SOURCE: Zumiez

May 17, 2012 16:01 ET

Zumiez Inc. Announces Record Fiscal 2012 First Quarter Results

First Quarter 2012 Sales Increased 23% to $129.9 Million; First Quarter 2012 Diluted EPS Increased 133% to $0.14

EVERETT, WA--(Marketwire - May 17, 2012) - Zumiez Inc. (NASDAQ: ZUMZ) a leading specialty retailer of action sports related apparel, footwear, equipment and accessories, today reported results for the first quarter ended April 28, 2012.

Total net sales for the first quarter ended April 28, 2012 (13 weeks) increased 22.7% to $129.9 million from $105.9 million in the quarter ended April 30, 2011 (13 weeks). Comparable store sales for the first quarter of fiscal 2012 increased 12.9% on top of a comparable store sales increase of 12.6% in the first quarter of fiscal 2011. Net income in the first quarter of fiscal 2012 increased 140.0% to $4.5 million, or $0.14 per diluted share, from net income of $1.9 million, or $0.06 per diluted share, in the first quarter of the prior fiscal year, a diluted earnings per share increase of 133.3%. The results for fiscal 2012 include costs of approximately $0.3 million, or $0.01 per diluted share, associated with the relocation of the Company's ecommerce fulfillment center from Everett, Washington to Edwardsville, Kansas.

At April 28, 2012, the Company had cash and current marketable securities of $171.2 million, an increase of 31.0% compared to cash and current marketable securities of $130.7 million at April 30, 2011.

Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, "We are pleased to start the year off with such strong performance. While the first quarter represents only a small percentage of our annual sales and earnings, theses results are further validation that our strategies to profitably grow the business are working. Our teams are energized and focused on carrying our current momentum into summer and positioning the Company for a successful back half of the year."

Fiscal 2012 Second Quarter Outlook

The Company is introducing guidance for the three months ending July 28, 2012. Net sales are projected to be in the range of $128 to $130 million resulting in net income per diluted share of approximately $0.04 to $0.06. This guidance is based on an anticipated comparable store sales increase in the mid single digit range for the second quarter of fiscal 2012 and includes costs of approximately $1.8 million, or $0.03 per diluted share, associated with the relocation the Company's ecommerce fulfillment center to Edwardsville, Kansas and corporate offices to Lynnwood, Washington from Everett, Washington.

The Company currently intends to open approximately 50 new stores in fiscal 2012, including up to 10 stores in Canada, with an opening cadence similar to fiscal 2011.

A conference call will be held today to discuss first quarter fiscal 2012 results and will be webcast at 5:00 p.m. ET on http://ir.zumiez.com. Participants may also dial (617)-213-8852 followed by the conference identification code of 42196127.

About Zumiez Inc.

Zumiez is a leading specialty retailer of action sports related apparel, footwear, equipment and accessories. Our stores cater to young men and women between ages 12-24, focusing on skateboarding, surfing, snowboarding, motocross and BMX. As of April 28, 2012 we operated 444 stores in the United States and 11 stores in Canada, which are primarily located in shopping malls, and our web site address is www.zumiez.com.

Safe Harbor Statement

Certain statements in this press release and oral statements relating thereto made from time to time by representatives of the Company may constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These statements include, without limitation, predictions and guidance relating to the Company's future financial performance, brand and product category diversity, ability to adjust product mix, integration of acquired businesses, growing customer demand for our products and new store openings. In some cases, you can identify forward-looking statements by terminology such as, "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "continue," or the negative of these terms or other comparable terminology. These forward-looking statements are based on management's current expectations but they involve a number of risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in the forward-looking statements as a result of risks and uncertainties, which include, without limitation, those described in the Company's annual report on Form 10-K for the year ended January 28, 2012 as filed with the Securities and Exchange Commission and available at www.sec.gov. You are urged to consider these factors carefully in evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. The forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

ZUMIEZ INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
April 28, 2012 % of Sales April 30, 2011 % of Sales
Net sales $ 129,899 100.0 % $ 105,851 100.0 %
Cost of goods sold 87,798 67.6 % 72,661 68.7 %
Gross profit 42,101 32.4 % 33,190 31.3 %
Selling, general and administrative expenses 34,839 26.8 % 30,638 28.9 %
Operating profit 7,262 5.6 % 2,552 2.4 %
Interest income, net 490 0.4 % 513 0.4 %
Other income, net 17 0.0 % 55 0.1 %
Earnings before income taxes 7,769 6.0 % 3,120 2.9 %
Provision for income taxes 3,242 2.5 % 1,234 1.1 %
Net income $ 4,527 3.5 % $ 1,886 1.8 %
Basic earnings per share $ 0.15 $ 0.06
Diluted earnings per share $ 0.14 $ 0.06
Weighted average shares used in computation of earnings per share:
Basic 30,779 30,343
Diluted 31,401 31,084
ZUMIEZ INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
April 28, January 28, April 30,
2012 2012 2011
Assets (Unaudited) (Unaudited)
Current assets
Cash and cash equivalents $ 7,962 $ 14,779 $ 13,290
Marketable securities 163,243 158,019 117,409
Receivables 8,700 6,284 8,277
Income taxes receivable 3,325 - 2,910
Inventories 70,435 65,037 63,148
Prepaid expenses and other 8,295 7,907 6,967
Deferred tax assets 1,837 1,477 1,720
Total current assets 263,797 253,503 213,721
Fixed assets, net 96,275 89,478 79,051
Goodwill 13,154 13,154 13,154
Long-term deferred tax assets 2,808 3,109 4,880
Long-term investments 2,351 2,380 2,799
Long-term other assets 541 533 758
Total long-term assets 115,129 108,654 100,642
Total assets $ 378,926 $ 362,157 $ 314,363
Liabilities and Shareholders' Equity
Current liabilities
Trade accounts payable $ 36,514 $ 21,743 $ 30,174
Accrued payroll and payroll taxes 7,086 9,062 6,232
Income taxes payable - 5,835 -
Deferred rent and tenant allowances 4,350 4,230 3,852
Other liabilities 14,452 14,706 11,518
Total current liabilities 62,402 55,576 51,776
Long-term deferred rent and tenant allowances 34,045 32,321 29,452
Long-term other liabilities 2,060 1,983 1,805
Total long-term liabilities 36,105 34,304 31,257
Total liabilities 98,507 89,880 83,033
Commitments and contingencies
Shareholders' equity
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding - - -
Common stock, no par value, 50,000 shares authorized; 31,324 shares issued and outstanding at April 28, 2012, 31,170 shares issued and outstanding at January 28, 2012 and 31,007 shares issued and outstanding at April 30, 2011 102,971 99,412 93,986
Accumulated other comprehensive income 191 135 79
Retained earnings 177,257 172,730 137,265
Total shareholders' equity 280,419 272,277 231,330
Total liabilities and shareholders' equity $ 378,926 $ 362,157 $ 314,363
ZUMIEZ INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended
April 28, 2012 April 30, 2011
Cash flows from operating activities:
Net income $ 4,527 $ 1,886
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion 5,275 4,705
Deferred taxes (35 ) 1,488
Stock-based compensation expense 1,606 1,386
Excess tax benefit from stock-based compensation (1,710 ) (1,054 )
Other (74 ) (5 )
Changes in operating assets and liabilities:
Receivables (2,172 ) (2,110 )
Inventories (5,355 ) (6,841 )
Prepaid expenses and other (411 ) 245
Trade accounts payable 14,297 13,470
Accrued payroll and payroll taxes (1,978 ) (1,348 )
Income taxes payable (7,443 ) (5,963 )
Deferred rent and tenant allowances 1,821 1,949
Other liabilities (2,549 ) (4,167 )
Net cash provided by operating activities 5,799 3,641
Cash flows from investing activities:
Additions to fixed assets (8,519 ) (2,540 )
Purchases of marketable securities and other investments (43,375 ) (39,281 )
Sales and maturities of marketable securities and other investments 37,317 38,843
Net cash used in investing activities (14,577 ) (2,978 )
Cash flows from financing activities:
Proceeds from exercise of stock-based compensation, net of withholding tax payments 243 173
Excess tax benefit from stock-based compensation 1,710 1,054
Net cash provided by financing activities 1,953 1,227
Effect of exchange rate changes on cash and cash equivalents 8 43
Net (decrease) increase in cash and cash equivalents (6,817 ) 1,933
Cash and cash equivalents, beginning of period 14,779 11,357
Cash and cash equivalents, end of period $ 7,962 $ 13,290
Supplemental disclosure on cash flow information:
Cash paid during the period for income taxes 10,705 5,710
Accrual for purchases of fixed assets 5,840 2,722

Contact Information

  • Company Contact:
    Brian Leith
    Director of Finance &
    Investor Relations
    Zumiez Inc.
    (425) 551-1500, ext. 1610

    Investor Contact:
    ICR
    Brendon Frey
    (203) 682-8200