Billabong will again not pay an interim dividend after swinging to a $1.6 million first half loss.

The surfwear manufacturer, which made a net profit of $25.7 million in the prior corresponding period, said gross margins were down due to excess inventory in the wake of a strike at US ports in early 2015.

“As we get inventories back in line, we believe margins will recover,” chief executive Neil Fiske said.

Total group sales were $561.9 million, up 7.6 per cent on the prior corresponding period (PCP).

Earnings before interest tax depreciation and amortisation (EBITDA) was $37.2 million, down from $42.8 million on the PCP.

The company said its three big brands had all grown sales, with Billabong (2.6 per cent), Element (9.1 per cent) and RVCA (20.6 per cent) all up.

“This is a brand led turnaround and our big three brands, where we placed our focus, grew globally,” said Fiske.

“The essence of our seven part strategy is building strong global brands operating on global platforms. This year we have begun the implementation of four major platform initiatives that will sustain our growth an improve profitability over the long run.”

The surfing retailer says the results for the remaining four months of the financial year will be influenced by ‘the large trading month of June in North America.’

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