HUNTINGTON BEACH, Calif.–Dec. 18, 2003–Quiksilver, Inc. (NYSE:ZQK)
— Quarterly Consolidated Revenues Increase 37%
— Quarterly Earnings Per Share Increase 20% to $0.30
— Fiscal Year Revenues Total $975 Million
— FY04 EPS Guidance Increases to New Range of $1.18 to $1.22
Quiksilver, Inc. (NYSE:ZQK), today announced operating results for the fourth quarter and full year ended October 31, 2003.
Consolidated revenues for the fourth quarter of fiscal 2003 increased 37% to $269.2 million as compared to fiscal 2002 fourth quarter consolidated revenues of $196.1 million. Consolidated net income for the fourth quarter of fiscal 2003 increased 43% to $17.4 million as compared to $12.2 million. Fourth quarter fully diluted earnings per share was $0.30 versus $0.25 for the fourth quarter of fiscal 2002.
Consolidated revenues for the full year of fiscal 2003 increased 38% to $975.0 as compared to fiscal 2002 full year consolidated revenues of $705.5. Consolidated net income for the full year of fiscal 2003 increased 56% to $58.5 million as compared to $37.6 in fiscal 2002, and diluted earnings per share for the full year increased 34% to $1.03 versus $0.77 for the full year of fiscal 2002.
Robert B. McKnight, Jr., Chairman of the Board and Chief Executive Officer of Quiksilver, commented, “We are pleased to have exceeded our plan for the fourth quarter, and we finished the year with clean inventories, continued strong sell through rates, and an excellent strategic position in the marketplace. As we close in on the $1 billion revenue mark in the upcoming year, we are excited about our prospects both domestically and around the world.”
Revenues in the Americas increased 15% during the fourth quarter of fiscal 2003 to $125.6 million as compared to fiscal 2002 fourth quarter revenues of $109.7 million. As measured in U.S. dollars and reported in the financial statements, European revenues increased 25% during the fourth quarter of fiscal 2003 to $106.7 million as compared to fiscal 2002 fourth quarter European revenues of $85.3 million. As measured in euros, European revenues increased 8% for those same periods. Revenues in the Asia/Pacific segment, which was added in the first quarter of fiscal 2003, totaled $36.7 million. In constant dollars, overall Spring bookings increased 6% over the previous year.
Revenues in the Americas for the full year of fiscal 2003 increased 18% to $492.4 as compared to fiscal 2002 revenues of $418.0 million. As measured in U.S. dollars and reported in the financial statements, European revenues increased 37% during the full year of fiscal 2003 to $386.2 million as compared to fiscal 2002 results of $282.7 million. As measured in euros, European revenues increased 15% for the full year. The Asia/Pacific division added $94.2 million to consolidated revenues in fiscal 2003.
McKnight continued, “Over the course of the year, we have been able to properly align our marketing strategies, our product lines, our operations, and our management team to go forward with a singular vision for the future. Clearly, the power of our youth-oriented lifestyle view and the culture of boardsports is resonating with consumers everywhere.”
Inventories in the Americas increased 25% to 86.4 million at October 31, 2003 from $69.0 million at October 31, 2002, while decreasing $2.1 million from July 31, 2003. European inventories increased 38% in euros and increased 63% in U.S. dollars, totaling $43.8 million at October 31, 2003 compared to $26.9 million at October 31, 2002. Inventories in the newly acquired Asia/Pacific division totaled $16.2 million at October 31, 2003. Consolidated inventories increased 53% to $146.4 million at October 31, 2003 from $95.9 million at October 31, 2002 which is an increase of 45% after adjusting for the effect of the stronger euro in comparison to the prior year.
Consolidated trade accounts receivable increased 33% to $224.4 million at October 31, 2003 fromm $168.2 million at October 31, 2002. Accounts receivable grew more slowly than sales as average days sales outstanding decreased about three days.
Bernard Mariette, President of Quiksilver, Inc., commented, “As we move forward into the new year, we are benefiting from a continued position as the leading youth brand in the United States, Europe and Australia, and we have excellent prospects for growth in a variety of markets in Eastern Europe. We are focused on leveraging the strength of our brands and our superior operating platform to take advantage of these opportunities.”
Also today, the company increased its guidance to new ranges of $1.06 billion to $1.08 billion for revenues and $1.18 to $1.22 for earnings per share.
McKnight concluded, “These results represent our 8th consecutive quarter of exceeding both internal and external expectations, and importantly, we have been able to accomplish all of this in a challenging retail climate. At the same time, we have successfully integrated a number of new businesses that will provide additional growth into the future. The benefits of our strong brands and diversified operating model are clear and compelling, and the combination of innovative product, unique marketing, a cohesive management structure, and world-class execution will allow us to expand our business and drive significant value to our shareholders into the future.”
Quiksilver designs, produces and distributes clothing, accessories and related products for young-minded people and develops brands that represent a casual lifestyle-driven from a boardriding heritage. Quiksilver’s authenticity is evident in its innovative products, events and retail environments across the globe.
Quiksilver’s primary focus is apparel for young men and young women under the Quiksilver, Roxy, Raisins, and Radio Fiji labels. Quiksilver also manufactures apparel for boys (Quiksilver Boys and Hawk Clothing), girls (Roxy Girl, Teenie Wahine and Raisins Girls), men (Quiksilveredition and Fidra) and women (Leilani swimwear), as well as snowboards, snowboard boots and bindings under the Lib Technologies, Gnu, Supernatural Mfg. and Bent Metal labels. Quiksilver’s products are sold throughout the world, primarily in surf shops and specialty stores that provide an authentic retail experience for our customers.