The acquisition of Rip Curl in October 2019 was a good move for Kathmandu Holdings. In a preliminary trading update, the Australian group said that its revenues for the six months ended on Jan. 31, 2021, progressed by 12 percent from the year-ago period, as Rip Curl’s strong performance offset weak sales by the Kathmandu brand.
During the period, operations continued to be disrupted by Covid-19 at a number of the group’s stores, with 60 Greater Melbourne locations closed for over 11 weeks during the second lockdown and 14 Auckland stores closed for over two weeks.
On a pro-forma basis, the group’s direct-to-consumer (DTC) sales offline and online declined by 18.5 percent on a same-store basis, as Rip Curl’s 7.4 percent gain was not enough to overcome a drop of 35.4 percent for the Kathmandu brand.
Overall, the group’s e-commerce represented 13.0 percent of DTC sales, compared with 8.9 percent last year.
Wholesale revenues were down by 11.5 percent, hampered by restrictions linked to the pandemic, including declines of 15.0 percent at Rip Curl and 3.8 percent at Oboz, the company’s American brand of outdoor shoes.
Ebitda for the period is expected to be in the range of $47 million to $49 million, including government subsidies and the realization of cost synergies.
Looking ahead, the management said that it is expecting a strong moment for Rip Curl’s DTC business in the Northern Hemisphere as the summer season approaches. Forward orders for the Rip Curl wholesale business are above pre-Covid-19 levels, encouraging early indications for future seasons.
Following the recent resignation of its CEO, Xavier Simonet, Kathmandu’s board has initiated a search process for his replacement. Simonet continues to work through his six-month notice period. Kathmandu intends to release the full result for the half-year on March 23, 2021.
More about the group’s outdoor operations in the Outdoor Industry Compass.