For the fourth quarter, net sales totaled $126.6 million, an increase of $14.2 million or 12.7%, compared to $112.4 million in last year's fourth quarter. When the additional week from fiscal 2006 is excluded, net sales were up 18.5% in the fourth quarter. The increase in net sales reflected the opening of 50 new stores since the end of the prior year, and a comparable store sales increase of 4%. 

Sales growth again benefited from an increase in average unit retail and an increase in the number of sales transactions.


Gross profit for the quarter increased $4.5 million or 10%, to $48.6 million, or 38.4% of net sales compared to the gross profit of $44.1 million or 39.3% of net sales in the fourth quarter last year. The slight decrease in gross profit margin was driven primarily by an increase in store occupancy costs as a percentage of sales and the loss of one week of sales.


Moving to expenses, in total, SG&A expenses increased $3.1 million or 12% to $29.2 million, compared to $26.1 million, but decreased as a percent of net sales to 23.1% from 23.2% in the fourth quarter last year. The slight percentage decrease was driven primarily by lower bonus accruals, largely offset by the loss of one week of sales and to a lesser extent an increase in depreciation expense as a percentage of sales. Operating income increased $1.2 million or 7% to $19.3 million, or 15.3% of net sales compared to $18.1 million or 16.1% of net sales in last year's fourth quarter. Net income for the fourth quarter was $12.4 million or 42 cents per diluted share, compared to $11.3 million or 39 cents per diluted share in last year's fourth quarter.


ZUMZ continues to target 20% square footage growth and plans to open 57 new stores in fiscal 2008. Fiscal 2008 sales are expected to be in the range of $430 million to $445 million on a flat to low-single-digit comp. Diluted earnings per share are expected to be approximately 90 cents to 93 cents for the year. The first half of the year is expected to result in EPS being down in the low-singles with the back half showing EPS increasing in the upper teens to low-20’s on a low-single-digit positive comp.