The Kathmandu Holdings Ltd (ASX: KMD) share price is on watch today following the Kiwi retailer's trading update.
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.
Foolish takeaway
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.
