KMD - KMD Brands

[The Triangle]

KMD shares crumble to all-time low as weather wreaks havoc on sales​

Unseasonably warm weather hurt sales of puffer jackets at Kathmandu, compounding an already weak consumer environment.
.
 NH

40 cents now. Ouch! But getting interesting. I'd imagine there's got to be a write-off coming on their massive intangibles on the balance sheet.

Cashflows from the latest half (~42 million) couldn't cover leases (~45 million). They might be able to play around with inventory for a better half, but I don't see anything major changing. We don't have results in from this half, but as the saying goes... go woke go broke... 99% of the world is sick of the constant promotion of trannies in everything as they statistically represent a miniscule portion of society. This did nothing good for RipCurl or the brand and who knows if it ultimately cost them anything significant or just a few days of low sales.

Have not bought anything at Katmandu for a few years now. It feels like they are stocking more 'kmart/target' type junk goods and not genuine outdoor goods. The diversity in cloths has dropped or at least the selections in Perth and their prices are not justified. Not to mention they closed their shop in the CBD. With most of the main outdoor brands being owned by conglomerates and quality plummeting I think there is a major void in the market for good stuff - KMD should add high quality non-Kathmandu gear to their stores. The brand simply is not well regarded (anymore? was it ever?) a lot of the good independent US and European brands are hard to find in Australia - so by adding some quality gear they should attract a few shoppers back to their stores.

They'll never grow anything outside of Australia with regards to outdoors. Maybe the surfing gear but not outdoor gear.

 

[finicky]

Looking at a weekly chart no signs of an interim low or a bottom that I can see yet.
Some positive momentum divergence but that's not enough to go on by itself. Closed the week almost on its low with increased volume. Still a stand aside stock apparently.

Not Held

WEEKLY

 

[peter2]

This chart of KMD reminds of their recent TV add where three people are hanging off a cliff while holding a KMD branded jacket. The jacket maybe strong but the share price is very weak.

 

[Dona Ferentes]

not getting any better

Kathmandu, Rip Curl owner sees consumers pulling back spending​

Surfers and campers are forgoing new wetsuits or puffer jackets with retailer KMD Brands’ losses more than doubled for the first half.
.
KMD Brands boss Michael Daly believes surfers and campers are forgoing a new wetsuit or puffer jacket in the same way many consumers are pulling back on takeaway meals as the cost-of-living crisis hurts his Rip Curl and Kathmandu stores. This was having a bruising impact on the surfing, camping and footwear retailer as its losses more than doubled for the first half, it skipped an interim dividend and warned of depressed profit margins. Improving sales momentum towards Christmas was dealt a blow by ex-tropical cyclone Alfred hitting Queensland and NSW, especially for Rip Curl which resulted in 100 lost trading days across the store network.

Mr Daly, who leaves KMD this week, said he was encountering a shopper still sensitive to price and needing a push to purchase as cost-of-living pressures affect the category.

“I think as most other retailers have said it is still challenging conditions and the average Australian and Kiwi shopper is being sensitive to price and if it is a great product and they really need it they’re still willing to buy, but they definitely have had more challenges in terms of their spending capability over the last few months to a year than they have in years prior,” he said. “And we are still seeing a very price sensitive shopper in the market and we expect that to continue for some time.”

Mr Daly unveiled KMD’s interim results that showed a 0.5 per cent gain in sales to $NZ470.9m ($428.6m) for the six months to January 31 as its losses blew out to $NZ20.7m from a loss of $NZ9.7m in the first half of 2024. No interim dividend was declared.

KMD’s half-year sales were about 3 per cent ahead of market expectations while earnings, although down almost 75 per cent to $NZ3.9m, were at the top end of guidance.
The outlook remains subdued due to the tougher trading environment and price-conscious shopper with KMD updating the market that it expected weaker margins for Kathmandu, with Rip Curl and Oboz to also face squeezed profitability in the face of sector-wide discounting and promotional activity.

Mr Daly said Kathmandu and Rip Curl were being pinched by these pressures on consumers as they increasingly saw picking up a new wetsuit, puffer jacket or trekking vest as a discretionary purchase that could be pushed back to help pay other more pressing household bills.
“Whether it be that expensive meal at a restaurant or can I get a quick fast food meal, or a puffer jacket, wetsuit, surfboard, the consumer certainly is challenged in terms of how much they can spend ...” he said. “Hopefully some interest rate cuts and some ongoing strengthening of consumer sentiment will see that change.”

This preference for value and “looking for deals” was being played out in his sales where the retailer’s outlet shops in discounter malls such as DFO were trading much better for Rip Curl and Kathmandu compared to full-price stores elsewhere. KMD are expecting gross margin pressures to continue in the near term in a highly competitive market, which may disappoint the market which is looking for margin expansion of about 64 basis points in the second half. At Rip Curl for the first half sales were up just 0.1 per cent to $NZ278.5m as earnings fell 22.9 per cent to $NZ16.1m. Direct-to-consumer sales increased 4.1 per cent, reflecting strong sales growth over the key Australasian summer and Christmas trading period. Also, stronger results were achieved in Europe and South America. Wholesale sales fell 7.9 per cent in a challenging global market.

At outdoor adventurewear retailer Kathmandu sales rose 3 per cent to $NZ156.8m as earnings slumped 22.3 per cent to $NZ22m. The performance was hit by increased promotional intensity in the category which constricted gross margin by 0.4 per cent.

KMD also owns hiking boots specialist Oboz, whose sales fell 6.3 per cent to $NZ35.6m with losses expanding to $NZ2.6m from $NZ500,000 for the previous corresponding period.
In a trading update KMD said sales for seven weeks to March 16 for Rip Curl were up 0.7 per cent, with Kathmandu up 5.2 per cent.