The UAE franchise partner of Billabong plans to expand the Australian surfing brand in the Emirates, despite the company suffering heavy losses and shutting stores elsewhere.
Surf's still up for Billabong in UAE
The UAE franchise partner of Billabong has pledged to expand the Australian surfing brand in the Emirates, despite the company suffering heavy losses and shutting stores elsewhere.
Billabong International posted a net loss after tax of A$859.5 million (Dh2.82 billion) in the year that ended in June.
The company's losses had tripled from the previous June, when they stood at A$276m for the year.
"You can see how much the core business has deteriorated over the last few years. There's still a massive challenge to get the business going right," Todd Guyot, an analyst at Moelis & Co in Sydney, told Bloomberg. "It probably isn't cool any more for the youth of today to wear Billabong."
If that is the case nobody has told UAE consumers.
"The Billabong business is doing very well for us here," said Samantha Warrayat, the marketing manager at UAE franchise partner Royal Sporting House.
"We're quite happy with the partnership. We intend to open more stores," she added.
Elsewhere the company has shut 158 under performing stores, cancelled relationships with more than three quarters of its suppliers and reduced its European staff by about 15 per cent, among other measures, in a bid to stem the slump.
The company's stock suffered its biggest decline since July yesterday, dropping 10.3 per cent in Sydney. The company has agreed to a US$294m refinancing deal which would save it as much as A$143m in interest over five years.
It has "clearly been a tumultuous year with all that has gone on, but in recent weeks we have made significant progress," Peter Myers, the acting chief executive, told an investor call after the results announcement, according to Bloomberg.
"The early fiscal year 2014 results are promising, especially for Australian retail."