KMD Brands swings to full-year loss on sales slump
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The news: Apparel retailer KMD Brands has swung to a full-year loss as sales fell sharply amid weak consumer sentiment and softer trading.
The numbers: The ASX and NZX-listed company reported a statutory loss of NZD48.3 million ($44.4 million) for the year to 31 July, 2024, compared to a NZD36.6 million profit a year ago.
Group sales fell 11.2% to NZD979.4 million, while underlying earnings slumped 52.8% to NZD50 million. It will not pay any final dividend.
The context: Sales at its key Kathmandu brand were down 14.5%, while surfing label Ripcurl and footwear brand Oboz saw sales drop 7.3% and 20% respectively. Group CEO Michael Daly attributed the disappointing performance to the effects of weakness in consumer sentiment and a challenging sales environment.
The weak trend has carried over to the new fiscal year, with Kathmandu NZ sales down 23% for the first eight weeks to 22 September, although Kathmandu Australia sales are up 2.1%.
Rip Curl global direct to consumer sales are also down 5% on year, while wholesale forward orders continue to be lower.
What they said: “We remain cautious on consumer sentiment, given the challenging global macroeconomic environment. Global inflationary pressures are easing, but it will take time to directly impact consumer spending,” Daly said.
The source: ASX announcement
