NZ-based outdoor gear retailer Kathmandu has confirmed the group’s sales have been hurt by the lockdowns in Eastern Australia., but sees an upturn with the staged re-openings in NSW and Victoria.
The company Tuesday reported same store sales (including online) for the 13 full weeks to October 31 were hit hard by the Covid Delta driven lockdowns with Rip Curl sales down 9.4% overall and Kathmandu brand sales diving 17.6%.
“Pleasingly, online sales have grown strongly at +33.8%, with Rip Curl +11.2% and Kathmandu +58.4%,” Kathmandu told the ASX.
It also noted that Oboz product deliveries will be impacted in the second quarter of 2021-22 as Vietnam footwear factories slowly ramp up production following COVID-19 closures during the first quarter.
Kathmandu says the significant impact from the lockdowns on first quarter sales is expected to result in profit being around $35 million below last year’s first quarter.
This is due to more severe lockdowns in NSW, Victoria, ACT and NZ than the prior period and “without any direct government subsidies recognised to date in 2021-22.”
“COVID-19 continued to be a major disruption in the first quarter, with Australasian retail stores significantly impacted by lockdowns, and supply chain disruption impacting our ability to fulfil strong wholesale demand,” Kathmandu CEO Michael Daly said in Tuesday’s statement.
Performance has recovered as economies reopen ahead of the important Black Friday and Christmas trading period, and the company says inventory remains sufficient to meet expected demand.
The company is facing a shortage of wetsuits at Rip Curl just as demand is rising and the company admitted that “demand for Rip Curl wetsuits continues to exceed available supply”.
“Freight, logistics and raw material costs remain elevated as the outlook for supply chain remains challenging. This will be managed where possible through pricing and raw material substitution.”
Kathmandu says it is managing ongoing supply chain disruption globally, particularly impacting the timely flow of products into our North American markets.
Kathmandu has also withheld full-year guidance.
“Due to the uncertain COVID-19 trading environment the group will not provide forward guidance, however as markets reopen, trading is expected to improve with growth opportunity in the second half of 2021-22,” the company said.
Kathmandu shares eased 0.6% to $1.56.
