TCM Corporation Plc (TCMC), a leading rug and carpet manufacturer, says cost control measures and an easing of lockdown rules in the UK helped it earn a profit of 108 million baht in this year's third quarter.
This is a big jump from the 9.7 million baht in profit earned in the third quarter of 2019, even though the company's sales and services in the third quarter of this year stood at 1.9 billion baht, a drop of about 7.9% when compared with about 2 billion baht year-on-year, said TCMC chief executive ML Walliwan Varavarn.
She said the pandemic had seriously affected the company's business, notably carpet and flooring, because TCMC's main customers are in the hospitality sector, which includes hotels, casinos, cruise ships and convention centres.
The impact had caused the company to earn 4.5 billion baht in revenue from January to September this year, 27.5% less than the earnings it made during the same period last year.
However, the company has adjusted its strategy in response to the reduction in orders by reorganising its business operations, reducing production capacity and saving various expenses.
"Finally, we have been able to return to a satisfactory profit," said ML Walliwan, adding that the company's furniture sales had also reached record highs in England.
"This shows that our acquisition strategy to diversify the business over the past few years was the right decision."
TCMC invested in furniture manufacturing and distribution in the UK, offering upholstered furniture using fabric and leather under various brands in England and other countries.
In the third quarter of 2020, furniture sales rose by 17.1% to 1.2 billion baht year-on-year mainly due to good business prospects in England. Following the country's relaxation of its lockdown measures in June, customers had shown stronger demand for furniture and home decorations, resulting in a lot of orders during this period.
The company had to expand its production capacity, including through the acquisition of a disused furniture factory in order to bring in additional machinery.
At the end of this period, TCMC's furniture business unit had generated a profit of 37.4 million baht.
In terms of its automotive carpet and fabric businesses, the company earned 146 million baht in revenue, a 45.6% decrease when compared with its earnings during the same period last year, due to a slowdown in the automotive industry.
However, through its cost-cutting measures and a degree of recovery in the auto sector, the firm experienced a rise in orders and eventually made a profit of 8.6 million baht in the third quarter.
TCMC's flooring business suffered a 31.9% year-on-year drop in revenue to 488 million baht in this year's third quarter, but thanks to a series of steps, including better cost management, it recorded a profit of 61.4 million baht.