Billabong has predicated that earnings will be reasonably flat in 2010-11 as the company experiences pressure from the strong Australian dollar.

At its annual shareholders meeting, Billabong chief executive Derek O’Neill reaffirmed that the company expects a 2 to 8 per cent growth in net profit after tax for the next financial year.

“While the caution by retailers in placing their summer orders in Australia may result in some healthy in-season repeat business, this will not be sufficient to offset the adverse effect of the weak forward order book which will have a significant impact on the half year result,” he said.

He also noted that earnings in terms of half year results will be slightly lower than last year.

“This result is expected to be driven by the previously mentioned weak forward order book in Australia, solid performance in Europe and good general trading in the US offset by some weakness in business with retailer Pacific Sunwear,” O’Neill said.

“As anticipated, forward orders for winter in Australia are following similar trends to those experienced in the first half year.”

Also, O’Neill has predicated that the brand’s retail footprint lifted from 380 to approximately 600 in the 2010-11 financial year.

“In the current year it is anticipated that Company-owned retail operations will contribute a little less than 40 per cent of Group revenues, assuming completion of the SDS/ Jetty Surf and Rush acquisitions in coming weeks, and it is currently expected to remain around those levels in the medium term,” he said.