SurfStitch sees more losses ahead

Haleiwa, Hawaii. Gabe LHeureux/ Getty Images

Troubled online retailer SurfStitch today posted a half year loss of $5.6 million and expects more of the same for the rest of the year.

A short time ago, the shares were up 2.7% to $0.185.

The six month loss was an $8 million improvement on the same six months the year before.

Revenue was down 13.1% to $106.30 million.

SurfStitch says it hit trading headwinds in the last few weeks of December and into January and February, similar to other retailers.

The company has revising upwards its underlying EBITDA loss forecast to a range of $5 million to $6.5 million, from $4 million to $5 million.

“The teams in each of our businesses across the group have worked very hard to deliver on the immediate objectives which we set ourselves at the beginning of the financial year; to stabilise and refocus the business,” says CEO Mike Sonand.

“The important thing is that we are building a solid foundation on which to operate our global business.

“We have made good progress in containing fixed and variable costs.”

Surfstitch’s management was restructured after the surprise departure of CEO and co-founder Justin Cameron in March last year.

The company then said it understood Cameron was pursuing a potential acquisition of the business in conjunction with private equity. There has been no news since.

The company says the integration of companies acquired over the last year has been slower than anticipated and the benefits lower than expected.

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