Kathmandu defies the retail crunch with record sales and profit

Sean Gallup/Getty Images
  • Record sales for Kathmandu of $NZ497.4 million, up 11.7%.
  • Full year profit $NZ50.53 million, up 33%.
  • Staff to get a $NZ1000 one-off bonus.

Kathmandu shrugged off a weak retail environment to post a record full profit of $NZ50.53 million, up by 33%.

Sales increased by 11.7% to $NZ497.4 million. Online sales now make up 9.4% of Kathmandu sales.

In Australia, the largest market, sales grew by 9.6% in Australia.

All Kathmandu permanent team members will get a $NZ1000 one-off bonus. The company declared a final dividend of 11 NZ cents.

“We were delighted to achieve record profits this year as we balanced sales growth with gross margin improvement,” says Chief Executive Xavier Simonet.

“Sales growth was supported by the success of our key product groups, improved promotional execution, inspiring digital content, and an enhanced in-store customer experience.

“Top line growth combined with a focus on cost control, resulted in excellent profit growth.”

Gross margin increased 1.4% points to 63.4% in 2018, above the long-term target range 61% to 63%.

Simonet says it’s highly motivating for the team to have achieved three years of strong profit growth in the core Australasian business.

“Our customers have reacted positively to innovative products and engaging brand content,” he says.

“Being an inspiring brand and bringing to market original, sustainable, engineered and adaptive products represent Kathmandu’s company ethos.

“Continuing to drive sales growth in our core market remains a key management focus.”

Bricks and mortar retailers have been hit by weak consumer confidence and increasing competition from digital players.

Kathmandu’s 2018 numbers:

Kathmandu

Durting the year Kathmandu bought US-based Oboz Footwear for $US60 million cash and earn-out of up to $US15 million.

Oboz is an American outdoor footwear company, founded in 2007, based in Bozeman, Montana. It designs, sources, and distributes footwear for backpacking, hiking, travel, winter and general outdoor wear through wholesale channels primarily to outdoor retailers in North America.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.