SIMON HASKELL APPOINTED TO HURLEY INT LEADERSHIP TEAM 21.08.10
Hurley Australasia GM Simon Haskell has been promoted to SVP of Global Business Development overseeing the brand’s global licensees and overall category strategy going forward. Haskell joins the senior leadership team after 5 years with the company and says the move to the USA demonstrates Hurley’s focus and commitment to being a fully integrated and globally minded company.” I am truly excited about the opportunity to be part of the future of the Hurley brand and further supporting the efforts of the Australasian team,” said Haskell. In line with Haskell’s appointment Richard Thomas has been promoted to General Manager of greater Australasia. Four regional directors have also been formalized with Jevon Leroux in South Africa and Rizal Tanjung in Indonesia joining Toby Sams in Australia and New Zealand as regional Business Directors. Sams brings over nine years of retail, market and management experience to the role, most recently he held the position of General Manager for General Pants Groups surf division. Sams will be capably joined by Matt Cattle, director of sales, as the leaders of the business in Australia and New Zealand. Jason Haynes steps up as Hurley’s Brand Director for greater Australasia, and Tim Cochran is now the Director of Product. Michael Lee will continue as the Director of Operations for greater Australasia, with an increased focus across the territories.
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HIGHLIGHTS FROM BILLABONG'S FY09-10 - AUSTRALASIA 20.08.10
Sales in Australasia were down 1.9% in constant currency terms or 4.2% in reported terms to $425.7 million (down from $444.3 million in the prior year). After being down 14.0% in the first half, EBITDA recovered in the second half to finish 10.3% lower across the full year in constant currency terms or 11.2% in reported terms to $89.2 million (down from $100.4 million in the prior year). The continued change in regional mix within the Australasian region, combined with weak trading results in Japan, New Zealand and South Africa, saw EBITDA margins drop to 20.9% from 22.6% in the prior year, while gross margins remained steady.
On a regional level, sales in Australia were marginally higher across the full financial year but there was a sharp deterioration in trading conditions in the final quarter. This reflected a general consumer slowdown post the cycling of the Federal Government’s fiscal stimulus of the prior year. Continued weak trading conditions, coupled with a retail and consumer focus on merchandise relevant to the soccer World Cup, led to a double-digit sales decline in South Africa. Elsewhere in the region, Group sales in Japan lifted in the second half to finish in line with the prior year in constant currency terms, while New Zealand remained challenging and ended the year down in the mid single-digit range. The Group’s Asian businesses continued to develop, with good initial results from direct operations established in Korea and Thailand. A distributor
5was also appointed in Taiwan through the period and this led to the opening of a retail door in Taipai just after the close of the period.
Eyewear brand VonZipper and Tigerlily experienced solid sales growth in Australasia, while DaKine, Xcel and Sector 9 had very strong growth off a lower base. Element experienced a slight decline in sales, as did the Billabong brand as sales slowed in the final three months of the year in Australia, in particular. Despite the retail contraction in the second half, overall inventory levels continued to improve and are expected to further benefit from a move towards more global styles, reduced range sizes and the introduction of a new global product lifecycle management system.
Company-owned retail operations in Australasia recorded sales growth of 5.9% in constant currency terms. The number of Company-owned retail stores lifted to 166 (from 143 in the prior year), with 13 doors closed and 36 opened. The majority of new doors were opened in Australia, where the door count lifted to 41 (from 29 in the prior year). Company-owned retail in Australia performed strongly in the first half but sales declined in the double-digit range in the second half, with locations relying on tourism being most heavily impacted. A new Tigerlily store concept was introduced at locations including Chadstone, Melbourne Central and Warringah Mall in Sydney and all performed very well. A new IT system was introduced into the Group’s Australian retail operations and is expected to be progressively rolled out into New Zealand and Asia. Since the close of the financial year, the Group also entered a joint venture with the two door Surfection retail business in Sydney. Surfection will continue to be run by its principal, Chris Athas, and he will drive a planned expansion of the banner. Additionally, the Group today announced a conditional agreement to acquire the 36- door Rush Surf chain, primarily based in regional Queensland. Other planned store openings include a Billabong concept store in the Sydney CBD and a 500 square metre multi-branded store on premises adjoining Billabong’s head office on the Gold Coast. In online retailing, the acquisition of an interest in Surfstitch, Australia’s premier online retailer for the boardsports community, is performing well and is helping the Group satisfy the growing demand for direct-to-consumer sales.
The sharp consumer slowdown evident in Australia in the final three months of the financial year created caution within the Group’s wholesale account base and this has been reflected in declines in the range of 20% for summer and hi-summer forward orders, which is also expected to lead to a soft winter order book. It is anticipated many retailers will be short on inventory and will have to chase product in season. The Australian business is expected to benefit from the distribution of the licensed footwear brands DVS and Lakai, the extraction of synergies from the addition of acquired retail banners and the purchase of the RVCA brand. The addition of RVCA is generating excellent interest at retail and significant investment will be made into the brand to ensure it realises its long term potential. Business in New Zealand, while still soft, is showing signs of improvement and the Group recorded positive same store sales in the month of July 2010. South Africa remains a challenging market, while business continues to develop in south-east Asia. The Group has reached agreement to establish a new joint venture in China in preparation for the Billabong brand’s entry into the market. Initial entry is through a series of shop-in-shop concepts, the first of which have opened in the southern China provinces of Shenzen and Guangzhou.
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PATAGONIA OPENS BURLEIGH LICENCED STORE 20.08.10
Patagonia has opened its second store in Australia at Burleigh Heads, Queensland. The Burleigh store, compliments Patagonia’s first flagship store in Torquay which opened in 2009. The Burleigh store will operate under licence with former Honolua brand manager Guy Walker. Walker says that having worked in the surf industry in various ways since he was 11- years old, he feels genuinely excited about the opportunity. “I can confidently stand behind the counter and align with the company, its ethos and its products,” says Walker. “Patagonia have a very different outlook on business that’s really refreshing.” The new store is located at 15 James St, Burleigh Heads. Walker says the store will host open nights with guest speakers like 8 x Molokai to Oahu Paddleboard Race Winner, Jamie Mitchell and others.
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BILLABONG RESULTS FOR YEAR ENDED 30 JUNE [10AM] 20.08.10
Billabong International Limited today announced a net profit after tax (NPAT) of $146.0 million for the financial year ended 30 June 2010. The result, built on the back of a strong second half performance, is up 8.1% in constant currency terms compared with the 2008-09 year (the prior year). Excluding the after tax impact of an impairment charge expense of $7.4 million in the prior year, NPAT for the year ended 30 June 2010 increased 3.1% in constant currency terms compared with the prior year. After adding back one-off post-tax acquisition transaction costs of $2.7 million, which under new accounting standard requirements now have to be expensed and cannot be capitalised, constant currency NPAT growth lifts to the Group’s previously-advised guidance of 5.0% compared with the prior year excluding the prior year impairment charge.
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BILLABONG ACQUIRES RUSH 8.45 AM 20.08.10
Billabong has released their Full Year results to the ASX. While full financial details will follow later today the company says it has reached a conditional agreement to acquire the 36 door Rush retail chain in Australia. Billabong says that the stores will remain a multi-brand retailer and continue to be operated by its founder Wade James. Its anticipated the purchase will be complete in October and earning per share positive in year one. More details to follow.
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OCCY SETTLES ON SHARES 19.08.10
According to a report picked up in ‘The Australian’ a stouch over Billabong shares between Mark Occhilupo and his former accountant appears likely to be settled out of court. A civil trial between Occy and Noel Holmes got under way on Tuesday in the Supreme Court in Brisbane.
However late Wednesday morning lawyers from both sides started discussing a potential settlement.
"We are in negotiations at the moment," Occy said outside court.
"So hopefully we are going to come to an agreement. "
The former world champ is fighting for control of about 21,700 Billabong shares bought for $50,000 in 2000.
At the current market price the shares are worth about $185,000.
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