Zumiez Inc. Announces Fiscal 2024 First Quarter Results

LYNNWOOD, Wash., June 06, 2024 (GLOBE NEWSWIRE) -- Zumiez Inc. (NASDAQ: ZUMZ), a leading specialty retailer of apparel, footwear, equipment and accessories for young men and women, today reported results for the first quarter ended May 4, 2024.

Net sales for the first quarter ended May 4, 2024 (13 weeks) decreased 3.0% to $177.4 million from $182.9 million in the first quarter ended April 29, 2023 (13 weeks). Net loss in the first quarter of fiscal 2024 was $16.8 million, or $0.86 loss per diluted share, compared to a net loss of $18.4 million, or $0.96 loss per diluted share, in the first quarter of the prior fiscal year.

At May 4, 2024, the Company had cash and current marketable securities of $146.6 million compared to cash and current marketable securities of $155.3 million at April 29, 2023. The decrease was driven by capital expenditures of $17.5 million over this time period, offset by $9.1 million provided by operating activities.

Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, “Fiscal 2024 is off to an encouraging start as we once again achieved sequential improvement in our year-over-year quarterly sales trends and both top and bottom line results exceeded our initial outlook for the quarter. The results were driven by our North American region which inflected positive in the first quarter. At the same time, our focus on improving full priced selling in Europe helped expand merchandise margins, which more than offset expense deleverage and fueled enhanced operating performance versus a year ago, even as overall sales remained under pressure. We still have much work to do to return to historic levels of both sales and profitability, but I am confident that our strategies to reinvigorate growth and reduce our cost base have us on the path to deliver further progress over the remainder of this year and beyond.”

May 2024 Sales
Net sales for the four-week period ended June 1, 2024 increased 1.8% compared to the four-week period ended May 27, 2023. Comparable sales for the four-week period ending June 1, 2024 decreased 0.2% from the comparable period in the prior year.

Fiscal 2024 Second Quarter Outlook
The Company is introducing guidance for the three months ending August 3, 2024. Net sales are projected to be in the range of $199 to $204 million. Loss per share is expected to be between $0.30 to $0.40.

The Company currently intends to open approximately 10 new stores in fiscal 2024, including up to 3 stores in North America, 3 stores in Europe and 4 stores in Australia.

Stock Repurchase Authorization
On June 5, 2024, Zumiez Inc. approved the repurchase of up to an aggregate of $25 million of common stock. The repurchase program is expected to continue through June 30, 2025 unless the time period is extended or shortened by the Board of Directors.

Conference call Information
To access today’s first quarter 2024 earnings call at 5:00 PM ET, 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 June 1, 2024, we operated 751 stores, including 593 in the United States, 47 in Canada, 86 in Europe and 25 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 LOSS
(In thousands, except per share amounts)
(Unaudited)
 
  Three Months Ended
  May 4, 2024 % of Sales  April 29, 2023 % of Sales
Net sales $177,388  100.0% $182,887  100.0%
Cost of goods sold  125,489  70.7%  133,529  73.0%
Gross profit  51,899  29.3%  49,358  27.0%
Selling, general and administrative expenses  72,054  40.6%  70,712  38.7%
Operating loss  (20,155) -11.3%  (21,354) -11.7%
Interest income, net  1,321  0.7%  858  0.5%
Other expense, net  (767) -0.4%  (541) -0.3%
Loss before income taxes  (19,601) -11.0%  (21,037) -11.5%
Benefit from income taxes  (2,821) -1.6%  (2,655) -1.4%
Net loss $(16,780) -9.4% $(18,382) -10.1%
Basic loss per share $(0.86)   $(0.96)  
Diluted loss earnings per share $(0.86)   $(0.96)  
Weighted average shares used in computation of loss per share:        
Basic  19,465     19,197   
Diluted  19,465     19,197   

 

 
ZUMIEZ INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
 
  May 4, 2024 February 3, 2024 April 29, 2023
  (Unaudited)   (Unaudited)
Assets      
Current assets      
Cash and cash equivalents $74,864  $88,875  $66,655 
Marketable securities  71,757   82,704   88,684 
Receivables  13,415   13,780   20,655 
Inventories  146,815   128,827   147,871 
Prepaid expenses and other current assets  14,177   12,401   12,755 
Total current assets  321,028   326,587   336,620 
Fixed assets, net  89,831   90,508   94,419 
Operating lease right-of-use assets  192,607   196,775   216,091 
Goodwill  15,385   15,374   56,925 
Intangible assets, net  14,117   14,200   14,404 
Deferred tax assets, net  11,158   8,623   11,034 
Other long-term assets  12,495   12,159   12,005 
Total long-term assets  335,593   337,639   404,878 
Total assets $656,621  $664,226  $741,498 
       
Liabilities and Shareholders’ Equity      
Current liabilities      
Trade accounts payable $62,301  $38,885  $59,551 
Accrued payroll and payroll taxes  16,958   18,431   18,378 
Operating lease liabilities  59,191   60,885   63,866 
Other current liabilities  18,869   25,886   19,298 
Total current liabilities  157,319   144,087   161,093 
Long-term operating lease liabilities  155,040   159,877   182,507 
Other long-term liabilities   6,927   7,052   6,055 
Total long-term liabilities  161,967   166,929   188,562 
Total liabilities  319,286   311,016   349,655 
       
Shareholders’ equity      
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding         
Common stock, no par value, 50,000 shares authorized; 20,318 shares issued and outstanding at May 4, 2024 and 19,833 shares issued and outstanding at February 3, 2024  198,047   196,144   190,599 
Accumulated other comprehensive loss  (20,025)  (19,027)  (19,077)
Retained earnings  159,313   176,093   220,321 
Total shareholders’ equity  337,335   353,210   391,843 
Total liabilities and shareholders’ equity $656,621  $664,226  $741,498 


 
ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
 
  Three Months Ended
  May 4, 2024 April 29, 2023
Cash flows from operating activities:    
Net loss $(16,780) $(18,382)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation, amortization and accretion  5,561   5,379 
Noncash lease expense  14,522   16,313 
Deferred taxes  (2,590)  (2,912)
Stock-based compensation expense  1,675   1,906 
Impairment of long-lived assets  101   312 
Other  525   375 
Changes in operating assets and liabilities:    
Receivables  1,077   1,030 
Inventories  (18,876)  (13,091)
Prepaid expenses and other assets  1,754   (925)
Trade accounts payable  21,763   18,868 
Accrued payroll and payroll taxes  (1,458)  2,087 
Income taxes payable  (797)  (301)
Operating lease liabilities  (17,276)  (18,609)
Other liabilities  (7,778)  (4,929)
Net cash used in operating activities  (18,577)  (12,879)
Cash flows from investing activities:    
Additions to fixed assets  (2,546)  (5,438)
Purchases of marketable securities and other investments  (1,967)  (1,850)
Sales and maturities of marketable securities and other investments  12,510   5,571 
Net cash provided by (used in) investing activities  7,997   (1,717)
Cash flows from financing activities:    
Proceeds from revolving credit facilities  3,220   1,549 
Payments on revolving credit facilities  (3,220)  (1,549)
Proceeds from issuance and exercise of stock-based awards  358   460 
Payments for tax withholdings on equity awards  (130)  (185)
Net cash provided by financing activities  228   275 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash  (245)  (509)
Net decrease in cash, cash equivalents, and restricted cash  (10,597)  (14,830)
Cash, cash equivalents, and restricted cash, beginning of period  94,284   88,453 
Cash, cash equivalents, and restricted cash, end of period $83,687  $73,623 
Supplemental disclosure on cash flow information:    
Cash paid during the period for income taxes $654  $536 
Accrual for purchases of fixed assets  2,094   2,323 
     

Company Contact:
Darin White
Director of Finance &
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1337

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


06/06/2024 20:05 -0400

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