Kathmandu warns on FY sales

Retailer feels the heat from warmer-than-usual winter, says June sales slower than expected.

Kathmandu is the latest retailer to feel the heat of a warmer-than-usual start to winter, with the group experiencing sales in June significantly below expectations in both Australia and New Zealand.

The company said that as with a number of other Australasian retailers, Kathmandu has experienced a sales downturn in the past five weeks in both Australia and New Zealand.

As a result, the company now estimates earnings before interest and tax (EBIT) for the 11 months to the end of June will be between 10 and 15% below the result for the same period in  fiscal 2013.

However, Kathmandu noted that July is typically its third-strongest sales month, so there is still scope to register a strong performance.

Kathmandu chief executive Peter Halkett said because of this, as well as the variability caused by winter weather patterns, a more specific forecast of the full years’ earnings result is not possible at this time.

"If we don’t have a more normal winter pattern through July, I would anticipate our earnings result would likely remain at least where we are today, which is between 10 and 15% down on last year’s performance," he said.

In fiscal 2013 Kathmandu posted earnings before interest and taxation (EBIT) of $63.4 million.

In recent weeks, Pacific Brands and The Reject Shop have both cut their full-year guidance because of similar weather impacts.

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