Distressed surfwear group Billabong could be without a chief executive for months, adding to the turmoil that has plagued the former market darling and led to a shock full-year loss of $860 million.
Chairman Ian Pollard said a prolonged battle between rival US private equity firms to recapitalise the struggling retailer meant CEO-designate Scott Olivet could now not begin his role at the company, at a time when a global downturn in sales, store closures and billions of dollars in destroyed goodwill was dragging the company deeper into the red.
Mr Pollard used the company's loss of $859.5 million for 2012-13, which took Billabong's losses since 2011 to nearly $1.2 billion, to implore shareholders to get behind the board and its refinancing deal with Altamont Capital and ignore overtures from a consortium made up of Centerbridge Partners and Oaktree Capital.
"The first and really key thing is that [Tuesday's] result demonstrates that prolonging any process that we're in now ... is in no one's interests," Mr Pollard told investors at an earnings briefing.
"Nor is there any reason for it to be prolonged. We've entered into a transaction with Altamont, which has already delivered important value to our shareholders and has enabled us to meet our financial commitments."
Investors sold the stock down on the result and continued uncertainty that has now gripped the company, with Billabong shares diving 16 per cent during intraday trading before closing down 3¢, or 5.3 per cent, at 53.5¢.
Although Altamont has extended $US325 million ($363 million) in bridging finance to stop Billabong sliding into the abyss, Mr Olivet has refused to officially take on the role until Centerbridge and Oaktree have packed up and left.
Shareholders are not set to vote on the Altamont proposal until October, leaving Billabong's fate in the hands of its chief financial officer and acting CEO, Peter Myers.
In the meantime Billabong remains mired in red ink after another $867 million in significant items blotted its copy book for fiscal 2013, adding to the $336 million of write-downs booked in 2012.
Profit before write-downs of $7.7 million for 2012-13 missed analyst expectations of a pre-abnormal profit of closer to $10.2 million. Impairment of intangibles including its brands and goodwill hit $604.3 million for the full year - almost triple the total market capitalisation of the company.
A collapse in sales and earnings last financial year across the Americas, Australasia and Europe - partly driven by a decision to shut down 170 underperforming stores - saw it write down the value of its flagship Billabong brand to zero, as well as its Element skate brand, effectively making both worthless.
Global sales of $1.34 billion were down 13.5 per cent in reported terms for 2012-13, or 12.6 per cent in constant currency terms. Its flagship Americas operation saw revenue slide 5.7 per cent to $636.7 million with pre-tax earnings flat at $38 million. In Australasia sales were down 6.6 per cent to $471.8 million and earnings were up 5.8 per cent to $2.8 million.
Mr Olivet will remain a consultant to Billabong until a deal with Altamont is clinched.
Loss for year
Value of Billabong brand written down from
$252m to zero