These days when a retailer does poorly it’s a case of ‘Amazon is coming, Amazon is coming, quick sell retail, blame all our stumbles, the poor products and weak execution on Amazon’.
But when one is shown to be doing well (and especially after running into a few hiccups in recent times) then the performance is ignored, or explained away.
Yesterday it was the turn of outdoor clothing retailer Kathmandu, the NZ-based group, to reveal that it has had a very solid 2016-17.
Judging by a positive trading update from Kathmandu yesterday it had survived the silly market talk of the damage Amazon is going to do, as well as weak consumer confidence levels (and spending) in its two main markets, Australia and NZ.
The company says it now expects net profit to rise at least 11.6% in the year that ended on July 31. The final figures will be issued on September 26. the shares ended steady at $2.10.
Kathmandu chief executive Xavier Simonet said in the update that earnings before interest and tax for the 12 months ending July to come in between $NZ56.0 and $NZ57.0 million, compared with $NZ50.9 million last year, and easily topping market forecasts of around $NZ54.3 million.
Kathmandu expects to achieve a net profit between $NZ37.4 million and $NZ38.0 million, compared with $NZ33.5 million in 2016, again topping market forecasts around $NZ36.6 million.
Sales are expected to rise 4.6% to $NZ445.3 million, ahead of market forecasts of $NZ442 million, underpinned by a solid 5.5% rise in same-store sales.
That came on the back of a very strong 6.9% rise in sales in Australia (its biggest market) on a constant currency basis, and a much slower 3.6% rise in NZ
Simonet attributed the better than expected trading to better winter promotions, new products and better engagement with customers.
"Our financial performance has been strengthened further during 2017 through operating leverage, reduced inventory and record low debt," he said.
There was no mention of dividend policy in yesterday’s update.
