Published
May 10, 2016
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Surfstitch slashes FY profit guidance on poor trade, increased ad costs

Published
May 10, 2016

Apparel e-tailer Surfstitch has slashed its full-year profit guidance for 2016 on poor trading and increased advertising costs. 

Surfstitch reissues poor FY earnings guidance - Surfstitch


The Australian e-tailer said earnings before interest tax depreciation and amortisation were expected to fall at least 61% for the full-year period, sitting between $2 million and $3 million.

Surfstitch's original forecast sat between $15 million and $18 million with prior-to-today market forecasts around $17.5 million. In 2015, the retailer's first year as a public company, earnings reached $7.7 million.

Surfstitch said revenue growth remained strong but that the rebranding and integration of purchased businesses was taking longer than expected.

Additionally, trading conditions had been more challenging in key markets, forcing the group to increase advertising costs, tightening gross margins.

The profit downgrade comes almost two months after the shock departure of co-founder and chief executive Justin Cameron. The former-CEO quit in March to pursue a privatisation bid.

Surfstitch launched out of a Sydney garage in 2007.

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