RM Williams posts bumper profit for billionaire Forrest

The iconic bootmaker enjoyed a $40m turnaround in fortunes in its first year of ownership under Andrew and Nicola Forrest, documents reveal.

Nicola and Andrew Forrest have owned RM Williams since October, 2020.

Iconic bootmaker RM Williams enjoyed a $40m turnaround in fortunes in its first year of ownership under billionaire Andrew Forrest, documents reveal.

The company, founded by R.M. Williams in the Flinders Ranges 90 years ago this year, made a bumper $36.8m profit after a $40m increase in sales of its boots in Australia and overseas.

The most recent RM Williams accounts, lodged late on Monday with the corporate regulator, are for the year to June 27, 2021, and provide the first snapshot of the company’s performance under its famous new owners.

Mr Forrest and wife Nicola bought RM Williams for $190m in October 2020, putting the business back in Australian ownership after a stint in the hands of American private equity group L Catterton, in which Louis Vuitton is a major shareholder.

RM Williams is held by the Forrest family in their Tattarang investment vehicle, which has more than $2.3bn in net assets on its balance sheet.

The Adelaide-based bootmaker’s revenue surged from $152m in 2020 to $192m last year as sales mostly increased in Australia. The $36.8m net profit for 2021 compared with a $2.3m net loss in the previous 12 months.

Most of the revenue increase came from the domestic market, with the RM Williams accounts revealing that Australian sales were up from $139m in 2020 to $178m in 2021.

International sales, a key focus for the business under its new owners, slightly increased from almost $9m to about $9.6m.

Nicola and Andrew Forrest last year at the RM Williams manufacturing floor in Salisbury. Picture: Keryn Stevens

While demand for RM Williams continues to grow, Nicola Forrest told The Australian earlier this year that she sees huge potential in the international market, where the business has largely had a wholesale presence.

“(Given) the current limitations on our production, we have to be very careful that we don’t try and run before we can walk,” she said in a Weekend Australian Magazine interview.

“We can’t say that we can supply the rest of the world when we are just meeting demand here. We have invested a lot in customer service, back of house, which is really coming online in the next few months. I think that’s going to create a lot more demand locally. So we have to really concentrate on delivering here first, but I think there is enormous potential.”

The deal to buy the business from L Catterton about two years ago came at the height of Covid and various lockdowns around Australia, which pushed the purchase cost down from what had previously been an asking price of about $500m by L Catterton.

The Forrests were reported to have beaten US private equity firm TPG Capital in the bidding.

“R.M Williams is a quintessential Aussie brand with a long and proud history of high-quality craftsmanship,” Mr Forrest said at the time of the deal.

He grew up on Minderoo Station in Western Australia’s remote Pilbara, and said his rural background made him especially excited about the purchase.

“My life began in the outback and I’ve never left,” he said. “I’ve never forgotten the first time I pulled on a pair of RMs. To wear RMs is to wear the boots of the countless hardworking Australians that have come before us.”

The Forrests say there are opportunities for further expansion into overseas markets. Picture: Keryn Stevens

Meanwhile, RM Williams increased prices across most of its range in July, citing a number of factors including inflation and raw materials costs.

The core Comfort Craftsman range was selling for $649, and while the company was cagey about what the cost increases were for each line, research done by News Corp Australia indicates that range was selling for $595 in June.

The 2021 RM Williams accounts were signed off by John Hartman, who this week replaced former National Australia Bank executive Andrew Hagger in the top job at Mr Forrest‘s private investment vehicle Tattarang and the Minderoo charitable foundation.

Mr Hartman has been appointed in an acting capacity.

“We have worked together overseeing a period of strong growth and diversification for Tattarang and I’m proud to have been part of the strong Minderoo Foundation leadership team that Andrew Hagger helped form,” he said regarding Mr Hagger’s departure after three years of working for Mr Forrest.

Tattarang’s other investments include the Harvey Road pastoral empire to aquaculture operations in Albany, WA. Tattarang also has a 17 per cent stake in the ASX-listed Australian Agriculture Company, the country’s largest beef producer, and a large holding in Bega Cheese.

It also holds investments in resources and energy companies.

ENDS