Stamford Tyres 3Q2009 Sales Down 6.6%

Stamford Tyres Corporation has reported double digit falls in both third quarter revenues (S$62.9 million, £29.2 million – down 21 per cent) and period gross profits (S$15.8 million, £7.34 million – down 16.6 per cent). The biggest quarterly fall was in the company’s net profits after tax, which fell to just S$100,000 (£46,426), down 94.9 per cent compared with the same period in the company’s 2008 financial year. Stamford puts the marked drops it experienced down to the “deteriorating business environment resulting from the global economic crisis.” Nevertheless the company evidently did turn a profit and continues to record healthy gross profit margins in excess of 20 per cent (2009:25.1 – 2008:23.8).

For the nine months ended 31 January 2009 revenue was S$227.6 million (£105.6 million), down 6.6 per cent compared to the same period in 2008. Gross profit for the first three quarters of the 2009 fiscal year was S$54.6 million (£25.3 million), comparable to what was achieved at the same point in 2008 (down 1.8 per cent to be precise). However, according to the company “most key territories in Stamford Tyres’ marketing network continued to perform satisfactorily.”

Mr Wee Kok Wah, president and CEO of Stamford Tyres said: “Our operations in Southeast Asia showed encouraging performance. Though the business environment was extremely challenging, we managed to maintain our gross profit margin.”

“The global tyre manufacturing and distribution industry is facing challenging conditions. While Stamford Tyres’ business model has been proven through many economic cycles, the current financial crisis is likely to cause its revenue and earnings to be under pressure for the foreseeable future. The group will continue its efforts to pare operating costs, maximize business and restructure operations where necessary and optimize its product mix.”