Outgoing Rip Curl parent company Group CEO Michael Daly commented on the impact the Liberated Brands bankruptcy is having on Rip Curl during the KMD Brands’ first-half earnings call this week.
“The change in ownership and structure arrangements for our competitors across the market for surf, while we think it creates some good medium- to long-term opportunities, it does see some short-term headwinds particularly as we see changes in partners across those brands, different distribution strategies, and certainly when we see the need for some of those exiting licensees to liquidate product.
“That does put a lot of pressure on the market in terms of price, both in terms of online activity and in-store activity,” he added. “Liberated’s Chapter 11 is widely documented and what they have been doing in the market recently is widely documented and we’re still trading through that. And you know that does put some pressure on Rip Curl in terms of driving sales growth in that broader environment.
“But it’s just part of the market at the moment and we’ll get through it in the short term, but we continue to think it creates good opportunities in the medium- to long-term.”
Rip Curl DTC Outperforms Wholesale in First Half
Rip Curl reported total revenue of NZ$278.5 million ($159.3 million) for the six months ended Jan. 31, up 0.1% compared to the same period last year.
KMD Brands said Rip Curl’s sales were negatively impacted by cautious wholesale accounts, and wholesale sales dropped 7.9% in the half.
Direct-to-consumer sales (stores plus online) grew 4.1%, with online sales jumping 13.9%.
The good news is executives said wholesale orders for the remainder of 2025 are looking better.
Rip Curl’s EBITDA dropped 14% to NZ $23.6 million ($13.5 million) compared to the same period last year.
Rip Curl’s EBITDA margin totaled 8.5% for the half, down from 9.9% in the same period last year and much lower than the 19.4% EBIDTA margin during the COVID boom years in fiscal 2021.
Daly voluntarily stepped down as KMD Brands Group CEO this week though he still led the earnings call, and new Group CEO Brent Scrimshaw stepped into the role on Monday.
KMD also announced a new CEO for Rip Curl this week, Nike veteran Ashley Reade.
