KMD Brands Limited (KMD) Q4 2024 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning, everyone, and thank you for joining us for today's presentation of KMD Brand's financial results for the 2024 financial year. My name is Michael Daly, and I'm the CEO and Managing Director of the group. I'm joined in the call by Ben Washington, our Interim Group Chief Financial Officer. We will be talking through the presentation lodged on the NZX and ASX this morning. Unless otherwise specified, all financial numbers are in New Zealand dollars. Today's presentation will begin with a summary of the key financial and operational results for FY24. We will then discuss the group's financials, brand results, and an update on Kathmandu. We'll conclude with our focus areas and outlook for FY25. I will begin with a summary of the key results for FY24 and an overview of our group. Drawing your attention to slide four now, sales were 11.2% below last year's record sales result. reflecting ongoing weakness in consumer sentiment. Sales declined for all three of our brands, cycling their strong sales growth achieved last year. Despite the challenges on sales, it was pleasing to see gross margin remaining resilient, underlying operating expenses reducing despite global inflation, and working capital reducing despite the sales decrease. Gross margin decreased by 0.2% of sales to 58.9% for the group, with increased promotional activity for the Kathmandu brand. Operating expenses were tightly controlled in a challenging sales environment. On an underlying basis, operating expenses were 3.6% or $19.6 million below last year. With sales more than $120 million lower than last year, and despite resilient gross margin and reduced operating expenses, underlying EBITDA decreased to $50 million for the year. After accounting for a one-off non-cash impairment of Oboe's Goodwill...