Outdoor camping and sportswear retailer Kathmandu posts bumper 2021 profit

Kathmandu, outdoor sporting wear retailer reported a net profit of $63m for the FY2021. Photo / Supplied

Kathmandu's profit jumped in the 2021 financial year with a full contribution from Rip Curl but the retailer said store sales in the past six months had been significantly impacted by transtasman Covid lockdowns.

Net profit climbed to $63.4 million in the year to July 31, up from $8.9m the previous year which included transaction costs related to the $368m acquisition of surf brand Rip Curl.

Underlying earnings before interest, tax, depreciation and amortisation (ebida) rose 35.9 per cent to $113.3m and total sales climbed 15.1 per cent to $922.8m. Gross margins improved by 40 basis points to 58.7 per cent.

The company declared a final dividend of 3c a share, taking the total full-year dividend to 5c a share.

The NZX/ASX listed outdoor equipment and clothing retailer said a strong sales performance was "driven by participation growth in surfing and hiking" and "strong forward order books for Rip Curl and footwear chain Oboz, above pre-Covid levels".

Kathmandu revealed it had received $16.6m in net wage subsidies across Australia and New Zealand.

The Group has 325 retail stores worldwide.

Group chief executive and managing director Michael Daly said Rip Curl achieved sales above the pre-Covid level in the key regions of North America and Europe during the Northern Hemisphere summer season.

"While Kathmandu has felt the impacts of Covid related travel restrictions, we were pleased with the early momentum following the brand relaunch in May 2021. This relaunch will build on strong brand fundamentals and position Kathmandu to grow to a truly global brand."

"Oboz continues its strong performance, with sales growth reflecting the successful product innovation strategy and diversification of its customer base. The forward order book is at its highest level ever, allowing investment to support future growth."

"Our refreshed Group strategy ensures we are focused on the things that matter most as we move into FY22 – building global brands focused on active outdoor activities, investing in digital platforms to provide consumers with a truly world class unified commerce experience, operational excellence, and sustainability [ESG] leadership."

Commenting on the outlook, Daly said despite the impacts posed by the pandemic, the Group was well-positioned to capitalise due to growing participation in outdoor activities.

And the rollout of Covid-19 vaccinations across the globe was positive news for the business.

He said the Group will continue to focusing on growing its brands via advertising and sponsorship, sustainability initiatives.

"We will continue to invest in building our global brands, through brand advertising, sponsorship, and sustainability initiatives, which include extending Kathmandu's B Corp accreditation to all Group brands and setting science-based targets."

"Rip Curl and Oboz wholesale order books are now significantly above pre-Covid levels. Rip Curl and Kathmandu are generating like-for-like retail sales growth excluding Covid-impacts from store closures. Online sales are continuing to grow for all three brands."

Kathmandu shares traded down 1c at $1.45 but have gained 14.06 per cent over the past 52 weeks.