Kathmandu, Rip Curl owner sees stronger sales and earnings ahead as economy reopens

The owner of Kathmandu, Rip Curl and Oboz footwear is winning from the return of travel, outdoor adventures and surfing as its sales and earnings ride a wave.

Kathmandu is benefiting from resurgent sales as the economy opens up and people travel again.

KMD Brands, the owners of retail chain Kathmandu, surfwear brand Rip Curl and footwear label Oboz, said its sales momentum had improved through the second quarter resulting in record first-half sales.

Its portfolio of retail brands is benefiting from the continued reopening of the global economy, and a return to tourism and outdoor activities such as hiking, bushwalking and surfing.

The company, whose shares are listed in Australia and New Zealand, said in a trading update on Tuesday that group total sales for the first half were expected to be approximately $NZ546m ($496.87m), which is an increase of 34 per cent above the first half of 2022, thanks to particularly positive trading in Australia.

Kathmandu’s sales recovery continued, with total sales up 51 per cent, reflecting a return of travel and tourism-related spending. At Oboz, first-half sales rebounded from Covid-19 related supply constraints last year, growing 124 per cent.

Its Rip Curl arm’s sales grew 18 per cent thanks to strong growth in direct-to-consumer sales while maintaining wholesale sales levels following strong growth last year.

KMD Brands said the group’s gross margin was resilient overall, with an improved gross margin for the Kathmandu brand. Underlying first-half earnings are expected to be approximately $NZ45m, against $NZ10.2m in the first half of 2022 which included $NZ5.1m of one-off Covid-19 assistance.

The group continued to benefit from a return to travel and international tourism through January as Kathmandu sales strengthened 52 per cent and Rip Curl 19 per cent, the company said.

Shares in KMD Brands closed up 5c at $1.02.