Zumiez Inc. reported a loss in the first quarter but it was better than guidance with same-stores landing at the upper end of guidance.
Total net sales for the first quarter ended April 29, 2017 (13 weeks) increased 4.7 percent to $181.2 million from $173.0 million in the first quarter ended April 30, 2016 (13 weeks). Comparable sales for the thirteen weeks ended April 29, 2017 increased 1.8 percent compared to a comparable sales decrease of 7.5 percent in the first quarter of 2016. Net loss in the first quarter of fiscal 2017 was $4.4 million, or 18 cents per diluted share, compared to a net loss of $2.1 million, or 8 cents per diluted share, in the first quarter of the prior fiscal year.
Zumiez had expected sales to land in the range of $178 million to $182 million resulting in a net loss per share of approximately 17 to 21 cents a share. The guidance was based upon anticipated comparable sales growth of between 0 percent and positive 2 percent.
At April 29, 2017, the company had cash and current marketable securities of $76.5 million, compared to cash and current marketable securities of $62.1 million at April 30, 2016. The increase in cash and current marketable securities was driven by cash generated through operations partially offset by capital expenditures, stock repurchases and cash used in the acquisition of Fast Times.
Rick Brooks, chief executive officer of Zumiez Inc., stated, “The combination of our authentic brand positioning, on-trend merchandise assortments, engaging sales experiences and advanced omni-channel capabilities contributed to first quarter comparable sales that were towards the high-end of our guidance range. Our teams are doing a good job striking a balance between achieving near-term targets in a challenging retail environment and executing strategies that are laying the foundation for long-term profitable growth. I am confident we are on the right course to grow both sales and earnings to generate value for our shareholders.”
May 2017 Sales
Total net sales for the four-week period ended May 27, 2017 increased 6.5 percent to $53.2 million, compared to $50.0 million for the four-week period ended May 28, 2016. The company’s comparable sales increased 3.3 percent for the four-week period ended May 27, 2017 compared to a comparable sales decrease of 7.6 percent for the four-week period ended May 28, 2016.
Fiscal 2017 Second Quarter Outlook
The company is introducing guidance for the three months ending July 29, 2017. Net sales are projected to be in the range of $185 to $189 million resulting in net loss per diluted share of approximately 6 to 11 cents. This guidance is based on an anticipated comparable sales increase in the 1 percent to 3 percent range for the second quarter of fiscal 2017. The company currently intends to open approximately 19 new stores in fiscal 2017, including up to 3 stores in Canada, 4 stores in Europe and 2 stores in Australia.
Photo courtesy Zumiez
