KMD Brands shares tumble after earnings warning
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More news: Shares in KMD Brands dropped in early trading after the Kathmandu owner reported a fall in group sales over the past 10 months and warned that FY25 underlying earnings are expected to more than halve year over year.
KMD shares were down 3.8% to 25.5 cents at 11:05am AEST, extending losses of 32% over the last 12 months.
Kathmandu owner KMD braces for earnings hit as warm weather bites
The news: Apparel retailer KMD Brands has reported a slide in group sales for the financial year to date, and warned that full-year underlying earnings are expected to more than halve, as unseasonably warm weather in Australia weighed on Kathmandu sales.
The numbers: KMD — which also owns the Rip Curl and Oboz brands — reported a 0.5% decline in group sales for the 10 months to May 2025.
The group expects full-year underlying earnings to be between NZD15 million ($13.9 million) and NZD25 million, down from NZD50 million a year earlier.
KMD also said its gross margin for the year-to-date period is 140 basis points lower year over year, as all its brands focus on generating cashflow.
The group expects US tariffs to impact full-year earnings by around NZD1 million, but noted that it remains too early to estimate their impact on consumer demand in the US.
The context: KMD said Kathmandu weekly sales have been volatile over the past four months. The company said unseasonably warm weather in Australia had a "material adverse impact" on Kathmandu's insulation product category.
What they said: "While the volatility of Kathmandu's sales performance is frustrating, we acknowledge that unseasonably warm weather in Australia, including Victoria's warmest autumn on record, has negatively impacted sales," said KMD's CEO and managing director Brent Scrimshaw.
"The group is proactively working on a range of initiatives to unlock future growth opportunities across the portfolio, address short-term market challenges and improve medium to long-term performance and value for shareholders."
The source: ASX
