Ltd(603661) ( Henglin Home Furnishings Co.Ltd(603661) . SH) is often compared with Ue Furniture Co.Ltd(603600) by investors. Comparing the performance of the two companies in recent years, there is a problem of “increasing income without increasing profit”, but Henglin Home Furnishings Co.Ltd(603661) performance is more stable. The company has made great efforts to transform from OEM to independent brand in recent years.
As a furniture manufacturer with OEM as its main business, Ue Furniture Co.Ltd(603600) orders are more likely to be affected by a single major customer. The financial Associated Press reporter noted that this year, IKEA, the company’s major customer, announced the closure of its stores in Guiyang, triggering concerns about its operation status. IKEA explained through media channels that the online business in Guiyang market is stronger under the influence of the epidemic. However, there are also views that the core or still lies in the poor performance of stores, and the pace of IKEA’s expansion in the Chinese market has been impacted by the downward impact of consumption.
At the performance meeting, the financial Associated Press reporter will also “does IKEA’s closing affect the company’s performance?” The question was raised twice, but there was no response.
Although the Ue Furniture Co.Ltd(603600) management made it clear that the Romanian production base is actively preparing and is not directly affected by the conflict between Russia and Ukraine, it did not respond to the actual progress of the project. Previously, the company said that the Romanian project is expected to be mass produced in 2022. It is worth noting that the project is a key step for the company to enter the European market. The project itself is also closely related to the key customer IKEA, which has carried out a series of investment layout in Romania.
