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Zara owner Inditex said on Wednesday its net profit fell 70 per cent in 2020 to €1.1 billion ($1.7 billion), a steeper drop than expected, after a year of global lockdowns and dampened demand caused by the coronavirus pandemic.

Fourth-quarter net profit fell 53 per cent to €435 million out of sales of €6.3 billion as restrictions on shopping came back into force across much of Europe during the end-of-year Christmas season, the company said.

Around 15 per cent of its shops worldwide were still closed due to COVID-19 restrictions as of March 8, Inditex said in a statement.

Six analysts polled by Refinitiv expected a quarterly net profit of €602 million, while a poll of 24 analysts forecast full-year net profit at €1.3 billion.

The Spanish fast-fashion retailer, which operates 6829 stores across the world, including Australia, said total sales in 2020 were down 28 per cent from last year at €20.4 billion, as an unprecedented 77 per cent of online sales increase partly offset the pandemic’s negative effects.

Clothing sales at Inditex’s brands, as well as at rivals H&M and Next, began to register a slow recovery in the second half of last year from record lows when the COVID-19 pandemic first struck, boosted by online shopping and a quick rebound in China.

But in the United States and Europe, a return to pre-COVID sales has been frustrated by lockdowns extending well into 2021 and slow vaccine rollouts in many countries.

About 30 per cent of stores were closed on January 31, when the company’s fiscal year ends, and 52 per cent were subject to restrictions. The company expects almost all stores to be open by April 12, it said.

The retailer, which sells clothing in over 200 markets worldwide, mitigated some of the potential damage of the uncertainty of demand throughout 2020 through tight management of its supply chain, with inventory 9 per cent down year-on-year despite rocky sales.

Australia has notched up its biggest trade surplus on record after a surge in exports of iron ore and coal driven by rebounding demand for commodities and defying China’s trade bans.

After posting a 3.1 per cent gain in economic growth in the December quarter, Australia has shot out of the blocks with the seasonally adjusted trade surplus for January, up $3 billion to a record $10.2 billion – far stronger than market expectations of $8.3 billion.

The solid start to 2021 also included a respectable lift of 0.5 per cent in retail sales over January to $30.5 billion – still more than 10 per cent above where sales were this time last year.

“What a way to start the New Year – a fresh record high for the trade surplus,” Westpac’s Andrew Hanlan said.

In what was the 37th consecutive monthly surplus, total goods exports rose $2.4 billion to $34.9 billion driven by a 9.7 per cent jump in resource exports as the global recovery gathers pace.

Iron ore leapt 14.2 per cent to $16.1 billion from December to January. The value of iron ore exports are now up 60 per cent from a year ago. There was also optimism around coal exports, up 2.6 per cent. LNG exports rose 7.9 per cent.

China again accounted for the lion’s share, spending $12.5 billion in January alone, mostly on iron ore. But amid ongoing political tensions exports to China fell by 8.2 per cent while imports from China also fell 17.5 per cent to $6.7 billion – the biggest monthly decline in 11 months. Exports to China are down 2.1 per cent on a year ago.

Over January commodity prices rose 7.6 per cent in US dollar terms or 4.8 per cent in Australian terms. The spot iron ore price was at US$167 a tonne in January 2021, a near 80 per cent increase from the US$94 per tonne a year ago.

Treasurer Josh Frydenberg said the jump in iron ore prices and volumes gave the government confidence in its efforts to repair its budget after the biggest shock to the economy since World War II.

Pressure on Australian dollar

“Iron ore prices are substantially up, as well, travelling above $150 a tonne. Let’s not forget we put it in the budget at $55 a tonne free on board. That augurs very well for the budget,” he said.

The record trade surplus will likely add further upward pressure on the Australian dollar, something which the Reserve Bank has been attempting to restrain.

“The big question is how high is too high for the currency,” Commsec’s Craig James said. “The Reserve Bank governor may need to provide some clarity on this in a speech to be delivered next week together with observations on rising bond yields and record home prices.”

Combined with record low interest rates, a surge of more than 800,000 extra jobs in seven months, rising house prices, a jump in consumption and business investment, the bullish trade figures give further impetus to a sustained economic recovery.

Commonwealth Bank economist Belinda Allen said Australia would continue to post big surpluses this year.

“We expect large monthly surpluses to continue (averaging $7 billion per month over 2021),” Ms Allen said, “Firm commodity prices, assisted by a global economic recovery, should assist.”

Exceptional surge

The drag on the trade surplus was Australia’s service exports such as tourism and student education which are still in the doldrums. Service exports dipped $150 million in January to $4.9 billion. Before COVID-19 service exports reached a monthly high of $8.8 billion.

On the import side of the trade balance, consumption imports fell by 3.3 per cent in January with falls in toys, books and leisure goods, down 9.8 per cent, and textiles down 13.5 per cent. Household electrical imports did, however, rise by 10.6 per cent.

Softer consumer good imports usually point to softer retail spending. The final figures for seasonally adjusted retail spending in January showed a 0.5 per cent rise in retail sales to $30.5 billion. This is still 10.6 per ent higher than the same time last year. Online sales are up an extraordinary 63 per cent compared to January 2020.

The result followed a 4 per cent drop in December, which was expected given an exceptional 7 per cent surge in November with Black Friday sales.

“There’s no doubt retail sales have performed incredibly well in recent months,” Australian Retailers Association CEO Paul Zahra said.

“It is encouraging to see the returning strength of some of the discretionary categories of spending, which were heavily impacted by lockdowns in 2020.”

January may have also benefited from some increase in spending on retail services.

NSW enjoyed a 0.8 per cent gain in retail sales while Victoria, still enjoying a reopening from COVID-19 restrictions, recorded a 1 per cent gain in the month.

The sharp lockdown in Queensland had a noticeable effect on its sales, falling 1.5 per cent.

ANZ card spending data suggests retail growth in February may have started to slow, which could mean another fall in consumption imports for February.

Big W has spearheaded its fashion department overhaul, with its autumn/winter 2021 collection featuring trend-driven garments from $15.

Designed locally by an in-house team, the range featured prints and designs influenced by 70s boho style.

Big W senior designer Claire Harahap (pictured) confirmed the womenswear range is priced from $15 to $49. 

“The global nomadic look has been trending in the fashion capitals and highstreets across the world and is reflective of the times we are in, with more people working, entertaining and holidaying at home.

"We’ve taken inspiration from these catwalks and translated for our BIG W customer, bringing a relaxed approach to dressing that features beautiful, on trend 70s inspired boho prints and fabrics and detailing.”

BIG W’s range features a mix and match of neutral colours such as camel, olive, grape and marigold, with a hero print in paisley.

Volume peasant blouses and tiering are key across the collection whilst outerwear pieces include a metallic puffer with a chimney neck. 

Fabrics such as cable knitwear feature heavily alongside denim, tiered skirts and faux leather items.

Big W collaborator and stylist Donny Galella said the range will shake up the value market. 

“Big W is really turning high-end fashion on its head, championing affordable, easy to dress style that makes women of all shapes and sizes look and feel good."

David Jones' South African parent has appointed investment bank UBS to run the rule over its property portfolio in order to reduce debt, which could lead to the sale of its flagship stores, following a strong double-digit decline in sales amid the COVID-19 crisis.

In a trading update Wednesday, Woolworths Holdings also said its Australian lenders agreed to suspend covenant testing after it provided a loan of $75 million to David Jones. Woolworths also is offering an additional $25 million loan should the local operations need it.

"UBS Australia has been appointed to support [a review of the capital structure of the Australasian entities] and will conduct a full review of options relating to the Australasian property portfolio," the company said in a statement.

"Any proceeds generated as a result of our capital management initiatives will be applied to the repayment and cancellation of debt facilities."

The two flagship stores in Sydney and Melbourne could worth more than $800 million combined given David Jones previously offloaded its smaller Sydney Market Street building for $365 million.

David Jones has continued to trade in its 40-odd large format stores throughout the pandemic, but has been significantly impacted by lower foot traffic with store sales falling by 35.8 per cent in the eight weeks to April 30.

The department store was already suffering well before the virus hit. In February, David Jones said profits fell 57 per cent to $20 million in the December half due to heavy discounting, weak sales and slowing foot traffic.

Former Woolworths chief Ian Moir – the architect of Woolworths' $2.1 billion buy of David Jones in 2014 – handed over to former Levis Strauss boss Roy Bagattini in February. Mr Moir remains acting CEO of David Jones until a permanent replacement is found.

Mr Bagattini said on Wednesday that stablemate Country Road Group was severely impacted by the full closure of 280 stores given social distancing measures, which resulted in a 50.4 per cent drop in sales in the eight weeks to April 30.

He said the update reflects the "tough and unprecedented trading conditions that have dramatically impacted performance across the retail sector globally."

The only bright spot for the group was second-half online sales for David Jones which doubled compared with the prior corresponding period. Online sales at Country Road Group – which includes the Mimco, Trenery, Witchery and Politix brands – posted growth of 19 per cent in second half to date. CRG stores began their planned reopening as of 22 May.

Thousands of other retail stores have reopened their doors within the country's big shopping centres in recent weeks, with foot traffic steadily increasing as pandemic restrictions eased. Woolworths said the easing of restrictions has led to a positive uplift in footfall and an encouraging sales performance across David Jones.

Woolworths has long planned to operate a smaller David Jones network, but Mr Bagattini said COVID-19 has accelerated the talks with local landlords about a faster network restructure and reduction in floor space.

David Jones sold its Sydney CBD menswear location several years ago, and the women's store across from Hyde Park now houses the entire CBD business across 12 floors.

The Melbourne flagship store also had a revamp in recent years. Both could be sold and leased back as a result of the UBS review.

On Wednesday, Woolworths said contracts have been exchanged for the sale of its Bourke Street menswear building in Melbourne, with the sale price "in line with expectations".

David Jones' update comes as rival Myer kicks off its stocktake sale, offering discounts of up to 50 per cent off across manchester, cookware, homewares, beds and up to 40 per cent off certain women's and men's fashion. Myer has been slowly re-opening stores around the nation after a full network closure.

In April, Woolworth's had flagged a 20 per cent-plus drop in full year earnings due to COVID-19 decimating sales in clothing stores across Australia, New Zealand and South Africa.

The board on Wednesday scraped the final 2020 dividend and flagged that any distributions to shareholders will be suspended until the COVID-19 situation stabilises.

Harvey Norman doubled profit after tax during the six months to 31 December 2020.

Off the back of strong sales of $5.12 billion, including franchised Australian stores as well as company-operated international locations, net profit rose 116.3 per cent to $462 million during 1h21.

The result proves Harvey Norman’s strong strategy, chairman Gerry Harvey said, with its combination of retail, franchising, property and online coming together to help it manage costs and navigate the difficult economic scenario businesses worldwide have been faced with.

“Pleasingly, customers continued to engage strongly with our brands and importantly, as we are in the lifestyle/home retail space, the customer was appreciative of the shopping experience, spaciousness and easy parking at the physical franchises complexes and stores,” Harvey said.

“The results achieved in 1H21 confirm the strength of our model.”

During the six month period the business was brought to a positive cash position of $21.75 million, compared to a net debt position of $553 million a year prior, allowing it to invest into the business’ future and making it “well placed to respond to the challenges” moving forward.

Harvey Norman keeping JobKeeper cash

The business will pay a fully-franked interim dividend of 20 cents a share this May – a decision which has frustrated shadow assistant minister for Treasury Andrew Leigh.

“Australian taxpayers gave Harvey Norman and franchisees $22 million in JobKeeper. They don’t need a cent of it. Firms with far smaller profits have already paid back their JobKeeper funds,” Leigh said.

“At a time in which one million Aussies are out of work, taxpayers shouldn’t be supporting a billionaire. Time to pay it back, Gerry.”

Many retailers that have profited from the conditions caused by the Covid-19 pandemic have subsequently returned the money they received in government subsidies – as they needed it then, and have recovered now.

Stockbroker Bell Potter has been tried on for size at Allegro Funds’ ASX hopeful Best & Less Group – and it’s a fit!

David Jones is shrinking its gourmet food business, closing three food stores in Victoria to stem losses that blew out to $12 million in the December half.

David Jones said on Monday it would close its Bourke Street food hall in Melbourne’s CBD next month and close its stand-alone Capitol Grand and its Malvern Central food stores in April and May.

However, it will invest more in the Elizabeth Street and Bondi Junction food halls and focus more on selling packaged gourmet groceries online.

Big W's first half results were boosted by big calendar events including Christmas and Halloween, parent Woolworths Group has reported. 

The retailer's focus on family, community and a simplified customer offer also contributed to its results during the half, which saw it deliver a 20.1% increase in sales to $2.6 billion.

Big W also recorded a 165.7% increase in EBIT to $133 million in the period. 

Woolworths Group CEO Brad Banducci welcomed the positive results. 

"Big W had a very strong half with all key metrics improving, including positive momentum in customer metrics, sales growth of 20.1% and EBIT growth of 166%.

"EBIT growth was driven by strong sales, gross margin improvements and good cost control despite higher COVID-related costs.

"Sales increased in all destination areas and were buoyed by seasonal sales events such as Halloween, Click Frenzy, Big Sale (Black Friday) and Christmas," he said. 

Big W's eCommerce sales also increased during the half, jumping up 120% with digital penetration at 9.5%. 

Helping to drive this growth was an acceleration of digital capabilities including contactless drive-up pick-up, the direct to boot launch across 75 locations and the rollout of same day delivery.

On the store side, Big W also made investments into 22 stores, enhancing the fixtures and layouts in apparel, baby and home categories. 

Meanwhile, the business also distributed 2.4 million books through its 'free books for kids' initiative, donated 1000 backpacks for back to school and donated 360,000 items to local charities through partner Good360.

Overall, Big W reported gross margin at 33.7%, up 118 basis points. 

EBITDA increased 61.7% to $224 million in the half, while EBIT to sales was 5.1%, up 282 basis points. 

Japanese retail conglomerate Fast Retailing, which owns and operates Uniqlo, is now the most valuable fashion retailer in the world, outstripping Zara’s parent-company Inditex.

Fast Retailing reached a market value of $130 billion last week, eclipsing the Spanish firm for the first time, which sits around $125 billion.

According to Nikkei Asia, the business’ focus on the Asia Pacific market, which has seen regions such as China and Australia weather the storm of the pandemic relatively well and, and on casual wear, which has seen a spike in relevance due to the ongoing working-from-home arrangements many workers find themselves in, has helped to deliver the growth needed to dethrone Inditex.

The business was named the biggest apparel brand in China last year after achieving record revenue of $6 billion during FY19, and with China projected to overtake the US as the world’s leading apparel market according to GlobalData, Uniqlo is in a strong position for further growth.

The difference between Uniqlo and other ‘fast-fashion’ brands is that it places an emphasis on quality than quantity, and makes clothing that is simple – with most of its range being fairly devoid of patterns and logos.

“We don’t chase trends. People mistakenly say that Uniqlo is a fast-fashion brand. We’re not. We are about clothing that’s made for everyone,” Uniqlo chief executive Tadashi Yanai said, according to Forbes.

“People will select clothes that are comfortable to wear as working clothes, as well as in their home. There will be no need for clothes that are worn for a year and then are discarded.”

Stylerunner has today launched its in-house, vertical label, Stylerunner the Label. 

Catering to the active and busy women, the collection launches with a range of tights, crops and leisurewear pieces including tanks, tees and shorts. 

The launch forms part of an overarching Accent Group strategy which focuses on vertical brands, with sister brand Platypus also having launched its own vertical brand ITNO. 

Speaking on the launch, GM Ryan Edelmuth said that the label plays between performance activewear and functional leisurewear. 

"Stylerunner the Label is the perfect mix of lifestyle and performance pieces. 

"The label is targeted at fashion conscious woman who lead an active and busy lifestyle. 

"The objective is to develop a stylish uniform that goes from the gym, to brunch, to work," he said. 

The collection is available in-store and online and features a 'core basics' colour palette, with black, grey, olive and rust pieces peppered with bold prints. 

The label will welcome new drops every six to eight weeks, with the first collection priced between $59-$129. 

City Chic's customer-led framework helped it adapt to the casualised buying behaviour exhibited during the pandemic, the business has reported. 

In its first half results, the business highlighted that its casual brand Avenue traded well in the US, while its customer-centric model allowed it to shift its local product mix to a more casual offering. 

During the half, City Chic reported a 13.5% lift in sales revenue to $119 million. 

CEO and MD Phil Ryan said that while the business was impacted by the pandemic, City Chic maintained its focus on servicing the plus-size market. 

"Our diversified business across different brands and regions allowed us to navigate the pandemic and deliver earnings growth, despite our fashion and dress categories being impacted by lockdowns and restrictions. 

"The more casual Avenue brand traded well in the US, and in Australia our customer-led model allowed us to quickly move to more casual product. 

"We have not let the pandemic distract us from our focus on the plus-size market and digital growth through expanding the customer base globally," he said. 

The Group's focus on global expansion throughout the half saw it welcome the UK brand Evans to its portfolio. 

According to the report, City Chic continues to receive the benefit of a transitional services arrangement (TSA) in connection with the Evans eCommerce business, which is due to terminate at the end of April 2021. 

A third-party logistics provider in the UK has been selected and the website build is progressing as scheduled. 

At the end of the TSA, the Evans eCommerce business will move to the fully integrated City Chic Collective global eCommerce platform. 

"I have followed Evans for over a decade, a brand that is very well known in the UK and one which aligns with our existing product streams," Ryan added. 

"It is a perfect fit strategically, and with cash on the balance sheet and a good understanding of the brand, we were able to move quickly and acquire the business at good value.

"Over the last two years, we have more than doubled our global active customer base to 801,000 (56% YoY), increased online penetration from 40% to 73% and grown our northern hemisphere business from 16% to 45% of total sales. 

"We now have three banner brands which have very strong brand recognition, customer loyalty and traffic in their respective home countries and we will leverage these platforms to sell all our brands around the globe," he said. 

Meanwhile, the business benefitted from its other acquisition, Avenue, which contributed to a larger sales result out of the US. 

US online websites (Avenue, City Chic USA and Hips and Curves) contributed sales of $45 million in H1 FY21 compared to $26 million in H1 FY20, driven by the expanded customer base from the Avenue acquisition. 

Locally, City Chic reported that Australian and New Zealand comparable sales growth (CSG) was 19.4% (excluding Victorian store closures) and 30% growth for ANZ online.

Overall, City Chic reported comparable sales growth of 20.8% (excluding Victorian store closures) and 12.7% including the store closures. 

The business delivered an underlying EBITDA of $23.3 million - a 21.8% increase compared to the first half in FY20. 

City Chic's online sales jumped up 42% with online penetration up to 73%. 

The business closed the half with net cash of $83 million and had 96 stores at the end of December after closing four stores during the half. 

Kathmandu Group saw sales spike 12 per cent during the first half of FY21, largely off the back of a strong performance from Rip Curl.

The recently acquired surf-wear brand’s sales rose 21 per cent during the six months to January 31, adjusted for store closures, though Kathmandu’s sales plummeted 30 per cent.

During the half, 60 stores were shut down in Melbourne for 11 weeks, as well as 14 stores in Auckland. Trading in Sydney was impacted by the concern over the Northern Beaches cluster through Christmas.

Ignoring the store closures, Rip Curl’s sales rose 7.4 per cent and Kathmandu’s fell 35.4 per cent.

“Our improved first-half operating profit underlines the resilience of our Group and validates the diversification strategy, launched through the successful acquisitions and integrations of Rip Curl and Oboz,” said Kathmandu Group’s outgoing chief executive Xavier Simonet.

Earnings for the half are expected to hit between $47 million and $49 million.

Simonet said Rip Curl’s forward momentum is continuing at pace, with forward orders for the wholesale business above pre-Covid levels, and the business about to enter summer in the Northern Hemisphere.

Kathmandu saw strong camping sales, but low demand for insulation and rainwear hurt the overall result.

“To put the first half into context, Kathmandu’s profit weighting has historically been heavily weighted to the second half-year, when winter in Australasia drives demand for insulation and rainwear,” Simonet said.

“Oboz [also] delivered sales growth year on year, with the product innovation strategy pursued by the new Oboz management team reflecting in the forward order book, which is tracking well above pre-Covid-19 levels.”

Underwear brand Hanes appointed Tanya Deans as the new president for Australasia effective on 8 February 2021.

She will succeed David Bortolussi, who left the company in August. Deans has 25 years of industry experience, having held a number of product leadership roles, handling the Bras N Things brand most recently.

“I am thrilled to confirm Tanya will be our new president of our Australasia business,” said Steve Bratspies, HanesBrands CEO.

“She is an outstanding people leader with deep experience building iconic brands. Tanya has demonstrated a clear vision for the future and I look forward to working with her as we apply her experience and learnings to drive growth across our global organisation.”

Deans will lead 4,400 team members across the region who are working under the apparel and lifestyle brands including Bonds, Bras N Things, Champion and Sheridan.

She will also oversee the company’s e-commerce business and more than 450 stores.

“I am honoured to have the opportunity to lead Hanes Australasia,” said Deans.

“We have an outstanding team, iconic brands and a deep commitment to sustainability. I look forward to working with our team and the HanesBrands global organisation as we build a truly consumer-centric company and deliver long-term growth.”

Meanwhile Mark Barry was appointed to the new position of group general manager of Bonds Group (formerly Apparel Group). Kate Hann is assigned as group general manager of Bras N Things and Jo Holding was elected as general manager of Champion. Paul Gould remains as group general manager for Sheridan.

Riding the booming homewares market Nick Scali almost doubled net profit for the last six months, the business announced to the market on Thursday.

Sales for the half year to 31 December hit $171.1 million, a 24.4 per cent increase, while net profit leapt to $40.5 million from $20.3 million – a 99.5 per cent jump.

The increase was earned through increased trade compared to the same period a year ago, but also by growing gross profit margin from 62.2 per cent to 64 per cent by reduced discounting.

And to top it off, January 2021 was the largest month of written sales orders the business has ever seen.

“[We] had many challenges to navigate including government mandated store closures, supply chain issues and significant delays experienced with global shipping providers,” said managing director Anthony Scali.

“Despite these events, the team was able to capitalise on shifting consumer spending patterns and deliver a record result.”

With more Aussies and Kiwis shopping from the comfort of their own home, the business’ online sales have almost already exceeded the business’ predictions for the entire year – reaching $3.5 million of Nick Scali’s $4 million target.

And there is still scope to improve the online experience, the business said, with investment in its e-commerce capabilities already underway in Australia and New Zealand.

Nick Scali isn’t the only business that has profited from the consumer-led shift in shopping during the Covid-19 pandemic, with Temple & Webster seeing earnings jump 556 per cent earlier this week, and JB Hi-Fi’s half-year profit up 86 per cent.

However, looking ahead to the remainder of the year, the furniture business is struggling to predict what the second half could look like.

“The rate of sales revenue growth has been lower than sales orders due to the increased lead times caused by delays in raw materials to our suppliers and shipping issues which continue to be challenging,” the business said.

“These supply chain delays make it difficult to accurately predict sales revenue growth for the second half.”

There’s another plant-based meat contender in Australia.

Proform Foods launched its $11 million plant-based meat manufacturing facility in Sydney on Thursday, designed to produce 5000 tonnes of ‘meat’ each year. The 1,600 square metre facility is in Mt Kuring-Gai, in Sydney’s north, and will use 70% Australian ingredients in its plant-based meat.

Its products are made under the MEET brand and are designed to have the same taste and texture of traditional meat.

Proform Foods makes 28 different products including meatballs, burgers, “beef style” strips, “chicken style” tenders and mince. Its MEET range is available in supermarkets and is set for global distribution in 2021. And Proform Foods plans to triple in growth in the next year as the demand for plant-based meat grows.

The company was created in 2008 by Stephen Dunn, the founder of Vogel Cereals. His son, Olympic swimmer Matt Dunn OAM, serves as CEO.

“We are incredibly excited to officially open the next generation plant-based meat manufacturing facility,” Matt Dunn said in a statement. “The global demand for plant-based products is booming, and our Australian innovation wins on both taste and texture.

“With plans already in the works to expand globally, we anticipate that the business will become a global leader in the US$4.3B plant-based meat industry, creating new jobs and export growth in Sydney and across the country.”

The facility was opened by Federal Minister for Industry, Science and Innovation Karen Andrews and Federal Member for Berowra, Julian Leeser. Andrews highlighted that plant-based meat is one of six major priorities under the government’s Modern Manufacturing Strategy.

“Australians want to buy Australian Made and the world wants our food too,” she said in a statement. “By further growing this area of manufacturing we can create more jobs for Australians. This is a great example of value-adding to our proud agriculture industry, and alongside our meat producers, we can capitalise on Australia’s reputation for producing safe, premium, high-quality food.”

MEET joins the growing range of plant-based meat companies in Australia such as V2 Food and Fable. It invested $2.3 million in partnership with CSIRO as a research provider in 2006 and has since invested an extra $8 million in research and development, before spending $11 million on the new site.

In Australia, the plant-based meat sector is on track to generate $3 billion in sales and employ more than 6000 people by 2030, according to a report from Food Frontier. In addition, research from Colmar Barton found one in three Australians are consciously reducing their meat consumption, with health being a main reason for the decision. Other reasons include the environment, animal welfare, cost and growing range of plant- based that are available.

Outdoor fashion retailer Kathmandu’s chief executive Xavier Simonet has resigned after five years at the helm

Simonet is taking up a role as CEO of Austrade, the Australian Trade and Investment Commission, and will remain with the company through the next six months or until the board dismisses him.

“I have had an awesome time at Kathmandu Holdings, where I’ve spent the last five immensely exciting years,” Simonet said.

“The Group has great brands, passionate teams and strong values. I’m very grateful to our teams, to the board of directors, to our shareholders, and to my chairman, David Kirk, for their support.”

Kirk said the group was disappointed to lose Simonet, but that it understands his desire to move on to a new role.

“We wish him well in the important work he will undertake,” Kirk said.

“Xavier has led Kathmandu Holdings through a period of growth and repositioning the company.”

Trade Minister Simon Birmingham said Simonet’s appointment comes at a time when the commission has a critical role to play in helping Australian businesses export internationally and maintain global supply chains.

“Bringing a distinguished career in brand sales and marketing, international market development and acquisitions, I am sure that Mr Simonet’s extensive knowledge and wide international experience will serve Australian businesses well,” Birmingham said.

The group recently released sales figures for the first quarter of FY21, which landed 72 per cent above the same time last year. However, Kathmandu saw sales decline due to the fall in CBD foot traffic and the impact of lockdowns, which was largely offset by the gains made at RipCurl heading into summer.

Toy wholesaler Funtastic has completed its acquisition of Hobby Warehouse, Toys ‘R’ Us, Babies ‘R’ Us, and Mittoni, with shareholders voting overwhelmingly in favour the transaction.

As of Thursday 26 November, Louis Mittoni will take up the position of managing director and chief executive of the combined company, with Kevin Moore acting as chairman and former director and chairman Bernie Brookes stepping down.

Mittoni previously said this was the next phase of Toys ‘R’ Us’ relaunch, and now said the wholesale operations of Funtastic and Mittoni Technologies will support the businesses future.

“This is an exciting day for both businesses, particularly as we head into the busiest period of retail trading with Black Friday, Cyber Monday and of course, Christmas shopping,” Mittoni said.

“Toys ‘R’ Us is now one of the fastest growing online retailers in ANZ and we will now look to accelerate that growth in 2021 with further expansion plans, plus the commencement of Babies ‘R’ Us.”

The next stage of Toys ‘R’ Us’ relaunch involves building new physical and digital logistics, as well as innovative, experiential retail stores.

Last year, a Toys ‘R’ Us spokesperson told Inside Retail the business would launch several large-format bricks and mortar stores, followed by a number of smaller footprint ‘retail-lite’ stores.

“All stock is on the floor, there’s no storage space out the back. It’s impulse items under $30 for sale there, and anything over $30 is buy-in-store, ship-to-home,” the spokesperson said.

“[But] every time you open a store, you’ve got to have a very clear mindset to say we’re going to commit five years of rent as a liability on the balance sheet, which will prevent me from using my working capital for other things – buying new products, advertising, employing people. “You have to be very clear as to why you’re going to open stores. They must have an absolute purpose.”

Sales across Accent Group’s brands have grown 1.3 per cent in the first 20 weeks of the new financial year, while digital sales more than doubled.

Excluding the impact of Victoria and Auckland’s lockdowns like for like sales grew 15.7 per cent, and with the reopening of both cities trading is ahead of CEO Daniel Agostinelli’s expectations.

For all the good news, however, the board managed to avoid a spill after the business’ AGM delivered a second strike against its’ remuneration report.

Shareholders have expressed their unhappiness with Accent Group’s pay in recent years, with 54 per cent voting down the business’ remuneration report this year but 95 per cent voting against a spill.

“We’re pleased with the strong trade to date and delighted with the performance of our new stores in Stylerunner and Pivot,” Agostinelli said.

“Our plans are well set to capitalise on the important November cyber events, Christmas and back to school trading periods. Our integrated omnichannel model has allowed us to trade strongly through a highly disrupted period along with demonstrating operating capability to respond to store impacts that may arise due to Covid-19, including the current Adelaide lockdown.”

This lockdown, Agostinelli said, is unlikely to have a material impact on the company given its store footprint and demonstrated pivot to online – which has grown sales 129 per cent compared to last year.

Additionally, the business’ newest brands, Stylerunner and Pivot, are progressing well. Stylerunner has launched its first store, with an additional 3 stores to come, while Pivot has launched 3 and has an additional 15 on the way. 

In total, the business expects to launch 80 new stores, including new concepts, in FY21.

Outdoor fashion group Kathmandu has seen group sales for the first quarter of FY21 72 per cent above last year, benefiting from the addition of RipCurl to its staple of brands.

The surfwear brand, which was acquired in October 2019, largely offset the negative impact felt by Kathmandu. RipCurl’s same store sales rose 26.8 per cent for the period, while Kathmandu fell 26.8 per cent due to falling CBD foot traffic and the impact of Melbourne’s and Auckland’s respective lockdowns.

The result shows the strengths of a newly diversified group, said Kathmandu Group CEO Xavier Simonet.

“We’re realising the benefit… with strong performance in summer weighted product categories for RipCurl in all key geographies following successful winter trading for Kathmandu,” Simonet said.

“The group continues to maintain a strong balance sheet and liquidity position, allowing it to respond to current trading conditions and pursue attractive growth opportunities that may arise.”

RipCurl saw strong sales in its key markets of Australia, Europe and North America, while Kathmandu enjoyed strong sales in camping and footwear – though not enough to offset falling travel related purchasing.

Footwear brand Oboz was also strong, according to Simonet, with forward ordering tracking above pre-Covid levels.

However, Simonet was quick to add that Kathmandu Group’s half year result will be highly dependent on the all-important holiday period, and that dividend payments may resume depending on the next few months’ market conditions.