By  on December 10, 2013

SYDNEY — Billabong International's shares surged on Tuesday after new chief executive officer Neil Fiske unveiled his turnaround strategy at the company's annual general meeting.

Shares in the Australian surfwear company jumped 18.46 percent to close the day at 39 Australian cents, or $0.35.

Fiske said he intends to rationalize and simplify the company's brands, styles, suppliers, marketing programs, IT systems and capital investments. The executive said Billabong is attempting to reconnect with its "core 15-18 year-old consumer" and focus on seven pillars: brand, product, marketing, omni-channel, supply chain, organization and financial discipline. Fiske said he anticipates the plan will take between 18 months and three years to complete.

"We have been trying to do too many things – and none of them particularly well," said Fiske in a transcript of the presentation that was lodged with the Australian Securities Exchange. "As complexity grew, we lost focus. We confused the organization. As someone said to me on my first global tour of the Company, 'Are we a retail company with brands…or are we brands with retail?'"

Billabong chairman Ian Pollard told shareholders that Billabong's performance for the 2014 year to date had been "steady or improving slightly in most markets except for the Americas".

The latter market had been impacted by weak trading for the West 49 retail chain, said Pollard, as well as disruption to Billabong's personnel and customer confidence as the company negotiated its way through the "difficult period in mid-2013". Billabong announced last month that it sold Canada-based West 49 to Toronto-based YM Inc for approximately 9 to 11 million Canadian dollars, or $8.63 to 11 million at current exchange.

In August, Billabong reported a net loss after tax of 859.5 million Australian dollars, or $776 million at August exchange, in the 12 months to June 30 2013.

In September, the company reached a $534 million (at September exchange) refinancing arrangement with US hedge funds Centerbridge Partners and Oaktree Capital Management.

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