BILLABONG ON THE RISE

MAINSTREAM MEDIA REPORT- BLOOMBERG NEWS ASIA

Billabong Shares Rise After Affirming Profit Forecast

Feb. 22 (Bloomberg) -- Billabong International Ltd., the world's largest surfwear maker, rose by the most in three weeks in Sydney trading after reaffirming profit forecasts.

Billabong shares rose 56 cents, or 4.7 percent, to A$12.40 at the 4:10 p.m.
close of trading in Sydney. The Gold Coast, Queensland state-based company reiterated annual earnings growth of between 5 percent and 10 percent, with earnings per share in constant currency terms expected to rise 15 percent.


Chief Executive Officer Derek O'Neill, who gets almost three-quarters of revenue from outside Australia, expects to maintain demand in the U.S. amid an expected decline in consumer spending in the world's largest economy. The company today said first-half profit fell for the first time as the Australian dollar's 11 percent gain against its U.S. counterpart in 2007 cut the value of North American sales.

``Billabong's result reinforces the relative strength of its brands,'' said Craig Woolford, an analyst at Citigroup Inc. in Sydney, who rates the stock ``buy.'' ``The company expects a strong summer selling season in the U.S.
and is confident given its visibility of forward orders until April,''
Woolford said in a report.

Net income fell 2 percent to A$88.7 million in the six months ended Dec. 31.
Sales rose 8.3 percent to A$665.4 million.

Earnings before interest, tax, depreciation and amortization in the Americas, the company's biggest market, fell 5.6 percent to A$48 million on the currency impact.

American sales for the half were little changed at A$287.5 million. In constant currency terms, revenue from the region rose 13.2 percent.

Overseas Markets

``We have good visibility through to April and we are sitting on a record forward order book in the U.S. as retailers are looking for proven brands,''
O'Neill said in an interview with Bloomberg Television today. ``I don't think we are immune from deteriorating conditions but while people might not be able to go on holiday or buy a new car, they may compromise and buy a new T-shirt.''

European earnings rose 25 percent to A$27.7 million.

The Australasian division, which includes Australia, New Zealand and Asia, increased earnings 12 percent to A$70.7 million.

``It's a great result and flew in the face of what everyone is saying about the consumer slowing down,'' said Tony Pearce, who helps manage the equivalent of $3.5 billion at Legg Mason Asset Management in Melbourne.