Coventry Group announced today that it has downgraded its expected net profit by about 25 per cent, and plans to exit its furniture component business.
The company said today its annual net profit would be about $6 million; it had previously indicated its profit would be in excess of $8 million.
That was based on a $4.2 million interim result and a prediction of similar profits in the second half.
The supplier to the resource, manufacturing and construction sectors said like many of its competitors “we have seen a decrease in demand in the second half of the 2013 financial year, which has not yet turned around”.
On the profit downgrade, Coventry stated “in the volatile markets we operate in it is extremely difficult to forecast accurately”.
Coventry also announced that it will exit the furniture and furniture component segment of its Arita business and concentrate its efforts on the traditional hardware component, which supplies hinges, handles and other products.
The company has announced it will sell down its furniture inventory and rationalise the segment’s costs to achieve operating efficiencies, with the Arita and Fasteners businesses sharing distribution centres.
It added that dedicated customer facing sales teams will be maintained in both its Fastener and Arita businesses.