TEAC Sales Plunge Distributor Reports $5.7M Loss
TTA Holdings the distributor of the struggling TEAC brand that has been available in Australia for more than 36 years has reported a 46% decline in revenue and losses of over $5.6M during the last financial year.
Back in January the CEO of TTA Holdings James Phoo, quit with the Company elevating Daniel Seow the senior product and marketing manager to run their operations in Australia.
The Company said that TTA’s revenue had decreased from $51.1million in 2014 to $27.6million in the year ended 31st March 2015.
This resulted in an after tax loss of $5.6million compared with a profit of $464,000 in the previous period.
This loss was largely attributed to incentives paid to mass retailers to clear excessive stock.
A write down of goodwill of $2million from $2.92million to $900,000 also contributed to the result.
ChannelNews understands that one major retailer is set to delist TEAC audio products in their stores.
In an effort to improve revenues the group took on the distribution of additional brands including iDance and TEAC car radios.
The current visual products range includes flat panel televisions, (LED, LCD), portable DVD players, digital set top boxes and twin tuner personal video recorders.
Audio products include sound systems, potable digital/analogue audio, iPod/iPhone docking systems and clock radios. The iDance products include DJ (disk jockey) products, headphones and party sound boxes. The Group’s sales are primarily from the distribution of audio visual products.
Currently TEAC products are distributed through major retailers including Harvey Norman, JB Hi Fi, Good Guys and BSR (Betta Home Living).
Other home State based retailers such as the Radio Rental (South Australia) Group in South Australia and Retravision and Kambos in Western Australia also form part of the Companies distribution network.
In their annual report the Company said that major restructuring process has taken place over the past year to reduce costs in line with the reduction in revenue. This resulted in several senior and operational staff being retrenched.
As part of the process, interstate sales and show room offices were amalgamated back to head office in Melbourne.
They said that the Group’s inventory level has been significantly reduced to 45 days stock turn as compared to 90 days in the previous period.
Executives said that the Group is finding the Australian market “challenging” and that a weak Australian dollar was driving competitive price competition between major brands a move that was hurting the Company.
TTA said that their forward strategy is to consolidate its product range and focus on product profitability and higher turnover to deliver improved results.
Support from major retailers to continue ranging the struggling product range is critical to future results the Company said.