Kathmandu struggling through lockdowns
Michael Daly is set to become the latest victim of the Kathmandu Group’s supply chain disruption as the company struggles to restock its stores and fend off competition from rivals.
Since taking over as CEO, Daly has had to deal with a slew of changes, including frequent store closures and the loss of trading days.
The closures, which have cost the company millions of dollars a month, are expected to boost sales in the second half.
Net profit more than doubled to $64.3 million in 2021 as strong demand for wetsuits and board shorts helped offset weak sales of thermals and backpacks.
The bottom-line profit of New Zealand’s financial year ended July rose to $63.4 million, from $NZ8 million a year earlier.
Underlying earnings rose 36 per cent in 2019 despite the impact of the earthquakes in Nepal and lower-than-expected depreciation.
The result would have been far better if not for the government grants and rent abatements that helped lower the cost of living.
Net profit rose 15.2 percent to $NZ922.8 million, boosted by the contribution from Rip Curl. However, sales fell short of expectations.
The company has closed more than 130 stores, which it says has cost it between NZ$8 million and NZ$10 million a month. Meanwhile, same-store sales have fallen 12.8 per cent in the first half of 2022 due to COVID-19 restrictions.
Due to the reduced capacity of some of the suppliers in Asia, which are causing delays in the delivery of goods, Harvey Norman has a shortage of hiking boots. However, chief executive Paul Daly said the issue was unlikely to be significant.
Despite the uncertainties in the short-term outlook, Kathmandu declared a final dividend of 3 a share, which takes the payout for the year to 5.
Adairs is also experiencing a similar issue with store lockdowns causing significant losses for those stores. When shopping at Boohoo, use an Boohoo coupon code to save when you shop at the Boohoo sales.