Kathmandu credits weather for 30 per cent sales surge

Kathmandu says advertising spend, larger stores and new product releases have all boosted sales. Photo / Richard Robinson

Outdoor clothing and equipment company Kathmandu lifted its sales by more than 30 per cent for the three months to May 1, helped by fine weather and a late Easter.

Total sales for the third quarter of the financial year were up 31.6 per cent while same-store sales rose 23.2 per cent, the company announced yesterday.

Kathmandu shares closed up 15c, or 6.12 per cent, at $2.60.

Measured on a constant currency exchange rate, the total sales increase for the quarter was 29 per cent.

The figures exclude all sales in Christchurch from February 22 onwards, due to the earthquake.

Same-store sales for the period were up by over 20 per cent in Australia but down in Britain.

For the financial year to date, total sales were up by 23.1 per cent, and same-store sales 15.5 per cent higher.

Kathmandu founder Jan Cameron, who sold her stake in the company in 2006 to Goldman Sachs and Quadrant, has a restraint of trade that expires this month. She plans to set up a competitor to Kathmandu in New Zealand and Australia.

Kathmandu chief financial officer Mark Todd said there was room in the market for another outdoor adventure retailer and that new competitors were constantly emerging.

Todd said Kathmandu would not comment "on Jan's plans".

Linwar Securities analyst Mark Wade said the sales figures were impressive and stood out from a large majority of discretionary retailers not involved in the outdoor industry.

Wade said the results showed there was a sign Kathmandu's growth trajectory had "stepped up a notch", which was reflected in the company's strong trading period over Easter.

Wade said the strong sales results could be attributed to the company's increased advertising budget, larger stores, improved stock availability and new product releases.

Kathmandu chief executive Peter Halkett said the company's Easter sale promotion was helped by favourable weather and the late timing of the Easter weekend this year.

"Clearly this has been a particularly good period for us, but it was in comparison to a relatively poor performance for the same period in 2010."

Halkett said Kathmandu remained on track to deliver strong year-on-year sales and profit growth.