Kathmandu says July cold snap boosted sales
Kathmandu Holdings [NZX: KMD] says a cold snap last month in Australia and New Zealand helped generate more sales than anticipated when the outdoor apparel and equipment retailer announced a profit warning in June. The shares rose 5.1 percent.
The Christchurch-based company said earnings before interest and tax was $62.5 million to $65.5 million in the year ended July 31, from $63.4 million the year earlier. That would be between a decline of 1.4 percent and a gain of 3.3 percent from the year earlier, an improvement from the company's expectation on June 24 that Ebit would likely fall 10 to 15 percent as warmer weather crimped sales of winter products.
"It is pleasing to have delivered a better full year result for FY14 than we were anticipating a few weeks ago when warm winter weather had significantly reduced customer demand," chief executive Peter Halkett said in a statement. "The improvement in sales and earnings in July once colder winter weather became established has resulted in a satisfactory outcome from our key winter sale event."
Shares in Kathmandu jumped 17 cents to $3.50, one of only two stocks to advance on the benchmark NZX 50 Index in morning trade.
Kathmandu said 2014 net profit was expected to be in the range of $39.5 million to $42.5 million, down from $44.2 million the year earlier as earnings were crimped by foreign currency exchange losses and a tax expense relating to an Australian intercompany loan revaluation.
Full-year sales rose 2.3 percent to $392.9 million, while same store sales increased 4.2 percent at constant exchange rates, the company said.
Kathmandu will release its full-year earnings Sept. 23.