On a Wednesday morning in March 2023, KMD Brands, the company behind Kathmandu, Rip Curl and Oboz, laid out its half-year results: a record NZ$547.9 million in sales, up 34.5 per cent, for the six months to January 31. The result carries the familiar warmth of a travelling world returning to itself, as tourists and holidaymakers reclaim airports and beaches that had been quiet for years. Beneath that warmth, however, the company's own leaders spoke with restraint, warning that inflation, high interest rates and retailers quietly thinning their shelves could temper what comes next.
KMD Brands Posts Record Half as Travel Recovery Lifts Rip Curl and Kathmandu, but Caution Clouds Outlook
A record half driven by people travelling again
Mark
A 34.5 per cent jump to NZ$547.9 million is a big number. What's behind it, according to the company?
Mimi
Mostly travel. Michael Daly says Australian airport stores are growing year on year and are now above pre-COVID levels, and Kathmandu is seeing more spending from inbound tourists.
Mark
So people are buying gear before they go, and when they arrive.
Mimi
Both, it seems. He also said more customers intend to travel overseas again.
Luke
Careful there. That's the CEO's read. The intention to travel is described as increasing, but we aren't given survey figures or any breakdown of how much of the 34.5 per cent comes from airports versus everything else.
Mark
Fair. What about the warning side?
Mimi
Wholesale. Daly says retail customers are destocking, competitors are promoting more, and orders are softer this half because buyers are spooked by recession talk.
Luke
And that's forward-looking management commentary. We don't know how much softer, or how it will show up in the next result.
Mark
Does the comparison period matter here?
Luke
It would, but the reporting gives no figure for it, so I wouldn't read the growth as a clean measure of momentum.
Mimi
What we can say is that management is optimistic on travel and openly cautious on consumers and wholesale.
Le Pouls
- Record sales of NZ$547.9 million, up 34.5 per cent, arrive just as the travel rush returns to the company's doorsteps.
- Australian airport stores are now trading above pre-COVID levels, a sign that travellers are once again moving through the terminals where KMD's shops sit.
- Wholesale customers are pulling back on orders, spooked by recession talk and sitting on too much stock while competitors push harder on discounts.
- Management is bracing for softer demand as inflation and elevated interest rates press on household budgets, leaving the next half's trajectory unresolved.
On a Wednesday morning in March 2023, KMD Brands, the company behind Kathmandu, Rip Curl and Oboz, laid out its half-year results: a record NZ$547.9 million in sales, up 34.5 per cent, for the six months to January 31. The result carries the familiar warmth of a travelling world returning to itself, as tourists and holidaymakers reclaim airports and beaches that had been quiet for years. Beneath that warmth, however, the company's own leaders spoke with restraint, warning that inflation, high interest rates and retailers quietly thinning their shelves could temper what comes next.
KMD Brands, the company that owns Rip Curl, Kathmandu and the US boot maker Oboz, has reported its strongest half-year yet. Sales reached NZ$547.9 million for the six months to January 31, a gain of 34.5 per cent on the previous period. The announcement came with a mood that was part celebration and part caution.
Chief executive Michael Daly credited the return of international travel. Sales at Australian airport stores have grown sharply on a year earlier and are now running above pre-COVID levels. Kathmandu is also seeing more purchases from inbound tourists, while locals are increasingly planning trips abroad. Daly said the breadth of products across the three brands helps as shoppers return to a wider range of activities.
The outlook was less certain. Daly warned that high inflation and elevated interest rates are weighing on consumers and are expected to dent demand. The sharpest concern lies with wholesale customers, who are stocking their own shelves more cautiously. Some are carrying too much inventory, and others are reacting to recession fears, so wholesale orders are softer this half and competitors are pushing promotions harder.
The result is a record half built largely on people travelling again, followed by a period in which retail partners are expected to order more carefully. The key question is whether the strength in airport and tourist sales can make up for softer wholesale orders in the months ahead.
KMD Brands, the company behind Rip Curl and Kathmandu, reported sales of NZ$547.9 million for the six months to January 31. That is a 34.5 per cent gain on the previous period and a record for the business. The numbers came out on Wednesday morning, alongside a message from management that was part celebration and part caution.
The company describes itself as a global outdoor and sports business. Its portfolio covers three brands: the surf label Rip Curl, the outdoor retailer Kathmandu, and the US boot maker Oboz. Chief executive Michael Daly said the group is well positioned to benefit from the return of international travel, pointing to tourists heading back to holiday destinations such as Hawaii and Queensland.
The clearest evidence he offered came from airports. Sales at Australian airport stores have grown strongly compared with a year earlier, Daly said, and are now tracking above pre-COVID levels. For a retailer whose stores sit in places where travellers pass through, that is a notable marker of recovery.
Travel is lifting the business from both directions. Kathmandu, Daly said, is seeing more purchases from inbound tourists, and there is a growing intention among customers to resume outbound international trips. In other words, visitors arriving in the markets where the company trades are spending, and locals are increasingly planning to leave.
Daly added that the products across all three brands appeal to a diverse range of consumer interests and demographics. That breadth, he suggested, helps the group as shoppers return to a wider set of activities.
But the outlook he gave investors was far less settled. Daly said the consumer picture remains uncertain, set against high inflation and elevated interest rates, and that these pressures are expected to dent demand.
The sharpest concern sits in the wholesale channel. Customers who buy from KMD to stock their own shelves are, in Daly's words, strategically destocking, and competitors have stepped up promotional activity. He told investors that wholesale orders are softer this half because those customers are spooked by talk of recession, and some of them are carrying too much inventory.
The picture, then, is of a record half driven largely by people travelling again, followed by a period in which management expects retail partners to order more cautiously. What to watch is whether the strength in airport and tourist-driven sales can offset softer wholesale orders as the current half unfolds.
Citations marquantes
Australian airport stores sales have achieved strong sales growth year-on-year and are tracking above pre-COVID levels.— Michael Daly, CEO, KMD Brands
Wholesale customers are spooked by recession talk and some are overstocked, so orders are softer this half.— Michael Daly, CEO, KMD Brands (paraphrased)
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