Some companies carry a famous name long after the value that made it famous has quietly drained away. KMD Brands, which owns the outdoor label Kathmandu and the surf brand Rip Curl, now finds itself at such a threshold: its accounts are not ready, its shares are frozen, and the rescue it needs has not yet found enough willing hands. Its stock, which once traded above $2.30 before the pandemic, closed at 16 cents, and the story turns on whether investors will still trust a low-priced lifeline offered in a moment of uncertainty.
Kathmandu and Rip Curl owner KMD Brands stalls on emergency capital raise as shares stay suspended
A results call was due; an hour before it, the shares were halted at 16 cents.
Mark
Why does a trading halt an hour before an investor call matter so much?
Mimi
Because the timing says the plan wasn't ready. The call was set, the results were expected, and then the shares stopped trading with the terms of the raising still unfinished.
Luke
Careful, though. We know the timing. We don't know the reason. The reporting doesn't say why the accounts were late.
Mark
What does the 16 cent close tell us?
Mimi
That the stock has fallen a long way. It traded above $2.30 before the pandemic, so this is the end of a long decline rather than a sudden drop.
Luke
Right, but the price is a snapshot from before the halt. It's not where the market would value the company now, since nobody can trade it.
Mark
And the investor support problem?
Mimi
The Financial Review reports the company is struggling to win backing for a low-priced issuance. That's the heart of the story.
Luke
That's one outlet's account. We don't have the size of the raise, the price, or who is holding back. Those are the unknowns that decide how serious this is.
Mark
So what do we actually watch for?
Mimi
Whether the raising gets backing, and when the accounts come out and trading resumes.
Il Polso
- A scheduled investor call was halted less than an hour before it was due to begin, leaving the market in suspense.
- KMD Brands could not publish its financial accounts on time, unsettling shareholders who expected clarity.
- The company is racing to finalise an emergency, low-priced share issuance meant to shore up its finances.
- Investors are reportedly reluctant to back the raising, and the shares remain suspended with no set date for resumption.
Some companies carry a famous name long after the value that made it famous has quietly drained away. KMD Brands, which owns the outdoor label Kathmandu and the surf brand Rip Curl, now finds itself at such a threshold: its accounts are not ready, its shares are frozen, and the rescue it needs has not yet found enough willing hands. Its stock, which once traded above $2.30 before the pandemic, closed at 16 cents, and the story turns on whether investors will still trust a low-priced lifeline offered in a moment of uncertainty.
On Wednesday, less than an hour before KMD Brands was due to speak with investors about its financial results, its shares were halted. They had last closed at 16 cents. The call that was meant to accompany the results did not go ahead as planned.
KMD owns Kathmandu, the outdoors retailer, and Rip Curl, the surfwear label. This week the company told the market it could not publish its accounts on schedule, and that it was still finalising a low-priced share issuance intended as an emergency capital raise.
The Australian Financial Review reports that investors are struggling to back that raising. The suspension has left shareholders unable to buy or sell while the terms remain unsettled. Before the pandemic the shares traded above $2.30, and the long slide since then is the backdrop to the company's need for emergency funds.
Much remains unclear: the size of the raise, the price being considered, and when trading might resume. What is known is the sequence of events, and what investors do next will shape the financial future of two well-known brands.
On Wednesday, less than an hour before KMD Brands was due to hold a call with investors, the company's shares were halted. They had closed that day at 16 cents. The call, which was meant to accompany the company's financial results, did not go ahead as planned.
KMD Brands is the retailer behind the outdoors brand Kathmandu and the surfwear label Rip Curl. This week it told the market it had been unable to publish its financial accounts on schedule. It also said it was still finalising the details of a share issuance priced low, an emergency capital raising meant to shore up the business.
The Australian Financial Review reports that the company is struggling to win investor support for that raising. The halt left the shares suspended days after the results were expected, and they remain suspended. Shareholders can neither buy nor sell while the company works out terms it has not yet settled.
The 16 cent close puts the scale of the decline in view. Before the pandemic, KMD shares traded at more than $2.30. In the years since, the stock has struggled, and the source describes that long slide as the backdrop to the current need for emergency capital.
The pieces of the situation are linked. A company that cannot publish accounts on time, is raising money at a low price, and is finding investors reluctant to commit is in a difficult position. The delayed accounts and the unfinished terms of the raising appear to be tied together, though the reporting does not spell out the reason for the delay or the full scale of the capital sought.
Those gaps matter. The available reporting does not say how much KMD is trying to raise, what price it is contemplating, or which investors have hesitated. It also does not say when trading might resume. What is established is the sequence: a scheduled results release that did not happen, a halt just before an investor call, a last close of 16 cents, and a raising still being put together.
What to watch next is whether investors back the low-priced issuance and when the company publishes its accounts and returns to trading. The outcome will shape the financial stability of two well-known brands.
Citazioni salienti
KMD said it could not publish its accounts as planned and was still finalising details of a low-priced share issuance.— KMD Brands, as reported by the Australian Financial Review
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