SANTA FE SPRINGS, Calif.–(BUSINESS WIRE)–March 21, 2001–
Total Sales Increase 21% to $83.3 million
Earnings Per Share Increase 42% to $0.17 vs. $0.12 Last Year
Same Store Sales Increase 16.3%
Back to School Bookings (Q1 Fiscal 2002) up more than 25%
Vans, Inc. (Nasdaq:VANS) today announced record financial results for the third quarter of fiscal 2001 ended February 24, 2001.
Net sales for the quarter increased 21.1% to $83.3 million versus $68.8 million last year and net income increased 50.3% to $2.6 million versus $1.7 million, with a 41.7% increase in diluted earnings per share of $0.17 versus $0.12. For the first nine months of fiscal 2001, sales increased 22.2% to $257.2 million versus $210.5 million last year and net income increased 27.2% to $13.1 million versus $10.3 million, with a 20.8% increase in diluted earnings per share to $0.87 compared to $0.72.
Gary H. Schoenfeld, President and Chief Executive Officer of Vans stated, “Our accomplishments over this past quarter are another strong indication of the progress our Company has made on a number of different levels. Each strategic move has helped to further Vans’ position as a leading sports and lifestyle brand for the youth market.”
“From a financial perspective, we were able to translate a 21% sales gain into a 42% increase in earnings per share,” Mr. Schoenfeld commented. “On the product front, our efforts were recognized last month with the Design in Excellence Award from Footwear+ and will be further demonstrated by the upcoming launch of signature shoes for Core Sports(TM) icons Geoff Rowley, Jeremy McGrath and Corey Nastazio. Our unique marketing and brand building initiatives continue to pay off as the Vans-produced film “Dogtown and Z-Boys” received both the Audience Choice Award and the Best Director Award for a documentary at the Sundance Film Festival. Finally, we recently announced network and cable television partnerships with NBC Sports and Fox Sports Net for the Vans Triple Crown(TM) Series, underscoring the increasing popularity of Core Sports(TM) and Vans’ recognition as the leader in the Core Sports industry.”
For the third quarter, total U.S. sales, including sales through Vans’ U.S. retail stores, increased 29.2% to $57.1 million, versus $44.2 million for the same period a year ago. Sales through the Company’s U.S. retail stores increased 37.2% to $28.4 million in the third quarter of fiscal 2001, from $20.7 million for the same period a year ago. Comparable store sales for the third quarter were up 16.3% versus the same period last year, the twenty-fifth consecutive quarter of such increase. U.S. wholesale sales in the third quarter increased 22.2% to $28.7 million, versus $23.5 million a year ago. Total international sales were $26.3 million, up 6.6 % from $24.6 million a year ago. On a constant dollar basis, after giving effect to an average 8.7% decline in the value of the euro, international sales would have been up 12.0%.
“We witnessed strong gains in U.S. wholesale during the quarter and once again our retail division outperformed both internal and external expectations,” Mr. Schoenfeld said.* “Retail continues to be a powerful growth vehicle for Vans as our stores provide us with a superior platform to showcase our products and our skateparks create an unparalleled experience with our brand.”
Gross margins for the quarter increased to 42.4% vs. 41.6 %, despite a more than 50 basis point negative variance due to the decline in the euro. Inventory was $58.0 million at February 24, 2001, up from $45.2 million a year ago, in line with the Company’s retail growth and bookings trends.
Both for the fourth quarter and fiscal year ending May 31, 2001, the Company expects total sales to increase approximately 20% over the respective periods last year.* The Company also continues to be comfortable with the First Call consensus diluted earnings per share estimates, which recently increased from $0.14 to $0.115 for the fourth quarter, and thus an increase of more than 21% to $1.02 year-over- year.* The Company’s internal targets for fiscal 2002 reflect sales growth of approximately 20% and diluted earnings per share growth at or above 20%.*
Mr. Schoenfeld concluded, “Total bookings are up more than 20% and 25% for Q4 fiscal 2001 and Q1 fiscal 2002, respectively, led by particularly strong domestic increases of more than 25% for Q4 and substantially more than 30% for the bigger back-to-school season, Q1 fiscal 2002.* Our retail stores continue to perform well and we look forward to the opening of two new skateparks near Philadelphia and Denver before the end of May. Financially and operationally we are sound, our product merchandising and design continue to strengthen, our marketing is among the best in the industry, and as evidenced by our performance and booking trends, we believe the VANS brand is stronger today than it has ever been.”*
Vans, Inc. is a leading branded lifestyle company for the youth market. Vans reaches its 10 to 24 year-old target consumers through the sponsorship of Core Sports,(TM) such as skateboarding, snowboarding, surfing and wakeboarding, and through major entertainment events and venues, such as the VANS Triple Crown(TM) Series, the VANS Warped Tour,(TM) the VANS World Amateur Skateboarding Championships, six VANS mega skateparks, and the VANS High Cascade Snowboard Camp,(TM) located on Mt. Hood. The Company operates 140 retail stores in the U.S. and Europe, and designs, markets and distributes active-casual footwear, clothing and accessories, performance footwear for Core Sports, (TM) snowboard boots, step-in snowboard boot bindings, and outerwear worldwide.