Daily Roundup

KMD Brands Ltd delivered a mixed financial picture for FY26, with strong operational momentum offset by significant one-time charges.

The outdoor and lifestyle retailer reported sales climbing 6.5% to $1,053.0 million, while gross margin expanded by 1.2% to 57.7%—a solid operational performance across its Kathmandu, Rip Curl, and Oboz brands. However, the headline numbers tell a grimmer story. The company posted a statutory net profit after tax loss of $414.4 million, largely due to a $394 million impairment expense that weighed heavily on the bottom line.

The underlying story is considerably brighter. When you strip out that impairment hit, underlying EBITDA surged 138% year-over-year, reflecting genuine operational improvement and a reset cost base. The company's technology and systems investments in Australia have also started paying dividends, streamlining business processes and positioning the business for digital growth.

Looking ahead, KMD isn't declaring a final dividend as it navigates the recovery phase. Management is guiding for FY27 revenue between $1,055 million and $1,075 million, with EBITDA expected to land between $52 million and $55 million. The guidance reflects confidence in seasonal product flows and the rollout of online fulfillment capabilities, while $10 million in annualised cost savings are already underway. Gross margin expansion should benefit from foreign exchange hedging and strategic price increases.

The company also flagged the divestment of its Southeast Asian manufacturing facility as part of its broader strategic review, signalling a shift in operational priorities as it focuses on higher-margin, digitally-enabled growth.