Business

Billabong posts first annual loss

AILING surf wear company Billabong will close 82 struggling stores after it announced a $275 million net loss on Monday.

The result was the company's first loss since 2001 and highlighted just how far it has plummeted in a short space of time.Billabong shares were trading at $1.31 on Monday, significantly less than the $17 traded just five years ago.

The store closures, combined with the shutting down of 58 under-performing stores in the past financial year, are expected to save the company $6 million before tax in the current financial year.

A Billabong spokesman said the bulk of the store closures would be overseas.

Closing under-performing stores formed part of the strategic capital restructure announced in February.

News of the loss, no doubt, will increase pressure on Billabong's major shareholder, board member and founder Gordon Merchant.

Mr Merchant is perhaps best known in the Clarence Valley for his multi-million-dollar home at Angourie built across three blocks.

In February, he used his 15% stake in the company to block an $850-million takeover bid by TPG Capital.

The United States private equity firm remains interested in Billabong and currently is examining the books.

The Billabong spokesman would not comment on TPG interest's interest in a takeover other than to say "due diligence was under way".

Meanwhile, Billabong used Monday's announcement to reveal details of a four-year strategy designed to reverse the company's fortunes.

Billabong CEO Launa Inman said in a statement the strategy would target "cost savings and revenue growth".

The "transformation strategy" will be aimed at simplifying the business, globalising its supply chain and leveraging Billabong's brands.

The strength of the Australian dollar added to the company's not insignificant challenges.

Despite its struggling share price and significant 2011-12 loss, Billabong CEO Launa Inman said she was confident the company remained profitable.

"As previously flagged to the market, the group's results have been adversely impacted by various significant and exceptional items," Ms Inman said.

Topics:  asx, billabong, profits, stock market




Join the Community.

Get your local news, your way.

Stay Connected

Update your news preferences and get the latest news delivered to your inbox.

Countdown is on as Grafton PBR takes shape

Professional Bull Riders / PBR , Hervey Bay Seafront Oval - Troy Wilkinson on Unearthed. Photo: Valerie Horton / Fraser Coast Chronicle

Watch highlights from the previous round of the PBR at Fraser Coast

Thirsty Merc 'Back To Grind' after Shifting Gears

Thirsty Merc are performing in Yamba on Friday night.

Thirsty Merc's lead singer soldiers on post car crash tragedy

Home is where the heart is for The McClymonts

THE McCLYMONTS: Mollie, Sam and Brooke are coming home to play at the Saraton Theatre in August.

10 shows announced for 10 Years of Hits anniversary tour

Latest deals and offers

How a sacked real estate agent made $725k in four months

Agent is now under investigation by the industry watchdog

VIDEO: Art Deco fan pays $835,000 for Imperial Hotel

No Caption

Iconic "Impy" sold at a bargan price to bidder who loves Art Deco.

RBA warns of future apartment oversupply

Toowoomba: Crest Apartments and Burke & Wills, Ruthven Street ( view from Neil Street) Photo Bev Lacey / The Chronicle

RBA says oversupply of apartments poses risk to household finances