The ending of the Covid lockdowns in Australia and strong market recognition saw KMD Brands’ trio of labels – the original Kathmandu, Oboz and especially RipCurl – power the group to a record first half for the six months to the end of January.
KMD told markets on both sides of the Tasman on Wednesday that the improvement in Australia in particular helped it ride out higher international freight costs and material cost pressures.
The re-opening of the Australian and NZ economies to international tourism also helped boost sales.
So strong was the turnaround in sales that KMD saw a rise in its gross margin, despite those higher costs.
January half sales surged 34% to $NZ547.9 million – a new record half performance for the retailer.
The company said that sales in the original Kathmandu brand range were up by over 50% in the first-half to $NZ194 million, made up of a 59% increase in sales in Australia during the period and a 22% increase in New Zealand sales.
Oboz saw sales rise 124% to $NZ47 million in the half year.
But Rip Curl was the group’s big winner in the half year – sales revenue of $NZ306 million was 19% more than the $NZ257 million in the same period of 2021-22.
All this saw KMD return to profit in the January half, reporting net earnings of $NZ14 million, well ahead of the $NZ5.1 million loss posted a year earlier.
It will pay an interim dividend of 3 NZ cents per share for the six months (and fully franked for Australian investors)
CEO Michael Daly saying that despite difficulties in the retail market, Kathmandu, Rip Curl and its wholesale footwear brand Oboz were able to deliver strong sale growth.
Daly said the record sales results “highlighted the strength” of KMD Brands’ global brands.
“For the first time since Rip Curl was acquired, the group has experienced a full 12 months of trade without significant interruption from the Covid pandemic, which resulted in group sales of over $1 billion.”
And it seems the company is seeing the turnaround continuing with Daly saying the company had a healthy balance sheet and expected a strong second half of trade.
Daly said the group remained “cautiously optimistic” and it had experienced stronf February trade.
“While the consumer outlook remains uncertain, with high global inflation and rising interest rates expected to impact consumer demand, we remain cautiously optimistic.
“The group is well capitalised and will continue to invest in the long-term global expansion of all our brands.”
KMD shares rose 1% to 95 cents on Wednesday.
