Loss tripled
Despite the
closure of 158 stores and redundancy of fifteen percent of the
European workforce, Billabong’s losses are increasing and all
attempts to steady the sinking ship seem futile.
Thetotal loss for this past fiscal year was 860 million Australian
dollars (576 million euro), three times higher than the year before.
The number even blew away the predictions made by analysts, who had
feared a loss of 547 million dollars (384 million euro).
The
thirteen brands belonging to Billabong International are worth a mere
90 million dollars (60 million euro), a stark contrast to their
maximum worth of 3.8 billion dollars (2.5 billion
euro) only six years ago. The Billabong brand has been described as ‘worthless’ by
the company itself, a stamp Element (skateboards) and Palmers
(surfing accessories) have also received.
Thestock market reacted badly after the results were revealed, seeing
the share fall 5.3 percent to 53.5 cents a share. In the past year
alone, the share plummeted 36 percent.
Hard
times ahead
Despite
the extra breathing space from the sale of West 49 and DaKine, the
future does not look bright. Failed negotiations with the Sycamore
Consortium, offering 60 cent a share, have forced Billabong to admit
that it has been a ‘tumultuous year’, but the company still has
hopes for the future.
A
refinancing deal would free up 95 million euro in interest over the
next five years, even though the net debt would still be huge. That
debt rose 28 percent over the past year, reaching 138 million euro.
Net losses over the past two years (760 million euro) have now
eclipsed the profits of the eight
years
before that (735 million euro).
