1H FY2026 Interim Results and Equity Raising
| Stock | KMD Brands Ltd (KMD.ASX) |
|---|---|
| Release Time | 31 Mar 2026, 8:58 a.m. |
| Price Sensitive | Yes |
KMD Brands delivers strong 1H FY2026 results, announces equity raising
- Group sales up 7.3% to $505.4 million
- Underlying EBITDA up 196.6% year-on-year
- Kathmandu delivers double-digit same store sales growth
KMD Brands Limited (NZX/ASX: KMD) today announced its results for the six months ended 31 January 2026 ('1H FY26'), reporting a 7.3% increase in group sales to $505.4 million and a 196.6% year-on-year increase in underlying EBITDA to $11.5 million. The strong performance was driven by solid growth in both the direct-to-consumer and wholesale channels, with Kathmandu leading the sales momentum with a 12.3% increase. Rip Curl and Oboz also delivered sales growth of 4.6% and 6.5% respectively. While gross margins declined by 1.2% due to a promotional marketplace, the company's focus on cost discipline and a strategic cost reset helped to improve operating leverage. The company also announced details of a $65.3 million fully underwritten equity raising, comprising a $6.8 million placement and a $58.5 million pro-rata accelerated renounceable entitlement offer. The proceeds will be used to strengthen the company's balance sheet, accelerate its path to a target leverage ratio of less than 0.5x net debt to EBITDA, and support the ongoing execution of its Next Level transformation strategy.
KMD Brands expects to deliver further EBITDA margin expansion in FY26, with underlying operating expenses for the full year planned to be broadly flat year-on-year on a constant currency basis. The company continues to target a leverage ratio of less than 0.5x net debt to EBITDA by the end of FY27.
The company remains focused on delivering continued performance improvement compared to the prior year, with early momentum in its Next Level turnaround strategy. Kathmandu is expected to continue its recent sales momentum, with gross margin expansion anticipated in the second half. Rip Curl and Oboz wholesale order books for the second half are in line with last year, and the company expects gross margin expansion in the second half reflecting actions taken to offset tariffs and cycling specific clearance of inventory.