KMD Brands has posted record full-year sales for the 2023 financial year, up 12.6% to $NZ1.1 billion with all three subsidiaries recording gains.
KMD Brands owns and operates outdoor apparel retailer Kathmandu, surfwear label Rip Curl and Oboz Footwear.
Rip Curl confirmed sales growth of 8.3% to $581.5 million, Kathmandu lifted by 10.6% to $422.2 million, while Oboz grew by 61.8% to $99.3 million.
KMD Brands CEO Michael Daly confirmed the fourth quarter saw a shift in macroeconomic conditions. This has flowed into FY24 with group sales for August 2023 down 6.4% on last year.
“Kathmandu sales grew strongly over the first three quarters of the year,” Daly said. “The fourth quarter for Kathmandu was more challenging with increased cost-of-living pressures softening consumer sentiment, and the warmest winter on record in Australia, which cycled the best-ever winter trade season last year.”
Daly said customers returned to bricks-and-mortar shopping in FY23, with retail store sales up 17.5%.
“This had an impact on online sales, a trend noted across the industry as customers returned to pre-pandemic shopping behaviours,” Daly said. “Online sales remain significantly above pre-pandemic levels.
“Despite a challenging wholesale market, Group wholesale sales grew by +11%.”
Rip Curl recorded a 6% drop in earnings before interest, tax, depreciation and amortisation (EBITDA), despite an overall lift in sales driven by a post-pandemic surge in direct-to-consumer channels and the return of international travel to Hawaii and Thailand.
Meanwhile, Kathmandu’s key winter trade season was impacted by warmer weather conditions which cycled its “best-ever” winter season performance last year.
In FY23, Kathmandu’s Australia sales grew by 7% and New Zealand by 13.1%. Online sales normalised at $58.8 million, representing 14% of direct-to-consumer sales.
KMD Brands confirmed that Kathmandu will continue to cycle through its second phase of post-pandemic recovery, with travel presenting an opportunity for growth.
The brand has already commenced an international soft launch, delivering initial sales of $2.6 million including first deliveries to select new wholesale customers in Europe and Canada.
“The long-term fundamentals of our diversified group of outdoor brands remain intact,” Daly said. “Despite the challenging consumer sentiment, we expect tailwinds with the continued return to travel, positive impact from the launch of innovative products and the outdoor lifestyle trend post-pandemic.”
Daly said there are new executive appointments to be announced this year, including a new chief information officer and a chief digital officer.
“We are extremely motivated by the opportunities that lie ahead for our strong and innovative team,” he said. “In a relatively short time, we’ve evolved from a single brand ANZ retailer to a global house of brands, diversified by channels, products, and geographies.
“We’ve achieved a number of significant milestones in FY23, in our first year of uninterrupted trade post-pandemic.”