GOLD COAST: Billabong International has reported the Australian market experienced "a sharp deterioration" in the fourth quarter of 2009/10 in what was otherwise a "strong" second half.
The international surfwear company revealed net profit after tax for the year ended June 30, 2010 was $146 million. This figure was down 4.5 per cent on the previous year.
Australasian sales – incorporating those in Australia, New Zealand, Japan and South Africa – were $425.7 million, down 1.9 per cent on the prior year.
Billabong CEO Derek O'Neill attributed “a sharp deterioration in the final quarter” within Australia to rising interest rates and the absence of government stimulus payments.
Billabong's sales in the Americas amounted to $712.6 million, with sales lifting 10.6 per cent in South America. European sales amounted to $344 million, up 5.2 per cent.
“The Group sells in more than 100 countries and the consumer environment generally remained volatile and difficult to predict. Against this backdrop, the Group performed well,” O'Neill said.
“Overall, the Group had an improved second half performance as the key market of the United States began to show signs of improvement and Europe remained solid, but there was a marked deterioration in trading in Australia late in the period that took some of the gloss off the result.”
The company announced it expects 2010/11 to be a “transition year”. The company has increased its investment in “direct-to-consumer” avenues, including the acquisition of retail stores in Australia and the US and increased investment in online retailers such as surfstitch.com and swell.com.
Brands within the Billabong Group include Billabong, Element, Von Zipper, Honolua Surf Company, Kustom, Palmers Surf, Nixon, Xcel, Tigerlily, Sector 9 and DaKine.