Billabong shops have been bleeding money. Credit:Glenn Hunt That would stun many investors and fans of the famous surf and streetwear brand, which was once one of the most famous and iconic youth brand across the world. The company's shares dived 11.5 per cent to 50 cents in early trade. Global sales plunge Billabong said this morning that global sales of $1.34 billion was down 13.5 per cent in reported terms for 2012-13, or 12.6 per cent in constant currency terms. Its flagship Americas operation saw revenue slide 5.7 per cent to $636.7 million with pre-tax earnings flat at $38 million.

In Europe, which continues to be hit by poor trading conditions and a macro economic environment where shoppers are keeping a hold of their money, sales were down 10.4 per cent to $232.1 million while pre-tax earnings completely collapsed, down 100.4 per cent to a loss of $100,000. In Australasia sales were down 6.6 per cent to $471.8 million and earnings were up 5.8 per cent to $2.8 million. The 2012-13 result was affected by $867 million in significant items, including more than $604 million in write-downs in the value of goodwill, brands and other intangibles. It also included a $129 million write-down as a result of transactions involving US brand Nixon. Downsizing Billabong Billabong chairman Ian Pollard said a range of strategies were in place to rebuild the company including the sale or planned sale of underperforming brands from within the portfolio such as Nixon and West 49 and the closure of 158 poorly performing stores.

It had reduced its suppliers by 75 per cent, driving cost savings and improving efficiencies, he said. The company would now move to reduce its European headcount by 15 per cent, restructure its Australasian wholesale operations. Net debt has increased however to $207 million from $161 million with gross debt $320 million at the end of 2012-13. Billabong first went international in the 1980s, firstly exporting to California, Japan, New Zealand and Europe and then entering licensing deals to push into other markets. In the next decade Billabong won No.1 status in Australian waters among the surfing community and further consolidated its hold on the global surfing stage.

On its 25th anniversary in 1998, Billabong moved into the new premises at 1 Billabong Place, Burleigh Heads - near its spiritual home. But the brand has suffered of late, being taken over by younger more "hip" brands as well as suffering from the global downturn in retail. Takeover battle intensifies

Any discussion about the resuscitation of the business is expected to be crashed by private equity bidders and their advisers who have been jostling for nearly a year to seize control of Billabong. The battle has intensified over the past 10 days after a successful bid from Altamont Capital and Blackstone was reworked following an adverse ruling from the Takeovers Panel, only to be trumped a few days later by the rival Centerbridge Partners-Oaktree Capital consortium, which claims to have put up a better deal for Billabong and its shareholders.

Billabong has said it will be moving ahead with the $US325 million refinancing proposal from Altamont and Blackstone with documents to be prepared for a shareholder vote by October. However, Centerbridge and Oaktree have fired back, saying their fresh proposal, delivered to Billabong directors last week, is a vastly better offer in terms of takeover premium extended to shareholders, the level of debt to be left in the group and the interest rate it would charge on its loan component. Centerbridge and Oaktree are working intensively to push Billabong directors to consider their deal, also claiming they could wrap up the details and finalise a recapitalisation within days. The duo claim they would allow acting Billabong boss Scott Olivet - installed by Altamont - to remain at the helm if their offer succeeds. However, it is believed Mr Olivet has told Billabong directors he would not work with Centerbridge and Oaktree and would resign. Bidding war 'distracting'

Mr Pollard this morning said the task of managing the multiple bids and refinancing proposals had been distracting for the company but, he said, the company had achieved a number of important reforms. They included progress on efforts to sell Canadian retail chain West 49, cost savings and simplification of its businesses. Loading ‘‘We are nearing the end of a long process that has caused distraction, impacted on staff morale and has been very costly,’’ he said this morning. ‘‘The company looks forward to refocusing, reinvigorating its brands and rebuilding the business on a solid, long-term financial footing.’’