The past six months have been, uh… interesting for Aussie surf mega-retailer SurfStitch. Really interesting. More-valuable-than-Billabong interesting as late as November.
That high was followed by the shock loss of co-founder Justin Cameron, who noped out of the whole operation in March. He bid adieu to the company via email, causing some serious hubbub among the barrel-happy business.
A massive projected profit downgrade in May gave way to today’s news: the company which seemed a sure bet to conquer the surf industry worldwide only six months ago expects to sink up to $18m into the red this year.
That profit hole can be attributed to a fallout between SurfStitch and an unnamed third party about a licensing agreement for their content.
Back in their cash-flush heyday of… late 2015, the brand bought up a stack of surf-related sites and media groups, with the intention of promoting those outlets along with their surf gear sales.
When the public found out that huge deal went busto, share prices tanked; investors in the company – and boy howdy, there are a few of you after last year’s peaks – saw share prices drop from 40c to 26c around midday.
That’s down from the dizzying highs of $2.09 in November, and the flat $1 issue price back in December 2014. This morning the company’s value was pegged at $74M, down from last year’s $511M, but the company said it’s deadset on returning to profitability next financial year.
So, we’ll all just have to wait and see if the Sydney-born juggernaut eventually does come up for air.
