KMD Brands Limited announced its half-year results

Wednesday 23rd March 2022

Leading global outdoor, lifestyle and sports company, KMD Brands Limited (ASX / NZX: KMD , ‘KMD’ or the ‘Company’), is pleased to announce its results for the six months ended 31 January 2022 (1H FY22).

1H FY22 key highlights (vs 1H FY21):

• Sales of $407.3 million (1H FY21: $410.7 million)

- positive Q2 rebound following Q1 COVID lockdown impacts on Kathmandu and Rip Curl in Australasia

- Oboz impacted by COVID closure of Vietnam factories (now reopened)

• Gross margin of 57.7% (1H FY21: 59.0%), due to elevated international freight costs, and increased clearance mix for the Kathmandu brand

• Underlying EBITDA of $10.2 million (1H FY21: $48.2 million) (excluding the impact of IFRS 16)

• Statutory NPAT loss of $(5.5) million

• Strong balance sheet with $48.6 million net debt and comfortably within all covenants; significant funding headroom of c.$250 million

• Interim dividend increased by 50% to 3.0 cents per share (fully franked for Australian shareholders)

Commenting on the 1H FY22 results, Group CEO & Managing Director Michael Daly said:

“We continued to deliver on our strategic objectives, positioning KMD Brands for growth as travel rebounds globally and COVID-related impacts on supply abate. We maintained a strong focus on building our global brands, sponsoring the first ever World Surf League finals, with the men’s event won by a Rip Curl surfer. We opened twelve new owned / licensed retail stores globally, and online sales increased to 17.4% of direct-to-consumer sales, rewarding initiatives to elevate digital capabilities. Substantial progress was also achieved on our ESG strategy.”

“Rip Curl delivered sales growth of 2.7% over the half, with strong sales growth in online and wholesale channels, underpinned by strong performance in Europe and Hawaii in particular, while North America was impacted by short-term wetsuit shortages and port congestion. Rip Curl returned to same store sales growth in Q2, as lockdown restrictions lifted and the business rebounded.”

“The Kathmandu Australasian store network was more impacted by COVID closures in Q1 than the Rip Curl global store network, before recovering strongly in Q2. While Kathmandu continued to feel the impacts of COVID related travel restrictions, we were pleased to see a 46.4% increase in online sales, and the business is well positioned to grow internationally, with the Europe Fall / Winter 22 sell-in complete, and forward orders in line with expectations.”

“Oboz was impacted by the closure of Vietnam supplier factories due to COVID lockdowns, with approximately half of 1H FY22 orders unable to be fulfilled. However, the demand for the Oboz brand and products has never been stronger, with forward orders into FY23 very strong and supporting our medium-term growth targets.”

“Our rebranding to KMD Brands earlier this month reflects our purpose to inspire people to explore and love the outdoors, with a vision of being the leading family of global outdoor brands – designed for purpose, driven by innovation, best for people and planet. It is with this ethos in mind that we look to develop our portfolio of global brands, underpinned by investments that deliver a world-class unified commerce experience, and our commitment to operational excellence and leadership in ESG.”

The following are attached in relation to KMD Brands Limited's Interim Result for the period to 31 January 2022:

1. Results Announcement

2. Media Announcement

3. Interim Financial Statements for the six months ended 31 January 2022 and the Independent Auditors Review Report

4. Investors Presentation

5. Distribution Notice

Investor briefing

An investor call will be hosted by Michael Daly (Group CEO) and Chris Kinraid (Group CFO) at 8.30am AEDT / 10:30am NZDT today,

Wednesday 23 March 2022. For those wishing to participate, please dial one of the numbers below and provide the conference ID to the operator:

Australia Toll Free: 1800 590 693

Australia Local: +61 3 8317 0929

New Zealand Toll Free: 0800 423 972

United States: 800 289 0459

Conference ID: 177616

- ENDS -

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