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Apparel marketer Billabong slips into H1FY16 loss
01
Mar '16
Aussie apparel marketer Billabong slipped in to a loss of Au $1.6 million for the first six months of fiscal 2016 ended December 31, 2015.

“This compares to a net profit of $25.7 million for the corresponding period of the previous fiscal,” a Billabong press release said.

“The first six months of fiscal 2015 benefited from $13.5 million of significant items including gains on asset sales, compared with an immaterial net impact this period,” the company explained.

For continuing businesses, EBITDA excluding significant items was down to $37.2 million compared to $42.8 million for the fiscal ago period.

However, for the reporting period, total group sales were $561.9 million, up 7.6 per cent as against the same period of prior fiscal, but were again down 0.8 per cent on a constant currency basis.

According to Billabong, the overall result was impacted by the Americas where EBITDA declined by $6.9 million for the period.

“Gross margins too were down due to pressures from excess inventory which followed the West Coast US port strike early in calendar 2015,” the company observed.

“Collectively the rest of the world EBITDA was ahead over the first half of prior fiscal despite increased cost of goods from a relatively higher US dollar,” it noted.

Billabong further added that global platforms to support brands have begun to be rolled out with targeted benefits of $30 million in annualised savings at maturity.

“This is a brand led turnaround and our big three brands, where we placed our focus, grew globally,” said Billabong CEO Neil Fiske.

“Europe continues to gain momentum and the Asia Pacific region has delivered a solid performance given currency pressures,” Fiske too added.

“The result has been impacted by conditions in the Americas, as highlighted in our November update, including sector weakness in retail and short-term margin pressures associated with clearing excess inventory,” he observed. (AR)

Fibre2fashion News Desk - India

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