Tandem Group has reported ‘challenging’ IBD and national retailer sales in its bike division in its latest results.
The Board of Tandem Group plc has announced its unaudited interim results for the six months to 30th June 2022, reporting that group revenue decreased by approximately 33% to £12.9 million compared to £19.3 million in the six months to 30th June 2021.
There was a 28% decrease in gross profit from £6.1 million to £4.4 million. Gross profit margin increased to 34% compared to 31.5% in the prior period primarily as a result of favourable foreign exchange variances.
The group said Peter Kimberley has ‘settled in well’ as CEO, bringing a new approach and new opportunities as he sets out his vision and strategy.
The bicycles division comprises all bicycle turnover from IBDs, national retailers and online customers for bicycles but excludes electric bicycles. Both IBD and national retailer sales continued to be ‘challenging’, said the group, being 55% behind that of the prior period.
Bicycle sales since 30th June 2022 to the end of August 2022 were however ahead of the same period last year. Tandem Group said the bicycle division benefitted from ‘unprecedented’ demand created by Covid-19 lockdowns, and it continues to target new accounts together with promotions and special offers.
In e-mobility, results remained ‘challenging’, with turnover in this division down 34% compared to the prior period.
A statement from Tandem Group said: “We remain confident that e-mobility is the division which has the largest potential for the group, and believe that continued pressures on both fuel prices and climate change will encourage the use of cheaper and cleaner modes of transport in the form of electrically powered alternatives.
“We are demonstrating our commitment to this area through the investment in our new on-site retail shop as announced in our AGM Trading Statement, and we have successfully launched our new Electric Life website.
“We are continuing to invest in new products in this division, as Government legislates and invests in alternative transport infrastructure, promoting consumers to adopt electrified means of transport such as e-mopeds, e-bikes and e-scooters.
“We are well positioned to take advantage of this increased demand.”
In a recent interview with BikeBiz, director of sales with Tandem Group Matt Rudd said: “We have witnessed in recent years people understanding the benefits of e-mobility and starting to embrace e-scooters, a trend that is simply well beyond e-bikes. The UK scooter market volume last year was estimated at over 250,000 units, which continues to show positive year-on-year increases.”
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The group said there are a number of key economic factors which are affecting the discretionary spending power of consumers, primarily the cost-of-living crisis. Rising energy and fuel costs, coupled with high inflation and increasing interest rates, are expected to outstrip wage inflation, leaving consumers uncertain,and this is impacting all areas of Tandem Group’s business.
Despite these challenges, the group said there have been encouraging signs, securing of a number of new customer accounts during the period and since the period end, and recent targeted product promotions have yielded good results.