Major Australian retailer says it lost $31million when all its stores were shut down during months of Covid lockdowns
- Australian retailer KMD Brands said profits were down during Covid lockdowns
- Sales across the board have began to bounce back since the retailer’s reopening
- Company said sales were up 6.2 per cent in the 12 months to July 31
- KMD Brands owns Rip Curl, Oboz Footwear as well as Kathmandu
KMD Brands says its full-year profit was down significantly due to Covid lockdowns but sales overall have been bouncing back since the closures.
The Rip Curl, Oboz Footwear and Kathmandu owner on Tuesday announced group sales were up 6.2 per cent to $NZ978.8 million ($A865.4 million) in the 12 months to July 31.
Kathmandu recorded its highest-ever sales in the fourth quarter, with total sales up 6.8 per cent to $NZ381.6 million.
KMD Brands (which owns Kathmandu) says its full-year profit was down significantly due to Covid lockdowns but sales overall have been bouncing back since the closures
Its online sales grew by a quarter and now represent 18.7 per cent of all sales, up from 7.7 per cent in 2017/18.
But the group’s net profit after tax dropped 40 per cent to $NZ36.8 million ($A32.5 million), as the lockdowns cost it an estimated $NZ35 million in earnings with over 11,000 lost trading days.
Oboz was also heavily impacted by the three-month closures of its factories in Vietnam.
A Rip Curl store in Torquay, south-west Melbourne. The surf clothing brand is one of those owned by KMD
In the first six weeks since July 31, sales have been up 10.3 per cent compared to the same pre-Covid period in 2019, KMD said. Sales are up 44 per cent on last year, when some stores were in lockdown.
But the company has been seeing different sales patterns.
‘Our suburban mall stores and our destinational stores have gone really, really strongly but our CBD stores continue to struggle just on the back of not seeing the same levels of people in and around cities – whether it be workers or… international tourists,’ chief executive Michael Daly told analysts on a conference call Tuesday.
International tourists including cruise ship passengers have been important KMD customers and so far haven’t yet returned, Mr Daly said.
Kathmandu recorded its highest-ever sales in the fourth quarter, with total sales up 6.8 per cent to $NZ381.6 million (pictured, member of the public after shopping at a Kathmandu store)
KMD is planning to close a handful of underperforming stores this financial year – maybe three to five locations, mostly in CBDs, Mr Daly indicated.
But the company also plans to open another 20 to 40 Kathmandu stores in Australia.
KMD has stores across the globe but most – 261 of its over 300 locations – are in Australia and New Zealand.
It has 30 owned and 16 licensed stores in North America and is working on a ‘soft launch’ with influential outdoor wholesale accounts to expand Kathmandu’s presence there.
KMD Brands plans to open another 20 to 40 Kathmandu stores in Australia (pictured, a store on Elizabeth Street, Melbourne)
‘The US market is very competitive market, as we know,’ Mr Daly told analysts.
‘Speaking openly, it’s been the graveyard of many Australian and Kiwi brands looking to go into that market. So we’re very cautious.’
KMD declared a full-franked final dividend of NZ3c per share, the same as last year. Its total dividend for the year is 6c, up from 5c a year ago.
At 2.32pm AEST, KMD shares were up 2.2 per cent to 91.5c.