Billabong announced today that net profits for its half year ended 31 December, 2011 dropped 71.8 % from the same period in 2010. While total revenue was up 1.5 % to just under $ 850 million AUD, profits were just under $16.1 million, down from $ 57 million last year.

Marc Occiluop was the face of the Billabong brand in the 1980's.

But the biggest news of the day was the company’s announcements of the results of its strategic capital structure review, which include plans to partially sell Nixon, to close under performing stores, reduce costs and overhead, and reduce dividends.

Billabong is selling 48.5% of Nixon to Trilantic Capital Partners (TCP), as part of a joint venture to “accelerate the growth of the Nixon brand globally.” Billabong expects to realize net proceeds of US $ 285 million as a result of the sale, all of which will be used to pay off debt. The deal values Nixon at US $ 464 million.

Billabong will also maintain 48.5% ownership of Nixon, with management retaining the remaining three percent.

Billabong, which currently operates 677 stores, is looking at closing 100-150 under-performing stores, which would result in an approximate savings of $20-30 million in rent said Derek O"Neill. Estimated job losses could reach as high as 10% of the company’s current 10,000 global employees.

As one of the biggest employers in Jeffreys Bay, Billabong has already shed jobs in the town during the past couple of years. The financial constraints being felt by Billabong internationally could well have ripple effects on the company in South Africa as well.

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