Shares to Sell – Billabong (BBG)
Billabong International Limited (BBG) is a producer of surf wear and sports apparel, with a presence in over 60 countries. With a market capitalisation of almost $2 billion, it is listed in the top ASX 200.
BBG has posted a 4.5% drop in FY10 net profit to $146 million, with the result just ahead of analyst estimates of $146 million.
Revenue was flat, in constant currency terms, at $1.5 billion, as BBG saw a decline in sales at America and Australasia.
Sales were impacted by the lingering effects of the global financial crisis and a sharp deterioration in trading conditions in Australia during the final quarter.
BBG sounded a very cautious outlook, stating that it expects a tough Australian market to translate to a flat EBIT result in FY11.
BBG declared a final dividend of 18 cents, whilst its poor outlook saw its share price sink almost 10% today.