Billabong shares plunge 15% after annual losses triple

Attention: open in a new window. PDFPrintE-mail

Shares of surfwear maker Billabong have tumbled as much as 15% in Sydney after its annual losses more than tripled.

The Australian company posted a net loss of A$859.5m ($777.8m; 495.1m) for the year ending 30 June, compared to a net loss of A$275.6m a year ago.

Billabong has been struggling to maintain sales in key markets such as the US and Europe.

The firm has also been in financial trouble after an international expansion loaded the company with debt.

The company has seen its share price plunge more than 60% in the past twelve months.

Restructuring exercise

The firm, which is also facing weaker trading in its home market, Australia, has taken various steps in an attempt to revive its business.

These include selling some assets, closing stores and replacing the chief executive.

Billabong's chairman, Ian Pollard, said that the firm is facing the most challenging period in its history.

The company is now considering two rival refinancing offers, one from US private equity firm Altamont Capital Partners and the other from two US hedge funds, Oaktree Capital Management and Centerbridge Partners.

"Financial stability is critical to rebuilding Billabong. Liquidity has been secured and we are within weeks of finalising our long term funding arrangements," he said in a statement.

"We are nearing the end of a long process that has caused distraction, impacted on staff morale and has been very costly."

Billabong had rejected a A$850m takeover bid from private equity firm TPG Capital Management early last year.

Courtesy: BBC

Forex open Market rates & comments Archive

Login Form