Industry News

Furniture Retailer Design Capital Widens Online Sale

Singapore-based Design Capital Limited has submitted an application for an initial public offering in Hong Kong, seeking to widen its footprint in the e-commerce sector.

Design Capital operates three business segments including furniture e-commerce sales in the United States, mid-to-high-end furniture sales in Singapore, and interior design services in Singapore, Malaysia, and Brunei.

Furniture e-commerce sales was the major source of revenue, accounting for 58.1 percent, 62.2 percent and 66.7 percent of the total revenue for the years ended December 2015, 2016 and 2017, respectively.

Founded in 1981, the company began as an interior design services provider for showflats and residential units. In 1995, the company expanded into furniture retailing and now operates eight points of sale in Singapore. In 2005, Design Capital entered the e-commerce sector in the US, selling furniture marketed under the brands Target Marketing Systems, Simple Living, and Lifestorey to more than 20 American e-commerce platforms.

The company is to further expand its product mix and brand portfolio, and widen its sales and marketing network to strengthen brand recognition. It will continue to retain and recruit talent for future growth.

Proceeds raised from the public float will be used for the expansion of furniture e-commerce sales in the US, including purchases of products to increase inventory.

Also, it plans to update the photo shooting of products to be displayed on customer websites and at trade fairs.

Funds will also be used for the expansion of furniture sales business including rents, overhead expenses and capital expenditure for opening three new points of sale in Singapore. Other capital will be spent on improving brand awareness and the expansion of warehouse in Singapore.

Total revenue for the years ended December 2015, 2016 and 2017, were SGD82.33 million (HKD475.89 million), SGD90.54 million and SGD100.93 million, while profit for the years were SGD5.8 million, SGD6.03 million and SGD8.54 million.

The Singapore-based company sees the foreign exchange rate as a risk to profit. Since most purchases of products are settled in US dollars, it is, therefore, susceptible to the exchange rate fluctuation of the greenback against the Singapore dollar.

“We have not entered into any agreements to hedge our exchange rate exposure relating to any foreign currencies and there is no assurance that we will be able to enter into such agreements on commercially viable terms in the future,” the company says in the prospectus.
(Gooruf Beta)

Show More

admin

just an admin

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close