Accent Group (ASX:AX1) outlined half-year results for the period ended December 28, 2025 and provided an eight-week trading update for the start of the second half of FY26, describing a “promotional trading environment” but noting growth across multiple parts of the portfolio.
H1 FY26 sales growth and portfolio changes
Management said total sales for the half reached AUD 865 million, up 2.4% on the prior corresponding period. Daniel (CEO) highlighted strong growth in The Athlete’s Foot, Hoka, Merrell, and Nude Lucy, and said Platypus also returned to growth. The company also reported wholesale sales ahead of the prior year in H1, with forward orders for H2 also ahead of the prior year.
The group also called out growth in “vertical” owned brand sales, with vertical sales rising to AUD 67 million, representing about 8% of total sales. Management said Sports Direct opened online and launched its first store at Fountain Gate in Victoria in November, with early trading described as “pleasing.” Accent also commenced distribution of Lacoste, including wholesale and the opening of a flagship store in Melbourne CBD in December, with a new Lacoste website planned to launch the following month and additional stores planned in the second half.
Earnings, margins, and currency impacts
Durbin reported EBIT of AUD 56.5 million, in line with previously provided guidance of AUD 55 million to AUD 60 million (issued November 21, 2025). Excluding Ozsale and Glue, EBIT from continuing business was AUD 72.7 million. Net profit after tax for the half was AUD 28.1 million.
Continuing business gross margin was 54.3%. Management attributed the outcome to the promotional environment, a “disciplined approach to inventory management,” and the year-on-year decline in the AUD-USD exchange rate. Durbin estimated the year-on-year currency impact to gross profit at about AUD 6.5 million, or roughly 80 basis points.
Cost of doing business was described as well managed at 44.3%, with efficiencies cited across store lease renewal negotiations, store and support team costs, and marketing spend. Management said it continued to work to offset inflationary pressures in rent and store wage rates.
Retail, wholesale, and brand performance
Owned retail sales grew 5.2% to AUD 719 million, which Durbin said was ahead of overall sales growth due to the transition of The Athlete’s Foot (TAF) franchises into owned stores. Like-for-like (LFL) retail sales increased 0.9%, with Q1 down 1.7% and Q2 up 2.8%.
On wholesale, the company reported sales up more than 9% to AUD 91 million, driven by Hoka, UGG, and the addition of Lacoste wholesale during Q2. In Q&A, management also said Skechers, Vans, and UGG forward orders were ahead of the prior year, and noted Vans forward orders were up “for the first time in a long time.”
Management discussed the promotional backdrop in more detail during Q&A. Daniel said the “lifestyle part of the business” was highly promotional through the half, particularly from November through to the end of January. He added that there was additional market promotional activity around November in The Athlete’s Foot that the company “had to respond to,” but said the January back-to-school period in TAF was full price, with no additional promotional activity. Platypus was described as “a little bit less” promotional, though management said the customer remained promotion-driven, while noting the business returned to growth in both sales and profitability.
Growth initiatives: Sports Direct, Hoka, Lacoste, and TAF reacquisitions
The company reiterated its growth plans across banners and brands:
- Sports Direct: One store (Fountain Gate) and online launched in November. Two more stores are planned for H2, with a third signed for H1 FY27. Management said it is negotiating on a further nine locations toward a long-term target of at least 50 stores over six years.
- Hoka: Continued growth was cited, particularly in digital following a new website launch in October. One store opened in H1, with three more planned for H2, including a flagship in Sydney CBD.
- Lacoste: Management described the launch as successful, supported by marketing activations alongside the Australian Open and the opening of the Melbourne flagship store. A further five stores “including online” are planned for the remainder of FY26.
- The Athlete’s Foot reacquisition program: Nine franchise stores were acquired in H1, with a further eight planned in H2, with trading and profit described as on track with plan.
Durbin also said at least 40 stores are planned to open in FY26, alongside closures. In addition to 16 store closures already planned, the company forecast a further seven loss-making stores would close in H2.
The company also announced a decision to close the Glue Store business, following the closure of Ozsale (which wrapped up in January). Management said the move improves future profitability and enables greater focus on growth initiatives. In Q&A, Daniel said H2 guidance includes Glue losses on a reported basis, and that any view on continuing business would be an improvement to the reported guidance.
Dividend, refinancing, and outlook
Accent declared a fully franked interim dividend of AUD 0.0325 per share, representing a payout ratio of about 70% of earnings per share for the half. The company also completed a debt refinancing, increasing the total facility by AUD 102 million to AUD 372 million on improved terms, including a lower margin and an extension to December 2028.
For the first eight weeks of H2, total owned sales were up 7.1% year-on-year, supported by wholesale, new stores, and new brands, while LFL retail sales were flat. Continuing business margin percentage in January was also in line with the prior year.
Management confirmed H2 FY26 EBIT guidance of AUD 30 million to AUD 35 million, noting it assumes flat LFL sales and gross margin percentage flat to the prior year. Daniel said the recent strengthening of the Australian dollar against the US dollar is expected to support gross margin later in FY26 and into FY27. In Q&A, management reiterated that a 1 cent movement in currency equates to roughly AUD 5 million in gross margin dollars on a 12-month basis, and said the company had moved from being “lightly hedged” to being hedged at about 60% over 15 months (versus a neutral policy of around 50%).
Accent said it plans to hold an investor strategy day in Q4 to provide an update on strategy, growth priorities, and its medium-term financial framework.
About Accent Group (ASX:AX1)
Accent Group Limited engages in the retail, distribution, and franchise of lifestyle footwear, and apparel and accessories in Australia and New Zealand. The company's brands and banners include The Athlete's Foot, Platypus Shoes, Hype DC, Skechers, Merrell, CAT, Vans, Dr. Martens, Saucony, Timberland, Hoka, Superga, Kappa, Palladium, Supra, Subtype, The Trybe, Stylerunner, Autry, Glue Store, and UCG. The company was formerly known as RCG Corporation Limited and changed its name to Accent Group Limited in November 2017.
