Australian-born streetwear business Globe International, which manages brands such as FXD, Salty Crew and Globe, has reported a 28 per cent slip in its net profit after tax (NPAT) in the first half of FY26, slumping by $1.4 million to $3.4 million.
Globe CEO Matt Hill told the market in a trading update this week that the bottom-line slump – which also includes a $1.9 million drop in its earnings before interest and tax (EBIT) to $5.2 million – was impacted by the short notice of the introduction of tariffs by the United States.
Hill said this affected the first-half performance of Globe in the North American market, which made up just over a third of the group’s total revenue for the first half. Australia made up just under half in the same period, with Europe making up around 14 per cent.
“Swift action was taken to absorb this new operating environment into the financial planning of the business in the USA and as such, at the current levels, tariffs are not expected to impact performance in the same way going forward,” Hill said.
Hill added that its core brands – Salty Crew, FXD and Globe – contributed strongly to group revenue and profit in the first half. Salty Crew grew in the half, he said, with the brand growing well in traditional doors, new product categories and the broader outdoor market.
“FXD continued to be a powerhouse in its workwear market and a large contributor to company revenue and profit while Globe brand grew in all regions,” Hill said.
“Having now dealt with the brunt of the short-term challenges of tariffs in the first half, the group emerges with improved margins in core brands and a stronger platform from which to deliver sales growth and improved profitability into the future.”
Despite the challenges and profit slips, Globe issued a 10 cent dividend to shareholders.
The group’s cash position at the end of 2025, net of working capital borrowings, was $19.3 million. This is consistent with the net cash position as of June 30, at the end of the FY25 period.
Cash generated from operations was $7.4 million, driven by a $3.3 million reduction in working capital associated with a decrease in trade receivables during the period offset by traditional seasonal inventory build at the half year.
Globe added that cash utilisation during the half year was driven by non-operating factors including dividends and capital expenditure.
Looking ahead, Hill said Globe continues to deliver upon its strategic objectives of focusing increasingly on higher sales and margin growth in its global brands.
“The group held up extremely well financially in the first half of the financial year, delivering growth, returns to shareholders, and dealing with the broader economic challenges presented during the trade period.
“Following this period, Globe emerges with a strong balance sheet, performing brands and improved margins which is anticipated to drive revenue and profit growth in 2026.”