Quiksilver, Inc. announced consolidated net sales for the second quarter of fiscal 2003 ended April 30, 2003 increased 40% to $262.2 million as compared to fiscal 2002 second quarter consolidated net sales of $187.4 million. Consolidated net income for the second quarter of fiscal 2003 was $22.6 million as compared to $13.5 million. Second quarter, fully diluted earnings per share was $0.40 versus $0.28 for the second quarter of fiscal 2002.
Robert B. McKnight, Jr., Chairman of the Board and Chief Executive Officer of Quiksilver, commented, “We are very pleased to have increased our top and bottom line by 40% and 43%, respectively, during the quarter. We experienced solid growth in each of our main categories and territories, with particular strength in Europe. The positive momentum we have experienced in the first two quarters of fiscal 2003 is encouraging, and we believe we are well positioned to continue our success in the second half of the year.”
Net sales in the Americas increased 15% during the second quarter of fiscal 2003 to $127.5 million as compared to fiscal 2002 second quarter net sales of $111.2 million. As measured in U.S. dollars and reported in the financial statements, European net sales increased 45% during the second quarter of fiscal 2003 to $108.5 million as compared to fiscal 2002 second quarter European net sales of $74.8 million. As measured in euros, European net sales increased 18% for those same periods. Excluding the newly added Asia/Pacific division, overall Fall bookings increased 11% over the previous year.
Mr. McKnight continued, “Our strong bookings trend for fall, despite a generally challenging market environment, gives us comfort with our forecasts for the remainder of the year. We believe that it reflects the compelling nature of our lifestyle brand, the timeliness of our product designs, and the effectiveness of our global marketing activities.”
Consolidated inventories increased 58% to $120.8 million at April 30, 2003 from $76.3 million at April 30, 2002. Consolidated trade accounts receivable increased 32% to $227.0 million at April 30, 2003 from $171.7 million at April 30, 2002. Inventory growth was 49% on a constant dollar basis. Inventories in the Americas and Europe grew 36% on a constant dollar basis with the new Asia/Pacific division accounting for the balance of the growth. Accounts receivable grew more slowly than sales as average days sales outstanding decreased about five days.
Bernard Mariette, President of Quiksilver Inc., commented, “After a series of successful mergers and acquisitions over the past year, our main focus is to now further harmonize the various aspects of our operating platform in order to unlock additional synergies, efficiencies and incremental growth opportunities. We now have the right pieces in place and a world-class management team to execute our long-term strategy. We remain committed to maximizing our leadership position around the globe.”
Mr. McKnight concluded, “Our consistent performance is the result of prudent planning and effective execution. It also underscores the strength of our business model and the validity of our multi-brand, multi-channel operating strategy. We are becoming, on many levels, a truly global lifestyle company, and we are dedicated to capitalizing on the many opportunities this posture has created for our company.”
Three Months Ended
April 30,
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In thousands, except per share amounts 2003 2002
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Revenues $262,210 $187,423
Cost of goods sold 143,627 111,684
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Gross profit 118,583 75,739
Selling, general and administrative expenses 81,374 51,569
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Operating income 37,209 24,170
Interest expense 2,107 2,287
Foreign currency loss 264 356
Other expense 97 55
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Income before provision for income taxes 34,741 21,472
Provision for income taxes 12,111 8,009
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Net income $22,630 $13,463
