Consumers spending up on skateboard gear

Skateboarders spent up on fashion as they put government stimulus to work.

Skateboarders spent up on fashion as they put government stimulus to work. (Photo by Robert Cianflone/Getty Images)

Skateboard and youth fashion retailer Globe International has reported a fourfold increase in its full-year profit as sales raced ahead by 76 per cent, but does not expect the same kind of extraordinary growth in sales and earnings for 2021 to be repeated this year as Covid-19 causes uncertainty and disrupts global supply chains.

Through 2021, however, its customers - mostly hip young skaters - were loaded up with government stimulus money and happy to spend it on clothing.

It will see Globe shareholders rewarded with a massive 230 per cent increase in the final dividend, which has been declared at 20c a share against the 6c a share paid last year, and payable on September 16.

For the year net sales rose 76 per cent to $266.5m as full-year profit in 2021 rose to $33.3m from $6.1m in 2020.

Globe, whose fourth-largest shareholder is Solomon Lew with a 5.88 per cent stake via his private company Poly Town, said it had reported extraordinary growth in both sales and profitability as it benefited from having strong brands in industries and activities that consumers were able to participate in throughout the Covid-19 pandemic.

A designer, producer and distributor in the board sports, street fashion, outdoor and workwear markets, Globe said its consumers were cashed up thanks to government stimulus although didn’t always have the chance to spend it.

Matt Hill, CEO of Globe.

“Our consumers had government stimulus money to spend, but limitations on how to spend it due to the restrictions in place globally for much of the year,” said chief executive Matt Hill, who along with his brothers own just under 70 per cent of the company.

“When our retail customers had to close their doors, we were able to capture those sales through our direct to consumer online platform, which experienced rapid growth at high margins.

“Then, as restrictions eased, we saw a strong rebound in wholesale sales.”

Mr Hill said he didn’t expect to see the kind of extraordinary growth in sales and profitability that was experienced during 2021.

“Trading conditions so far this financial year have been challenging but performance has remained solid. However, the global effects of the evolving Covid-19 pandemic are having an impact on our business. The latest lockdowns across Australia, the strain on global logistics caused by container shortages and port congestion and closures, along with the global surge in new Covid-19 cases all create uncertainty.”

Shares in Globe rose 45 cents, or 7.26 per cent on the result to $6.65.