Billabong reduces the value of its brand to zero

Surfer Jordy Smith competing in the ASP world tour Billabong Rio Pro 2013 finals Billabong sponsors surfing events and competitors

Related Stories

The Australian surfwear brand Billabong has reported much worse than expected results as it continues to try to refinance its debt.

It reported a net loss of A$859.5m ($777.8m; £495.1m) for the year ending 30 June, compared with a loss of A$275.6m a year ago.

It has written off the value of many of its brands, including cutting the value of the Billabong brand to zero.

Its shares fell as much as 15%, having lost more than 60% in the past year.

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

"They have had an absolutely ginormous writedown, and that's the only way that you can describe it," said IG Markets analyst Evan Lucas.

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

Billabong rejected an A$850m takeover bid from private equity firm TPG Capital Management early last year, which valued the shares at A$3.50 each. The shares ended the day at 53.5 cents.

Restructuring exercise

Chairman Ian Pollard said the year had been "the most challenging period in the company's history".

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

It has closed 158 of the stores it describes as under-performing, sold the DaKine brand and all but withdrawn from its Nixon joint venture.

It is also in the process of replacing its chief executive, with an interim boss in place while it finalises the appointment of former Oakley chairman Scott Olivet.

It is also considering rival proposals to refinance its debt from two private equity firms.

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

"The company looks forward to refocusing, reinvigorating its brands and rebuilding the business on a solid, long term financial footing."

More on This Story

Related Stories

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Features & Analysis

  • French luxury Tea House, Mariage Freres display of tea pots Tea for tu

    France falls back in love with tea - but don't expect a British cuppa


  • Woman in swimming pool Green stuff

    The element that makes a familiar smell when mixed with urine


  • Female model's bottom in leopard skin trousers as she walks up the catwalkBum deal

    Why budget buttock ops can be bad for your health


  • The OfficeIn pictures

    Fifty landmark shows from 50 years of BBC Two


From BBC Capital

Programmes

  • Tuna and avacadoThe Travel Show Watch

    Is Tokyo set to become the world's gourmet capital?

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.