Kathmandu lifts full year profit

Adventure gear retailer Kathmandu has posted a 13.5 per cent increase in full-year profit to NZ$38.04 million (A$34.8 million), helped by strong winter sales and improvements in promotions.

Revenue for the 12 months to July 31 was up 4.6 per cent to NZ$445.35 million, the company stated.

Earnings before interest and tax (EBIT) increased from NZ$50.9 million to NZ$57.0 million for the same period. A final dividend of NZ 9.0 cents per share will be paid, bringing the full year payout to a record NZ 13.0 cents per share.

“We were pleased to achieve strong same store sales growth driven by innovative new products and inspiring digital content,” said chief executive Xavier Simonet. “In addition to top line growth, continued cost control and working capital efficiency delivered very solid profit growth.”

Simonet said the company’s financial position continued to strengthen during FY2017, and they ended the year with lower inventory and record low net debt.

According to Simonet, sales grew strongly in their two largest markets, Australia and New Zealand.

Online sales now comprise 7.5 per cent of group sales.

“We have now delivered two successive years of strong profit growth and four successive quarters of same store sales growth,” Simonet said. “As a product and brand led business, we are focused on engaging our customers by creating distinctive, sustainable, quality products and by promoting our brand authenticity.”

Simonet said in the year ahead, it is their aim to continue to grow in their core markets, with gross margin and operating efficiency a key management focus.

“As we look forward, I am excited about the wholesale trials we are conducting in Europe, and remain committed to developing new international channels for the Kathmandu brand,” he said.