The turnaround at Billabong is working.
The surf clothing group has just posted a full year after tax profit of $4.2 million. Thew last time it announced a profit was for 2011.
Compare that to a $233.7 million loss the previous year. In 2015 revenue was up 2.6% to $1.048 billion.
“Two years into our turnaround Billabong is back to full-year profit and back to doing what it does best – building great global brands,” says CEO Neil Fiske. “Growth has returned in the key United States market and Europe is again profitable.”
Sales were up 13.1%, and accelerating in the second half, in the US wholesale market.
The RVCA brand, based in Costa Mesa, California, increased sales by 15.3% over the last six months.
The Element skateboard brand continues to grow in its largest market of Europe and the forward order book in the US indicates the brand is on the way back.
Fiske says Billabong is refining its business, getting out of under-performing stores, consolidating multi-brand banners and investing in new and refurbished brand stores.
So far in the 2016 financial year, the early part of back to school in North America saw a slow start for the sector as a whole.
“Europe, on the other hand, has been above expectations,” says Fiske. “The trend in Asia Pacific has been improving since year‐end with trading broadly in line with the prior year.”
Billabong shares are up 4.67% to $0.66.