OneAll forced to drop profit forecasts as China-US trade fight starts to bite
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The China-US trade dispute has started to hurt profits at furniture seller OneAll, with a new major US customer cancelling orders.
The company (ASX:1AL) says it expects profit to fall 4.6 per cent to 9.1 per cent in the 2018 calendar year, to $8m-$8.4m.
Revenue is set to drop 3.1 per cent to 6.8 per cent to $49m-$51m.
OneAll makes garden furniture in China and sells it around the world.
The company says existing customers are maintaining ordinary order levels.
“OneAll, does, however expect more competition in Europe as Chinese manufacturers shift their focus away from the US while the dispute is ongoing,” the company said.
They’ve also decided to clamp down on costs, suspending expansion works on a manufacturing facility until there is “greater clarity” on the trade dispute.
But they are retaining a 60-80 per cent dividend payout ratio.
OneAll stock hasn’t been hurt by the dispute however, remaining flat on Thursday morning at 97.5c.