Kathmandu chief Xavier Simonet hails Rip Curl buy

Kathmandu chief Xavier Simonet has hailed the benefits of the retailer’s purchase of surfware brand Rip Curl.

Kathmandu CEO Xavier Simonet Picture: David Geraghty

Kathmandu chief executive ­Xavier Simonet has told shareholders the adventurewear retailer has the potential to exceed 10 per cent earnings per share accretion from its $350m purchase of global surfwear brand Rip Curl.

Addressing the AGM on Friday, Mr Simonet said fiscal 2020 pro forma EPS accretion of 10 per cent was achievable with the potential for further upside as synergies were identified.

Kathmandu unveiled its takeover of Rip Curl last month and, with the deal now approved by shareholders, it is working on using the Rip Curl platform to help further expand the Kathmandu brand in core target ­markets.

Kathmandu delivered a record sales and profit result in the 2019 fiscal year, posting a 13.7 per cent lift in full-year net profit to $NZ57.63m ($53.43m). Full-year sales were $NZ545.618m, up 9.7 per cent, with same-store sales up 0.6 per cent across the group and its Australian stores increasing like-for-like sales by 2.7 per cent.

Total sales in Kathmandu’s largest market, Australia, were up 4.5 per cent, with continued growth in key product categories. For the year, online sales were up 9.2 per cent and now make up 10.1 per cent of direct sales to ­consumers.

The stronger financial results were helped by the recent acquisition of US hiking boots business Oboz.

“Fiscal 2019 was another strong year for Kathmandu financially. Strong sales growth, particularly through online channels and from Oboz, and well-controlled operating expenses allowed the combined business to reach record profits,’’ chairman David Kirk said.

“Our team are proud to have delivered four years of consecutive sales and profit growth, at the same time as executing on the company’s transformation from a leading Australasian retailer to a brand-led global multi-channel business.”