HUNTINGTON BEACH, Calif.–March 13, 2002–
– Consolidated Sales Increase 20% — – Earnings Per Share of $0.13 Exceeds Consensus Estimate of $0.09 —
– Consolidated Summer Bookings Increase 13% —
Quiksilver, Inc. (NYSE:ZQK), today announced operating results for the first quarter ended January 31, 2002.
Consolidated net sales for the first quarter of fiscal 2002 increased 20% to $145.8 million as compared to fiscal 2001 first quarter consolidated net sales of $121.8 million. Consolidated net income for the first quarter of fiscal 2002 was $3.1 million as compared to $3.7 million. First quarter, fully diluted earnings per share were $0.13 versus $0.16 for the first quarter of fiscal 2001.
Robert B. McKnight, Jr., Chairman of the Board and Chief Executive Officer of Quiksilver, commented, “We were pleased with our performance during the quarter which exceeded expectations and gives us confidence that we are emerging from the recently challenging retail and economic environment in an excellent position. Our double-digit bookings growth is a reflection of the strength of our product line. This belief is reinforced by strong current sell-through rates and positive reviews from the trade on our new Fall and Winter ranges.”
Domestic net sales during the first quarter of fiscal 2002 increased 14% to $89.8 million as compared to fiscal 2001 first quarter domestic net sales of $78.6 million. As measured in euros, European net sales increased 31% for those same periods. As measured in U.S. dollars and reported in the financial statements, European net sales increased 30% during the first quarter of fiscal 2002 to $56.0 million as compared to fiscal 2001 first quarter European net sales of $43.2 million.
Mr. McKnight continued, “Increased open to buy budgets and feedback from major customers leads us to believe that the retail environment is showing significant improvement within our classifications. We opened seven company-owned stores during the quarter, including a Boardriders Club in the Mall of America, a Boardriders Club and a Hawk store in Salt Lake City and additional Boardriders Clubs in Barcelona and Lisbon. These stores will be both image platforms and profit centers. Additionally, we continued to conduct aggressive marketing campaigns and brand support initiatives that reinforce our position as the dominant brand in the action-sports market. We hosted, again, the premier big wave surfing event in the world, the Quiksilver Eddie Aikau at Waimea Bay in Hawaii. The contest was won by Kelly Slater, our highest ranking team rider, who recently announced his return to the World Championship Tour. Lisa Anderson is back on the women’s tour and doing well, and Tony Hawk continues to garner incredible visibility within our core market. Finally, along with the rest of the country we were incredibly proud of the three-medal sweep performance of the U.S. snowboarding team in Salt Lake City, particularly the silver medal won by Quiksilver team rider, Danny Kass.”
“The quick resumption of a robust pace of business since the events of last year is a testament to the resilience of our brands and the strength of our management team,” Mr. McKnight further commented. “Our competitive, strategic and financial position is strong.”
Consolidated inventories increased 8% to $116.4 million at January 31, 2002 from $107.6 million at October 31, 2001, while increasing 3% compared to January 31, 2001. Consolidated trade accounts receivable decreased 7% to $145.0 million at January 31, 2002 from $155.9 million at October 31, 2001, while increasing 20% compared to January 31, 2001. Inventory growth was modest compared to the increase in sales in response to the weaker economic environment. The year-over-year increase in accounts receivable is consistent with the sales increase.
Mr. McKnight concluded, “The consistency of our purpose, our product and our brand message has enabled us to develop a leadership position in tthis market around the globe. In a constantly changing sea of competition, Quiksilver has been a rock. We will continue to stay true to our roots and our life-style. More importantly, we believe we have a tremendous opportunity for growth at the same time. Our first quarter results mark a strong start to the new fiscal year.”
Quiksilver designs, produces and distributes clothing, accessories and related products for active-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, Radio Fiji and Hawk Clothing labels. Quiksilver also manufactures apparel for boys (Quiksilver Boys and Hawk Clothing), girls (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 Manufacturing and Bent Metal labels. Quiksilver’s products are sold throughout the world, primarily in surf shops and specialty stores that provide an outstanding retail experience for their customers.