Based in Melbourne, Globe International Limited reported a significant increase in sales and profitability in the first half ended December 31. The company’s four brands: Impala, FXD, Globe, and Salty Crew, all grew.
Net sales of A$124.8 million grew 60 percent compared to the prior year. The company’s brands fueled the growth. According to Globe, the brands had a strong trajectory before COVID-19 and have continued to deliver sales growth through the pandemic. The company’s three regional operational segments experienced strong double-digit growth in the half-year, while North America stood out, with net sales almost double the previous corresponding quarter.
Earnings before interest and tax (EBIT) of A$21.0 million (16.8 percent of net sales) eclipsed the A$4.2 million reported in the prior period (5.4 percent of sales).
Net profit after tax (NPAT) of A$15.3 million for the half-year was A$11.4 million, or 300 percent higher than the prior year. Cash generated by operations during the period was A$17.8 million.
CEO Matt Hill said, “This time last year, just weeks before the onset of the pandemic, we advised the market that we had completed the restructuring of our Globe brand and divested our stable of Dwindle brands. Moving forward, our focus was on our growth brands across the outdoor (Salty Crew), workwear (FXD), and boardsports (Impala and Globe) markets, all of which grew in the first half of FY20 and were poised for further growth. A year on from the pandemic, it is extremely pleasing to see that our brands are still at the top of their game. Our dedicated global team remains agile and adapted quickly to the numerous sourcing, operational and selling challenges presented by the pandemic. As a result, we have been able to capitalize on the opportunities created by our brands’ strength. We have done this by working closely with our global retail customers over the last 6 months and expanding on how we digitally reach and communicate with our end consumers. All of this has been underpinned by the support provided by our manufacturing partners who have been flexibe and reliable, in what has been an extremely difficult time.”
Looking ahead, Hill said the company expects sales growth to “continue to remain robust” in the second half of the 2021 fiscal year, pending the continued reliable supply of products, primarily from China and assuming there is no significant deterioration in global economic conditions. Profitability is also expected to remain strong but will be lower in the second half of the fiscal year versus the first half due to investments to support continued growth and the margin impact from landed cost increases and sales mix. Hill concluded, “We expect working capital to increase substantially over the second half of the year as both inventories and receivables are forecast to grow to facilitate sales growth. While the coming months will no doubt provide a range of new challenges, we look forward to delivering a full-year result that is well ahead of the prior year with regards to sales, profits and returns to shareholders.”
The full statement is available here.
Photo courtesy Salty Crew