Kathmandu’s earnings rise in quarter
Margins widen as outdoor retailer sells less clearance stock Profit drop for Arvida
Kathmandu Holdings, the outdoor equipment retailer set to hold its annual meeting on Friday, says its firstquarter earnings were up despite sales dipping as it widened margins by selling less sale stock.
In the 16 weeks to November 19, group sales rose 0.6 per cent at constant exchange rates but dropped 1.6 per cent on a same-store basis, the Christchurch-based company said.
In Australia, its largest market, same-store sales grew 2.9 per cent in the quarter while they dropped 10 per cent in New Zealand.
Gross margin expanded 240 basis points, or 2.4 percentage points, with the level of clearance stock about 40 per cent lower than a year earlier, it said.
“During the first quarter we sold more current season product than last year, but less clearance stock,” said chief executive Xavier Simonet.
“This meant improved gross margin, and with total sales broadly in line with last year, we ended our first quarter with an improved earnings result. We have maintained our strong working capital position, and we expect first-half profit to be above last year. As always our first half-year result is highly dependent on the more significant Christmas trading period.”
In the last financial year, Kathmandu Holdings posted first-half profit of $10 million, up 6.4 per cent and just beating earnings guidance. More recently, the company announced it had lifted annual profit 14 per cent to $38m as sales grew in New Zealand and Australia, while it cut its debt levels to record lows.
It has continued the recovery from an earnings slump in 2015 when an inventory build-up forced it into aggressive discounting to clear stock.
The company will hold its annual meeting in Melbourne on Friday morning. 1. As the record date for the dividend declared on 29 August 2017 has passed, under the terms of O.G. Oil & Gas’s offer the offer price for the ordinary shares has been reduced by the amount of the dividend paid on 3 November 2017. For the fully paid ordinary shares the adjusted offer price is 74 cents per share. 2. 74 cents (representing the offer price adjusted for the 4 cents dividend declared on 29 August 2017) is a 24.2% premium to the twelve-month weighted average price of $0.60 on the NZX for the period up to and including 9 August 2017 (being the last trading day prior to release of Zeta’s notice of intention to make a takeover offer). The unadjusted offer price of 78 cents (74 cents + the 4 cents dividend already paid) represents a 30.9% premium to the twelve-month weighted average price of $0.60 on the NZX for the period up to and including 9 August 2017. 3. This offer is a partial offer for 67.55% of the New Zealand Oil & Gas fully paid ordinary shares. If the offer is successful, the total number of shares that O.G. Oil & Gas will purchase from you will depend on the total number of shares tendered by other shareholders. For holders of fully paid ordinary shares, your acceptance may be subject to scaling, but only if O.G. Oil & Gas receives acceptances for more than 67.55% of the New Zealand Oil & Gas fully paid ordinary shares that O.G. Oil & Gas does not already own or control. As of 17 November 2017, O.G. Oil & Gas has received acceptances for 53,190,812 fully paid ordinary shares it does not already own or control. 4. 9 December 2017 is the closing date, unless extended in accordance with the Takeovers Code. Retirement village company Arvida Group, which listed in 2014, reported a decline in first-half profit on lower valuation gains and higher employee costs after a pay-equity deal.
Net profit fell to $14.5 million in the six months to September 30 from $19.4m a year earlier.
The result included an $8.9m valuation gain on its investment properties from a $14.3m gain a year earlier as the property market shows signs of slowing after several years of solid growth, Arvida said.
So far it had not experienced any material lengthening in settlement time or unit pricing weakness.
Expenses were higher at $51.7m versus $39.4m a year earlier, largely due to 32 per cent jump in employee costs. Arvida noted that increased employee costs from the introduction of pay equity rates were largely offset by increased funding from government and private sources.
Total revenue was $60m, a $13.1m rise on the same period last year, and continued to be underpinned by growth in care fees, which represent more than 70 per cent of revenue. Underlying profit rose 29 per cent to $12.4m. The company declared a dividend of 1.15c.