Zumiez Inc. Announces Fiscal 2023 Second Quarter Results
07 September 2023 - 10:05PM
Zumiez Inc. (NASDAQ: ZUMZ) a leading specialty retailer of apparel,
footwear, equipment and accessories for young men and women, today
reported results for the second quarter ended July 29, 2023.
Net sales for the second quarter ended July 29, 2023 (13 weeks)
decreased 11.6% to $194.4 million from $220.0 million in the second
quarter ended July 30, 2022 (13 weeks). Net loss in the second
quarter of fiscal 2023 was $8.5 million, or $0.44 per diluted
share, compared to net income of $3.1 million, or $0.16 per diluted
share, in the second quarter of the prior fiscal year.
Total net sales for the six months (26 weeks) ended July 29,
2023 decreased 14.4% to $377.3 million from $440.7 million reported
for the six months (26 weeks) ended July 30, 2022. Net loss for the
first six months of fiscal 2023 was $26.9 million, or $1.40 per
diluted share, compared to net income for the first six months of
fiscal 2022 of $2.7 million, or $0.14 per diluted share.
At July 29, 2023, the Company had cash and current marketable
securities of $140.0 million compared to cash and current
marketable securities of $166.2 million at July 30, 2022. The
decrease was primarily driven by capital expenditures.
Rick Brooks, Chief Executive Officer of Zumiez Inc., stated,
“While our North American business remains under pressure, second
quarter sales trends improved month-to-month and our year-over-year
top-line performance was meaningfully better compared with the
first quarter. With continued headwinds facing consumer
discretionary spending combined with a heightened promotional
marketplace, we are pleased with the progress we’ve made
positioning our business for the second half of 2023. The
back-to-school season, which is historically a good indicator for
holiday demand, is continuing to show improvement from the last few
quarters. Despite the challenges year-to-date, we are confident
that the global consumer centric operating model we have built and
refined over the past four decades will continue to deliver great
long-term value for our shareholders.”
Third Quarter To-DateTotal third quarter-to-date sales for the
37 days ending September 4, 2023 decreased 7.7%, compared with the
same 37-day time period in the prior year ended September 5, 2022.
Total comparable sales for the 37-day period ending September 4,
2023 were down 8.6% from the comparable period in the prior
year.
Fiscal 2023 Third Quarter OutlookThe Company is introducing
guidance for the three months ending October 28, 2023. Net sales
are projected to be in the range of $211 to $216 million.
Consolidated operating margins are expected to between negative
1.5% and negative 2.5% resulting in a loss per diluted share of
approximately $0.15 to $0.25.
The Company currently intends to open approximately 19 new
stores in fiscal 2023, including up to 5 stores in North America,
10 stores in Europe and 4 stores in Australia.
Conference call Information To access the conference call,
please pre-register using this link (registration link).
Registrants will receive confirmation with dial-in details. The
conference call will also be available to interested parties
through a live webcast at https://ir.zumiez.com. To avoid delays,
we encourage participants to dial into the conference call fifteen
minutes ahead of the scheduled start time. A replay of the webcast
will also be available for a limited time
at https://ir.zumiez.com.
About Zumiez Inc.
Zumiez is a leading specialty retailer of apparel, footwear,
accessories and hardgoods for young men and women who want to
express their individuality through the fashion, music, art and
culture of action sports, streetwear, and other unique lifestyles.
As of August 26, 2023, we operated 761 stores, including 609 in the
United States, 49 in Canada, 81 in Europe and 22 in Australia. We
operate under the names Zumiez, Blue Tomato and Fast Times.
Additionally, we operate ecommerce web sites at zumiez.com,
zumiez.ca, blue-tomato.com and fasttimes.com.au.
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 fiscal year ended January 28, 2023 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.CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(In thousands, except per
share amounts)(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
July 29, 2023 |
|
% of Sales |
|
July 30, 2022 |
|
% of Sales |
Net sales |
|
$ |
194,438 |
|
|
100.0 |
% |
|
$ |
219,993 |
|
|
100.0 |
% |
Cost of
goods sold |
|
|
132,760 |
|
|
68.3 |
% |
|
|
144,929 |
|
|
65.9 |
% |
Gross profit |
|
|
61,678 |
|
|
31.7 |
% |
|
|
75,064 |
|
|
34.1 |
% |
Selling,
general and administrative expenses |
|
|
72,171 |
|
|
37.1 |
% |
|
|
70,109 |
|
|
31.8 |
% |
Operating (loss) profit |
|
|
(10,493 |
) |
|
-5.4 |
% |
|
|
4,955 |
|
|
2.3 |
% |
Interest
income, net |
|
|
775 |
|
|
0.4 |
% |
|
|
358 |
|
|
0.1 |
% |
Other
income, net |
|
|
423 |
|
|
0.2 |
% |
|
|
233 |
|
|
0.1 |
% |
(Loss) earnings before income taxes |
|
|
(9,295 |
) |
|
-4.8 |
% |
|
|
5,546 |
|
|
2.5 |
% |
(Benefit
from) provision for income taxes |
|
|
(786 |
) |
|
-0.4 |
% |
|
|
2,479 |
|
|
1.1 |
% |
Net
(loss) income |
|
$ |
(8,509 |
) |
|
-4.4 |
% |
|
$ |
3,067 |
|
|
1.4 |
% |
Basic (loss)
earnings per share |
|
$ |
(0.44 |
) |
|
|
|
$ |
0.16 |
|
|
|
Diluted
(loss) earnings per share |
|
$ |
(0.44 |
) |
|
|
|
$ |
0.16 |
|
|
|
Weighted
average shares used in computation of (loss) earnings per
share: |
|
|
|
|
|
|
|
|
Basic |
|
|
19,311 |
|
|
|
|
|
19,084 |
|
|
|
Diluted |
|
|
19,311 |
|
|
|
|
|
19,262 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
July 29, 2023 |
|
% of Sales |
|
July 30, 2022 |
|
% of Sales |
Net
sales |
|
$ |
377,325 |
|
|
100.0 |
% |
|
$ |
440,679 |
|
|
100.0 |
% |
Cost of
goods sold |
|
|
266,290 |
|
|
70.6 |
% |
|
|
293,242 |
|
|
66.5 |
% |
Gross profit |
|
|
111,035 |
|
|
29.4 |
% |
|
|
147,437 |
|
|
33.5 |
% |
Selling,
general and administrative expenses |
|
|
142,881 |
|
|
37.8 |
% |
|
|
141,985 |
|
|
32.3 |
% |
Operating (loss) profit |
|
|
(31,846 |
) |
|
-8.4 |
% |
|
|
5,452 |
|
|
1.2 |
% |
Interest
income, net |
|
|
1,632 |
|
|
0.4 |
% |
|
|
850 |
|
|
0.2 |
% |
Other
(expense) income, net |
|
|
(118 |
) |
|
0.0 |
% |
|
|
405 |
|
|
0.1 |
% |
(Loss) earnings before income taxes |
|
|
(30,332 |
) |
|
-8.0 |
% |
|
|
6,707 |
|
|
1.5 |
% |
(Benefit
from) provision for income taxes |
|
|
(3,441 |
) |
|
-0.9 |
% |
|
|
4,037 |
|
|
0.9 |
% |
Net
(loss) income |
|
$ |
(26,891 |
) |
|
-7.1 |
% |
|
$ |
2,670 |
|
|
0.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Basic (loss)
earnings per share |
|
$ |
(1.40 |
) |
|
|
|
$ |
0.14 |
|
|
|
Diluted
(loss) earnings per share |
|
$ |
(1.40 |
) |
|
|
|
$ |
0.14 |
|
|
|
Weighted
average shares used in computation of (loss) earnings per
share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
19,254 |
|
|
|
|
|
19,308 |
|
|
|
Diluted |
|
|
19,254 |
|
|
|
|
|
19,592 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ZUMIEZ
INC. CONDENSED CONSOLIDATED BALANCE
SHEETS(In thousands) |
|
|
|
|
|
|
|
|
|
July 29, 2023 |
|
January 28, 2023 |
|
July 30, 2022 |
|
|
(Unaudited) |
|
|
|
(Unaudited) |
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
57,854 |
|
|
$ |
81,503 |
|
|
$ |
59,144 |
|
Marketable
securities |
|
|
82,128 |
|
|
|
91,986 |
|
|
|
107,036 |
|
Receivables |
|
|
23,910 |
|
|
|
20,613 |
|
|
|
24,201 |
|
Inventories |
|
|
156,654 |
|
|
|
134,824 |
|
|
|
151,071 |
|
Prepaid
expenses and other current assets |
|
|
14,523 |
|
|
|
11,252 |
|
|
|
14,053 |
|
Total current assets |
|
|
335,069 |
|
|
|
340,178 |
|
|
|
355,505 |
|
Fixed
assets, net |
|
|
94,193 |
|
|
|
93,746 |
|
|
|
91,196 |
|
Operating
lease right-of-use assets |
|
|
221,538 |
|
|
|
222,240 |
|
|
|
228,243 |
|
Goodwill |
|
|
56,889 |
|
|
|
56,566 |
|
|
|
54,017 |
|
Intangible
assets, net |
|
|
14,409 |
|
|
|
14,443 |
|
|
|
13,679 |
|
Deferred tax
assets, net |
|
|
12,161 |
|
|
|
8,205 |
|
|
|
6,546 |
|
Other
long-term assets |
|
|
11,575 |
|
|
|
12,525 |
|
|
|
11,425 |
|
Total long-term assets |
|
|
410,765 |
|
|
|
407,725 |
|
|
|
405,106 |
|
Total assets |
|
$ |
745,834 |
|
|
$ |
747,903 |
|
|
$ |
760,611 |
|
|
|
|
|
|
|
|
Liabilities and Shareholders’ Equity |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Trade
accounts payable |
|
$ |
69,773 |
|
|
$ |
40,379 |
|
|
$ |
72,915 |
|
Accrued
payroll and payroll taxes |
|
|
14,608 |
|
|
|
16,321 |
|
|
|
16,970 |
|
Operating
lease liabilities |
|
|
66,087 |
|
|
|
65,460 |
|
|
|
67,411 |
|
Other
liabilities |
|
|
19,312 |
|
|
|
23,649 |
|
|
|
23,951 |
|
Total current liabilities |
|
|
169,780 |
|
|
|
145,809 |
|
|
|
181,247 |
|
Long-term
operating lease liabilities |
|
|
184,439 |
|
|
|
188,835 |
|
|
|
196,073 |
|
Other
long-term liabilities |
|
|
6,191 |
|
|
|
5,931 |
|
|
|
4,995 |
|
Total long-term liabilities |
|
|
190,630 |
|
|
|
194,766 |
|
|
|
201,068 |
|
Total liabilities |
|
|
360,410 |
|
|
|
340,575 |
|
|
|
382,315 |
|
|
|
|
|
|
|
|
Shareholders’ equity |
|
|
|
|
|
|
Preferred
stock, no par value, 20,000 shares authorized; none issued and
outstanding |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Common
stock, no par value, 50,000 shares authorized; 19,809 shares
issued and outstanding at July 29, 2023, 19,489 shares issued and
outstanding at January 28, 2023, and 19,474 shares issued and
outstanding at July 30, 2023 |
|
|
192,169 |
|
|
|
188,418 |
|
|
|
184,619 |
|
Accumulated
other comprehensive loss |
|
|
(18,557 |
) |
|
|
(19,793 |
) |
|
|
(26,662 |
) |
Retained
earnings |
|
|
211,812 |
|
|
|
238,703 |
|
|
|
220,339 |
|
Total shareholders’ equity |
|
|
385,424 |
|
|
|
407,328 |
|
|
|
378,296 |
|
Total liabilities and shareholders’ equity |
|
$ |
745,834 |
|
|
$ |
747,903 |
|
|
$ |
760,611 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ZUMIEZ
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(In
thousands)(Unaudited) |
|
|
|
|
|
Six Months Ended |
|
|
July 29, 2023 |
|
July 30, 2022 |
Cash
flows from operating activities: |
|
|
|
|
Net (loss) income |
|
$ |
(26,891 |
) |
|
$ |
2,670 |
|
Adjustments
to reconcile net (loss) income to net cash used in operating
activities: |
|
|
|
|
Depreciation, amortization and accretion |
|
|
10,881 |
|
|
|
10,598 |
|
Noncash
lease expense |
|
|
34,380 |
|
|
|
33,040 |
|
Deferred
taxes |
|
|
(4,060 |
) |
|
|
3,035 |
|
Stock-based
compensation expense |
|
|
3,476 |
|
|
|
3,513 |
|
Impairment
of long-lived assets |
|
|
338 |
|
|
|
65 |
|
Other |
|
|
84 |
|
|
|
(115 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
Receivables |
|
|
(1,113 |
) |
|
|
(5,496 |
) |
Inventories |
|
|
(21,721 |
) |
|
|
(24,671 |
) |
Prepaid expenses and other assets |
|
|
(3,807 |
) |
|
|
(3,946 |
) |
Trade accounts payable |
|
|
30,150 |
|
|
|
17,084 |
|
Accrued payroll and payroll taxes |
|
|
(1,676 |
) |
|
|
(13,958 |
) |
Income taxes payable |
|
|
(1,044 |
) |
|
|
(4,128 |
) |
Operating lease liabilities |
|
|
(38,783 |
) |
|
|
(37,239 |
) |
Other liabilities |
|
|
(4,480 |
) |
|
|
(4,611 |
) |
Net
cash used in operating activities |
|
|
(24,266 |
) |
|
|
(24,159 |
) |
Cash
flows from investing activities: |
|
|
|
|
Additions to
fixed assets |
|
|
(11,879 |
) |
|
|
(10,253 |
) |
Purchases of
marketable securities and other investments |
|
|
(1,850 |
) |
|
|
(1,914 |
) |
Sales and
maturities of marketable securities and other investments |
|
|
12,284 |
|
|
|
67,890 |
|
Net
cash (used in) provided by investing activities |
|
|
(1,445 |
) |
|
|
55,723 |
|
Cash
flows from financing activities: |
|
|
|
|
Proceeds
from revolving credit facilities |
|
|
25,682 |
|
|
|
19,844 |
|
Payments on
revolving credit facilities |
|
|
(25,682 |
) |
|
|
(19,844 |
) |
Proceeds
from issuance and exercise of stock-based awards |
|
|
460 |
|
|
|
781 |
|
Payments for
tax withholdings on equity awards |
|
|
(185 |
) |
|
|
(499 |
) |
Common stock
repurchased |
|
|
— |
|
|
|
(87,860 |
) |
Net
cash provided by (used in) financing activities |
|
|
275 |
|
|
|
(87,578 |
) |
Effect of exchange rate changes on cash, cash equivalents,
and restricted cash |
|
|
179 |
|
|
|
(2,367 |
) |
Net
decrease in cash, cash equivalents, and restricted
cash |
|
|
(25,257 |
) |
|
|
(58,381 |
) |
Cash, cash equivalents, and restricted cash, beginning of
period |
|
|
88,453 |
|
|
|
124,052 |
|
Cash, cash equivalents, and restricted cash, end of
period |
|
$ |
63,196 |
|
|
$ |
65,671 |
|
Supplemental disclosure on cash flow
information: |
|
|
|
|
Cash paid during the period for income taxes |
|
$ |
1,520 |
|
|
$ |
5,027 |
|
Accrual for purchases of fixed assets |
|
|
1,784 |
|
|
|
2,466 |
|
|
|
|
|
|
Company Contact:Darin WhiteDirector of Finance
& Investor RelationsZumiez Inc.(425) 551-1500, ext. 1337
Investor Contact:ICRBrendon Frey (203)
682-8200
Zumiez (NASDAQ:ZUMZ)
Historical Stock Chart
Von Apr 2024 bis Mai 2024
Zumiez (NASDAQ:ZUMZ)
Historical Stock Chart
Von Mai 2023 bis Mai 2024