The Kathmandu Holdings Ltd (ASX: KMD) share price is one to watch today after a positive trading update from the Kiwi retailer.
The post Why the Kathmandu (ASX:KMD) share price is in focus appeared first on The Motley Fool Australia. –
Why is the Kathmandu share price on watch?
Kathmandu reported record Rip Curl performance leading to strong half-year earnings before interest, tax, depreciation and amortisation (EBITDA).
Kathmandu reported half-year total group sales up ~12% to the six months ended 31 January 2021 (1H 2021).
The retailer said half-year sales growth reflected the successful integration of Rip Curl and a diversified portfolio of brands. However, Kathmandu sales were impacted by low demand for insulation and rainwear due to reduced international travellers in the Northern Hemisphere.
Kathmandu expects to report unaudited group EBITDA above last year thanks to the strong Rip Curl result. Half-year EBITDA is expected to be in the range of $47 million to $49 million.
That result came from across key global markets despite coronavirus disruptions. Sixty Melbourne stores were closed for 11 weeks in Victoria’s second lockdown with 14 Auckland stores closed for over two weeks.
The Kathmandu share price is one to watch as investors digest the latest numbers.
The retailer intends to report its half-year results on Tuesday 23 March including an announcement regarding dividend resumption.
Group CEO Xavier Simonet said the record result “highlights the strength of its brand and quality technical products”. Forward orders for the Rip Curl wholesale business are above pre-COVID levels with “encouraging early indications for future seasons”, Mr Simonet added.
The search continues for a new CEO following the resignation of Mr Simonet in November 2020.
The Kathmandu share price has slumped nearly 49% in the last 12 months after being slammed in the March bear market.
Kathmandu has entered the second half of the financial year with strong momentum. That’s despite COVID-19 disruptions such as store lockdowns across major markets.
The record Rip Curl result has underpinned an uplift in EBITDA which makes the Kathmandu share price worth watching in early trade.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.