TOMEI RATIONALISATION EXERCISE CONTINUES
Company to complete rationalisation exercise first before moving on to expansion
TOMEI Consolidated Bhd, the manufacturer, retailer and distributor of gold ornaments and jewellery, will fully carry out the rationalisation exercise before it moves forward with its expansion plans.
The rationalisation plan, according to managing director Datuk Ng Yih Pyng, would involve the closure of underperforming outlets and opening of new ones in strategic locations.
“Last year, we closed more than 10 outlets, but we also opened three to four. This year, we will open an outlet in the Genting Premium Outlet and another in Johor,” he said
The capex for both outlets would be about RM1 million.
“At this point, the outlets that we wanted to close have been closed. For those outlets awaiting a renewal due date, we will decide later,” he said after Tomei’s annual general meeting, here, yesterday.
“Cost-wise, the company has been very careful in its spending. I would say that there are not much costs to be cut, but certain processes need to be improved so that less manpower is used.”
The three-year rationalisation exercise, upon its conclusion by the end of the year, will enable the company to implement its expansion plans.
On its outlook, Ng said the company expected to do better than last year.
“The price of gold has been within range this year despite some fluctuations but we hope for more stable prices this year.
“Despite the current soft retail environment, Tomei has managed to improve on its profitability while also embarking on its rationalisation plan.
“We will continue with our strategy of cost control and maximise returns from our outlets to ensure the sustainability of our profitability,” he added.
Recently, Tomei entered into an agreement with Shenzhen Harmony Batar Jewellery Co Ltd for the exclusive right to distribute and retail the Xifu jewellery collection in Malaysia.
The Xifu jewellery collection, which is owned and trademarked by the World Gold Council, is a jewellery series that is tailored to the global wedding market.
Tomei recorded a RM4.3 million net profit in its first quarter ended March 31, compared with RM3.3 million in the same quarter last year.
The Tomei Group has a network of more than 60 outlets in Malaysia.
Despite the current soft retail environment, Tomei has managed to improve on its profitability while also embarking on its rationalisation plan.
DATUK NG YIH PYNG Tomei Consolidated Bhd managing director