Quiksilver Second Quarter Income Jumps 25% with 32% Sales Gain

Quiksilver's consolidated net revenues for the second quarter of fiscal 2005 increased 32% to $426.9 million as compared to fiscal 2004 second quarter consolidated net revenues of $322.6 million. Consolidated net income for the second quarter of fiscal 2005 increased 25% to $34.7 million as compared to $27.8 million the year before. Second quarter fully diluted earnings per share was 28 cents versus 24 cents for the second quarter of fiscal 2004, both amounts as adjusted for the two-for-one stock split that took effect in May 2005.

Robert B. McKnight, Jr., Chairman of the Board and Chief Executive Officer of Quiksilver, Inc., commented, “We are pleased to report strong results and exceed expectations for the 14th consecutive quarter. The upside to our plan for the quarter was broad-based and driven by better than expected results from each of our three regional operating groups.”

Net revenues in the Americas increased 34% during the second quarter of fiscal 2005 to $199.2 million as compared to fiscal 2004 second quarter net revenues of $148.5 million. As measured in U.S. dollars and reported in the financial statements, European net revenues increased 26% during the second quarter of fiscal 2005 to $176.3 million as compared to fiscal 2004 second quarter European net revenues of $140.3 million. As measured in euros, European net revenues increased 18% for those same periods. Asia/Pacific net revenues increased 52% to $50.3 million in the second quarter of fiscal 2005 compared to $33.2 million in the second quarter of fiscal 2004. As measured in Australian dollars, Asia/Pacific net revenues increased 47% for those same periods.

Mr. McKnight continued, “In addition to delivering a good quarterly performance, we maintain the position of our business for sustained growth. We have excellent opportunities across our portfolio of brands, by category, by tier of distribution, by region, and by gender. We continue to look toward the future enthusiastically, especially as we anticipate the addition of the Rossignol businesses and brands, which will provide us with even more vehicles for growth.”

Consolidated inventories increased 40% to $177.8 million at April 30, 2005 from $127.3 million at April 30, 2004. Inventories grew 36% in constant dollars. Consolidated trade accounts receivable growth is in line with the increase in net revenues, increasing 33% to $342.0 million at April 30, 2005 from $257.1 million at April 30, 2004.

Bernard Mariette, President of Quiksilver, Inc., commented, “The excellent results we are reporting today are once again a tribute to the strength of our operating teams around the world. Also today in France, we have launched our tender offer to acquire the publicly traded shares of the Rossignol Group. The plans we are developing for the integration of our two groups are very exciting. I can't speak now about them in detail, but there are many things to share once the transaction closes, which we expect at the end of July. Both the Quiksilver and Rossignol teams are strongly embracing our vision to become the number one company in the global outdoor market. It's all coming together at the right time, as next week in a town near our European headquarters in Southwest France, we will be celebrating the grand opening of our new retail concept, which will cover the entire outdoor world by featuring both Andaska and our new Quiksilver shop. I believe this will be a milestone much like our opening on the Champs-Elysees.”

Mr. McKnight concluded, “While we continue to achieve record levels of sales and earnings, never have our opportunities been larger. We look forward to continuing to capitalize on our strategic position and once again, demonstrating our superior ability to drive shareholder value.”

             CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

                                                  Three Months Ended
                                                       April 30,
                                                 ---------------------
In thousands, except per share amounts                2005       2004
                                                 ---------- ----------

Revenues, net                                     $426,853   $322,579
Cost of goods sold                                 233,488    175,536
                                                 ---------- ----------
   Gross profit                                    193,365    147,043

Selling, general and administrative expense        139,314    104,647
                                                 ---------- ----------

Operating income                                    54,051     42,396

Interest expense                                     3,269      1,476
Foreign currency gain                                 (288)    (1,180)
Other (income) expense                                 (61)       227
                                                 ---------- ----------
Income before provision for income taxes            51,131     41,873
Provision for income taxes                          16,464     14,083
                                                 ---------- ----------

Net income                                         $34,667    $27,790
                                                 ========== ==========

Net income per share                                 $0.29      $0.25
                                                 ========== ==========

Net income per share, assuming dilution              $0.28      $0.24
                                                 ========== ==========

Weighted average common shares outstanding         118,169    112,340
                                                 ========== ==========

Weighted average common shares outstanding,
   assuming dilution                               123,791    117,370
                                                 ========== ==========