Globe International, the Australian-based multi-brand skate company, saw sales and profits soar in its fiscal year ended June 30, as it benefited from rapid growth in its online business and its ownership of brands involved in activities that many consumers continued to participate in throughout the Covid-19 pandemic.
Sales increased by 76 percent to 266.5 million Australian dollars (€163.1m-$190.3m) in the 12-month period, expanding by over 50 percent in all markets and driven by the company’s core FXD, Impala, Salty Crew and Globe brands.
“We delivered a record performance for the financial year as our business benefited from having a captive market for our products,” said Matt Hill, the CEO of Globe. “Our consumers had government stimulus money to spend, but limitations on how to spend it due to the restrictions in place globally for much of the year.”
Net profit for the year soared to A$33.3 million (€20.4m-$ 23.8m) from A$6.1 million in the prior year. The operating profit (Ebit) amounted to A$46.7 million (€28.6m-$33.3m), more than five times the A$7.3 million seen in the previous fiscal year, as the Ebit margin expanded to 17.5 percent from 4.8 percent.
Overall costs grew at less than half the rate of sales, thanks to spending limitations triggered by Covid-19 restrictions, government support and the time it took to add resources to keep up with the pace of demand growth.
In constant currency terms, online sales were four times higher than in the previous year and wholesale revenues were up by 63 percent. Globe said that when retailers had to shut stores as a result of lockdowns, it saw rapid, high-margin growth in its online business. Wholesale revenues rebounded quickly when restrictions were eased.
North America continued to be a standout, with revenues more than doubling, to A$100.6 million (€61.5m-$71.8m) from A$46.8 million the year earlier. At constant currency rates, sales in North America jumped by 141 percent, fueled in part by a shift toward online sales. Sales in Australasia rose to A$124.0 million (€75.8m-$88.5m) from A$79.3 million (€48.5m-$56.6m) and sales in Europe grew to A$41.9 million (€25.6m-$29.9m) from A$25.6 million.
To keep up with the growing demand, Globe said it expanded its sourcing capacity, adapted warehousing and distribution arrangements and added staff to its global team.
The current financial year is not expected to match the growth in sales and profitability seen in the last one, yet Hill said the company remains optimistic about the positioning and prospects for its brands. The new fiscal year has begun with a “solid” performance despite ongoing challenges on the logistics and other fronts, he said.
The company declined to provide a specific outlook for fiscal year 2022 at this point in time, pointing to uncertainty tied to the latest lockdowns in Australia, the global surge in new Covid-19 cases and the strain on global logistics due to container shortages and port congestion.
