KUALA LUMPUR: Tomei Consolidated Bhd
expects to record a net increase of one outlet to two outlets by year-end as the jewellery retailer adopts a cautious but selective expansion strategy amid an uncertain market environment.
Managing director Datuk Ng Yih Pyng said the company currently operates 63 branches and is in talks with several malls for potential expansion.
However, he said Tomei may delay some planned openings while also reviewing the performance of its existing outlets.
"We are talking to a few malls on expansion, but we might have to delay some of the expansion in view of the current situation in West Asia.
"We might open a few and close a few non-performing outlets, but the net increase will not be more than one or two,” he told a press conference after the company’s 21st annual general meeting today.
Ng said Tomei remains cautious about its near-term outlook, as the second and third quarters are expected to be slower following the end of the peak festive season of Chinese New Year and Hari Raya.
He said market sentiment had also softened, but the company would continue to monitor conditions closely and introduce new product ranges to support demand.
Chairman Raja Tan Sri Aman Raja Ahmad said the group remains focused on maintaining a healthy debt ratio and strong cash flow while evaluating new business opportunities more carefully.
"Using a football analogy, this is a defending timeline, not a scoring timeline. We have to make sure our debt ratio is good, and our cash flow is strong,” he said.
On gold prices, Ng said prices had reached a peak earlier this year before correcting and are now expected to remain within a range until there is greater market certainty.
He said that while Tomei remains positive on gold over the longer term, high prices have affected jewellery demand as consumers become more price-sensitive, while demand for gold investment products such as wafers, coins and kilo bars has increased.
On margins, Ng said Tomei sells on a mark-to-market basis and does not practise hedging for its inventory, adding that the company buys back the equivalent quantity of gold daily after sales.
Meanwhile, he said Tomei’s digital gold platform, GoldNow, which was soft-launched before the Chinese New Year, has recorded encouraging take-up, although its contribution remains small at less than one per cent of the group’s overall turnover. - Bernama
