California Apparel News

The “annus horribilis” of surf giant Billabong International Ltd. might be coming to an end. For more than a year, the Australian-headquartered company was embroiled in bitter proxy fights and hobbled by plummeting stock value on the Australian Securities Exchange, all while running an international business without a permanent chief executive officer. Any one of these issues could have spelled the demise of a smaller company.

But Billabong proved it could overcome many of the hurdles—perhaps because it was too big to fail.

It is one of the largest surf brands in the world. It employs 6,000 people around the globe, and its products are sold at 11,000 retail locations around the world. It also owns two of the action-sports world’s most popular brands: RVCA and Element, both headquartered in Orange County, Calif.

On Dec. 12, Ian Pollard, the chairman of Billabong’s board of directors, announced at the company’s shareholder meeting that there was light at the end of the tunnel. “Billabong has confronted an extraordinary sequence of circumstances over the last year,” Pollard said in the address. “For the first time in at least 12 months, the company is in a position where we can confidently say who our CEO will be for the foreseeable future, and we can confidently say who our principal financiers will be for the foreseeable future.”

The new chief executive officer and managing officer is Neil Fiske, former chief executive officer at Washington-based outdoor brand Eddie Bauer and a senior retail adviser for Canadian company Onex. He took the helm of Billabong in a dramatic game of musical chairs in which the company accepted—then, a few months later, dropped—a proxy offer from Altamont Capital Partners. Part of the Altamont deal was to place former Oakley Inc. chief Scott Olivet as Billabong’s chief executive officer. Instead, Billabong decided to accept a financing deal from Centerbridge Partners and Oaktree Capital Management, which entailed placing their candidate, Fiske, as the chief executive officer of Billabong.

At the shareholder’s meeting, Fiske gave a preview to his administration’s turnaround plan for the surfwear giant, which he described as “fewer, bigger, better.”

“We have been trying to do too many things—and none of them well,” Fiske said. The company had lost focus in the past years. It would regain focus by concentrating on just a few brands, specifically Billabong, RVCA, Element and some emerging brands such as Von Zipper. It will develop clearer merchandising planning, inventory and supply-chain management programs, develop a more robust digital marketing program, and an omni-channel retail program. Fiske promised to reveal more details of his turnaround program next year. Stay tuned.