French furniture business Roche Bobois has reported a decline in first quarter sales as it outlines year ahead.
According to its latest Q1 2024 trading update, total sales fell 9.4% to €94.2m against the same period in 2023. This result was in line with the Group’s expectations for the start of 2024, on the back of “exceptionally high delivery momentum at end-2023”.
Revenue for France and the rest of Europe respectively totalled €27.4m and €22.6m (down -9.7% and -6.4% respectively). The US/Canada region achieved revenue of €32.1m, also down -15.5% and -14.5%.
“In the 2024 financial year, and despite a continued less buoyant market environment, Roche Bobois SA upholds its ambition to show the same record performance as 2023,” the business said.
“The Group expects a gradual upward trend in 2024, in anticipation of a slight decline in revenue in the first-half and a return to growth in the second half, with the gradual ramp-up of new stores (including franchise acquisitions) such that they align with the Group’s standards.”
As part of this, Roche Bobois has recently signed a letter of intent to acquire a 51% majority interest in Shanghai Rock Castle Furniture, the owner of the Roche Bobois franchise in China, which directly runs three stores (one in Beijing and two in Shanghai) and manages 23 franchised outlets.
This capital-intensive acquisition, set to take effect in July 2024, is expected to be accretive to the Group’s revenue and EBITDA from 2024. In addition, the Group announced that it signed a second letter of intent to acquire franchised stores in Vancouver and Calgary.
Together, in 2023, these stores accounted for retail sales of €3.5m and will further contribute to stepping up the Group’s presence in North America, the Group’s leading market in revenue and profitability terms. This deal should also be completed by mid-2024.
“On the strength of this new acquisition, Roche Bobois SA continues to accelerate in its targeted consolidation strategy within strategic markets, which creates value for the Group both in terms of expected sales and profitability,” the company said.
