Bangkok--17 Aug--i2C Communications
SABINA disclosed its performance for the first half of 2020. Sales revenue was 1,331 million baht, a 18.4% decrease from 1,632 million baht in 1H 2019 while net profit in the first six months was 121 million baht, a 39.6% decrease from last year. Gross profit margin stood at 45.9% due to impact from the COVID-19-induced lockdown but net profit was maintained owing to efficient cost control measures. The second quarter (April to June) is declared the trough which is to be followed by recovery based on economic conditions.
Mr. Bunchai Punturaumporn, CEO of Sabina Public Co., Ltd. (SABINA) revealed that SABINA managed to maintain its net profit margin in both the second quarter and the first six months of 2020 in spite of being the most challenging period for SABINA. Because of the COVID-19 outbreak, the government imposed a lockdown to slow down the spread by closing shopping malls from the end of the first quarter to the middle of the second quarter, thus affecting sales revenue from the retail channel, which is the main channel. In 1H 2020, sales revenue from the retail channel dropped by 31.2%, similar to how sales revenue from exporting the SABINA brand to CLMV countries dropped by 2.6% and sales revenue from OEM orders from customers in Europe fell by 2.4%.
Nonetheless, SABINA achieved a considerable growth of 58.1% through non-store retailing (NSR) channels such as online sales and TV home shopping in the first six months of 2020, especially in 2Q which despite being the period most affected by the mall lockdowns, SABINA’s sales from the NSR channels still grew by an impressive 109.2%. This reflects SABINA’s success in adapting itself by forming online sales teams and marketing teams so competent that SABINA’s products are ranked among the top selling fashion items in leading platforms, a strength that SABINA must continue to capitalize on for continuous growth.
“Though revenue from main channels has fallen, we managed to maintain our profit thanks to key factors being SABINA’s efficient cost and expense management. Our gross profit margin decreased to 45.9% because during that period, in addition to SABINA’s price promotions to aid consumers affected by lowered income due to the government’s measures, SABINA also allocated part of its production capacity to make cloth face masks for various agencies in need of such masks throughout the period, particularly the healthcare professionals and the government officials servicing the public. The cloth masks were also donated to students in areas lacking such masks as a CSR activity which is every party’s duty in a crisis like this. After these situations ease up and are on the road to recovery, there is no doubt that SABINA will attain its gross profit margin growth as planned,” Mr. Bunchai said.
As regards the remainder of this year, SABINA must keep abreast of the circumstances, both local and international trends of the COVID-19 outbreak, including evaluation of purchasing power from the overall economic recovery to see how long it will take to return to normal. Another matter to be monitored is the government’s economic stimulus measures, especially those for the general public. If situations improve over time, SABINA’s 2H 2020 performance will enjoy an upward trend from the lowest point in 2Q 2020 and it is forecast that SABINA will get back on track for a robust growth in 2021.