Kathmandu sales fall as currency effects weigh on results
Kathmandu delivered news of challenging trading conditions in Q1 on Friday with the outdoor and adventure products retailer saying its first half will be heavily dependent on its performance over the Christmas period.
Q2 is traditionally a busy period for the company with around 30% of its sales happening in that quarter.
It also said its first half profit will be broadly flat year-on-year due to careful management of gross margins and operating expenditure, despite pressure on sales growth.
The company saw sales falling 0.6% in the 15 weeks to November 13, although with currency effects factored-out they rose 2.8%, while same-store sales managed to edge up 1.4%. This was much slower than the 4.8% comp sales growth it reported a year ago.
But in its largest market, Australia, sales rose 3.4% while New Zealand declined by 1.9%.
"In response to the strengthened US dollar, we have been less promotional in the first quarter. Combined with a higher mix of clearance and cycling UK store closures, this has impacted on sales in the first 15 weeks,” said chief executive Xavier Simonet at the firm’s annual general meeting.
The company also said there are store opening opportunities in Australia with additional growth potential online, especially internationally.
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