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Kathmandu quadruples annual profit on strong sales

Kathmandu's store in Auckland's Sylvia Park shopping mall. Photo / Natalie Slade
Kathmandu's store in Auckland's Sylvia Park shopping mall. Photo / Natalie Slade

Kathmandu Holdings, the outdoor clothing retailer, quadrupled annual profit as sales shot up through the year and it faced none of the previous year's cost of floating on the stock exchange.

Net profit was $39.1 million, or 19.2 cents per share, in the 12 months ended June 30, up from $9.4 million, or 0.3 cents per share, a year earlier, the Christchurch-based company said in a statement.

The retailer boosted sales 25 per cent to $306.1 million, and didn't have to deal with the charge of its initial public offering on the New Zealand and Australian stock exchanges, which shaved $16.8 million from last year's bottom line.

Earnings before interest and tax rose 32 per cent to $64 million, as expected.

"We have achieved double digit same store sales growth in both Australia and New Zealand and improved margins despite the well-publicised difficult economic environment," chief executive Peter Halkett said in a statement.

"Our key growth strategies are working and delivered solid sales and profit growth this year despite a tough environment, so FY12 is really about more of the same."

Kathmandu has bucked the trend among local retailers as households eschewed new spending in favour of repaying existing debt in a low interest rate environment.

The retailer will continue to roll out new stores in Australia and New Zealand this coming financial year, along with growing its product line and refurbishing existing premises. It will keep its UK footprint on hold after the British segment recorded 15 per cent in total sales growth.

Halkett said the strong trans-Tasman currencies underpinned the year's success by reducing the cost of imports and encouraging Australians to visit New Zealand and buy outdoor equipment.

The board declared a final dividend of 7 cents per share, taking the total payment to 10 cents, or $20 million.

The shares rose 2.3 per cent to $2.24 and have gained 17 per cent this year.

- BusinessDesk

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