ITC and modulyss owner Belysse saw profits fall sharply in the first quarter, with European operations again only breaking even.
Sales rose by 2.2% to €76.6m but the increase was entirely due to foreign exchange gains. Sales in Europe fell by 3.2% and rose by 8.6% in the US.
The flooring manufacturer saw adjusted EBITDA fall by 17.5% to €5m, of which €4.9m ofwas from US operations.
‘While our US business saw a slow start, after an acceleration of shipments at the end of last year, volumes recovered in the second part of the quarter and Q1 revenue ended 8.6% above last year. The EBITDA margin for the quarter saw a temporary drop affected by higher raw material costs following the change of our main yarn supplier last year. This transition and the negative impact on margins is coming to an end,’ says the company.
‘In Europe, Q1 2023 faced a challenging macro-economic environment with weak demand across the market, in particular in residential renovation. Countering the negative volume impact, we have been seeing some recovery in our unitary margins from last year’s low levels, despite high raw material costs still weighing on the Q1 2023 P&L due to FIFO accounting.
‘We have been able to reduce inventory levels by a more efficient sales and operations planning.’