KMD Brands Limited, the parent company of Kathmandu, Rip Curl and Oboz, confirmed Monday that it has engaged Goldman Sachs to assist with its treasury and capital management strategy as it navigates a refinancing of its long-term debt facilities.
The New Zealand-based outdoor and surf group said no decision has been made to pursue any recapitalization initiatives, and no terms of any refinancing have been agreed upon. The announcement came in response to a story in the Australian Financial Review that published on March 15.
The markets did not like the news. The company’s stock, which is traded on both the Australian and New Zealand stock exchanges, closed at 52-week lows Monday following the news of the company’s engagement with Goldman Sachs and rumors of recapitalization. KMD’s stock price fell 13% on the New Zealand stock exchange and 11% on the Australian stock exchange.
KMD Brands Limited (KMD) has experienced a significant downward trend over the last year, losing approximately 46% to 50% of its value across both exchanges.
KMD Brands Seeing Positive Sales Trends Across Portfolio
KMD’s hiring of Goldman Sachs follows a February 2 trading update in which the company reported improving sales trends across its portfolio for the first five months of fiscal 2026. The company also disclosed at the time that it had extended its existing debt facility to April 2027 and reduced its total syndicated bank facilities to approximately NZ$283 million (approximately $161 million).
Kathmandu was the standout performer in the first five months of KMD’s fiscal year, posting total sales growth of 12.9% year-over-year, with momentum building across both Australia and New Zealand.
Rip Curl posted total sales growth of 5.6% during the same period, led by strong results in North America.
Oboz, the U.S.-based footwear brand, recorded total sales growth of 4.5% during that period.
Despite the top-line momentum, the group’s gross margin came in at 56.7% year-to-date, approximately 100 basis points below the prior year. The company cited elevated promotional activity across the market and continued efforts to clear aged inventory as the reason.
KMD Projects Improved EBITDA for First Half of Fiscal 2026
KMD projected first-half underlying EBITDA in the range of NZ$8 million to NZ$11 million (approximately $4.6 million to $6.3 million), up from NZ$3.9 million (approximately $2.2 million) in the prior corresponding period.
At the time of its update in February, the company said net debt on January 31 was expected to land between NZ$85 million and NZ$90 million (approximately $48 million to $51 million).
“We are still at the early stages of our transformation, but we are encouraged by the improved performance of Kathmandu,” CEO Brent Scrimshaw said during the February update, pointing to fresh product innovation planned for the second half as a lever for gross margin expansion.
KMD is scheduled to release its first-half results for the period ending January 31, 2026, on March 25.
