BILLABONG STRUGGLES IN SEA OF RED

BILLABONG STRUGGLES IN SEA OF RED
BILLABONG (ASX: BBG) shares slid more than 10 per cent this morning as the company slipped back into the red.

The Gold Coast company, which also holds retailers Element and RVCA, continued its history of reporting losses to this time post a net loss after tax of $23.7 million.

More than two-thirds of the decline related to higher tax expense, which totalled $7.8 million this year compared to a $12.2 tax credit in the prior corresponding period.

Sales were up 4.6 per cent to $1.1 billion across Billabong brands, but down 1.4 per cent on a currency basis.

Billabong's Americas business traded down by all measures, sales across Asia Pacific were down overall but ecommerce was up 154 per cent from a small base, and European online sales were up 160 per cent, also from a small base.

The company reported that higher markdowns to reduce excess inventory were largely to blame for the poor Americas result, and it has worked to reduce inventory by $20 million over there in the last six months.

The strength of pre-summer trade will make or break Billabong's next result, one which the company says will also be implicated by the consolidation and rationalisation occurring in the North American retail market

Billabong CEO Neil Fiske (pictured) says the company has, however, made 'significant progress' in the last year.

Online sales increased 52 per cent, and Fiske is somewhat banking on the online world to carry the business to higher levels, bringing shareholder attention to 'rapid growth' in social media followings across Billabong brands as a drawcard.

Justifying higher marketing spend, Fiske says new influencers and athletes have delivered a significant lift in consumer engagement.

Billabong shareholders will not receive a dividend.

The company is trading at around $1.41 on the ASX.

Billabong ranked number nine on Gold Coast Top Companies 2016.



Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

A game changer? Aspiring to the new standard on workplace mental health
Partner Content
Work health and safety regulators have been more active in the area of mental health ri...
Aon
Advertisement

Related Stories

NSW eases border restrictions with ACT and Queensland

NSW eases border restrictions with ACT and Queensland

As the Australian Capital Territory leaves lockdown today and Queen...

Pfizer jab closer to approval for children, IDT to make new Monash vaccine

Pfizer jab closer to approval for children, IDT to make new Monash vaccine

Australian children aged five to 11 years of age could receive Pfiz...

Virgin Australia to lift flight capacity linking QLD tourism hotspots with SA, Tasmania

Virgin Australia to lift flight capacity linking QLD tourism hotspots with SA, Tasmania

Virgin Australia is set to add almost 150,000 more seats in flights...

Toll workers secure “industry first” superannuation and job security offer

Toll workers secure “industry first” superannuation and job security offer

UPDATE (11.04AM AEDT 14 October): Toll has issued a statement ...