Here’s some interesting information about Billabong’s results during the second half of 2007. Billabong is headquartered in Australia and traded on the stock exchange there.
These results were released Friday and flew under my radar. I apologize they are a few days late.
The results are from July through December, 2007.
Americas highlights
- Group sales Americas: up 13.2 percent to $249.6 million in constant currency terms.
- EBITDA: up 7.9 percent to $41.7 million
- EBITDA margins were 16.7 percent, down from 17.8 percent during the same period last year. The company said lower margins were from softer tourism in Hawaii, reduced sales to Pacific Sunwear and increased contribution from the lower margin South American business.
- Margin expansion is expected to return in the next reporting period.
- Sales grew double digits in North America, with the east coast a bit better than the west coast.
- The strongest growth came from independent speciality store channel.
- Billabong recorded sales growth at PacSun stores, while Element sales declined at PacSun. PacSun represents 15 percent of the company’s North American sales.
- Billabong Girls and Element Eden had “excellent growth while mens had “good” growth.
- Strong categories included denim, art-inspired T-shirts and hooded fleece for mens and girls.
- Nixon had a strong Thanksgiving holiday season.
- Company-owned retail “continued to perform well.” The company had 65 stores at the end of the period, up from 58.
- Forward orders “remained very healthy as retailers placed a greater focus on proven brands.”
- The company sees significant growth opportunities in South America, with Brazil the strongest performer during the period.
Europe highlights
- Europe sales: up 19.6 percent in constant currency terms
- EBITDA: up 30.2 percent
- Strong territories included Italy, Germany and emerging markets in eastern and northern Europe.
- Billabong, Element, Nixon and Von Zipper each recorded double-digit sales growth.
- Strong categories for Billabong included men’s sweaters, fashion fleece, T-shirts and denim.
- Element had strong sales in mens and girls and had “some success” in a softer environment for closed-toe footwear.
- Von Zipper had good growth in sunglasses and goggles and has a “particularly strong” business in France.
- Nixon had strong sales in both boardsports and fashion lifestyle markets, especially in the U.K.
- The group opened 16 stores during the period to bring its company-owned total in Europe to 47.
Australia/Asia
- Australia/Asia sales: up 16.8 percent in constant currency terms.
- EBITDA: up 12.1 percent
- Strong territories included Japan, Singapore, Malaysia and Indonesia.
- The group is planning to move deeper into emerging Asian markets such as Taiwan and Korea.
- Von Zipper and Element performed particularly well.
- Forward orders were healthy but growth expectations were dampened a bit by poor weather on Australia’s east coast.
Company-wide brand update
Element, Nixon and Von Zipper offer the most growth opportunities.
Wetsuit brand Xcel is expected to add 1 percent of group revenue in the 2007-08 financial year.
