21 Sep 2021

Kathmandu's strong full year result overshadowed by lockdowns

6:34 pm on 21 September 2021

The outdoor equipment firm Kathmandu Holdings' strong full year result has been overshadowed by the reimposition of lockdowns on both sides of the Tasman.

Kathmandu Head Office in Christchurch CBD

Photo: RNZ / Nate McKinnon

The company owns and operates the Kathmandu, Rip Curl and Oboz footwear brands.

Key numbers

(For the 12 months to July 2021 against 2020)

  • Net profit after tax - $63.4m vs $8.1m (includes $22.6m in one-off costs)
  • Revenue - $922.8m vs $801.2m (Boosted by 12 month contribution from Rip Curl)
  • Net cash - $37m vs ($9.4m)
  • Final dividend - 3 cps vs nil

"We are proud of the results we have been able to produce over the past 12 months in the face of ongoing Covid challenges, delivering strong sales and positioning the business for sustained growth," Kathmandu group chief executive Michael Daly said.

Trading over the past 12 months had been dogged by the various lockdown restrictions, especially in Australia, which was estimated to cost the company $13m in earnings.

This saw the sales from the Kathmandu brand fall by 17 percent to $354m.

However, the Rip Curl brand achieved sales growth of more than half, fuelled in large part by strong growth in the key regions of North America and Europe during the Northern Hemisphere's summer.

The Oboz brand saw sales rise by $19m to $78.4m, as the brand benefited from a new-found interest in hiking follow last year's lockdowns.

Online sales stabilised after last year's sharp growth, now representing 14.4 percent of all sales.

The company reported strong order books across all its brands.

Trading update and outlook

Lockdowns on both sides of the Tasman had disrupted sales through the Kathmandu and Ripcurl brands during the first six weeks of the current financial year.

Sales were down 19.9 percent and 12.8 percent respectively.

In addition, the latest disruptions were affecting the group's supply chains.

"Suppliers have reduced factory capacity due to enforced closures, and freight congestion is leading to delivery delays and increased freight costs," the company said.

As a result, the company forecast its first half profit for current financial year would be below that of HY21.