Outdoor clothing and goods retailer Kathmandu has reported a higher first half profit on the back of stronger sales as it moved to buy a footwear company.
Kathmandu will buy US-based Oboz Footwear company. Photo: Supplied / Oboz
The company's net profit for the six months ended January was up 23 percent to $12.3 million, in line with its forecasts, as solid Christmas sales boosted revenue by more than 4 percent to $204.8m.
Sales grew in Australia, Kathmandu's largest market, but in New Zealand were lower as the company was unable to clear stock as much as anticipated, although margins were higher.
"Striking the right balance between generating sales growth and improving our gross margin has fuelled healthy earnings growth in the first half," chief executive Xavier Simonet said.
He said the second half had got off to a good start with total sales up 8 percent.
Kathmandu is also going to buy the United States-based Oboz Footwear company for $US60m, with up to another $US15m payable if it meets its current year earnings target.
Oboz sources and sells footwear for backpacking, hiking, travel, winter and general outdoor wear, and has been supplying footwear to Kathmandu for more than 10 years.
"This is a significant event for the company, accelerating our international growth, and diversifying our product mix, geography and channels to market," Mr Simonet said.
The acquisition is being paid for through a mix of debt, and the sale of shares to institutional investors and current shareholders.
