Kathmandu is at a four-year high after defying the retail crunch with record sales and profit
Kathmandu shares jumped 11 per cent to a four-year high today after the clothing retailer shrugged off a weak retail environment to post a record profit.
Kathmandu posted a 33 per cent higher full-year profit of $NZ50.5 million. Sales increased 12 per cent to $NZ497 million.
The shares (ASX:KMD) jumped 11 per cent to an intraday high of $3.18 in early trade before settling bac to $3.04 by 11am AEST.
Online sales now make up almost 10 per cent of Kathmandu sales. In Australia, the largest market, sales grew by 9.6% in Australia.
All Kathmandu permanent staff will get a $NZ1000 one-off bonus. The company declared a final dividend of 11 NZ cents.
“We were delighted to achieve record profits this year as we balanced sales growth with gross margin improvement,” said chief Xavier Simonet.
“Sales growth was supported by the success of our key product groups, improved promotional execution, inspiring digital content, and an enhanced in-store customer experience.
“Top line growth combined with a focus on cost control, resulted in excellent profit growth.”
Gross margin increased 1.4 percentage points to 63.4 per cent in 2018, above the long-term target range 61 per cent to 63 per cent.
Mr Simonet said it was motivating for staff to have achieved three years of strong profit growth in the core Australasian business.
“Our customers have reacted positively to innovative products and engaging brand content,” he said.
“Being an inspiring brand and bringing to market original, sustainable, engineered and adaptive products represent Kathmandu’s company ethos.
“Continuing to drive sales growth in our core market remains a key management focus.”
Bricks and mortar retailers have been hit by weak consumer confidence and increasing competition from digital players.
Kathmandu’s 2018 numbers:
During the year Kathmandu bought US-based Oboz Footwear for $US60 million cash and earn-out of up to $US15 million.
Oboz is an American outdoor footwear company, founded in 2007, based in Bozeman, Montana. It designs, sources, and distributes footwear for backpacking, hiking, travel, winter and general outdoor wear through wholesale channels primarily to outdoor retailers in North America.