Kathmandu FY profit drops 4.5%, sees Australasian growth 23 Sep 2014
Related articles
- NZ consumers grow more upbeat, may resume spending Business
- Knowles quits as CEO of KiwiBank Business
- NZ migration bolstered by British invasion Migration
- NZ manufacturing activity reaches highest since 04 Business
- NZ dollar hits 22-month high vs euro Business
- OceanaGold finds new gold deposits at Fraser mine Business
- Transpower gets go-ahead for $170m SI upgrade Business
- NZ home sales creep up in March, still subdued Property
- NZ economy expands at fastest pace in two years Business
- New Zealand food prices fall in February Business
Kathmandu says Australasian earnings will grow as it steps up global expansion
By Tina Morrison
Sept. 23 (BusinessDesk) - Kathmandu Holdings, which today posted a 4.5 percent decline in annual profit, said Australasian earnings should rise in the coming year although overall profit at the outdoor equipment retailer may be dented by investment spending.
Net profit fell to $42.2 million, or 20.8 cents a share, in the year ended July 31, from $44.2 million, or 21.9 cents, a year earlier, the Christchurch-based company said in a statement. Profit was near the top end of the company's $39.5 million to $42.5 million forecast.
Kathmandu earnings were hurt by a warmer start to winter, which dented trading of seasonal goods through a period when it holds one of its biggest annual sales. The company plans to invest $5 million to expand its business in the UK and Europe this financial year, in the first phase of a three-year strategy to build its global brand, which may dent earnings growth.
"Providing there is no deterioration in economic conditions, we expected improved earnings from the Australasian business in FY2015, however the overall outcome will be impacted by the UK investment," chairman David Kirk said.
Sales and earnings are expected to increase in Australasia through the next three to five years at least, the company said.
Outside of Australasia, the company will focus on selling its products through online channels rather than expanding its store network, it said, adding there is "long-term significant upside and further opportunity" if positive earnings are achieved from global growth.
Shares in Kathmandu advanced 0.3 percent to $3.16, and have shed 10 percent so far this year.
Sales rose 2.3 percent to $392.9 million. Operating expenses increased 4 percent to $175 million as it increased advertising to boost sales and invested in its online business.
Kathmandu's gross margin edged up to 63.1 percent in 2014, from 63 percent in 2013, within its target range of 62 percent to 64 percent, it said. Margins were unchanged in Australia, improved 50 basis points in New Zealand and declined 230 basis points in the UK as it discounted stock when closing a store.
At the start of the company's new financial year in August and September, trading has been "very strong", supported by a campaign to clear its winter stock, Kathmandu said. Group same-store sales rose more than 30 percent in the period to Sept. 14, it said.
Australasian sales in 2015 are expected to continue to grow at similar rates to 2014, the company said.
In 2014, the company's New Zealand pre-tax profit edged up 1.3 percent to $30.7 million as sales at its 45 stores advanced 2.9 percent to $141 million. Same-store sales were generally ahead of the prior year, apart from a "substantial downturn" during the key winter trading period in June, the company said.
In Australia, pre-tax profit jumped 44 percent to $29.7 million as sales from its 100 stores gained 2.6 percent to $247.3 million. In Australian dollar terms, sales rose 15 percent. The company plans to open eight new Australian stores in the first half of this financial year.
In the UK, the company's pre-tax loss widened to $3.1 million from $2.3 million the year earlier as sales fell 21 percent to $4.7 million after it closed unprofitable stores. Excluding the impact of store changes, sales rose 13 percent, the company said. It had four stores at the end of 2014, compared with five a year earlier.
Kathmandu said a higher New Zealand dollar crimped 2014 earnings by $5.8 million.
It will pay a 9 cent final dividend on Nov.21, taking the annual dividend to 12 cents, unchanged from the year earlier.
The company benefited from a $1.3 million one-time gain in 2014 after an insurance claim was settled in full following the Christchurch earthquakes. The gain includes a writedown of assets that were lost or damaged as a result of the earthquakes. The company had a one-time gain of $293,000 in 2013.
Kathmandu said yesterday its general manager of sales and marketing, Tamalin Morton, would leave the company in December to take a position with another company. It said today a recruitment process is underway for a new chief executive after Peter Halkett said last month he would leave on Nov. 25.
(BusinessDesk)
News
Hilary Timmins' Award-Winning UK Documentary Series To Inspire NZ Students
29 Jun 2020 Education
Dream Catchers, produced and directed by Hilary Timmins, celebrates the success stories of more than thirty inspirational New... more
New Zealand reaffirms support for Flight MH17 judicial process
7 Mar 2020 News
Ahead of the start of the criminal trial in the Netherlands on 9 March, Foreign Minister Winston Peters has reaffirmed the need to... more
Business
NZ Government's Economic package to fight COVID-19
17 Mar 2020 Business News
The Coalition Government has launched the most significant peace-time economic plan in modern New Zealand history to cushion the... more
NZ Government announces aviation relief package
19 Mar 2020 Business News
Transport Minister Phil Twyford today outlined the first tranche of the $600 million aviation sector relief package announced earlier... more
Living
Diversity was Key at New Zealand Trade Tasting in London
6 Jun 2022 Food & Wine
New Zealand Winegrowers Annual Trade Tasting was recently held in London, on Wednesday 4 May, in Lindley Hall.
It was the first... more
Kiwi author stuns Behind the Butterfly Gate
12 Jan 2022 Arts
Hidden behind the Butterfly Gate is where the secret has been kept for 76 years...
New Zealand writer Merryn Corcoran’s... more
Property
Fairer rules for tenants and landlords
17 Nov 2019 Property
17 NOVEMBER 2019
The Government has delivered on its promise to the over one million New Zealanders who now rent to make it fairer... more
New Zealand Government will not implement a Capital Gains Tax
17 Apr 2019 Property
The Coalition Government will not proceed with the Tax Working Group’s recommendation for a capital gains tax, Jacinda Ardern... more
Migration
Boosting border security with electronic travel authority – now over 500,000 issued
19 Nov 2019 Migration
19 NOVEMBER 2019
We’ve improved border security with the NZeTA, New Zealand Electronic Travel Authority, which helps us to... more
Christchurch reinstated as refugee settlement location
18 Aug 2018 Migration
18 AUGUST 2018
HON IAIN LEES-GALLOWAY
The announcement that Christchurch can once again be a settlement location for refugees... more
Travel
Gallipoli Anzac Day services cancelled
19 Mar 2020 Travel & Tourism
The New Zealand and Australian Governments have announced this year’s joint Anzac Day services at Gallipoli will be cancelled... more
New Zealanders advised not to travel overseas
19 Mar 2020 Travel & Tourism
New Zealanders advised not to travel overseas
more
Sport
The Skipper's Diary: Sir Richard Hadlee honouring his father and NZ's Forty-Niners
27 Oct 2019 Cricket
NZNewsUK London Editor Charlotte Everett spoke to Sir Richard Hadlee about why he’s chosen to publish his father’s... more
PREVIEW: All Blacks v England semi-final
26 Oct 2019 Rugby
The two most convincing quarterfinals winners are set to square off in a semifinal showdown for the ages when the All Blacks meet old... more
Columns
Gordon Campbell on the Gareth Morgan crusade
11 Nov 2016 Opinion
Gordon Campbell on the Gareth Morgan crusade
First published on Werewolf
The ghastly likes of Marine Le Pen in France and Geert ... more
Gordon Campbell on the US election outcome
10 Nov 2016 Opinion
Column - Gordon Campbell
Gordon Campbell on the US election outcome
Well um.. on the bright side, there (probably)... more
Kiwi Success
Congratulations to Loder Cup winner
26 Sep 2018 People
25 SEPTEMBER 2018
The Loder Cup, one of New Zealand’s oldest conservation awards, has been awarded to Robert McGowan for 2018... more
Appointments to New Zealand National Commission for UNESCO
16 Aug 2018 Appointments
16 AUGUST 2018Appointments to New Zealand National Commission for UNESCO
HON JENNY SALESA
Associate Education Minister Jenny Salesa is... more
Recruitment
Historic pay equity settlement for education support workers
14 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more
Historic pay equity settlement for education support workers
22 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more