KMD Brands Limited (Group), the New Zealand-based parent of the Rip Curl, Oboz and Kathmandu brands, reported Group sales grew a tepid 1.0 percent to NZ$989.0 million for the fiscal year ended July 31, 2025. The results include a mix of results for the three brands, with Rip Curl leading the way with a low-single-digit year-over-year (y/y) improvement, flattish sales growth at Kathmandu, and a low- to-mid-single-digit decline at Oboz.

Sales results were said to be underpinned by improved sales in the direct-to-consumer (“DTC”) channel (including online). Group online sales performance has been a highlight, with all three brands achieving strong online sales growth year-over-year. Online reportedly remains a key growth priority for the Group.

KMD Brands reports in the New Zealand dollar (NZ$) currency. Fiscal 2025 NZ$/US$ conversion rate was 0.591 compared to a fiscal 2024 conversion rate of 0.605.

Rip Curl

Rip Curl total sales increased 2.1 percent to NZ$550.4 million for the full fiscal year, improving from a flattish 0.1 percent y/y growth in the first half.

DTC sales increased 4.6 percent y/y, said to reflect strong flagship store sales growth in the key regions of Australia, Hawaii, Europe, and South America, supported by store openings. Online sales increased 10.2 percent y/y to $41.7 million, comprising 12.5 percent of DTC sales.

DTC same-store sales (comprising owned-retail stores and online) increased 1.2 percent year-over-year.

Wholesale sales decreased 2.9 percent y/y, improving from a 7.9 percent decline in the first half on 1.5 percent y/y sales growth in the second half of FY25, supported by closeout sales for end of line styles.

Gross margin decreased 90 basis points y/y with DTC channel mix helping to offset the impact of “increased promotional intensity in a competitive market,” plus clearance of end of line styles.

Operating expenses continue to be a key focus area, given global cost pressures and an evolving channel mix.

Oboz

Total Oboz sales decreased 3.5 percent y/y to NZ$76.6 million for the full year, improving from 6.3 percent y/y decline in the first half.

Online sales increased 18.3 percent y/y, reportedly “growing strongly” during key online promotional periods, reinforcing the growth opportunity for the brand.

Wholesale sales decreased 5.8 percent for the full year, improving from a 10.6 percent y/y decline in the first half of the year. Wholesale sales trends reportedly improved in the second half with the launch of new season styles for the North American summer hiking season. The company said that since the announcement of U.S. tariffs, at-once wholesale demand has softened. However, there has not been a material impact on the fiscal 2025 full-year result.

Gross margin decreased 380 basis points y/y as clearance of inventory has contributed to lower gross margins in fiscal 2025.

Operating expenses were said to be lower than fiscal 2024 due to lower sales volumes, while continuing to invest in brand and digital marketing.

Oboz intangible assets have been impaired by NZ$45.4 million. This one-off non-cash item does not impact the day-to-day operations of the business. This impairment has been excluded from underlying1 results.

Kathmandu

Kathmandu brand total sales increased 0.2 percent to NZ$361.9 million for the full year, improving from an 8.8 percent y/y decline in the third quarter to 2.5 percent y/y increase in the key fourth quarter winter trading period.

  • Australia sales increased 0.2 percent y/y, with unseasonably warm weather reportedly impacting insulation product category sales in the third quarter. Positive sales growth of 2.9 percent y/y returned in the key fourth quarter, with enhanced promotional activity.
  • New Zealand sales were down 2.3 percent versus fiscal 2024, said to be due to a more challenging consumer environment, also returning to positive year-over-year sales growth of 0.6 percent in the fourth quarter.

Online sales increased by 9.3 percent y/y to NZ$52.1 million for the fiscal year, comprising 14.5 percent of DTC sales. Same-store sales (including online) decreased by 0.2 percent y/y in fiscal 2025.

KMD said most Kathmandu product categories achieved sales growth, including Rainwear, Fleece, Baselayer, Knits, and Footwear. This was said to partially decrease reliance on insulation, which achieved lower sales year-over-year especially during a warm third quarter.

Gross margin decreased 3.0 percent of sales, with increased promotional intensity and a focus on maintaining market share in a highly competitive trading environment.

Operating expenses were said to be tightly managed while facing store labour and rent cost pressure. Kathmandu brand marketing investment increased by $2 million year-over-year.

Financial Summary

  • Gross margin was down 190 basis points to 56.5 percent of sales in fiscal 2025.
  • Underlying operating expenses were up 3.9 percent to NZ$541.6 million.
  • Underlying EBITDA was NZ$17.7 million, down 64.7 percent year-over-year.
  • Statutory NPAT (net profit after tax) loss was NZ$93.6 million. Underlying NPAT loss amounted to NZ$28.3 million.
  • Net Working Capital was NZ$157.7 million in 2025, NZ$40.6 million lower year-over-year.
  • Net Debt was NZ$52.8 million at year-end, with “significant funding headroom” of ~NZ$235 million.
  • No final dividend declared as a result of FY25 operating performance.

Image courtesy Rip Curl/KMD Brands Limited