Rip Curl, Kathmandu owner KMD Brands preliminary result: Second half improvement

Christchurch, New Zealand (20 August 2024) – KMD Brands Limited provides the following unaudited preliminary results for the year ending 31 July 2024 (“FY24”):

• Rip Curl and Kathmandu sales have shown continued improvement on first half sales trends during both the third and fourth quarters of FY24, as outlined below.
• Kathmandu sales trends, relative to FY23, continued to improve in a challenging consumer environment, with enhanced in-store execution and new products. Australia (-4.5%) performed significantly better than New Zealand (-16.5%) through the key fourth quarter winter trading period.
• Rip Curl direct-to-consumer sales continued to outperform the wholesale channel. DTC sales for FY24 were -2.8% below last year’s record sales result, compared to the wholesale channel -13.0% below last year as wholesale customers continue to reduce their inventory holdings.
• Oboz online sales continued to deliver strong year-on-year growth in FY24, +31.7% above last year. Wholesale sales for FY24 were -23.1% below last year’s record sales.
• Gross margin decreased -30 basis points (-0.3% of sales) to 58.8% for FY24, driven by increased promotional intensity through the fourth quarter. Operating costs were tightly controlled, benefiting from restructuring implemented last year, and lower variable costs associated with lower sales.
• The Group confirms that underlying EBITDA2 is expected to be in the range of $49 million to $51 million for FY24.
• Group inventory at 31 July 2024 was approximately $25 million below the same time last year, resulting in Net Working Capital being approximately $21 million lower year-on year.
• Net debt at 31 July 2024 was $60 million, with significant funding headroom of approximately $230 million.

The Group will release its audited results for the year ending 31 July 2024 on Wednesday 25 September 2024. 

Timing of certain wholesale dispatches changed year-on-year from April to May, impacting Q3 and Q4 variances.

KMD Brands is a global outdoor, lifestyle and sports company with 3 brands, Kathmandu, Rip Curl and Oboz. Kathmandu was founded in 1987 in New Zealand and specialises in quality clothing and equipment for travel and adventure. Oboz, which became part of the group in 2018, is based in North America and designs outdoor footwear. Rip Curl, acquired in 2019, is a surf brand started in Australia in 1969.