Quiksilver Returns to Double-Digit Growth

The company did not record any pro-forma adjustments for the third quarter of fiscal 2011, therefore income from continuing operations was also $10.4 million, or 6 cents per share, compared to $8.2 million, or 5 cents per share, in the third quarter a year ago.

Consolidated gross profit of $255.1 million increased 11 percent compared to $230.7 million in the third quarter a year ago. The company earned Pro-forma Adjusted EBITDA of $52.7 million compared to $53.5 million earned in the third quarter of fiscal 2010.

Robert B. McKnight, Jr., Chairman of the Board, Chief Executive Officer and President of Quiksilver, Inc., commented, “We're pleased with our solid third quarter financial results and feel increasingly positive about our product offerings and the strength of our brands, which are resonating with consumers around the world despite global economic pressures. We’re seeing continued strong growth in emerging and developing markets while our category expansion initiatives are delivering good initial returns, consistent with our longer-term plans.”

McKnight continued, “And after working closely with city officials over the past few days, we've determined that the Quiksilver Pro New York surf contest should and will move forward in an appropriate manner given the impact of Hurricane Irene on the city and residents of Long Beach. We’re eager to bring the world’s best surfers as well as a great surf event to the New York area and in particular to Long Beach, which has an incredible surfing tradition and spirit.”

Net revenues in the Americas increased 11 percent during the third quarter of fiscal 2011 to $260.2 million from $234.6 million in the third quarter of fiscal 2010. As measured in U.S. dollars and reported in the financial statements, European net revenues increased 16 percent during the third quarter of fiscal 2011 to $176.4 million from $151.7 million in the third quarter a year ago. In constant currency, European segment net revenues increased 2 percent compared to the prior year. As measured in U.S. dollars and reported in the financial statements, Asia/Pacific net revenues increased 20 percent during the third quarter of fiscal 2011 to $65.5 million from $54.5 million in the third quarter of fiscal 2010. In constant currency, Asia/Pacific segment net revenues decreased 3 percent compared to the prior year. Please refer to the accompanying tables in order to better understand the impact of foreign currency exchange rates on revenue trends in the European and Asia/Pacific segments.

Q3 Brand Highlights

Legendary Quiksilver team rider and defending 10-time ASP World Surf Champion Kelly Slater won the US Open of Surfing in Huntington Beach, CA, as well as the ASP tour event in Tahiti, vaulting him into first place in the points standings in the race to become the 2011 World Surf Champion.

Quiksilver held the grand opening of its newest Boardriders Store in Ericeira, Portugal. The modern-style facility offers a large selection of products representing each of the company’s brands and includes the country’s largest skate park.

Australian Roxy surfer Sally Fitzgibbons won for the third time on the 2011 ASP Women’s World Tour in capturing the women’s title at the US Open of Surfing. Sally has finished the year ranked #2 in the world for the second time in just three years on tour.

DC co-founder and World Rally Championship driver Ken Block released the fourth installment of his Gymkhana precision driving series and it rapidly became the fastest-spreading viral video on the Internet with over 7 million views in its first two weeks. The entire Gymkhana franchise has now generated over 120 million views and has fueled the sales of DC’s TeamWorks collection which includes shoes, shirts, hats and jackets inspired by Ken’s rally car livery.

The Street League DC Pro Tour completed a second very successful season of skateboarding competitions this past week with the season finale carried on ESPN2. The tour attracted the world’s best skaters including Nyjah Houston, Chris Cole, Sean Malto, Ryan Sheckler, Chaz Ortiz, Shane O’Neill, Billy Marks, Paul Rodriguez and Mikey Taylor.

DC held the grand opening of the DC Embassy in Barcelona, Spain. This unique industrial-inspired space includes large showroom areas designed to showcase DC’s expanding product line. The complex sits atop a 1300 square meter skate park that will serve as the headquarters for the European members of the DC skate team.