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Rip Curl buoys Kathmandu through first half

Kathmandu Group saw sales spike 12 per cent during the first half of FY21, largely off the back of a strong performance from Rip Curl.

The recently acquired surf-wear brand’s sales rose 21 per cent during the six months to January 31, adjusted for store closures, though Kathmandu’s sales plummeted 30 per cent.

During the half, 60 stores were shut down in Melbourne for 11 weeks, as well as 14 stores in Auckland. Trading in Sydney was impacted by the concern over the Northern Beaches cluster through Christmas.

Ignoring the store closures, Rip Curl’s sales rose 7.4 per cent and Kathmandu’s fell 35.4 per cent.

“Our improved first-half operating profit underlines the resilience of our Group and validates the diversification strategy, launched through the successful acquisitions and integrations of Rip Curl and Oboz,” said Kathmandu Group’s outgoing chief executive Xavier Simonet.

Earnings for the half are expected to hit between $47 million and $49 million.

Simonet said Rip Curl’s forward momentum is continuing at pace, with forward orders for the wholesale business above pre-Covid levels, and the business about to enter summer in the Northern Hemisphere.

Kathmandu saw strong camping sales, but low demand for insulation and rainwear hurt the overall result.

“To put the first half into context, Kathmandu’s profit weighting has historically been heavily weighted to the second half-year, when winter in Australasia drives demand for insulation and rainwear,” Simonet said.

“Oboz [also] delivered sales growth year on year, with the product innovation strategy pursued by the new Oboz management team reflecting in the forward order book, which is tracking well above pre-Covid-19 levels.”

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