Australia's Billabong to cut jobs, close stores

Australian surfwear retailer Billabong International on Friday said it would cut 400 jobs worldwide and shut down up to 150 stores to help repair its debt-laden balance sheet. The sports apparel maker also announced the partial sale of Nixon, a watches and accessories brand. It has entered into definitive agreements with Trilantic Capital Partners (TCP) to establish a joint venture for the company that will see net proceeds to Billabong of approximately US$285 million. "Under the joint venture, Billabong will retain 48.5 percent of Nixon, while TCP will purchase 48.5 percent and Nixon's management will purchase 3.0 percent," the company said. All the proceeds will be used to write down debt, the company added after reporting first half net profits to December 31 were down 71.8 percent to Aus$16.1 million (US$17.4 million). The group wants to reduce rent expenses by Aus$20 million to Aus$30 million and said it would close between 100 and 150 loss-making and underperforming stores worldwide. It has 677 stores globally. Casual and full-time job losses would total "approximately 400 worldwide, including up to 80 in Australia". Billabong shares soared on the news and were up 48 percent at 86 cents in late morning trade.