Shares in Kathmandu plunged by more than a quarter on Thursday after it warned that weaker consumer spending may hurt earnings.
The outdoor clothing and equipment retailer says sales are increasingly difficult, particularly in Australia, so far this Christmas.
If the trend continues, chief executive Peter Halkett says half year gross earnings are likely to be lower than a year ago, when it made $23.2 million.
He says the company's overall profit is mainly dependent on trading during the second half of the year, which contributed almost 70% of its annual profit last year.
The company's stock fell 56 cents to $1.64 per share on Thursday.