KMD Brands Limited Analysis

Overview

Kathmandu, a certified B Corp, was founded in 1987 in New Zealand and specialises in quality clothing and equipment for travel and adventure. Oboz, which became part of the group in 2018, is based in North America and designs ‘True to the Trail’ outdoor footwear to help people explore the wilderness. Rip Curl, acquired in 2019, is a leading global surf brand born in Bells Beach, Australia in 1969.

With a shared focus on expertly designed, technical and sustainable products, all three brands are distributed through wholesale, retail and digital channels.

On 19 October 2009 the company, then named Kathmandu Holdings Limited, announced an Initial public offering for fully paid ordinary shares to be listed on ASX and NZX under the code KMD.

On 16 March 2022, the company changed its name to KMD Brands Limited.

Performance

The following information was extracted from KMD Brands Limited's Half Year Results, released 26 March 2025

1H FY25 financial summary (vs 1H FY24):

• Group sales up +0.5% to $470.9 million.
• Gross margin down -0.3% of sales to 58.5%.
• Underlying operating expenses(1) up +4.2% to $271.6 million.
• Underlying EBITDA(1) $3.9 million, down -74.3% year-on-year (“YOY”).
• Statutory NPAT loss -$20.7 million. Underlying NPAT(1) loss -$16.1 million.
• Net Working Capital $192.6 million, -$33.6 million lower YOY.
• Net Debt $76.2 million, -$20.0 million lower YOY.
• No interim dividend declared as a result of 1H FY25 operating performance.

Total sales decreased -6.3% YOY, impacted by wholesale customer caution.

Online sales increased +32.8%, growing strongly over the Black Friday and Christmas promotions, and reinforcing the growth opportunity for the brand. Wholesale sales decreased -10.6% as wholesale accounts remain cautious on pre-season commitments in a challenging market, partly offset by improved in-season buying from key accounts.

Gross margin decreased -5.7% of sales as clearance of excess inventory has contributed to lower gross margins YOY. Gross margin on core styles and new launches remains in line with historical margins.