HUNTINGTON BEACH, Calif.–March 8, 2000–Robert B. McKnight Jr., chairman of the board and chief executive officer of Quiksilver Inc. (NYSE:ZQK), today announced operating results for thefirst quarter ended Jan. 31, 2000.
Consolidated net sales for the first quarter of fiscal 2000increased 16.3% to $99,929,000 as compared with fiscal 1999first-quarter consolidated net sales of $85,947,000.
Consolidated net income for the first quarter of fiscal 2000increased 21.6% to $4,079,000, or $0.18 per share on a diluted basis,as compared with $3,354,000 or $0.15 per share on a diluted basis forthe first quarter of fiscal 1999.
Basic earnings per share was also $0.18 for the current quartercompared with $0.15 per share for the first quarter of fiscal 1999.Domestic net sales during the first quarter of fiscal 2000 increased20.1% to $62,650,000 as compared with fiscal 1999 first-quarterdomestic net sales of $52,145,000.
European net sales during the first quarter of fiscal 2000 asmeasured in French francs increased 25.7% compared with the fiscal1999 first quarter.
As a result of a weaker Euro vs. the U.S. dollar in the firstquarter of fiscal 2000 compared with fiscal 1999, European net salesduring the first quarter of fiscal 2000 increased 10.3% in dollars to$37,279,000 as compared with fiscal 1999 first-quarter European netsales of $33,802,000.
Consolidated inventories increased 25.2% to $90,376,000 at Jan.31, 2000, from $72,207,000 at Oct. 31, 1999. In comparison with Jan.31, 1999, consolidated inventories increased 6.3%.
Inventories increased somewhat from 1999 levels primarily tosupport increased sales for the spring and summer seasons of thecurrent year.
Inventory turnover improved both domestically and in Europecompared with the first quarter of fiscal 1999. Consolidated tradeaccounts receivable decreased 12.0% to $94,739,000 at Jan. 31, 2000,from $107,619,000 at Oct. 31, 1999, and increased 29.4% compared withJan. 31, 1999, which is consistent with the growth in net sales in thelatter portion of the first quarter.
McKnight said: “Our first quarter was another solid quarter ofgrowth, with net income up 23%. It’s also important to note that ourEuropean business continues to be very strong. Sales were up 26% inFrench francs vs. last year, and we beat our plan by enough toovercome the weakness of the Euro.
“During the quarter, we opened three Boardriders Clubs, includingcompany-owned stores in Boston and London. Just two weeks ago weopened our store in South Beach, Miami, which is doing very well.”
McKnight continued: “We’re thrilled with the way our Roxy team hascome together under the direction of Carol Christopherson, senior vicepresident of Roxy Merchandising; Lissa Zwahlen, vice president ofwomen’s design; and Dana Dartez, design director. We now have the basethat we believe will take Roxy to a new level.
“Also, we held our Mavericks big wave surfing event last Friday,March 3. It was the first time I had seen Mavericks break first-hand.It is a gladiator pit of surfing. … It’s huge, it’s cold, it’sgnarly, it’s rocky and it’s scary. In surfing, Mavericks is the realdeal,” McKnight said.
Quiksilver designs, produces and distributes clothing, accessoriesand related products for active-minded people and develops brands thatrepresent a casual lifestyle — driven from a boardriding heritage.Quiksilver’s authenticity is evident in its innovative products,events and retail environments across the globe.
Quiksilver’s primary focus is apparel for young men and youngwomen under the Quiksilver, Quiksilver Roxy, Raisins and Radio Fijilabels. Quiksilver also manufactures apparel for boys (QuiksilverBoys), girls (Teenie Wahine and Raisins Girls), men (QS SilverEdition) and women (Leilani), as well as snowboards, snowboard bootsand bindings under the Lib Technologies, Gnu and Bent Metal labels.
Distribution is primarily in the United States and Europe and iased in surf shops and specialty stores that endeavor to provide anoutstanding retail experience for their customers.
NOTE: For further information about Quiksilver Inc., you areinvited to take a look at our world at http://www.quiksilver.com andhttp://www.mervin.com.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ended Jan. 31,
|Net sales||$ 99,929,000||$ 85,947,000|
|Cost of goods sold||61,061,000||52,526,000|
|Selling, general and|
|Foreign currency loss||60,000||20,000|
|Provision for income|
|Net income||$ 4,079,000||$ 3,354,000|
|Net income per|
|Net income per share,|
|assuming dilution (a)||23,154,000||22,847,000|
(a) Per-share amounts and shares outstanding have been adjusted toreflect a three-for-two stock split effected on April 23, 1999.-0-
Jan. 31, 2000 Oct. 31, 1999
|Cash and cash equivalents||$ 2,947,000||$ 1,449,000|
|Trade accounts receivable,|
|for doubtful accounts|
|of $4,318,000 (2000)|
|and $5,518,000 (1999)||94,739,000||107,619,000|
|Prepaid expenses and|
|other current assets||8,557,000||7,825,000|
|Total current assets||200,410,000||193,174,000|
|Property and equipment, net||47,303,000||45,153,000|
|Trademark & consulting, net||1,345,000||1,393,000|
|Total assets||$ 268,495,000||$ 259,673,000|
|Lines of credit||$ 32,044,000||$ 28,619,000|
|Current portion of long-term debt||3,539,000||3,615,000|
|Income taxes payable||1,468,000||–|
|Total current liabilities||91,983,000||83,351,000|
|Additional paid-in capital||37,146,000||36,780,000|
|Total stockholders’ equity||153,146,000||151,753,000|
|Total liabilities &|
|stockholders’ equity||$ 268,495,000||$ 259,673,000|
LIABILITIES & STOCKHOLDERS’ EQUITY