Kathmandu full-year sales up 24%

Kathmandu (NZX:KMD) has announced consolidated sales for the year to July 31 of $306.0 million, an increase of $60.2 million (24.5%) on the previous year.

Measured on a constant currency exchange rate the increase in sales was $54.2 million (21.5%).

Same store sales increased by 15.7% on the previous year (12.9% on a constant currency basis).

Australia sales were up A$29.9 million to A$143.4 million, (up 26.3%), New Zealand sales rose $17.0 million to $111.3 million, (up 18.0%), while United Kingdom sales dropped £0.3 million to £3.9 million (down 6.7%).

Ebit for the year is expected to be between $63 million and $65 million, compared to $47.9 million for the previous year (an increase of between 31% and 36%).

Kathmandu attributes the increase in sales in Australia and New Zealand to increased investment in inventory, favourable weather patterns for the Easter and winter promotional periods and better than expected results from new stores opened during the year.

Chairman James Strong says the substantial improvement in results year on year warranted early advice to the market.

“We anticipate the Kathmandu result will be against the general trend for the retail sector this reporting season.

“It is clear that market conditions throughout this year have been particularly difficult for retailers dependent on discretionary consumer spend, particularly in the apparel category.”

Chief executive Peter Halkett says the result is a good outcome given the very uncertain economic environment and the impact this has had on discretionary spending by consumers over the second half of the financial year, particularly in Australia.

“Our key strategies of new store rollout, upgrading of existing stores and ongoing growth in our product range have all delivered increased sales,” Mr Halkett says.

“However we also have to acknowledge that autumn and winter weather was overall a positive for us, and we also believe the strong A$ and NZ$ has encouraged growth in travel overseas, which has a flow on benefit for us.” 

Kathmandu's full year audited result will be released on September 21.