Zumiez Inc. total net sales for the first quarter ended April 29, 2006 increased by 43.2% to $47.8 million from $33.4 million reported in the first quarter of the prior fiscal year. The company posted net income for the quarter of $1.1 million or four cents per diluted share versus a net loss of $40,000 or breakeven per diluted share in the first quarter of the prior fiscal year. Comparable store sales increased 19.7% for the first quarter of fiscal 2006 compared to 12.1% in the first quarter of fiscal 2005.
Rick Brooks, President and Chief Executive Officer of Zumiez Inc., stated, “We are pleased to report our results for the first quarter, which once again exceeded expectations. Our comparable store increase of 19.7% was driven by double digit increases in same store transactions and an increase in average unit retail”
Mr. Brooks continued, “We opened 5 new stores in the quarter and remain on track to open 42 stores this year. In addition, the consummation of our recently announced agreement to acquire Fast Forward will give us an additional 19 stores in desirable locations for Zumiez. We are thrilled to be working with the team at Fast Forward and are working together towards making the integration of our companies seamless.”
During the quarter, the Company implemented a two-for-one stock split of its common shares. The stock split was effected on April 19, 2006 and trading began on a post-split basis on Nasdaq on April 20, 2006.
Mr. Brooks concluded, “While we are proud of the strong results that Zumiez has generated, we believe we are still in the early stages of our growth potential. With only 179 stores at quarter end, we are still tremendously under-penetrated, and believe we can eventually operate 800 stores in the U.S. We have a terrific team in place to deliver on our goals as we expand in the marketplace.”
The company stated that it is raising guidance for fiscal 2006 to $0.65 to $0.66 from the prior split-adjusted guidance of $0.61 in diluted earnings per share, of which $0.01 to $0.02 is from the acquisition of Fast Forward. Weighted average diluted shares for the fiscal year are expected to be approximately 29,300,000. The company also stated that it believes that its projected earnings growth rate of 30% continues to be achievable for fiscal 2006 and beyond.
ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(in thousands, except share and per share data)
(Unaudited)
Three Months Ended
-----------------------
April 29, April 30,
2006 2005
----------------------------------------------------------------------
Net sales $47,785 $33,369
Cost of goods sold 32,519 23,522
----------- --------
Gross margin 15,266 9,847
Selling, general and administrative expenses 13,796 9,830
----------- --------
Operating profit 1,470 17
Interest income (expense), net 352 (44)
Other income -- 15
----------- --------
Earnings (loss) before income taxes 1,822 (12)
Provision for income taxes 713 28
----------- --------
Net income (loss) $ 1,109 $ (40)
=========== ========
Basic net income (loss) per share $ 0.04 $ 0.00
=========== ========
Diluted net income (loss) per share $ 0.04 $ 0.00
=========== ========
Weighted average shares outstanding, Basic 27,272,799 22,610,522
Weighted average shares outstanding , Diluted 28,631,942 26,321,313
