Some headwinds for Kathmandu in the domestic market

Kathmandu Holdings has posted an 85 percent drop in profit in the year to July 31.

Chief executive Xavier Simonet says the group faced significant challenges under Covid-19 restrictions.

First Retail Group's Chris Wilkinson says Kathmandu's sector is increasingly competitive, with UK chain Mountain Warehouse arriving on our shores.

He says they've put a lot of sites into New Zealand, and are very strategic and have performed extremely well in other overseas markets.