StockTalk

Really good trading update today

KMD share price should be a ot higher than $1.10 if this is how they are performing

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/395265/374587.pdf

Agree winner. I got some more this morning.

FB positive

KMD Brands' (KMD) trading update highlighted a pleasing second half performance, notwithstanding ongoing COVID-19 challenges. Management's first-time FY22 guidance for Underlying (pre-IFRS) EBIT of NZ$53m–NZ$59m was below our expectations, but (1) a record winter promotional period for Kathmandu in Australia, (2) the recovery in the supply of Obõz product, and (3) a strong wholesale order book for Rip Curl, supports an improving outlook. Whilst we remain cognisant of the current risks surrounding the broader economic environment, we continue to view the risk-reward as positive. KMD currently trades on a two-year forward PE of ~9x, at the bottom end of peers and below its own historical average PE multiple. We retain our OUTPERFORM rating.

Average analyst target $1.53 according to marketscreener

KMD a global outfit where whatever happens in NZ has minimal impact on overall performance - you'd think that the share price would get back to those levels again ... sooner than later?

It's my only retail stock. I like the diversification of the business.  $1.50 is fair. All we need is for conditions to improve and should be back over $2.

Kathmandu is interesting from a corporate finance point of view

Pre Rip Curl acquisition market cap was $760m. Today it is $787m in spite of $374m of new capital since.

There's a thing called MVA - Market value Added being Market Cap less Shareholder Equity. In other words how much 'value' has the market added (rewarded) the company for its efforts.

Back in August 2019 KMD'd MVA was about $300m - it is now negative $43m - ie market Cap less than Equity.

This MVA is essentially the NPV of future financial returns over and above the company's cost of capital (known as excessive returns). Been tough for Kathmandu last couple of years so look at 2023 prospects in this regard. Forecasts for F23 imply a ROIC (Return on Invested Capital which includes debt) of 9% -  which is probably below Kathmandu's current cost of capital. - in other words no 'excessive returns'

This valuation methodology says KMDs market cap is about the same as its equity (ie no market value) and that is about the same as today's share price.

It seems the market per se is not yet expecting Kathmandu to make excessive returns from its recent acquisitions and will need to see that happening before the share price makes any decent gains. That's saying the recent acquistions haven't added any real value to date.

Playing around with numbers if they could achieve EBIT of $150m and show signs of growing this forever then something around $1.50 would be a reasonable valuation..... maybe next year

Just finance stuff but you'd be surprised how many real investment managers (not the guru broker analysts) look at a company this way

Take your points Winner. No question covid has been destructive in destroying shareholder value. Pre covid things were looking good.

I think the acquisition of Rip Curl has probably saved the company and has the potential to be the largest brand. Covid has not been kind especially to the Kathmandu brand.  Previous to covid you had earnings per share in 2019 of $.25 and a DPS of $.16 from $83m EBIT

We will need a miracle I think to get to $150m EBIT next year, maybe 2024. This year (2022) is not going to be good either in the broader sense, although improvement over last year.

To me this company will be a big beneficiary in any recovery. Only if covid continues to not be such an issue.  The weather does what its supposed to do, and the world doesn't go to war. Then the company should continue to improve with the 2023 earnings being a substantial improvement say $120m EBIT and $.12 EPS.

So given the market is future looking I'm thinking $1.50 is realistic now.

Thoughts ?

Any predictions for performance with the border opening up?

Tourists looking for cheap outdoor gear to explore Godzone?

Quote from: arekaywhy on Aug 02, 2022, 04:11 PMAny predictions for performance with the border opening up?

Tourists looking for cheap outdoor gear to explore Godzone?

What happens in NZ is insignificant in the big picture of this global out

So answer to you question in my humble opinion is very little.

For bar says was a lot of Australians buying KMD last quarter.  Now own 34.5 percent of the shares.

That's good. If they own the shares, hopefully they buy as well the goods :) ;

Anyway - so far retail seems to do quite well ... and every time I am in the pool I notice more people wearing Rip Curl tops ... good people, I always give them a smile.

CIP FY22/23 forecasts lowered to reflect expected cost pressures
We leave our sales forecasts unchanged, however lower our forecast EBITDA for KMD in FY22/23 by -9% and -7% respectively, to reflect the impact of inflationary cost pressures such as freight and labour on Group earnings.
Maintain Overweight. Target price -8.1% to $1.58 (prev. $1.72)
Following our above-mentioned forecast changes and impacts from an increased RFR we decrease our 12-month DCF derived target price for KMD

Result out today I think

Won't be that good but they'll paint a bright outlook

Could be so bright the share price will rocket to $1.20 ..that'll be cool

Those guru analysts can't be wrong with their targets over $1.50

Sorry, meant to post yesterday as on open you might miss out on the real cheap shares at the Dollar Store

Craig's say $39m NPAT DPS 5.5c for FY22

Forbar say $40.3m NPAT DPS 6.1c for FY22

Let's see . Result out today. I'm picking it's going to be good.

Quote from: Shareguy on Sep 20, 2022, 08:22 AMCraig's say $39m NPAT DPS 5.5c for FY22

Forbar say $40.3m NPAT DPS 6.1c for FY22

Let's see . Result out today. I'm picking it's going to be good.

$40m+ bloody good after a $6m first half loss eh

The colour around how bright the future is is key today

Should point out brokers figures above are normalised before adjustments.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/399077/379334.pdf

Not one I follow but I couldn't help noticing the pretty slow stock turn v other retailers, (from memory 1.7 times but DYOR) but the gross margin is impressive in this environment.  About 20 times FY22 profit, feel like a lot of the recovery and we cycle pandemic lockdowns is possibly built in but I am sure they will do much better in FY23.  Most of their products are "outdoors" lifestyle orientated so I would expect a huge uptick in demand as we cycle the endless drudgery of Covid restrictions.

On the other hand, no imputation credits for Kiwi investors will annoy dividend hounds and retail is challenged by a multiplicity of factors already debated at great length on this forum and elsewhere.  That very modest stock turn, the complete lack of imputation credits and their modest level of digital sales, (about 16% from memory but again DYOR) make other best of class retailers like HLG look more attractive to me, not to forget HLG have far more attractive metrics, (very early teens PE and partial imputation credits giving a yield of approx 8% gross).

That said brokers expect a huge increase in eps in the years ahead to 10 cps in FY23 and 13 cps in FY24 so maybe this is a good retailer for a springboard to growth as we emerge from the recession in FY24 ?
https://www.marketscreener.com/quote/stock/KMD-BRANDS-LIMITED-103506238/financials/

Final thought.  Just brought up a 1 year chart and had a look at the T.A.  Oh my goodness that looks ugly.  You'd have to be a VERY brave investor to buy into that confirmed downtrend.

Thoughts ?

ONLINE SALES GROWTH BEYOND COVID STEP-CHANGE
• Kathmandu +47.1% online sales growth since FY19 (pre-COVID), and now
comprising 18.7% of sales
• Rip Curl record online sales at full margin, more than double FY19 (preCOVID), and highest-ever penetration at 13.0% of DTC sales
• Oboz online sales exceeded expectations in Q4 once inventory levels
recovered. Significant growth opportunity, supported by inventory depth and
product range expansion

Still poor.
More effort required.
Looks to me as though their business model is still based on 3 or 4 so called sales a year.

I guess there is some light as well as some shade :)

Inventory up, Receivables up and Intangibles up ... hmm.

RoE of 4.3 % isn't yet ready for the Guinness Book of records either, and in the combination with the high intangibles one could wonder, whether they paid too much for their intangibles, couldn't one?

Anyway - dividend (6 cts for the year) is amazing (considering the share price) and higher than their earnings for the year (5.1 cts per share), so board must be really optimistic.

Better not check the cashflow statements ... but hey,

NTA did go up by more than 10% ... (this is good  ) reaching an outstanding 18.5 cents per share (  ); Ah, well ...

what possibly could go wrong?

Did I mention it? Despite some warts I think around $1 they are worthwhile a punt ... The outlook sounds clearly better than last year, the outdoors are calling and tourists are coming back.

Discl: bought some more cum div ...

You're very brave BP.  KW would give me a darn good tongue lashing (Beagle is VERY scared of that), if I dared buy this in such a horrible confirmed downtrend.

Quote from: Basil on Sep 20, 2022, 12:33 PMYou're very brave BP.  KW would give me a darn good tongue lashing (Beagle is VERY scared of that), if I dared buy this in such a horrible confirmed downtrend.

Fair enough, according to KW's well known slogan it might have been as well dumb move - or maybe not.

I guess we will see ... it just feels, given these results, it can't go much further down anymore ... and the analytical power of the NZ Superfund (just last week backing up the truck) is as well on my side :) ; But for sure - nobody knows what the future will bring.

FY22 result a bit short on expectations. As we no with the 1H result covid had a big impact ($35M plus $8M Oboz)).

Currently trading at $1.03 which gives us a trailing PE of 20.6.....not cheap.

History says a lot about this company, with the purchase of Ripcurl a fantastic acquisition and probably saved the company in my opinion.

EPS was really taking off until covid hit, as follows (taken from result announcements)

2018  $23.8cps
2019  $15.9
2020  $1.6
2021  $8.6
2022  $5.0

2023  $11.26  Craigs Forecast which on $1.03 is a forward PE of 9.1
2024  $13.48                                                                                 7.6

The outlook was the key with CEO stating that August sales above August 2019 (pre CVD) by 10.3 percent continuing trajectory of Q4 FY22.  Group direct to consumer sales for the first 6 weeks of FY23 plus 86.7 percent YOY.  Inventory to reduce.

KMD is my only retail stock and I like it because the products they sell are designed by them which enables them to command a great margin.  The question is are the bad times over?  If we agree that lockdowns are a thing of the past and supply issues normalize, then the future does indeed look brighter for KMD. That's my thoughts, what's yours?

https://finnewsnetwork.us1.list-manage.com/track/click?u=4e327af0b9377422183e60879&id=900867fd8c&e=2039e3d3d1

A few more thoughts. Objectively it must be acknowledged they've done a fabulous job to maintain the gross margin at a very high 58.9% given the enormous challenges thrown up by Covid and supply chain issues.

It also has to be said that there's a readily apparent pathway forward to better times given its obvious many of the challenges experienced in the first half are on the balance of probabilities either non-recurring or the impact going forward is now considerably ameliorated.

I also suspect that more than two and a half years into this pandemic most people are well and truly "over it" and the sort of products KMD sell are directly related to getting out there into the great outdoors again which is something I suspect many people are really looking forward to.

If Craigs are right with their forecast for FY23 then the shares are very cheap with further growth forecasted into FY24.  I've put these on my watch list and will follow the TA closely.

Craig's have updated today to outperform at $1.46 from $1.56

EPS FY23 9.37 which is pe 11
    FY24 11.81         Pe 8.7

While FY22 proved to be another challenging year for KMD, highlighted by 1H22 uEBITDA down -80% on the pcp, our thesis has been that KMD will benefit as travel restrictions unwind. 2H22 provided some evidence to support this view, with the Kathmandu brand producing record Q4 sales and 2H22 Group uEBITDA up +34% on the pcp. Further, management have commented that strong momentum has continued into FY23. With travel returning, supply chain disruptions easing and forward order books holding strong for Rip Curl and Oboz, we expect the post COVID earnings normalisation will continue through FY23/24. With a forecast 3 year EPS CAGR of 37% to FY25, low net debt and trading on an FY24 PE of 8.7x, we continue to see KMD as a strong reopening trade, maintain Overweight.

America and Europe - here we come!

CEO does not lack ambitions:

https://www.nzherald.co.nz/business/what-expansion-looks-like-for-kathmandu-as-it-pushes-into-europe-and-north-america/IVH6U3VHCIMJ3BURBREUOW4DOE

(probably paywalled)

Strategy, though sounds sensible:

QuoteKMD Brands chief executive Michael Daly said the launch into North America and Europe would remain small initially while it tested demand. All going well, he said Kathmandu planned to follow with retail store openings to complement its e-commerce strategy.

The company has its eyes set on large cities that appeal to its active outdoor consumer, locations such as Vancouver in Canada, Denver in America and Munich in Germany, for flagship retail locations.

"It is very much a soft launch [at this stage] focusing on 20 to 25 select influential outdoor accounts to test our concept and give us confidence for future expanded distribution. We're focusing on wholesale and online at the moment in Europe and Canada, and likewise when we launch in the US later this year," Daly told the Herald.

Quote from: BlackPeter on Sep 22, 2022, 08:59 AMAmerica and Europe - here we come!

CEO does not lack ambitions:

https://www.nzherald.co.nz/business/what-expansion-looks-like-for-kathmandu-as-it-pushes-into-europe-and-north-america/IVH6U3VHCIMJ3BURBREUOW4DOE

(probably paywalled)

Strategy, though sounds sensible:

Interesting, Canada is well served already with established outdoor clothing and apparel retailers.  I'm not sure what KMD would offer that's not already there? 

Quote from: Hectorplains on Sep 22, 2022, 07:58 PMInteresting, Canada is well served already with established outdoor clothing and apparel retailers.  I'm not sure what KMD would offer that's not already there? 

Canada Goose jackets are really awesome BUT check out the prices...   https://www.matchesfashion.com/intl/mens/designers/canada-goose  makes Kathmandu jackets look like they're very good value at full retail price, which is no easy feat !

Added another parcel today on the back of further insider buying.

Quote from: Shareguy on Oct 10, 2022, 02:59 PMAdded another parcel today on the back of further insider buying.

Well, yes - three of the directors accumulated or bought recently ....

Philip Bowman increased his holding in two steps from 400k to 650k;
David Kirk bought 250k shares and
Abby Foote increased her holding from 65k to 130k.

All quite meaningful holdings .... I assume this means they are reasonable optimistic re Kathmandus  fortunes :) :

Quote from: BlackPeter on Oct 11, 2022, 10:35 AMWell, yes - three of the directors accumulated or bought recently ....

Philip Bowman increased his holding in two steps from 400k to 650k;
David Kirk bought 250k shares and
Abby Foote increased her holding from 65k to 130k.

All quite meaningful holdings .... I assume this means they are reasonable optimistic re Kathmandus  fortunes :) :

Good to see directors following David's edict to buy shares to demonstrate your support of the company and stop the share price sliding into oblivion

Quote from: winner (n) on Oct 11, 2022, 10:49 AMGood to see directors following David's edict to buy shares to demonstrate your support of the company and stop the share price sliding into oblivion

Hmm - what's your beef with KMD?

I honestly doubt that directors put up several 100k of personal funds just to satisfy an imaginary request by the chair ...

BTW - I hear Cotton On doing not too bad across the ditch  ... maybe times are not too bad for quality rug traders?

Quote from: BlackPeter on Oct 11, 2022, 11:04 AMHmm - what's your beef with KMD?

I honestly doubt that directors put up several 100k of personal funds just to satisfy an imaginary request by the chair ...

BTW - I hear Cotton On doing not too bad across the ditch  ... maybe times are not too bad for quality rug traders?

No beef with KMD - but i've learnt over the years that getting excited when Directors buy shares it's not good for your health ... and clouds one judgement

And Glassons showing that quality rag traders aren't doing too bad

And Kathmandu like me as a customer

I agree - if directors buying is the only indicator, then this would be a bit thin (as with any other stand-alone indicator).

I see as well that earnings trend dropped (on a per share basis), while revenue increased ... which is normally a bad sign, but in this case easily explainable with a mistimed emergency capital rise (and subsequent dilution).

As well, analysts expect the uptrend to resume again, but sure - nothing in the future is certain ;) ;

On the plus side ... I do see a forward PE of 10, a dividend yield of 6.7% (though not fully imputed) and I do see good retailers (and I count them into this category) making promising noises re business / margins. Customers get used to increased prices and freight rates are actually dropping.

I guess nothing is certain but uncertainty ... but I do see them at the current price as a promising play ...

With KMD you've got to think Global and the opportunities that bring. KMD not really a NZ company anymore

If you judge them on NZ you'd run a mile from this high profile best in breed dog - based on this sales trend

2014   $141.0m
2015   $139.1m
2016   $141.7m
2017   $146.4m
2018   $143.0m
2019   $138.6m
2020   $133.7m
2021   $120.8m
2022   $113.9m

Just as well NZ only going to be less than 10% of group sales eh

See Alan Gray became a SSH the other - they are renowned 'value' / 'contrarian'   investor and include the likes of FBU in NZ holdings

Could be another 6 moths or so before this lifts off as Europe will be under water retail for a while until next summer?

could be a while giving somerunway before taking a position here on this one.

I agree Waltzing.  Europe is such a mess at present.  People desperate just to pay their power and gas bills which have literally exploded in price and put food on the table.  Doubt too many will be buying expensive Kathmandu, Canada Goose or any other high end jackets anytime soon.  Cheap thick polar fleece on the other hand should be selling like hotcakes to people who can't afford to heat their homes properly any more.

Quote from: Basil on Oct 11, 2022, 02:53 PMI agree Waltzing.  Europe is such a mess at present.  People desperate just to pay their power and gas bills which have literally exploded in price and put food on the table.  Doubt too many will be buying expensive Kathmandu, Canada Goose or any other high end jackets anytime soon.  Cheap thick polar fleece on the other hand should be selling like hotcakes to people who can't afford to heat their homes properly any more.

According to investor presentation YE 2021 total sales are $980m with UK sales $100m. I do agree with your comments, caution is warranted but UK not main market. CEO has also stated a push in the UK so might not end up to bad. 

I have also been researching retail during the GFC and other recession's. Came to the conclusion that people still like spending on looking good outdoors, even in tough times.

My kids tell me a Katmandu jacket in winter and Rip Curl are like what "nomads" were  in the old days.

Quote from: Basil on Oct 11, 2022, 02:53 PMI agree Waltzing.  Europe is such a mess at present.  People desperate just to pay their power and gas bills which have literally exploded in price and put food on the table.  Doubt too many will be buying expensive Kathmandu, Canada Goose or any other high end jackets anytime soon.  Cheap thick polar fleece on the other hand should be selling like hotcakes to people who can't afford to heat their homes properly any more.

Interesting that the people with the largest distance to Europe seem to have the best idea what's going on there ... when I talk with our relatives back on the old continent, they tell me just about their third holiday trip this year ... and I am pretty sure, they didn't go naked :) ;

Increased gas prices just rippling themselves now into the household bills (i.e. the stuff everybody here is complaining about for the last 6 months is now just starting to happen. However - many do have alternatives. Our son has a heating system which works as well with firewood ... and many of the older gas systems can be operated as well with diesel.

But I probably need to tell my relatives about the astronomic electricity prices we pay here in NZ (what was it recently - $200,000 per GWh)? I am sure, this gives them something to laugh ... and maybe they set up a donation account for the poor people in NZ?

OK - yes, there are poor people in Europe as well, but probably not more (in proportion) than in NZ. And hey, we still sell higher quality stuff as well, don't we? That's exactly the same situation like in Europe.

Off topic but some facts on U.K. power prices might interest some people.  From 1 October 2022 its gone up to 52p per kw/hr
https://energyguide.org.uk/average-cost-electricity-kwh-uk/ = $1.03 Kiwi per kw/hr.  Any way you slice and dice it that's "shocking"
I believe most people in N.Z. are paying in the 20-30 cents per kw/hr range.

The swedes are nervous, very nervous and while not back in eureop at the moment have been warned not to return yet...

will be looking to replace some rip curl this summer for sure.. They used to last a good decade for so and had posted shots of these amazing clothing items that some have last decades.

Quote from: Basil on Oct 11, 2022, 08:45 PMOff topic but some facts on U.K. power prices might interest some people.  From 1 October 2022 its gone up to 52p per kw/hr
https://energyguide.org.uk/average-cost-electricity-kwh-uk/ = $1.03 Kiwi per kw/hr.  Any way you slice and dice it that's "shocking"
I believe most people in N.Z. are paying in the 20-30 cents per kw/hr range.

If true, this is dear. However - I note that you are talking about a BREXIT riddled UK ... I thought we are talking Europe? Little England shot itself into the foot and is not any more part of it.

Power prices (per kWh) in the heart of Europe are currently somewhere around 30 to 40 Euro cents - i.e. 50 to 70 NZ cents. More expensive than here, but they typically have been twice the NZ rates for a long time.

A bit of a look at this stock:

(https://substackcdn.com/image/fetch/f_auto,q_auto:best,fl_progressive:steep/https%3A%2F%2Frecastinvestor.substack.com%2Fapi%2Fv1%2Fpress_kit%2F78420166.jpg%3FbgImage%3Dtrue%26textColor%3D%2523ffffff%26hash%3D1108060809%26version%3D9?utm_source=substack&utm_medium=email) (https://recastinvestor.substack.com/p/update-kmd-brands-kmdnzx-kmdasx)

Anybody else noticed the recent Share price move, or did you all take after the relentless doom and gloom on this thread KMD out of your portfolios and watchlists?

SP moved above MA100 (the pink line below) and so far holding. Sure - early signs, but certainly worthwhile to watch. I like the green shoots coming out in spring :) ;

KMD.JPG


Discl: holding;

Thanks for posting that graph BP. Yes I have noticed. My only retail stock. I don't think investors realise or trust what the future EPS is forecast. Insider buying is a big positive.

Seems yesterday's fall took share price below MA100

Couldn't be right so I looked at EMA100 (some TA gurus say EMA better guide than MA because it puts more weight on more recent events)

Bugger share price even more below that ... EMA100 a bit over 1.09

No worries because todays Friday and that often is a good day and KMD will go to 1.10

Failing that there's a lunar eclipse net week and that's a good omen

The MA100 still going down

It seems to be saying to the share price wait for me to catch up ,,,,, but that's not how the maths go is it ..... declining share price usually leads to a declining MA100

Next week it all might be different so no worries

Applying your favourite extrapolation technique - given that SP went up by 3 cents in the last 2 months, it will be no doubt around $1.20 in a year from now :P;

If it doesn't - blame linear extrapolation :) ;

Anyway - I see they appointed a new director:

https://announcements.nzx.com/detail/402109

QuoteZion commenced his career with adidas in New Zealand as Product Manager for Footwear in 1998 before moving to the adidas headquarters in Germany in 2002. From 2005 to 2014, Zion held various leadership roles in Asia-Pacific including President & Managing Director adidas Group South Korea. Since 2015, he served as General Manager of adidas North America and in 2018 was promoted to President - adidas North America.

heavenly news indeed ...

It appears that Zions career with adidas might add some quite invaluable experience and insights to the Kathmandu board. Good choice.

 

Hopefully getting new people on Boad so they can ask Captain Kirk to 'retire'

Well past his use by date is David

In saying that he has taken a small ANZ outfit to a global giant --- but I don't knpw if shareholders are much richer (not checked that out)

Zion might be the man

Quote from: winner (n) on Nov 10, 2022, 12:26 PMHopefully getting new people on Boad so they can ask Captain Kirk to 'retire'

Well past his use by date is David

In saying that he has taken a small ANZ outfit to a global giant --- but I don't knpw if shareholders are much richer (not checked that out)

Zion might be the man

Using Morningstar here's how punters have done if they bet $10,000 on KMD in 2013 - includes divies which are reinvested - worth $4,446 now

Good thing about this chart - it can't really go down any more can it

0000kmd.JPG

Great chart Winner. I feel for long term holders.

I spoke to a mate of mine this morning who was speaking to his mate who is a partner at one of the top two largest accounting firms in NZ. He apparently said cracks are starting to show in several of the big retail chains they are involved with.

Allan Gray buys another 7m

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/402191/383165.pdf

Quote from: Shareguy on Nov 11, 2022, 02:58 PMAllan Gray buys another 7m

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/402191/383165.pdf

They seem to like NZ at the moment

Must use BlackPeter as their NZ advisor - they be buying into OCA next  ;)

Quote from: winner (n) on Nov 11, 2022, 03:07 PMThey seem to like NZ at the moment

Must use BlackPeter as their NZ advisor - they be buying into OCA next  ;)

Wouldn't that be good. It needs some love

KMD Brands update today.

Achieved a positive result in Q1 FY23, with strong sales growth across all brands compared to both prior year and pre-COVID levels. Pleasingly, gross margin and profitability are holding up well, with group underlying operating profit for the first quarter of FY23 improving by nearly $30 million year-on-year.

https://www.nzx.com/announcements/402435

Quote from: Shareguy on Nov 16, 2022, 10:04 AMKMD Brands update today.

Achieved a positive result in Q1 FY23, with strong sales growth across all brands compared to both prior year and pre-COVID levels. Pleasingly, gross margin and profitability are holding up well, with group underlying operating profit for the first quarter of FY23 improving by nearly $30 million year-on-year.

https://www.nzx.com/announcements/402435

Bloody good -

Q1 FY23 underlying operating profit has improved by nearly $30m year-on-year


All back to normal

A broker had a $1.75 target not long ago --- share price heading back that way ..... middle of next year

Share price burst through MA100 - that's a good sign

KMD say - group underlying operating profit for the first quarter of FY23 improving by nearly $30 million year-on-year."

Jeez - full year 22 was $36m

So after Q1 $30m ahead of last year - makes you wonder what full year will be eh

Bonanza year on way .... might see that $1.75 share price yet

Give Forbar full marks for loyalty to KMD

You'd think that one day (soon) their and many others view of where the KMD share price should be will become reality

Who had a target of $1.75 a year or so ago?

One day the charts will look better - won't they

0000kmd.JPG

Agree Winner. 2023 will be the year.  Im picking SP should rerate on next results.

My only retail stock. 

Quote from: Shareguy on Dec 12, 2022, 10:03 AMAgree Winner. 2023 will be the year.  Im picking SP should rerate on next results.

My only retail stock. 

Chart looking good on the MA100 - that MA100 line went below the share price line rather than the share price line going above the 100MA line - whether that means anything or not no idea

so Forbar might publicly include KMD in their Brokers Tips for 2023 in the Herald thing

Hope some other broker puts it in as well - that will see a lot of buying over the holiday break .... mums and dads love including Brokers Tips in their portfolios -esp when they do their annual review and throw out the losers etc etc

Allan Gray disclosure this morning.  Grabbed another 1.1 percent.  That's a vote of confidence not just in KMD but retail more broadly.

Quote from: Hectorplains on Jan 16, 2023, 09:48 AMAllan Gray disclosure this morning.  Grabbed another 1.1 percent.  That's a vote of confidence not just in KMD but retail more broadly.

Alan Gray a much respected 'value' investor

Sous out the bargains

Good stuff

Quote from: winner (n) on Jan 16, 2023, 11:05 AMAlan Gray a much respected 'value' investor

Sous out the bargains

Good stuff

Good to see he is still buying.  I also have been adding and now have enough.

quess work?.... warmer winter in europe .... they could be right... late start to summer down under...

Macpac reported H1 sales to December were 55% up on pcp

Hope KMD done better than this in Aust and NZ ...after all they said in November they were 106% up for the first part of the year

That be good

Pretty good update

All on track to get that share price moving up

Craig's said $1.75 last year ...target probably less now ...maybe $1.50

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/406617/388469.pdf

• Sales momentum has continued in Q2, resulting in record first half sales
• Group total sales for 1H FY23 (unaudited) are expected to be approximately $546 million, an increase of +34% above 1H FY22, with particularly positive trading in Australia.
o Kathmandu sales recovery continues, with total sales +51% above 1H FY22, reflecting a return of travel and tourist-related spend
o Oboz first half sales have rebounded from COVID-related supply constraints last year, growing +124%
o Rip Curl total sales have grown +18%, with strong growth in direct-to-consumer sales, while maintaining wholesale sales levels following strong growth last year
• Group gross margin remains resilient overall, with improved gross margin for the Kathmandu brand
• Underlying 1H FY23 EBITDA(1) is expected to be approximately $45 million, cycling $10.2 million EBITDA in 1H FY22, which included $5.1 million of one-off COVID assistance

I was very surprised at the result.
I bought a few at $1.09.
BP is right..

 looks pretty good going. share up already.

Quote from: Waltzing on Feb 14, 2023, 10:24 AMlooks pretty good going. share up already.

That'll make BP happy

no mention of NPAT though WInner() .....

that underlying ----- the junk removed re leasing right?

any other junk in the PL removed?

havnt had time to look. we hace just gone through a monster OOP implementation and complete change of how our software woks along..... mean works...OOOPPS..

OOP stands for ...https://en.wikipedia.org/wiki/Object-oriented_programming

Good but not good enough. Would not use 2022 1H as comparison.

Craig's said this morning that todays announcement has missed their analysts forecast of $65m ebitda.  2021 1H was $48m ebitda.

 

aye shareguy I saw the same excerpt but they still regarded it positively with continued momentum in quarterly revenue and gp margins holding up - but the issue was with the CODB costs they had forecast vs what transpired. it's pretty bloody difficult to forecast anything using pcp comps at the moment - trying to remember where was the previous lockdown, what sort of covid support did they have - so pretty easy to get the base wrong let alone what inflation rate to roll them forward by.

I dont see the miss to forecast as overly consequential as the market never believe the $65m and its more the direction of the step up in activity rather than how close it got to consensus.

and here come the sellers... lots of shares hanging over from the cap raise... dump into the good news...right got it understood...

craigs covering their ass.... spoke to a local craig team member over drinks one evening in hamilton a few years ago and he said... dont put your money with us.

They do do a nice published market presentation or used to.

at least KMD is back selling and did not go belly up.

getting hit a bit now... might be a real bargain at a dollar...

From Craigs' research today.
Recovery on track.
overweight.
Price target-12 mth.....$1.44

i had drinks a few years back with a local craigs guy... he said dont put your money with us...

he dressed like a london spiv...

hey winner(), found W J ONiel, charting in stocks.. it wass holding up a computer....

I have been a very happy satisfied client for over 40 years.
Christchurch and Dunedin branches have served me well.

Quote from: lorraina on Feb 15, 2023, 05:01 PMI have been a very happy satisfied client for over 40 years.
Christchurch and Dunedin branches have served me well.

I agree. Have made a lot of money through Craig's. They don't get it right all the time but no one does.

They do publish some nice booklets... for those not running multiple live portfolios a full service broker is nice to have for the retail investor.

Its ten years past the point where FA reports from Listed companies dont come with Tag objects in PDF files.

Once they do CHAT AI (open AI) back ends can go to work.

market updates may be positive... but retail investors may not have any money to drive stocks higher...

they are keeping it for a rainie day and..... retail shopping...

The Group continues to benefit from a return to travel and international tourism through January, with
Kathmandu sales strengthening +52% and Rip Curl continuing its growth trajectory at +19% for the
month.

Volume   
69,280

BIDS:

Quantity   No.   Price
 21,357   2   109


Asks   
Price   No.   Quantity
110   3    23,293

Recent Trades   
Price   Volume   Time   Cond
109   1,653   14:2

going to need some rip curl gear.. summers here.

BOP surf beaches were pumping today and people came out from 8 weeks of  winter in summer....

1H23 out Wednesday. I'm expecting a great result and turn around.

I'm forecasting

NPAT $18m
EPS 2.5 cps
DPS 3.0 cps

Quote from: Shareguy on Mar 21, 2023, 06:23 AM1H23 out Wednesday. I'm expecting a great result and turn around.

I'm forecasting

NPAT $18m
EPS 2.5 cps
DPS 3.0 cps

Hope you right shareguy

But whatever has to be better than last year, after all sales are 34% higher

But I reckon $19m/$20m NPAT but KMD will be touting Underlying EBITDA eh

Quote from: winner (n) on Mar 21, 2023, 07:59 AMHope you right shareguy

But whatever has to be better than last year, after all sales are 34% higher

But I reckon $19m/$20m NPAT but KMD will be touting Underlying EBITDA eh

Sales will be up...but so will costs.  It'll be interesting to measure them against HLG. 

Quote from: Shareguy on Mar 21, 2023, 06:23 AM1H23 out Wednesday. I'm expecting a great result and turn around.

I'm forecasting

NPAT $18m
EPS 2.5 cps
DPS 3.0 cps

We were both optimistic eh ....did you change your forecast and edit original post?

Statutory NPAT of $14.0 million; Underlying NPAT1 of $16.5 million

Statutory NPAT of $14.0 million; Underlying NPAT1 of $16.5 million

One thing I noticed

Group EBIT (underlying) $29.3m ...RipCurl EBIT $28.8m

Shoes and Kathmandu don't contribute much do they

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/408724/391122.pdf

Bit of a long wait to 30th June for the 3cps unimputed divie.
Otherwise a good result with a strong out look.
2nd half usually the stronger half.

Quote from: winner (n) on Mar 22, 2023, 09:35 AMWe were both optimistic eh ....did you change your forecast and edit original post?

Statutory NPAT of $14.0 million; Underlying NPAT1 of $16.5 million

Record sales but a big increase in employee costs resulted in NPAT being below what I thought.  Divi good but unimputed for NZ holders. Debt at $85m

PS No I did not edit my post. (It says if the post has been edited) 

Had a brief look over this to see what I might be missing compared to my sector preference HLG.  Couldn't find anything to get enthusiastic about to be honest about it.  Lot of sales for very little profit, good gross profit margin but razor thin net margin reflected in very modest net profit after all costs taken into account.
Gosh the stock turn is scary low at 1.61 times compared to HLG which somehow despite there obviously only being 4 seasons, manages to consistently get a stock turn above 4.  Kathmandu gear has always struck me as expensive even on sale and in tougher times I suspect we will see quite a bit of brand substitution to cheaper brands like the Mountain Warehouse.  Gosh 2H performance will need to be considerably better to justify the apparent metrics this is trading on.
Prefer HLG by a country mile.  I guess I don't "get' the international growth opportunities this may have and would rather stick with Glassons Au proven track record of strong sales and strong eps growth.
Unimputed 6% yield doesn't spin my wheels but each to their own and good luck to holders.

Basil ....in the media

Business is booming and the future looks bright for global outdoor apparel firm KMD Brands after the grim slog through the pandemic now appears to be behind the company

CHEAP CHEAP at current prices

Quote from: lorraina on Mar 22, 2023, 09:50 AMBit of a long wait to 30th June for the 3cps unimputed divie.
Otherwise a good result with a strong out look.
2nd half usually the stronger half.

The wait .....,,giving themselves time to quit some of that excessive stock to get the cash to pay it .....and avoid having to borrow a bit more

Will most probably work well for me, as I it is a drought time of the year for me receiving divies.

Quote from: winner (n) on Mar 22, 2023, 03:45 PMBasil ....in the media

Business is booming and the future looks bright for global outdoor apparel firm KMD Brands after the grim slog through the pandemic now appears to be behind the company

CHEAP CHEAP at current prices

Funny you mention cheap cheap mate...can't help myself thinking of a budgie lol
Lot of cheap stocks around at the moment.  Some really scream "cheep" just like a budgie, (late single digit PE's with nearly 10% yields).  Retailers HLG and TRA good examples. 

Just a thought for KMD, how long before catch-up tourism spend and outdoor adventure activities cools off a bit? 

I agree sales were great. However Group uEBITDA margin of 8.3% in 1H23 was a considerable step up from 2.5% in the pcp, however remains well below the 11-12% pre-COVID levels. No real guidance given other than second half normally better.  So all going well maybe a 7 cent total divi if we are lucky.

Overall, disappointed and agree there are better opportunities currently. 2024 might be the year for KMD

https://sendy.tarawera.co.nz/l/J6oLVth2f3f6IXNYvUBQEg/zYAtsvHUNkzTUQDgRIuOkA/2T0a5L8luuDCkDAKsv2ghw

Craig's updated note this morning

No guidance provided. Only minor changes to CIP forecasts: KMD indicated strong momentum has continued into Feb, with sales up +31.9% YoY across the Group, (albeit this not a significant trading month). With sales healthy and guidance commentary largely in-line with our forecasts, we make only minor changes to our numbers following this result.

Target price $1.48 (prev. $1.44), +2.8%: We increase our 12-month target price by 2.8% which reflects minor changes to our forecasts and the impact of TVM since last publish.
 
 

Much respected and successful value investor Alan Gray still buying at bargain prices

Probably can't believe their good fortune

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/409824/392483.pdf

well winner dont see it out performing this and not even HLG... but you never know...and with all that government money , mean your money being spent on the rebuild after the cyclone who knows the American said even expects BRS to benefit...

Inflation says KIWI's whats that?

Anybody noticed this Golden Cross which passed by a couple of weeks ago? Since that point in time did the SP nicely hold above or bouncing at the MA200. Golden times ahead :) ;

I don't know Alan Gray but Kathmandu looks cheap to me. As volume recovers and profits grow we could see the share price recover.
Looking at marketscreen the shares are on a pe of 13.5 for 2023 and 10.2 for 24, when a dividend of 7 cents is forcast. I would take this with a big pinch of salt. But fingers crossed. The pe drops to 8.6 for 25 with a 9 cent dividends. Cash flow also improves. Hope springs eternal

Quote from: afc029871 on Apr 14, 2023, 02:46 PMI don't know Alan Gray but Kathmandu looks cheap to me. As volume recovers and profits grow we could see the share price recover.
Looking at marketscreen the shares are on a pe of 13.5 for 2023 and 10.2 for 24, when a dividend of 7 cents is forcast. I would take this with a big pinch of salt. But fingers crossed. The pe drops to 8.6 for 25 with a 9 cent dividends. Cash flow also improves. Hope springs eternal

You are probably referring to dividend yield (if you talk about dividend). PE is Share Price divided by Earnings per share ... and latter says nothing about whether the board decides to pay a dividend or not.

Having said that - you are right ... while KMD is not cheap if it just would keep its current earnings (with a PE of 21), if we assume that the earnings will grow from here with 2 cts per year (as e.g. market screener shows), it is a steal (which would turn it into a forward PE of 12 with a two digit earnings CAGR). Obviously - at this stage its just that, a promise and - predicting the future is impossible.

If you are an optimist for KMD, its a great buy. If you are a pessimist and expect people to stop buying good quality outdoor gear, its not.

Discl: I am an optimist :) - i.e. holding;

Quote from: BlackPeter on Apr 14, 2023, 11:15 AMAnybody noticed this Golden Cross which passed by a couple of weeks ago? Since that point in time did the SP nicely hold above or bouncing at the MA200. Golden times ahead :) ;

Aren't Golden Crosses wonderful things .......KMD shsre price on real roll ...reinvigorated it is

Yes Winner() but what does BG say about P/E's

and if that is the case this is fully priced for now and HLG is no where near it according to MR B....

Short the KIWI...

Quote from: Waltzing on Apr 17, 2023, 01:54 PMYes Winner() but what does BG say about P/E's

and if that is the case this is fully priced for now and HLG is no where near it according to MR B....

Short the KIWI...

Don't forget - your Mr B tells us that the crowd is roaring and buying as if there will be no tomorrow.

This will be good for all retailers ... and if the crowd buys stuff, they are buying shares as well. Euphoria, here we come.

Anyway - problem is, no matter whether they are Mr A. B or C ... none of them has a more than random chance to predict the future. Nobody has. This is something only G can ... and she has been made by Mr A, B and C's forebears.

Re shorting the Kiwi ... did you have a look at the ratio debt to GDP for e.g. US, Japan, Britain, EU and compared that to ours?

BIG is not always good ...

certainly hope they dont know what GDP is or OCR or GNP or PPP ...

and they keep buying.... and the SUN is still out apparently...
 

I have always found Kathmandu gear very expensive, even on so called sale whereas Glassons and Hollensteins stuff seems very reasonably priced even when not on sale.  If someone with my means finds Kathmandu expensive, maybe others will too and look to engage in brand substitution in tougher times, e.g. The Mountain Warehouse.

Quote from: Basil on Apr 17, 2023, 02:37 PMI have always found Kathmandu gear very expensive, even on so called sale whereas Glassons and Hollensteins stuff seems very reasonably priced even when not on sale.  If someone with my means finds Kathmandu expensive, maybe others will too and look to engage in brand substitution in tougher times, e.g. The Mountain Warehouse.

One of the few shares I hold where I would not buy their products.
Perhaps the only share.

PS.I think I would be arrested for indecent exposure if a wore a Rip Curl G String bathing suit at New Brighton Beach...

Quote from: Basil on Apr 17, 2023, 02:37 PMI have always found Kathmandu gear very expensive, even on so called sale whereas Glassons and Hollensteins stuff seems very reasonably priced even when not on sale.  If someone with my means finds Kathmandu expensive, maybe others will too and look to engage in brand substitution in tougher times, e.g. The Mountain Warehouse.

My great grandmother used to say "We are poor people, we can't afford to buy cheap stuff". She lived that way.

The stuff I buy at Kathmandu (and similar) outlets typically keeps for a couple of decades (+/-).

Much cheaper that replacing the wardrobe every year at HLG.

Nice weather at the upper and central north island beaches this weekend should see some rip curl tops and wet suits going out the door in what has been a good few weeks for surfing in the upper north island except for the on shores...

inflation down a bit good for retail.

Pretty solid Q3 sales

Rip Curl a bit of a problem it seems
Rip Curl the future of KMD ...needs to do heaps better

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/411610/394559.pdf

ok wll go and buy some wet suits... although a lot like ..O Neill...

picked up a go pro mini from T7 this week... and go pro bike fitting with 360 swivel from DS australia...

you can use the bike fitting for clamping on to carbon fibre in any sport where you need to collect data..

could not find a single ref to Margin or COS or GP or PAOE ....  oh sorry EBIT..

seems to be chugging along along along ..

better get the financials out and do the whole P&L thing and work up a model suppose...

Craig's today

•   KMD – Investor Day on at the home of Rip Curl in Torquay on the Melbourne Coast today ... and if it wasn't for a QAN flight cancellation this morning Kieran Carling would have been there (!) Here is Carling's take on KMD's brief Q3 earnings update this morning (alongside a c.160-page investor day presentation!):
o   Sales for the Group in Q3 increased by an impressive 15.6% YoY, which brings sales YTD (for the 9 months to Apr-23) to +27.7%. Given both CIP forecasts and consensus are for FY23 Group sales to be up c.17-18% on FY22, this update comes in ahead of expectations and highlights continued momentum across the Group following the strong first half result. With gross margins "resilient", sales growth reported across all brands, and the key Q4 winter period still to come for Kathmandu, we see this update as positive indication that KMD's recovery story remains intact. We expect the stock to trade up today.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/414604/398360.pdf
Market seems disappointed with this part

QuoteRecent trading in the fourth quarter ("Q4") has been more challenging, with increased cost-of-living pressures softening consumer sentiment.
Kathmandu has so far experienced a slower start to its winter trading period, cycling its best-ever
winter season performance last year. Sales and retail footfall have been impacted by a warmer start to
winter in Australia, and softening consumer sentiment overall.

KMD half year preso they showed Rolling 12 months sales $1,150m and ebitda $127m

So 2nd half Ebitda about $20m less than last year

Rough numbers for H223 -

Sales $552m ,,,DOWN $22m or 4% on pcp
Ebitda $60m ......DOWN $22m or 25% on pcp

Jeez ..if this trend carries through into F24 no wonder punters jumping ship and share price collapsing

KMD Q3 sales up 16% which was pretty good ...and they were pretty excited about that

H2 sales flat at best

Must have been a torrid last quarter .......double digit decline

yes but what a bargain might emerge later next year!!!!

looking for some rip curl spring sales!

Just prior to announcing the Rip Curl acquisition I June 2019 KMDs market cap was about $680m. FY19 sales were $546m and NPAT was $58m

Since then (4 years) sales have doubled to $1.1 billion but NPAT is going to be about $45m

And today KMDs market cap is still about $680m ....even though they've raised the best part of $400m

Something not quite right eh

But some might say it just shows the huge potential and possible big share price gains once KMD sort their **** out and maybe get lucky

Quote from: winner (n) on Jul 17, 2023, 02:02 PMJust prior to announcing the Rip Curl acquisition I June 2019 KMDs market cap was about $680m. FY19 sales were $546m and NPAT was $58m

Since then (4 years) sales have doubled to $1.1 billion but NPAT is going to be about $45m

And today KMDs market cap is still about $680m ....even though they've raised the best part of $400m

Quote from: winner (n) on Jul 17, 2023, 02:02 PMJust prior to announcing the Rip Curl acquisition I June 2019 KMDs market cap was about $680m. FY19 sales were $546m and NPAT was $58m

Since then (4 years) sales have doubled to $1.1 billion but NPAT is going to be about $45m

And today KMDs market cap is still about $680m ....even though they've raised the best part of $400m

Something not quite right eh

But some might say it just shows the huge potential and possible big share price gains once KMD sort their **** out and maybe get lucky

Something not quite right eh

But some might say it just shows the huge potential and possible big share price gains once KMD sort their **** out and maybe get lucky

Hard to say. A lot of retailers - WHS springs to mind - are struggling to maintain market share and are only doing so through heavy discounting resulting in their margins going backwards. At the same time - again WHS is an example - they don't seem willing or able to take a knife to costs and instead think they can continue to pay high executive salaries and expand into new areas at a time of recession. I'd say KMD are probably better managed than WHS but that isn't much of a vote of confidence!

Dismal update from Kathmandu ......as KW says sales are being smashed

Do we complete this sentence for them ....

"Group underlying EBITDA1 for FY24 YTD is c. $16 million below last year, with Christmas and January retail trading periods to come" (they forgot to add) so H124 underlying EBITDA will be c. $22 below last year

Last years EBITDA  was $45m so this year about half that ....ouch?

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/423822/409931.pdf

Quote from: winner (n) on Dec 20, 2023, 11:19 AMDismal update from Kathmandu ......as KW says sales are being smashed

Do we complete this sentence for them ....

"Group underlying EBITDA1 for FY24 YTD is c. $16 million below last year, with Christmas and January retail trading periods to come" (they forgot to add) so H124 underlying EBITDA will be c. $22 below last year

Last years EBITDA  was $45m so this year about half that ....ouch?

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/423822/409931.pdf

Where is your last years number coming from? FY 2023 EBITDA was $200m (for the whole year), so lets say $67m for the first 4 months.

The $16m less they claimed for the first 4 months would reduce last years EBITDA by less than a quarter, not cut it in half.

Peter
H123 Normalised EBITDA $45.3m

Need to use this Normalised number as it includes rents/leases which is one of their bigger expenses eh

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/408724/391122.pdf

Quote from: BlackPeter on Dec 20, 2023, 11:47 AMWhere is your last years number coming from? FY 2023 EBITDA was $200m (for the whole year), so lets say $67m for the first 4 months.

The $16m less they claimed for the first 4 months would reduce last years EBITDA by less than a quarter, not cut it in half.

Winner is correct - the ASX announcement dated 14 Feb 2023 said "Underlying 1H FY23 EBITDA1 is expected to be approximately $45 million" and they formally reported "Underlying EBITDA1 of $45.3 million" in March 2023.

Quote from: winner (n) on Dec 20, 2023, 11:19 AMwith Christmas and January retail trading periods to come" 

Many retailers and commentators are noting that in Australia and NZ, Black Friday sales now appear to have replaced Christmas and Boxing Day sales.  So consumers may already be tapped out and not in the mood to hit the stores on Tuesday. 

Quote from: winner (n) on Dec 20, 2023, 12:00 PMPeter
H123 Normalised EBITDA $45.3m

Need to use this Normalised number as it includes rents/leases which is one of their bigger expenses eh

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/408724/391122.pdf

Fair enough, though my head is hurting. I guess bad enough to work with EBITDA, but normalizing this stuff feels somehow unnormal to me :)

Quote from: BlackPeter on Dec 20, 2023, 12:12 PMFair enough, though my head is hurting. I guess bad enough to work with EBITDA, but normalizing this stuff feels somehow unnormal to me :)

Accounting is a creative art  ;D  But so long as they use the same definition each year it doesnt really matter as what you want is a direct comparison of performance between periods however they choose to measure it.

My pet bugbear is tech companies that capitalise software development and so never account for it in EBITDA.  Good companies expense it. 

The $45m ebitda ended up as $14m npat (the metric you prefer)

So a $$23m EBITDA this year May/could end up as npat of less than $5m

That's a big ouch too

Forbar forecast F24 npat at $15.7m (F23 $43.4m) ....I'd hazard a guess if achieved most will be coming in second half.

Jeez that's an EPS of 2.2 cents ....so currently on huge PE ratio ....but is at a cyclical low eh so no worries

Quote from: winner (n) on Dec 22, 2023, 08:15 AMForbar forecast F24 npat at $15.7m (F23 $43.4m) ....I'd hazard a guess if achieved most will be coming in second half.

Jeez that's an EPS of 2.2 cents ....so currently on huge PE ratio ....but is at a cyclical low eh so no worries

Miserable noises on the radio about the seasonal spending spree (or the lack thereof). Sounds like many retailers started already Pre-X-mas with Boxing day sales in order to move at least some of their goods. I am wondering how many of our retailers will bite the dust.

Obviously - we can now all sell our retail shares and commiserate each other, or we could start wondering which of the retailers are likely to survive and coming out stronger out of this crisis.

Who do people think will be the winners?

HLG? Clearly they do have their fan base (though most of the fans don't fit into the Glassons dresses :) ;

WHS?? Hard to say ... there is always a place for junk traders, but they clearly would need to do more than just wait in order to start through again ...

KMart? They moved from selling cheap junk with little staff and boosted their quality to reach nearly Warehouse standards (but still selling with less and less paid staff). Maybe, there always is a place for (one or two) junk traders.

BGP? Never really a fan of their sales strategy and too rarely in the need to buy something they sell, so I might not be the best judge in that regard ...

KMD? Sales strategy similiar to BGP, but they sell more stuff I am interested in, and most of it is really good quality. I'd think they will survive and thrive when the industry bounces back,but no doubt - they could do better as well.

amazon? It appears their business model works, but at least on our shores they still didn't got the transport channel (-time and -cost) under control)

temu? Interesting - they buy stuff cheap in China (and some of it is not too bad) and send it for free everywhere in the world. Their logistics must be planned by a genius - Order stuff in China and get it pre christmas in a bit more than a week. If its only for this achievement, they should thrive. Might be interesting to check their books, but if they managed to make money this way, than I expect amazon might have some tough times ahead.

Whatever it is - I think now is not the time to commisserate the terrible sales numbers, but to place the chips for the next round.

Only question is - who will be the winner of the crisis? At the moment are the chips really cheap ...

QuoteWhatever it is - I think now is not the time to commisserate the terrible sales numbers, but to place the chips for the next round.

Why place your bets now ?  Nicola Willis reckons the economy is going to be in the dog house for 2 more years.  I think it's too early to be making bets on retail recovering in 2024 and frankly, I like the chances of winning at that game a lot better if you sit out this round and play in early 2025.
I don't expect any horse to run a really good time at the track with the current boggy conditions.  Turners will put in a thoroughbred performance next year with the brilliance of Tina as the jockey but other than that...

The problem for you Basil is Turners only make money in NZ and Nicola is saying only NZ is poked.

KMD get about 12% of revenue from NZ. 70% plus from Australia.
Rip curl is also the biggest revenue brand for KMD not KMD products.

Sure tough for retailers at present but the global markets will get cracking again before NZ wakes up

Better tell TINA to get off the road when the KMD 1 billion revenue road train starts coming through...Beep Beeep get out of the way Tina


If you believe in the KMD brands and story better to buy at these cyclical lows and ride that next big incoming wave on your rip curl board right up the beach.

Quote from: Basil on Dec 22, 2023, 03:12 PMWhy place your bets now ?  Nicola Willis reckons the economy is going to be in the dog house for 2 more years.  I think it's too early to be making bets on retail recovering in 2024 and frankly, I like the chances of winning at that game a lot better if you sit out this round and play in early 2025.
I don't expect any horse to run a really good time at the track with the current boggy conditions.  Turners will put in a thoroughbred performance next year with the brilliance of Tina as the jockey but other than that...

I see where you are coming from. On the other hand - I found so far nobody who was able to predict the future (and this includes what the economy may or may not do), and I suppose that even Nicola Willis belongs to the same group of people.

Tourism might come back earlier than expected - I notice Cathy Pacific came back to ChCh and United started flying to ChCh.

Overseas students seem to boom again. I notice that some local schools have even problems to find enough host parents.

Interest rates might swiftly coming down when the economy does ...

But hey, what do I know? I learned at some stage that pessimists are as often right as optimists, however - optimists live longer and have more fun. What can I say?

Profit wise F24 heading towards KMDs worst year ever ........maybe even worse than F20 covid year

Resilience they talk about ...but sadly missing I reckon

Allan Gray and superfund or acc be along shortly...Allan must have quite a big money tin

Looking at FY23 results when KMD achieved record sales, the GM of 59.1% is impressive but the underlying operating expenses of 49.5% of sales seems very high. Need to lower costs or achieve significantly higher sales off the same cost base. However, per the trading update, sales have weakened since then.

One-armed Hawaiian surfer Bethany Hamilton fell out with Rip Curl but the dispute took a new turn more recently. 

The owner of surf brand Rip Curl is in a furore over transgender rights as the company's financial performance faces scrutiny.
The controversy emerged just two months after Rip Curl fell out with former ambassador and shark attack victim Bethany Hamilton (https://www.textise.net/showText.aspx?strURL=https%3A%2F%2Fwww.nzherald.co.nz%2Fsport%2Fovercoming-jaws-the-remarkable-journey-of-soul-surfer-bethany-hamilton%2FAHJPGY6DWPXSD2V6CIMYURMPQA%2F) over her refusal to compete against transgender women.

Kathmandu (KMD), founded in New Zealand, acquired Rip Curl in 2019 for $368 million.

A social media backlash debate emerged over the weekend with a Rip Curl ad campaign featuring transgender surfer Sasha Jane Lowerson.  Some Australian commentators argued the Instagram ad featuring Lowerson and subsequent backdown was a case of "go woke, go broke".

Burt said Rip Curl was now in a controversy likely out of all proportion to what was anticipated. He said somebody posted online: "Rip Curl, enjoy your Bud Light moment."

Diabolical update today

$15m ebitda sort of says breakeven at best ...not a good half year

Rip Curl becoming a problem child by looks of it

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/426457/412913.pdf

Quote from: winner (n) on Feb 20, 2024, 10:09 AMDiabolical update today

$15m ebitda sort of says breakeven at best ...not a good half year

Rip Curl becoming a problem child by looks of it

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/426457/412913.pdf

Mmh - sure, lower revenues never sound flash. On the other hand - they gained last year in HY1 (+34,5%) much more on sales than they gave back this HY (-14.5%). They said they managed to kept their margin ... and to reduce their cost and inventory.

Maybe I am not objective on the use of the word "diabolical", but I could imagine worse :)

I hear they have currently a hard winter in the Northern hemisphere ... and for some funny reason the southern hemsiphere frequently follows this pattern. Hard winters are good for the sale of warm jackets.

Agree however - their sales strategy (focus on online) feels a bit dusty these days - and the shops I pass by occasionally are often quite empty - of customers as well as of desirable products. Even I had to buy recently my latest pair of mountain boots at Merrell, after first checking Kathmandu and MacPak. Better quality shoe at a lower (well, less inflated) price ...

Online the rise of temu is likely hurting them - and brick and mortar shops with good quality outdoor gear are these days a dime a dozen. They can't rely anymore just on the name Kathmandu to distinguish themselves ... I suppose the generation which bought at Kathmandu because the name remembered them at Ed Hillary's achievements is moving out of the outdoors equipment stores and into the retirement villages.

Lost their way. Evolved from a focused outdoor equipment and apparel company to another ineffective corporate.

Quote from: Mos on Feb 20, 2024, 06:01 PMLost their way. Evolved from a focused outdoor equipment and apparel company to another ineffective corporate.

Sales trend doesn't look too bad, even allowing for recent ups and downs

Must be a worry seeing revenues still over 1 billion but last 12 months profit only about $20m

Skinny profit margin for a branded retailer .....yep mos maybe has become an ineffective corporate
IMG_5649.png

Yes Winner, sales is one thing but profit is another as you say. Costs are eye wateringly high per my December post.

 Kathmandu being killed by MacPac here and in Australia. Mountain Warehouse taking share from Kathmandu as well

No wonder KMD group performing badly ...and Rip Curl and shoes not pulling them through

Kathmandu woes summed up in BusinessDesk article

This bit pretty damning

Coriolis director Morris blames execution for the decline, saying from reading the earnings reports that the company has identified the issues.

"There's nothing that's not fixable with Kathmandu," he said.

"It's pretty straightforward to look and see what needs to be done, but in practice, it doesn't seem to be happening."

https://businessdesk.co.nz/article/retail/kathmandont-analysts-pan-nz-outdoor-retailer

So first half is a $9.7m LOSS

The Kathmandu brand/stores getting worse as time goes by ....almost beyond redemption I'd say


http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/428176/415136.pdf

Quote from: winner (n) on Mar 19, 2024, 09:47 AMSo first half is a $9.7m LOSS

The Kathmandu brand/stores getting worse as time goes by ....almost beyond redemption I'd say


http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/KMD/428176/415136.pdf

Hmm - not flash. Particularly considering that the outlook 6 months ago was not that bad

"Despite the challenging consumer sentiment, we are well positioned with tailwinds from continued return to travel, positive impact from the launch of innovative products and the outdoor lifestyle trend post-pandemic."

... and considering that others in the field managed to deal much better with the (undoubtedly) challenging consumer sentiment.

Not sure I would consider them as "beyond redemption" - and the article you posted just above clearly outlines the problems. Shouldn't be that hard to fix, but not sure whether I find the CEO's comments faith inducing that he is on the right path.

Hard to say where this is going - while I do see a market for them (and times improving), it still will be difficult if they allow others to eat their lunch.

Quote from: BlackPeter on Mar 19, 2024, 12:11 PMit still will be difficult if they allow others to eat their lunch.

Mountain Warehouse are doing exactly that.  If you want a REAL sale, go there when one is on.  September at their Queenstown branch is a great place to be.

Gross Margins remain resilient, operating costs are being tightly managed and the Balance Sheet is in good shape (0.5x Debt/EBITDA) ... but with sales going backwards by c15% YoY making headway is difficult.

Loss of divi makes sense under the circumstances.   

GAP having same issues as Kathmandu

GAP saying they are changing wayscand goingbto become cool again

Probably too late for either to become cool again

I recently took a position after selling out some time ago. Future interest rate cuts are going to be a game changer for retail.  Looks attractive trading on a forward (forecast from FB)two year PE of 8.  Announced covenant waivers in my opinion take the risk of any further capital raises off the table, unless it really turns to custard. Have $200M of funding headroom as at 31 July 24. Focus on reducing overheads should reap benefits when customers start spending, which they will... 

Has been plenty of insider buying plus Allan Gray and the NZ super fund have been adding.  Possible M&A.

 

https://www.rnz.co.nz/news/business/523942/briscoes-thinking-about-kathmandu-investment

"Look, I'm not as close to that business as perhaps I should be. Clearly, there are some issues embedded in that business. I'm not quite sure whether it's their summer time business or their winter time business that's the issue. Maybe it's both."

Guess that puts to bed the old Rod Duke taking over KMD yarn.

If it barks like a dog, howls like a dog, wags its tail like a dog, guess what, its a dog !
I think Kathmandu gear is simply too expensive for what it is.

Up 18 percent this week. Nice

yes .... retail has  got a bid ... BGP did not move though...

trading update:

https://www.nzx.com/announcements/436469

... and actually, this does not look as bleak as analyst consensus.

Yes, revenue is down (as expected), but clearly the slow down was reducing towards the second half. margins down as well, but just by a tiny bit.

After they've done all their numbers I am pretty sure they will come  up with a better earnings than the small loss (neg 1 cts/share) the analysts predicted.

How would 2 to 3 cents sounds? Just dreaming ... I am sure they can find some one - offs, but hey.

Anyway - market seems to be pretty upbeat as well. I wonder why?

Someone found something positive hiding in that release apparently  :-\

go retail!!! 

must be the underlying EBIT ...

• The Group confirms that underlying EBITDA(2) is expected to be in the range of $49 million to $51 million for FY24.
• Group inventory at 31 July 2024 was approximately $25 million below the same time last year, resulting in Net Working Capital being approximately $21 million lower year-on-year.

Quote from: Gerald on Aug 20, 2024, 12:04 PMSomeone found something positive hiding in that release apparently  :-\

Someone? Many!

SP up 6 cts (12%) since release of the announcement.

Quote from: Waltzing on Aug 20, 2024, 12:07 PMgo retail!!! 

must be the underlying EBIT ...

• The Group confirms that underlying EBITDA(2) is expected to be in the range of $49 million to $51 million for FY24.

Made me wonder if this EBITDA(2) was another "community adjusted EBITDA", but not quite that bad;

Earnings before interest, tax, depreciation, and amortisation, excluding the impact of IFRS 16, software as a service accounting, restructuring, and one-off non-cash items.

Still quite a mouthful. Could have been easier to give free cash flow guidance but might not look too good.

Quote from: Gerald on Aug 20, 2024, 12:33 PMMade me wonder if this EBITDA(2) was another "community adjusted EBITDA", but not quite that bad;

Earnings before interest, tax, depreciation, and amortisation, excluding the impact of IFRS 16, software as a service accounting, restructuring, and one-off non-cash items.

Still quite a mouthful. Could have been easier to give free cash flow guidance but might not look too good.

In a perfect world they would all report on standardized terms. Isn't that why we have IFRS standards?

To be honest, however - not sure I remember any company reporting in their ad hoc financial updates against IFRS terms. They all pick whatever they think makes them look good and is not comparable to competitors and often not even to their own previous reports.

Not good, but that's the way it is.

yup need to attend an online seminar before each reporting season to get updated on the whatever some much of PHD's have decided to change something in the General Ledger...

a ledger full of general stuff , or not in the general ledger but an off ledger adjustment...

Slightly off topic but in response to others I look at IFRS a different way.  Take for example IFRS16 where renting a property turns what is a liability / expense into an asset....IMO it is absurd.  Same can be said for other standards which are driven by US private equity interests which insist on putting a value on everything.  Underlying profit is the business trying to tell you the investor here are the real numbers without the IFRS junk polluting the true P&L.  We should be thankful businesses are prepared to pull back the veil on the real numbers.  That said, not all CFOs are honourable...

Well still not great, however it looks like its getting better. The worst is over with a bit of luck. 

Kathmandu sales trends, relative to fiscal year 2023, continued to improve in a challenging consumer environment, with enhanced in-store execution and new products.

Cloth has been cut. No need of new capital in my opinion. Interest rates on the decline. Has the potential to be a multi bagger. Not without risk. However I believe current share price has little downside from here.

be interesting to see where retai goes in europe this next 12 months but a few stocks on the move yesterday from TRA (sort of retail) to yield stocks like ARG...

LVMH will be of interest to see if the luxury retail buyer is back or when...

KMD used to be a fav ...  instead one gets the old titanium sprayed coated wet suit out and sees if it can go another season

FB positive

Despite the recent rally in share price, we continue to view the risk-reward as attractive with: (1) the current share price implying KMD is only two-thirds as profitable as it was in FY19, and (2) the business being better positioned to benefit from significant operating leverage when the consumer starts to turn. OUTPERFORM.

Good luck mate.  I think its always been an "also ran" at the back of the retail field, but you never know, every dog eventually has its day :)

Quote from: Basil on Aug 21, 2024, 01:53 PMGood luck mate.  I think its always been an "also ran" at the back of the retail field, but you never know, every dog eventually has its day :)

Thanks. Already up on the deal and not a big holding.

https://api.nzx.com/public/announcement/438827/attachment/427986/438827-427986.pdf

KMD finding things pretty tough.

KMD delivered a very weak as expected. Guidance was $49 to $50m so $50m bang on. NZ the issue.

I'm picking it's all good from here, weighted to 2nd half. High insider ownership, plus possible M&A.

Quote from: Basil on Sep 25, 2024, 01:35 PMhttps://api.nzx.com/public/announcement/438827/attachment/427986/438827-427986.pdf

KMD finding things pretty tough.

I guess, things are tough in a cost of living crisis, particularly considering that they are selling stuff which is not essential AND of high quality.

A lot of the stuff I am wearing has their label. Most of it is more than 10 years old, often used and still as good as new.

One highlight for them - wife's backpack might need a replacement (after roughly 20 years) - the ZIP gave up.

Good thing is - sales seem to have reached the rock bottom and, if Chinese customers return (I hear, China reduced mortgage rates), then 2025 might even turn out to be a good year for them.

Anyway - good to see they reached the revenue as predicted by analysts, and margin still in the high 50% is not too bad. Analyst predictions for 2025 are for (slightly) improved revenue ($1028m) and back to some positive earnings (2c/share).

Long term avg PE (10 years) at 4.6!

All up from here?

MacPac reported strong first half sales .....even decent growth in NZ

Kathmandu lost there way and market relevance. Not a good place to be

And Rip Curl seem to be going the same way

I think Kathmandu gear is simply too expensive and if someone like me is thinking that with no cost of living pressures...guess what others are thinking.

Quote from: Basil on Sep 25, 2024, 04:32 PMI think Kathmandu gear is simply too expensive and if someone like me is thinking that with no cost of living pressures...guess what others are thinking.

Tough market maybe but Kathmandu not facing up to facts of life ....their market relevance has gone

Quote from: winner (n) on Sep 25, 2024, 05:16 PMTough market maybe but Kathmandu not facing up to facts of life ....their market relevance has gone

Last time I was in Queenstown in September some years back the Mountain Warehouse had some absolutely amazing gear at prices that would make your eyes water if you had bought Kathmandu gear (even at their so-called sale prices).  Suppose its all available online too. https://www.mountainwarehouse.com/nz/?utm_source=bing&utm_medium=cpc&utm_campaign=BRAND+-+NZ+BING&utm_term=mountain%20warehouse%20nz&utm_content=2NuVrYCY|pcrid|78684006125408|pkw|mountain%20warehouse%20nz|pmt|bp|pdv|c|slid||product||grp|1223756940289263|tid|kwd-76485184102765:loc-2495|cmp|367697810||&msclkid=d6537e799d071acd4876188a009fa962

Look at this super jacket marked right down.  I could see you walking your dogs next winter in that, you'd look very stylish https://www.mountainwarehouse.com/nz/gorge-ii-mens-long-jacket-p43792.aspx/stone/

Quote from: Basil on Sep 25, 2024, 05:22 PMLast time I was in Queenstown in September some years back the Mountain Warehouse had some absolutely amazing gear at prices that would make your eyes water if you had bought Kathmandu gear (even at their so-called sale prices).  Suppose its all available online too. https://www.mountainwarehouse.com/nz/?utm_source=bing&utm_medium=cpc&utm_campaign=BRAND+-+NZ+BING&utm_term=mountain%20warehouse%20nz&utm_content=2NuVrYCY|pcrid|78684006125408|pkw|mountain%20warehouse%20nz|pmt|bp|pdv|c|slid||product||grp|1223756940289263|tid|kwd-76485184102765:loc-2495|cmp|367697810||&msclkid=d6537e799d071acd4876188a009fa962

Look at this super jacket marked right down.  I could see you walking your dogs next winter in that, you'd look very stylish https://www.mountainwarehouse.com/nz/gorge-ii-mens-long-jacket-p43792.aspx/stone/

I've still got a nice padded jacket I got 7 years ago when from Mountain Warehouse in Gretna Green of all places.

Assumed if it kept me warm in Scotland it should be OK for walking dogs in Wellington

Quote from: BlackPeter on Sep 25, 2024, 03:49 PMOne highlight for them - wife's backpack might need a replacement (after roughly 20 years) - the ZIP gave up.

https://twinneedle.co.nz/pages/repairs

63 Gasson Street, Sydenham, Christchurch 8023

RB

MD talking about 'structural refinement changes' ....not restructuring per se.

Going to bring the three business onto one platform ...like 3 systems onto one new ERP platform.

Wonder what will go wrong ..... something bound to

I reckon be some impacts on profitability over next few years

I see the Rip Curl man is quitting as kathmandu CEO

He must have been pretty disappointed how Rip Curl has performed. The $368m acquisition has hardly been roaring success...... current sales much the same as when acquired and profits down. Not a great acquisition.

I'd hazard a guess that it's Kathmandu's ability to grow a successful niche business ....corporate never as good as entrepreneurs. Interfered too much etc etc

I'd say Mr Daly has become rather disillusioned with how Rip Curl has changed for the worse and finally seen what mess the Kathmandu brand really is ...better to leave than hang in there. Then again maybe he was pushed

The ex Nike man might do better ...somehow I doubt it.



https://api.nzx.com/public/announcement/439287/attachment/428636/439287-428636.pdf

the RIP CURL creators knew DA market and no corp is going to do that ..

like saying we understand skate boarders .. good luck just watch the early skate board movies about skating pools in the US ..

now someone been buying .. probably dont skate or surf ... WHO DAT BUYING !!!

https://api.nzx.com/public/announcement/439814/attachment/429243/439814-429243.pdf

Quote from: Waltzing on Oct 10, 2024, 04:41 PMthe RIP CURL creators knew DA market and no corp is going to do that ..

like saying we understand skate boarders .. good luck just watch the early skate board movies about skating pools in the US ..

now someone been buying .. probably dont skate or surf ... WHO DAT BUYING !!!

https://api.nzx.com/public/announcement/439814/attachment/429243/439814-429243.pdf

Actually - great hedge ... if surfers and skaters have more accidents, than ACC can pay for the treatment with the increased dividend from KMD. They just need to make sure that surfers (or better everybody having an accident) are only covered if they wear appropriate clothing (aka Rip Curl or anything else supplied by KMD). Hey, this would be great, wouldn't it? - self funding accidents!

BP ..no divies from KMD for a while

Wonder who sold thev50 million shares today?

Quote from: winner (n) on Oct 10, 2024, 05:58 PMBP ..no divies from KMD for a while

Wonder who sold thev50 million shares today?

Indeed. Hopefully find out Tom. I'm more interested in who has brought them.

One trade of 50328. From latest annual report

Briscoe has 48m
Yara capital 50902
NZ Super 90m
Alan Gray 115m

If Alan Gray has purchased them taking into account acc would take them over 20 percent. So Alan Gray disclosed on ASX today at 17 percent

Quote from: winner (n) on Oct 10, 2024, 05:58 PMBP ..no divies from KMD for a while

Wonder who sold thev50 million shares today?

Interesting question. Well, it was not me (neither selling nor buying), but given that this is roughly 7% of all shares, a look into the top 10 share holders or so might give a clue. It won't be Rod, will it?

Quote from: Shareguy on Oct 10, 2024, 06:14 PMIndeed. Hopefully find out Tom. I'm more interested in who has brought them.

One trade of 50328. From latest annual report

Briscoe has 48m
Yara capital 50902
NZ Super 90m
Alan Gray 115m

If Alan Gray has purchased them taking into account acc would take them over 20 percent.

Bloody hell NZ Super got 90 million ..thought they were clever

Saw one of their investment guys out walking the wharf the other night ...not even in Kathmandu gear

Quote from: winner (n) on Oct 10, 2024, 07:25 PMBloody hell NZ Super got 90 million ..thought they were clever

Saw one of their investment guys out walking the wharf the other night ...not even in Kathmandu gear

Alan Gray just disclosed on ASX at 17.7 percent. Note it's only till the 9/10. Plot thickens. Looks like it went to multiple buyers says NZ Herald.

May as well post here as well

I pulled these historical numbers out for Kathmandu. Period starts before they went on the acquisition trail and spent zillions buying Oboz and Rip Curl.

You'd have to say that these acquisitions haven't added any value .....abject failure I'd say and I'd say you can't blame the challenging market conditions for this dismal performance.

Before the acquisitions the company sales were about $500m with a profit margin of nearly 12% and a ROE of about 14%. All good stuff.

In spite of sales doubling profits have disappeared ......on average the profits they have made are less than pre acquisition.

All that capital raised essentially produced zilch.

No wonder the share price is where it is

Getting rid of CEO and bring in new man ain't going to help much ...company almost beyond redemption and if it recovers it'll take years

Might be taken over by a brave acquiror ...all I'd say is good luck to them.

Any have a look at these numbersIMG_5935.png

Cheers for the analysis, which I "liked"- the analysis, not the numbers.

Sad RoE and pathetic stock turnover.

Overall - pretty sobering picture. Buying brands and physical factories did clearly not work for them (though I remember some years where Rip Curl sort of saved the bacon) - i.e. the base business was doing still worse).

Maybe they should go back to their core business and just sell good stuff from whatever brand they can get their hands on using the Briscoes sales strategy ...

Nice work Winner. Always has had very poor stock turn and looks to have got worse lately.
Did they tout various synergies at the time of the acquisition and what happened to them?  Even if no synergies claimed with the capital raise, this is good evidence that bolt on acquisitions are by no means a certainty to be eps accretive and often are so much work, management take their eye off the core business, which is what appears to be the case here.
Lately, profit margin has been not much better than WHS which is a real shocker.  I find that difficult to understand when you look at the price of Kathmandu gear which is very expensive even when on "so-called "sale"    Agree, a LOT of work for the new CEO to do.
ACC have been buying though.  Maybe they like small punts on flea ridden dogs as a small part of their portfolio?  Heck, even I am having a small punt on an unproven and unconsented mine with Santana minerals that BP reckons is going to devastate the environment so not only am I also prone to the occasional small punt myself, but also on sin stocks that destroy the environment...makes me a bad person and a really evil punter eh  ;)

Quote from: Shareguy on Oct 10, 2024, 06:14 PMIndeed. Hopefully find out Tom. I'm more interested in who has brought them.

One trade of 50328. From latest annual report

Briscoe has 48m
Yara capital 50902
NZ Super 90m
Alan Gray 115m

If Alan Gray has purchased them taking into account acc would take them over 20 percent. So Alan Gray disclosed on ASX today at 17 percent

Ok so it's Yara who sold.

Might be taken over by a brave acquiror ...all I'd say is good luck to them.

Any have a look at these numbersIMG_5935.png
[/quote]

Great work Winner,Thankyou. If you look at the purchase of Ripcurl I suggest it saved the day and Kathmandu would not have survived.

What is "asset turnover" measuring?  It looks like some have interpreted this as inventory turnover...perhaps?  Also, I'm not sure what this metric is trying to show.

Quote from: Ferg on Oct 15, 2024, 09:35 AMWhat is "asset turnover" measuring?  It looks like some have interpreted this as inventory turnover...perhaps?  Also, I'm not sure what this metric is trying to show.

Asset turnover is a ratio that measures how efficiently a company uses its assets to generate sales. The higher the better as more sales generally more profit. For KMD this has been declining over the last few years ...as have profits. Briscoes on other hand has a steady asset turnover of about 1.7.

Stock one of main assets and as you can appreciate more the stock turns over the better eh. This just an extension of that



What I've shown is just the output of the Du Pont Model. Good tool to compare companies in same industry.

Crux is ROE is Profit Margin X Asset Turnover X Financial Leverage. Can obtain good insights as to how a company is going.

Point of showing this Kathmandu is that the recent acquisitions have basically added no value ....could even be a destruction of value.

Quote from: winner (n) on Oct 15, 2024, 10:12 AMCrux is ROE is Profit Margin X Asset Turnover X Financial Leverage. Can obtain good insights as to how a company is going.

That makes sense.  I was going to say RoE is a better measure given it doesn't ignore debt funding, whereas RoA does.  But I see you are breaking RoE into its components.  Makes sense - otherwise RoA on its own is of little value IMO.

Mention of stock turns.

KMD 1.4 stock turns a year compared to

MHJ 1.3
WHS 4.2
BRG 4.1
HLG 6.1

Even allowing for some manufacturing component both KMD and MHJ pretty pathetic when it comes to managing stock

Ranking does tell a bit of a story eh

Michael Daly gone ...now Brooke ...that's what made Rip Curl great gone

Suppose after Michael was 'pushed' (speculation) Brooke said I'm off too.

So it's up to Captain Kirk and the Nike guru to keep the ship upright

That's not good

https://announcements.nzx.com/attachment/429535.pdf

With a new ceo I'm not surprised with the changes. Brooke might well of applied for the ceo role and be disappointed. Changes in the share register and with executives. We just need to see some improvement and the SP will follow.

Ripe for someone to buy a bruised business at bottom of the cycle. Im picking it's going to be a good summer.

I believe KMD's downfall has been a long time coming, and rebuilding may not be as simple as waiting for consumer confidence to return. In my view, KMD is suffering the long-term consequences of several missteps:

• Their pricing strategy: the practice of setting extortionate regular prices, only to offer frequent deep discounts, feels manipulative. While some might see these sales as 'good value', I think this approach ultimately builds consumer resentment. It forces us to 'time our run' when shopping at KMD, adding unnecessary friction to the store experience.
• I've noticed KMD losing its identity as an innovative outdoor brand. In my opinion, Macpac has clearly taken the lead in providing genuinely good mountaineering gear. They partner with widely recognised fabric technology companies like Pertex, which adds credibility to their products.
• I find their 'Summit Club' rebrand to be poorly executed. Also, charging $10 to join a summit club seems counterintuitive to me. Why should customers pay for the privilege of being loyal?

These issues have soured my perception of KMD, and I suspect many other consumers feel the same way.

Always good to see insiders buying.

https://www.nzx.com/announcements/440401

Quote from: Shareguy on Oct 22, 2024, 07:06 AMAlways good to see insiders buying.

https://www.nzx.com/announcements/440401

True - while KMD shares are still on special, another 200k are not peanuts.

The other day at their ASM Super Retail said MacPac sales in NZ '... have demonstrably slowed'

Blamed competitive pressures

Kathmandu must be winning big time ....hooray

Another "beginning of a trend of improvement" from Kathmandu. They have been saying that for 3 years already. The stock looks cheap, but I wonder if it's cheap enough.

GFC - but its been hit across all it markets.. havnt had time to look into it...

but it does not look cheap enough...as 10 year bonds are still up at nearly 5...

if US crashes the oil market then stock markets could turn .. and the arrows start pointing up...

No matter what the trend, but this is cool:

https://www.rnz.co.nz/news/top/544406/kathmandu-to-design-and-produce-nz-s-olympic-uniforms

Just imagine how good all these gold medals will look next to the Kathmandu logo :) - for sure, this must be worth something;

Quote from: BlackPeter on Mar 12, 2025, 02:14 PMNo matter what the trend, but this is cool:

https://www.rnz.co.nz/news/top/544406/kathmandu-to-design-and-produce-nz-s-olympic-uniforms

Just imagine how good all these gold medals will look next to the Kathmandu logo :) - for sure, this must be worth something;

Lets hope they are still solvent by then, or maybe part of the mountain warehouse group

Interim Results are out:

https://www.nzx.com/announcements/449015

Quote1H 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.

NPAT (loss) of -3cts in the fist HY. Still pointing to a trend showing that the closer quarter have been less worse than earlier quarters. Comforting?

A couple of outstanding words / phrases in presentation and announcement:

"challenging trading environment" (referring to the past and presence)
"hopefully" (referring to the future)

While emphasizing several times the importance to maintain their marketshare, they refused to tell us what it is, and how it is developing.

Didn't wanted to tell us either how their competitors are doing.

Just keep faith and have hope.

Hmm.

Rip Curl , great winter wet suites... fabulous...tried several makes before settling on the back zip with the inner lined latest model..

Quote from: Waltzing on Mar 26, 2025, 06:31 PMRip Curl , great winter wet suites... fabulous...tried several makes before settling on the back zip with the inner lined latest model..

No doubt - their gear is good, as is lots of the outdoor gear and clothing I have from Kathmandu. Maybe some of their stuff is just too good - it keeps forever (though, nice from the customer perspective).

From a pricing perspective I had over the last couple of years (well, when I went to buy something) the impression that they set their price line higher than comparable competitors (like e.g. MacPac, Merrell or Mountain Warehouse). Sadly (for Kathmandu) this convinced me to buy the stuff I was after somewhere else, and not sure I am unique in that regard.

Anyway, at the moment it feels they have problems turning good products into profits ... and as far as I am concerned did their recent update didn't really convince me that they see and understand the problems and are doing something about them.

Quote from: BlackPeter on Mar 27, 2025, 11:16 AMFrom a pricing perspective I had over the last couple of years (well, when I went to buy something) the impression that they set their price line higher than comparable competitors (like e.g. MacPac, Merrell or Mountain Warehouse). Sadly (for Kathmandu) this convinced me to buy the stuff I was after somewhere else, and not sure I am unique in that regard.

I can assure you that you are not alone.  Stuff at the Mountain warehouse on sale makes the sale prices at Kathmandu look ridiculously overpriced.  Don't even start me on the full retail price at Kathmandu stores, you'd need to have rocks in your head to think those prices are fair and reasonable.

Craig's thoughts on the result

   
The positives

(1) sales run-rates across all brands saw a significant improvement in Q2 vs. Q1, 2) Kathmandu's mkt. share losses appear to have stabilized, 3) Rip Curl's brand health and margins remain intact, despite broader surf category challenges, 4) KMD's balance sheet is in reasonable shape.

The negatives

 (1) short-term margin pressure is expected for all brands (predominantly Kathmandu), 2) Rip Curl (60% of Group sales in 1H) must now contend with a flood of inventory hitting the market in North America due to competitor store closures, 3) the Wholesale channel recovery has been slow (with timing still uncertain), and 4) Kathmandu's performance through the key 2H period remains heavily reliant on cold weather

KMD shares down 1 cent on Thursday and another 2 cents today to close at 34.5 cents

Seems tariffs might hurt them quite significantly with Rip Curl and Oboz in North America. About 20% of KMD sales are made their with most imported from Asia counties

Nike and Adidas shares took a decent hit as well today

From their announcement the other day Kathmandu have no idea how tariff issues is going to impact sales/margins/profitability

CEO spot on "The new US tariffs are another headwind in an already challenging consumer environment ..... " and knowing how Kathmandu handle headwinds I'd say a +ve outcome is unlikely.

Quote from: winner (n) on Apr 09, 2025, 08:52 AMFrom their announcement the other day Kathmandu have no idea how tariff issues is going to impact sales/margins/profitability

CEO spot on "The new US tariffs are another headwind in an already challenging consumer environment ..... " and knowing how Kathmandu handle headwinds I'd say a +ve outcome is unlikely.

Ze zolution eez to bring back ze vounder of zhis business - Kath Mandu.   Let Kath zort eet out!

RB

 

KMD generates 19 percent of revenue from the US. FB reckon a possible hit of up to $20m post tax on Trumps tariffs. So yes these are material to an already stretched KMD.

ok we will buy some more wet suits...

surf till we cant paddle anymore...

dont think that will cover it though... anyone got an ideas? 

since there hasnt been a Turn the Table upside down  like this one some in the press are calling it the NEW COVID...

cant be that bad surely...

maybe the RBNZ needed to cut 50 or 75... that 25 was pathetic..

Quote from: Shareguy on Apr 09, 2025, 08:57 PMKMD generates 19 percent of revenue from the US. FB reckon a possible hit of up to $20m post tax on Trumps tariffs. So yes these are material to an already stretched KMD.

Where is Country of Origon of products entering the US. If China, then the tarriff will kill them.

its ok the can send the job to here in NZ...

Quote from: Minimoke on Apr 09, 2025, 09:51 PMWhere is Country of Origon of products entering the US. If China, then the tarriff will kill them.

Yes $20m is a big hit. I suspect all will be good in time.

Quote from: Waltzing on Apr 10, 2025, 08:30 PMits ok the can send the job to here in NZ...

NZ can't change a product from China enough to change country of origon

yes was joking of course... rip curl wetties made in the BOP....

sunshine long boards still being made in the BOP one sees... well shaped, laid up and sprayed....

does NZ still have tech courses in sewing ... rubber has to come in from some where..

MADE IN NZ.... Make NZ Great Again...

the can do attitude...

Quote from: Waltzing on Apr 11, 2025, 12:11 AMyes was joking of course... rip curl wetties made in the BOP....

sunshine long boards still being made in the BOP one sees... well shaped, laid up and sprayed....

does NZ still have tech courses in sewing ... rubber has to come in from some where..

MADE IN NZ.... Make NZ Great Again...

the can do attitude...

Valtzing you are overtheenking zhis.   All you need eez a pair of zcissors, a tube of adhesive, 'Made in NZ' labels  and zome glue sniffers.  Get zhem to cut ze 'Made in China' label off and ztick a 'Made in New Zealand' on in eets place.

Zhen, (here eez ze clever bit) pay our glue sniffers $1,000 per hour to do zhis vork.   Zhat means, vhen ze total cost of producing ze product eez added up, 'adding the label' vill boost NZ content to more zhan 50%.  Zo ve legitimately have a garment/surfboard/shoe vith an NZ content of more zhan 50%, making ze 'NZ made' label justifiable!

Result:  Lower 10% tariffs vor Kathmandu products een ze USA, Glue sniffers off ze streets living a life of luxury, and ze police vreed from dealing vith zuch people, and vree to carry out more rewarding work.  Vin, vin, vin! 

Ze miracle of 'transfer pricing'!

RB

Latest Trading update....... seems the Group is doing lots proactive monitoring stuff..... GLH

https://www.nzx.com/announcements/453644

Quote from: Left Field on Jun 19, 2025, 10:20 AMLatest Trading update....... seems the Group is doing lots proactive monitoring stuff..... GLH

https://www.nzx.com/announcements/453644

YEP, lots of monitoring. Question is - do they have a strategy to change the course, or is this just hope, pray and document the inevitable?

Discl: I did hold them for a long time, but sold out some months ago. Not my best investment, but must be time now for them to raise :) ;

A couple of Directors have been buying lately:

https://api.nzx.com/public/announcement/459704/attachment/453230/459704-453230.pdf

https://api.nzx.com/public/announcement/459736/attachment/453302/459736-453302.pdf

KMD what MR AI says..

https://claude.ai/public/artifacts/c073acb1-9444-4de7-8bc7-fc5d13861738

Possible CR


https://www.afr.com/street-talk/kmd-brands-enlists-goldman-sachs-for-major-recapitalisation-20260315-p5oanj

Capital raise going ahead.  Asking people to throw good money after bad ?

Link to CR trading halt:
https://www.nzx.com/announcements/469885

I think the Directors were buying at 26c / 27.5c.  Not their best investment....

Quote from: winner (n) on Oct 16, 2024, 08:21 AMMention of stock turns.

KMD 1.4 stock turns a year compared to

MHJ 1.3
WHS 4.2
BRG 4.1
HLG 6.1

Even allowing for some manufacturing component both KMD and MHJ pretty pathetic when it comes to managing stock

Ranking does tell a bit of a story eh

That's been a very deep systemic issue for many years and makes them uninvestable in my opinion.

well the BOP Mount shop wont be doing record sales. Was in shop this last week and the main street was almost empty except for Tourist ship.

Numbers in the water in the evening surfing were a fraction of last year. That might be weather related with a wet summer and perhaps higher winds?

Business persons in the professions seems more than concerned for the retailers .

The entire pilot bay area seemed almost deserted as the big hill right around to the surf club was fenced off...

Big tourist destination for the country and it seemed to be in a pretty dire situation.

Very, very sad for all involved down there. 

8 to 10c hahahahahahahaha

what a basket case

disc - me as a holder:

(https://media1.giphy.com/media/v1.Y2lkPTc5MGI3NjExdnl1a2UyaDBhYjJxemszbjkxamh3YjEzZDI4bW93ZmJtczQxMDA2ZiZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/LSW8xc7yNmapdRlMvM/giphy.gif)

KMD a great example of wealth destruction



A  couple of capital raises and acquisitions and at the end of day poorer for it



FY18 saw $497m revenues and $51m from $614m assets and $420m equity. Profit margin >10% and ROE 13.7%.. There were 211m shares and a market cap of $694m



Acquired Oboz and Rip Curl - great stuff



In 2019 raised $145m at $2.55 per share. In 2020 raised about $200m at 50 cents a share



Come 2026 revenues doubled to about $1 billion but no profits - even allowing for writing down some of the goodwill on those acquistions



Assets have increased from that $614m to $1,100m and Equity up to $690m (badly impacted by the writedowns)



Not surprisingly Market Cap has fallen from the $694m to current $139m - down $555m ... wow



All that money and effort and nothing to show for it leading to huge destruction of shareholder wealth ... Captain Kirk and his team should be ashamed of themselves



So dire they are going to plead for more cash -- be interesting what story they spin this time



Question is though - what's changed and is this time going to be different

Can not see KMD 'putting the fizz back into the bottle' with Kathmandu or Rip Curl, and Oboz never had any' fizz in their bottle.'
Only part of KMD's business which I think could survive is Rip Curl,but not under KMD's management.

Running some numbers....711m shares on issue.  Net debt was forecast to be around ~$90m or less at the half year.  Assuming they pay away all debt and the CR process costs say $10m, then they need to raise $100m.  A 1:1 rights issue at 14c per share will do it.  Will the market accept 14c, or demand more of a discount?  And given the targeted cost savings and saved interest costs on debt, is that enough to turn a profit?  Keep in mind that would be on twice as many shares.  It's time they dropped the ESG nonsense and focused on making money.

Quote from: lorraina on Mar 26, 2026, 12:53 PMOnly part of KMD's business which I think could survive is Rip Curl,but not under KMD's management.

I have been wanting to buy 2 Rip Curl wetsuits (1 winter, 1 spring) and signed up to their alerts & promotions etc.  The trouble is I got 2 decent wetsuits for 1/3rd the cost elsewhere......I'm not that much of a fan that I would pay that much more.

Not good

KMD – speculation in The Australian that Kathmandu's capital raise is not going to plan as it struggles to raise $100m at a price of circa 8-10cps to clear its debt and reports that the offer has attracted only $30-40m of demand so far with Briscoe (6.8%) owner declining to participate (consistent with the last KMD raise during COVID). KMD currently has a market cap of c$140m (at 20cps) ... illustrating the scale of the value destruction over the past 6 years since it raised c$180m to buy Rip Curl in 2019 and then raised a further $207m during COVID in 2020. KMD's largest holder is Allan Gray with 17.77%.

I think with this capital raise its a case of fool me once, shame on them, fool me twice, shame on me, try and fool me three times...not on your nelly.
Heads need to roll in the C Suite and at board level.  The level of capital destruction has been almost criminal.  No wonder Rod Duke is not participating.  What's the point of throwing good money after bad...

Kirk is chairman. This capital raise is poorly handled. Possibly a scrap with the auditor. Breakup, sale of parts and delisting probably best but decision makers have their incomes to protect.

Another entity that Kirk chairs is the rugby union. Messy handling of Robertson decapitation and questionable reasoning behind it. Not expecting much from the All Blacks this year. They will probably be put to the sword in SA. Eviseration.

Quote from: Recaster on Mar 28, 2026, 01:10 PMKirk is chairman. This capital raise is poorly handled. Possibly a scrap with the auditor. Breakup, sale of parts and delisting probably best but decision makers have their incomes to protect.

Another entity that Kirk chairs is the rugby union. Messy handling of Robertson decapitation and questionable reasoning behind it. Not expecting much from the All Blacks this year. They will probably be put to the sword in SA. Eviseration.

Suggest the lack of interest for the CR is the issue. If it happens I bet it's going to be heavily discounted and very dilutive to existing share holders. The question is "will it be worth taking a punt on, even at 8\10 cps". A punt is all it would be.

RNZ think

https://www.rnz.co.nz/news/business/590866/what-s-going-on-at-kathmandu-owner-kmd-brands

I was horrified recently when I tried to buy tramping socks. Kathmandu wanted $55 for one pair. There was  no percentage of Merino listed on the label which was disappointing . I went to the warehouse and brought three pairs for $60 and suggest they had even a higher percentage of Merino.

Disc/ Glad I got out some time ago.

PS Agree with you re the Rugby

ZERO

As announced to market on 25 March 2026, KMD intends to launch a capital raise, and finalise terms for a refinancing of its existing bank facilities, in conjunction with the release of its financial results for the half year ended 31 January 2026 (HY26 Results). KMD is not presently in a position to make an announcement regarding the capital raise and refinance, as the final details, including pricing, are still being determined. Discussions regarding these matters remain ongoing.
In order for the directors to approve the HY26 Results, and KMD's auditors to complete their review of the HY26 Results, the final details of the refinance and the capital raise will need to be confirmed. Accordingly, KMD is unable to finalise the HY26 Results.
A voluntary suspension is therefore required to maintain an orderly market while KMD works to finalise the details of the capital raise, the refinance and its HY26 Results.
How long we want the voluntary suspension to last:
We would like the voluntary suspension on NZX to commence prior to the commencement of trading on NZX on
Monday, 30 March 2026 and for the voluntary suspension that is already in place on ASX to continue.

WOW they really are struggling. Someone or more likely some people responsible for previous capital raises that have proved to be value destructive need to go.

WOW all right

Five years ago hovering around $1.62. Now settled at $0.19


KMD.png

Clown show continues ...

Untouchable  & uninvestable IMO......

This article sums up KMD's position well.

https://www.scoop.co.nz/stories/BU2603/S00510/whats-going-on-at-kathmandu-owner-kmd-brands.htm

Writing has been on the wall for a long time. Surely any potential major investors in the capital raise will demand the Board responsible for the value destruction is cleaned out as part of any capital rescue plan.

Quote from: Mos on Mar 30, 2026, 10:57 AMWriting has been on the wall for a long time. Surely any potential major investors in the capital raise will demand the Board responsible for the value destruction is cleaned out as part of any capital rescue plan.

And those directors will be doing everything they can to protect their income flows ...

Extremely difficult to make money with a stock turn of only 1.4 times. The company is in need of a comprehensive strategic review, if it survives.

It occurs to me that the financial results and cash burn are so bad the bankers have said raise capital or we're appointing receivers. The auditors will not sign off as a going concern without new capital.
Larger investors they are trying to tap for fresh capital have probably been appraised of the financial performance which is likely so bad they are declining to provide fresh capital.
Just my speculative thinking based on limited information. 

I agree with others, it's uninvestable at any price.

Quote from: Basil on Mar 30, 2026, 11:12 AMExtremely difficult to make money with a stock turn of only 1.4 times. The company is in need of a comprehensive strategic review, if it survives.

It occurs to me that the financial results and cash burn are so bad the bankers have said raise capital or we're appointing receivers. The auditors will not sign off as a going concern without new capital.
Larger investors they are trying to tap for fresh capital have probably been appraised of the financial performance which is likely so bad they are declining to provide fresh capital.
Just my speculative thinking based on limited information. 

I agree with others, it's uninvestable at any price.

Good point on the auditors.

Receivership probably the best option. Three hundred odd shops many of which are in new zealand? Will hit hard. Rip Curl saleable.

There should be some searching questions asked of Directors as to what they knew when KMD issued this upbeat release on sales and debt management on 2 February, less than two months ago and when the half year period to 31 January was already complete.

https://www.nzx.com/announcements/466796 (https://www.nzx.com/announcements/466796)

 

Quote from: Mos on Mar 30, 2026, 10:57 AMWriting has been on the wall for a long time. Surely any potential major investors in the capital raise will demand the Board responsible for the value destruction is cleaned out as part of any capital rescue plan.

Agree Kirk and others need to go. I found interesting that one of the big broker houses that I use has not been contacted by GS at all to participate in this CR.  Unusual I'm told given the current state of the market.

Gosh  AFR suggesting 6 cps.  KMD is now said to be willing to raise funds at around 6¢ per share, an eye-watering 62.5 per cent discount to its last traded price.

https://www.afr.com/street-talk/slim-pickings-for-kathmandu-owner-kmd-brands-emergency-cash-call-20260325-p5xf9c

6c

KMD is proposing to raise NZ$65.3 million of new capital by way of an approximately NZ$6.8 million placement
(Placement) to be conducted by Goldman Sachs New Zealand Limited and Forsyth Barr Limited (the Joint Lead
Managers), together with a 1 for 0.73 accelerated renounceable entitlement offer (AREO) to raise approximately NZ$58.5 million. The Placement and AREO are fully underwritten by Goldman Sachs New Zealand Limited and Forsyth Barr Group Limited (the Underwriters).

So no insto demand and expecting existing bagholders to make up the bulk of it. Yeah time to put a fork in this one. Underwriters overhang gonna be massive.

Record date 1 April

Consistent with directors' primary motivations which are to protect their incomes at all costs.

The business is failing. Instead of making the right choices more capital will be destroyed and the final reckoning put off for a time.

Completely consistent with new zealand's rotten business practices. But one would expect the Australians to be smarter.

Can't wait to see the accounts.

I reckon there will be maybe 2b shares on issue at the end of the process.  Running some numbers of future profits based on $1b of sales, and various P/E ratios, following is a table of a range of share prices:

KMD-matrix - Copy.JPG

Assuming NPAT at 2% of sales and $20m NPAT, then at a P/E ratio of 10 the future share price should be around 10c.  Or with NPAT at 1% of sales and a P/E of 8 the SP should be around 4c.

From 2013-2019 (before Rip Curl) underlying NPAT averaged 9.2% of sales. Since then it has averaged 1.6%.

Sobering and big numbers eh Ferg

What gets me is that in spite of all the positive words (like 'strong performance') and the raving about how great this NEXT LEVEL this hopeless cash flow last 6 months

Took $520m through the tills but a Operating Cash Flow (inc leases) of NEGATIVE $22m and then spent $16m on capex - cash burn of $38m

Before the acquisition and global dominance strategy Kathamndu itself was as you pointed out making respectable returns .... but maybe beyond redemption now.

Picture is even worse. Intangibles impairment probably tested annually. Massive intangibles on balance sheet. This year's impairment should be at least $200 million.

Of course tame auditors who are focused on their fees paid by the company will probably not impair. Just like the crooks at mfb.

But take another $100 million off this half year result and you will have a better idea of how screwed this company is.

Cash flow from operations was negative when the stock price was over a dollar. A sure sign back then that things were very bad.

Directors were buying back then which some guys on sharetrader thought was a sign that things were good and dandy. Real lesson in that.

Alan Gray is going to take up there full entitlements, plus take part in the placement says AFR. They are sitting on a huge unrealised loss. Last disclosure in Feb 26 sold down to 115m shares. Ouch...

This is going to be a very interesting capital raise. Anyone keen at 6cps?

I suspect the underwriters will get left holding the baby in a huge way. No interest from me. The business model is conceptually flawed. 1.4 times stock turn is appallingly bad. That and management and the board simply cannot be trusted to play a fair game with a straight bat. Generally speaking even on so called sale, KMD gear is unimpressive on a quality or value for money basis in my opinion. Like trying to sell Cadbury chocolate at a Whittakers price.

Business has been stuffed from a long time. A retailer that operates with bottom tier distributor level stock turns, a huge CODB, and average GP margins (that certainly dont justify the hold time on stock). Despite the average margins, it's product offering is still well expensive, likely on account of its B corp status, and it just isn't nimble enough to economically source stock or react to changes in the market. Not sure I see that changing.

And its product is not well regarded.

I've always wondered about this wee clause in FB's T's and C's for Private Portfolio Management. And what actually funds their underwriting activities

"You do not have a right to be consulted on or to countermand any investment decisions that we make under the Investment
Authority."

Quote from: Fiordland Moose on Mar 31, 2026, 04:42 PMBusiness has been stuffed from a long time. A retailer that operates with bottom tier distributor level stock turns, a huge CODB, and average GP margins (that certainly dont justify the hold time on stock). Despite the average margins, it's product offering is still well expensive, likely on account of its B corp status, and it just isn't nimble enough to economically source stock or react to changes in the market. Not sure I see that changing.

And its product is not well regarded.

I know its a bit like shooting fish in a barrel. I'm not so sure you can put this down to its B Corp status. I reckon it will be more down to its Rainbow Tick

But in all seriousness, these virtue signalling certifications surely have to be a red flag to investors. To me its a clear sign the board and senior management are not focused on their business.

I'm really not sure these Certifications actually hit their target consumer. I really dont see, as an example, Laurel Hubbard wanting to be clothed in that Urban outdoorsy chic look.

B Corp, Rainbow tick and all sorts of other virtue signaling and inclusion policies feature prominently in another well known company that repeatedly raises capital and then promptly flushes it down the toilet, (with biodegradable environmentally friendly toilet paper of course).  Yes, you guessed correctly I'm thinking of you Synlait.  Red flags for sure.

Oh yes, the good old B Corp!!

More like BS Corp!!  ;)

Opening at 6.1 cents. The geniuses who run this company have done it again.

No doubt David Kirk to be knighted.

Officially my worst investment in any share on any market.

(https://media3.giphy.com/media/v1.Y2lkPTc5MGI3NjExb3U0Y3RuMGxsYzBnZnY4cW5lNzBqNW5pbGdsbGg2bWtmMXlhdHkyaCZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/LSW8xc7yNmapdRlMvM/giphy.gif)

Quote from: Recaster on Apr 02, 2026, 10:27 AMOpening at 6.1 cents. The geniuses who run this company have done it again.

No doubt David Kirk to be knighted.

Muppets !  No doubt the underwriters will do their best to try and support the price above 6 cents.

The shortfall bookbuild related to the Institutional offer achieved a clearing price of 6cps. ... this suggests very weak demand (relative to TERP of c11cps)

NBR has an interesting write-up on this fiasco today.

Kathmandu acquired Rip Curl in 2019 for $368m .... and raised new capital at $2.55 a share

Rip Curl reportedly had sales of $550m at that time (FY19) and EBITDA of $52m

Of course the acquisition was going to be EPS accretive - said at least 10% in first year

Come 2026 and sales are still about $550m but making stuff all profit - EBIT say $9m

I appreciate times have been tough at times since the acquisition but one would have to say this has been an unmitigated disaster

In spite of all management ravings about how great they are things not getting much better - and still going backwards. Hard to see much real improvment

I'd have to say the whole acquisition has been executed poorly .... lets blame management eh

Of course the writing was on the wall when they mentioned EPS accretive and capturing synergies. Never been EPS accretive and as the old saying 0f 'where did the synergies go' comes true again

Never mind they say things coming right - hang in there comes to mind

PS - tested carrying value of goodwill in last report - budgets and forecasts say goodwill number all OK

PS - tested carrying value of goodwill in last report - budgets and forecasts say goodwill number all OK

Lol. Scam.

NBR has a great article on this fiasco.
Apparently management's attitude at the analysts briefing was this was all just "business as usual" and there's nothing untoward with raising capital at a ~70% discount to last traded price !   Some brokers happy to clip the ticket for millions and to hell with the discount and how its decimated the share price..
Yeah, everyone here is acting in the best interests of shareholders...(sarcasm). Someone please hand me a Tui .::)

Apparently mid way through the presentation at the Investor call the other day any media who had signed in were told no media quastions but you stay logged in and listen to analysts quastions.

And mid one question Scrimshaw interrupted and said 'no more questions and thank you for dialling in blah blah'

Arrogant lot

Quote from: winner (n) on Apr 03, 2026, 12:50 PMApparently mid way through the presentation at the Investor call the other day any media who had signed in were told no media quastions but you stay logged in and listen to analysts quastions.

And mid one question Scrimshaw interrupted and said 'no more questions and thank you for dialling in blah blah'

Arrogant lot

Typical new zealand. Corrupt to the core.

Quote from: Recaster on Apr 03, 2026, 11:13 AMPS - tested carrying value of goodwill in last report - budgets and forecasts say goodwill number all OK

Lol. Scam.

Agree. Looking at the last annual report goodwill is huge and I would have thought big write downs should have been completed in result. How long to wait until the share consolidation happens.

Quote from: Shareguy on Apr 06, 2026, 08:39 AMAgree. Looking at the last annual report goodwill is huge and I would have thought big write downs should have been completed in result. How long to wait until the share consolidation happens.

arrying value of Kathmandu brand $273m / Oboz $33m (after a couple of decent impairments) and Rip Curl at $264m

In total Intangibles are $626m - with Shareholder Equity at $689m. No worries as they are a owner and operator of brands lol

No wonder Recaster makes the comments he does.

Good article innBusinessDesk today "How Allbirds went extinct"

Prob paywalled. https://businessdesk.co.nz/article/retail/how-allbirds-went-extinct

Couldn't but think one could pen a piece about Kathmandu along the same 'extinct' Is taking longer than Allbirds but same sort of trend.

To be fair, there were huge customer concerns about the durability of Allbirds gear.   Maybe to some extent there is also concerns around the durability of KMD clothes ?

I hope they have plenty of stock on hand, apparently nylon has increased in price substantially,  50% from memory. 
Hemp, cotton and wool back in flavor?

I can see a scenario where kmd are gone before Xmas.

I used AI to help put the following thoughts into words.

The Kirk Legacy: A Masterclass in Shareholder Value Destruction

I've sold out of KMD after years of pain. Cost basis ~$1.20, sold at 9 cents. I'm done. But before I go, I want to put the full picture in one place, because I think the scale of what's happened here deserves to be spelled out clearly.

David Kirk has been Chairman for 13 years. In that time he has presided over three capital raises:

2019: $145m raised at $2.55 per share (to buy Rip Curl)
2020: $207m raised at $0.50 per share (COVID)
2026: $65m raised at $0.06 per share (to avoid covenant breach)

That's roughly $417 million in equity raised from shareholders. The current market cap is about $108 million. Let that sink in. Shareholders have tipped in four times what the entire company is now worth, and they have nothing to show for it. No dividends since 2024. No profits. Just a share price chart that looks like a ski slope.

The numbers tell the story:

In FY18, before the acquisition spree, Kathmandu was doing ~$497m in sales with ~$51m profit, a margin above 10%, and ROE of nearly 14%. There were 211 million shares on issue. It was a well-run, profitable outdoor retailer.

Fast forward to FY25: sales have doubled to $989m but the company lost $93.6 million on a statutory basis and $28.3 million on an "underlying" basis. There are now going to be ~1.8 billion shares on issue. Shareholders' equity has been inflated by capital raises and hollowed out by losses and impairments. The intangibles on the balance sheet ($626m) are worth more than the equity ($690m) and roughly six times what the market says the whole company is worth.

All that capital raised. All those acquisitions. Sales doubled. And the result is... losses, dilution, and a share price down 97% from the 2019 raise price.

The Rip Curl acquisition has been an unmitigated disaster. Bought for $368m in 2019 when it was doing ~$550m in sales with ~$52m EBITDA. They told us it would be "at least 10% EPS accretive in the first year." Come 2026, Rip Curl sales are still ~$550m and it's making stuff-all profit. The whole group is now worth less than what they paid for Rip Curl alone. If that isn't a failed acquisition, I don't know what is.

And then there's the director share purchases. In September-October 2025, no fewer than seven directors and insiders bought shares on-market at prices between 25 and 30 cents. Kirk himself bought 700,000 shares at ~30c. Five months later, the company did a capital raise at 6 cents — a 77-80% haircut from where the directors were buying.

So either:

(a) They didn't know a capital raise was coming, which is a governance failure of the first order, or
(b) They did know and bought anyway, which raises its own set of questions about judgment

Neither explanation covers them in glory.

Let's also talk about what Kirk was saying while all this was happening. At the November 2025 AGM — four months before the emergency capital raise — he told shareholders: "We believe KMD Brands is materially undervalued" and expressed confidence in the Group's "ability to self-fund key initiatives." Self-fund. Those were his words. Four months later, shareholders are being asked for $65 million at 6 cents a share just to keep the banks happy.

And the February 2026 trading update — less than two months before the raise — talked about "sales momentum," covenant compliance, and discussions with lenders about refinancing. No hint that a massively dilutive emergency equity raising was weeks away. Shareholders who bought on that update at 20-24 cents got wiped out.

For context, Rod Duke offered to buy this company in 2015 for ~$1.80 per share. The independent adviser, Grant Samuel, told shareholders the company was worth $2.10-$2.41 and recommended they reject. They did. Today the shares trade at 6-7 cents. Every single shareholder who followed that advice has been annihilated. Meanwhile Briscoe Group shares have gone from $2.79 to $4.60 over the same period. The road not taken.

I know Kirk is finally leaving as part of this raise. Good. It should have happened years ago. But his departure doesn't undo the damage. Bowman (8+ years on the board), Martens, and others who sat alongside him through all of this should be asking themselves serious questions too.

On the flip-side, the Q1 FY26 numbers were the first encouraging sign in years. But I've heard "it's turning the corner" from this company too many times and been burned every single time. At some point you have to ask: is this a turnaround, or is it just another chapter in the same story?

Good luck to all.

Great post Entrep. Kirk has a lot to answer for. Agree the other directors need to go as well. What a disappointment.

Quote from: entrep on Apr 15, 2026, 01:42 PMI know Kirk is finally leaving as part of this raise. Good. It should have happened years ago. But his departure doesn't undo the damage. Bowman (8+ years on the board), Martens, and others who sat alongside him through all of this should be asking themselves serious questions too.

On the flip-side, the Q1 FY26 numbers were the first encouraging sign in years. But I've heard "it's turning the corner" from this company too many times and been burned every single time. At some point you have to ask: is this a turnaround, or is it just another chapter in the same story?

Good luck to all.

That most of been a hard painfull call after hanging on so long & losing so much but A very brave decision in so many ways .well done thanks for sharing entrap

Top post Entrep. A complete disgrace. Management on the call acting like it's business as usual and there's nothing untoward about issuing vast numbers of shares at a 70% discount to last traded price tells you all you need to know about the calibre of senior management and the board.

Recent comments from management and the board may be actionable in terms of how vastly different they were from the truth. ATM just settled a class action for similar "disingenious" forward commentary several years ago. If I was a large shareholder I'd be talking to other shareholders about a class action lawsuit.