Kathmandu Holdings Limited (ASX: KMD), the outdoor and camping retailer, released its half year report to the ASX this morning.

Kathmandu is one of Australia and New Zealand’s largest outdoor retailers with 164 stores.

Here are some of the financial highlights from Kathmandu’s HY report compared to last year (all figures are in NZ dollars):

  • Sales increased 4.3% to $204.8 million
  • Gross profit margin increased to 63.3% from 61.6%
  • Day to day trading, or EBITDA, increased by 16.7% to $25.1 million (click here to learn what EBITDA means)
  • Profit up 23% to $12.3 million
  • Store count up 2 to 164

Kathmandu Chief Executive Xavier Simonet commented on the result: “Striking the right balance between generating sales growth and improving our gross margin has fuelled healthy earnings growth in the first half. Our financial position continued to strengthen during the first half and we ended the period with healthy inventory and record low half year net debt.”

Management were pleased to point out that in Australia, its largest market, sales grew by 3.7%. Australian same store sales growth was 1.9% whilst New Zealand same store sales growth dropped by 6.3% because of lower levels of clearance stock. Online sales now comprise 8% of group sales.

Kathmandu’s leadership declared an interim dividend of NZ$0.04 per share, the dividend will be fully franked for Australian shareholders.


Management announced that it is going to acquire US-based Oboz Footwear for US$60 million and an earn-out of up to US$15 million. Oboz designs, sources and sells footwear for backpacking, hiking, travel, winter and general outdoor wear. It distributes those products to a variety of North American retailers.

This will be funded by a NZ$40 million placement to professional investors and a capital raising of NZ$8 million to NZ$10 million from regular investors.

Trading update

Sometimes companies will give a trading update detailing how the company has done in the first few weeks after its reporting period. For the six weeks to 11 March 2018, Kathmandu’s group sales were 7.9% higher at constant currency rates. Same store sales were 7.5% higher in Australia and 5.1% for New Zealand. According to management, gross profit margins are also higher.


Mr Simonet commented further on the result, “We are focused on delivering profit growth in our core markets for the second half of FY18. As always the success of our full year result is still very dependent on the key promotion periods to come.”

The Australasian business provides the foundation for our brand to expand internationally. -Simonet


It’s hard to know if investors are warming up to the Kathmandu result because the shares are currently in a trading halt. Management said that the Oboz acquisition will allow Kathmandu to accelerate international growth and diversify its product mix, geography and channels to market.

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