Zumiez first quarter as a public company is showing some very positive signs in spite of posting a slight net loss for the period. Comparable store sales increased 12.1% during the first quarter on top of an 8.3% increase last year. Total net sales for the first quarter, bolstered by the addition of six new stores, increased by 34.4% to $33.4 million versus $24.8 million last year. The company plans to open 35 new stores throughout 2005, and management stated that they are on-plan for the remainder of the year.
Since the companys first quarter reporting date falls within the SEC mandated “quiet period” following an IPO, Zumiez was not able to provide any further detail on the quarter other than what was available in the press release and SEC filing.
“With 146 stores, a very compelling unit economics proposition, and now significant capital resources, we are well-positioned and focused on fulfilling our many opportunities for growth,” said Zumiez president and CEO, Rick Brooks.
Zumiez gross margins improved 480 basis points to 29.5% compared to 24.7% last year. SG&A expenses as a percentage of sales were up 110 basis points to 29.5% compared to 28.4% last year. This brought operating profit out of the red and up to $17,000 compared to an operating loss of $930,000 last year.
The retailer still reported a net loss of $40,000 for the quarter, although this is a huge improvement over the $687,000 net loss reported last year. Diluted EPS increased to zero cents per share compared to a loss per share of six cents last year. Management was unable to offer any detail on the factors driving the improvement, or reasons for the net loss, but the companys IPO stated that, “net sales and operating results are typically lower in the first and second quarters of our fiscal year, while the winter holiday and back-to-school periods historically have accounted for the largest percentage of our annual net sales.”
|Fiscal First Quarter Results|
|(in $ millions)||2005||2004||Change|
|Gross Profit %||29.5%||24.7%||+480 bps|
|Diluted EPS||0¢||(6¢)||vs. loss|
|Inventory @ Yr-End||$31.3||$23.2||+34.7%|