PROFIT WHITEWASH FOR BILLABONG

Written on the 4 March 2011

PROFIT WHITEWASH FOR BILLABONG

BILLABONG International has reported half year profit (NPAT) of $57.2 million - down 18 per cent on last year’s $69.7 million.

The strength of the Aussie dollar against the Euro and the $USD had a significant adverse impact on the company – eroding almost $50 million off revenues and $6 million off profit. Earnings per share of 22.8 cents were down 18.3 per cent.

The Gold Coast’s largest company, with market cap exceeding $2 billion, had sales revenues of $834.9 million – up 15.8 per cent compared with the corresponding period last year. Revenues in the key markets of the Americas were $408.4 million, up 38.2 per cent.

CEO Derek O’Neill, in a statement to the ASX, attributed the result to a ‘very weak’ retail environment in Australia, combined with the initial dilutive impact of recent acquisitions of Australian retailers SDS/Jetty Surf and Rush Surf, whose results are yet to reflect the benefit of the buy.

The surfing apparel and hardware giant continued to invest in major boardsport-inspired events and athletes. Key marketing initiatives included the hosting of the Billabong Pro World Championship Tour surfing events in South Africa and Tahiti and the Billabong Pipeline Masters in Hawaii, along with the World Junior Championships in Australia.

The company views the 2010-11 financial year as a transition year, with the strong sales revenue growth in the first half. It expects full FY revenues of $1.7 billion.

Shares remained flat today at $8.00.

Don’t miss the full interview with Billabong CEO Derek O’Neill in the March edition of Gold Coast Business News, where the city’s top companies will be revealed.


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