Embattled surfwear maker, Billabong, admits shareholders have suffered from its drawn out negotiations for a refinancing deal with two US investment firms.
Billabong is holding its annual general meeting on the Gold Coast almost two months after it secured a $586 million deal with Centerbridge and Oaktree Capital Management.
The clothing label pulled out of an earlier deal reached with rival American private equity firm Altamont, which would have resulted in former Oakley boss Scott Olivet becoming CEO.
Chairman Ian Pollard said the process had been difficult.
“Getting here has been difficult and strenuous for the company and the distractions and costs of these processes have resulted in both lost opportunity and lost shareholder value,” he told shareholders.
“Throughout this period a brand that has been built on some of the simplest joys in life has been mired in high profile corporate transactions of extreme complexity.”
Neil Fiske, Billabong’s new CEO who previously led US outdoor clothing group Eddie Bauer, said the surfwear label had too many products.
“We’ve been trying to do many things, and not many of them particularly well,” he said.
“Are we a retail company with brands, or brands with retail?”
Fiske said product lines would need to be reduced.
“Our mantra is fewer, bigger, better,” he said.
The number of styles would be reduced by 25 to 30 per cent, Fiske said, adding Billabong had poor merchandising where latest styles were out of stock within three weeks as slow moving lines remained in store.
“Our product lines are too wide, too shallow,” he said.
“We have our work cut out for us. No doubt about that.
“But we have an extraordinary opportunity over the next few months to lay the foundation for years of profit growth and sustained shareholder returns.”
Billabong made a $860 million loss in the 2012/13 financial year.
Shareholders displayed their displeasure with the company’s performance and the refinancing process, with almost 34 per cent of votes going against the re-election of Pollard.
AAP
