by The Editors on December 22, 2008
Bob McKnight, Joe Scirocco, Bruce Thomas, and Marty Samuels covered a lot of ground in last week’s conference call, but there was one topic that they didn’t go over: the rumor that Quiksilver is actively negotiating the sale of DC Shoes.
This rumor has gained momentum lately most likely because the deal seems to make sense. On the conference call DC was repeatedly spoken of as a bright spot in Quiksilver’s brand portfolio. If Quik could unload DC Shoes for somewhere in the $700 million range, that would go a long way toward covering the company’s $1 billion debt. It would also allow Quiksilver to get back to basics with its core business after spending a couple years running the whole expansion thing into the ground. Not to mention it being a relief to many DC employees who believe all their hard work is being blown by bad business decision at the mothership. It probably wouldn’t hurt the company’s stock price, either.
So far no “official word” on the sale.
by The Editors on December 22, 2008
Camp Woodward has signed a licensing and consulting agreement with the Chinese government to help develop the next wave of Chinese action sports automatons as they create their “first international camp in Beijing next summer.”
Woodward Camp President Gary Ream is obviously looking forward to monetizing China’s billions.
[Link: Sports Business Journal]
by The Editors on December 21, 2008
Back in the early 80s Rainbow Sandals were the only flips any self-respecting surfer would wear. And now, almost 40 years later founder Sparky Longley is still living the dream and bringing in $12 million in profits on $37 million in sales. Not bad for a guy who still “depends on word of mouth” and a few ads in The Surfer’s Journal to spread the Rainbow message.
The LA Times rus a whole background check on the company and man and we can’t think of anyone who has done the action sports business thing more smoothly than Sparky. Click the link to check it out.
[Link: LA Times]
by The Editors on December 19, 2008
Ogio President David Wunderli announced today that Mark Kuryak, the former VP of hockey at Easton Bell will be the new VP Global Action/Professional/Sport.
We’ve always had the long-term vision of making OGIO the gear bag maker of choice for all categories of sports,” Wunderli explains. “Mark has proven expertise in elevating sales, service and distribution to the level that innovative products warrant. We’re excited to unleash his skills on what we know to be the category with our highest growth potential.
Motocross, snow, skate, and surf go hand in hand with hockey, right? [click to continue…]
by The Editors on December 18, 2008
Looks like we should have jumped in on the $.80 Quiksilver share prices several weeks ago because Quiksilver is fighting its way through some rough times. In their conference call today with analysts they stated that they doing well, but still have a ways to go.
Consolidated net revenues for the fourth quarter of fiscal 2008 increased 3% to $606.9 million compared to $587.3 million in the fourth quarter of fiscal 2007. . . . Consolidated net revenues for the full year of fiscal 2008 increased 11% to $2.26 billion compared to $2.05 billion in fiscal 2007. . . . European net revenues increased 16% during the full year of fiscal 2008 to $933.1 million and were up 4% in local currency.
Bob McKnight says:
I am proud of the efforts of the entire Quiksilver team around the world as we fought through a deteriorating global economy to deliver financial results that were consistent with the outlook we provided 6 months ago. As economic conditions continue to worsen in our key markets in the US and in Europe, we’ve continued our efforts to reduce expenses and capital expenditures, to carefully control inventory and to reconfigure our post-Rossignol capital structure.”
Notes from the conference call:
- Europe has been doing extremely well for the company.
- The DC footwear business has been “quite strong.”
- Sales will be down in the low double digits for the first quarter of 09
- Expecting a revenue decline in the high single to low double digits for 2009
- Every five cent swing in the Euro translates into $30 million in sales.
- Quik will open “very few new stores” in 2009. “Two in the US and maybe 2 or 3 in Asia Pacific and a couple in Europe”
- The company is looking to 25 retail stores. Nine will close in 2009; 21 of the stores are in the US, 12 are full-price stores and 41 percent of those are in California, Arizona, Florida.
- Quiksilver’s top 30 customers worldwide do less than 25 percent of the company’s sales.
- Capital expenditures for the coming year will be cut approximately $34 million from $94 million to $60 million.
- They are looking at every area of expenditure and trying to adjust to a new reality as to the projected 2009 revenue.
- Company debt still in the $1 billion range
- In 2009 there will be $70 million in interest expense
- The company also has a $55 million loan, which CFO Joe Scirocco called “the big one” is due on March 14, 2009
The Street appeared happy with the report as the stock rose 10% in after-hours trading.
For the whole press release, follow the jump, or click here for a transcript, or listen to the whole call right here.
[click to continue…]
by The Editors on December 17, 2008
Citigroup analyst Kate McShane sent out a note to investors today in which she outlined some stocks to watch and some to run from. Her favorites:
Those include sports apparel and footwear maker Nike Inc., apparel maker VF Corp., sporting goods retailer Dicks Sporting Goods Inc. and sports apparel and footwear retailer Foot Locker Inc., all of which McShane rates “Buy.”
But she’s not, however, a fan of Zumiez.
Names to avoid include Liz Claiborne Inc. and Zumiez Inc., McShane recommended, due to what she considers “elevated credit risk and uncertainty of business fundamentals.”
We’re not so sure we agree with your police work there, McShane.
[Link: Money.cnn.com]
by The Editors on December 17, 2008
According to reports ASA Entertainment, the action sports event marketing company, has made at least four staff cuts in recent days.
Their director of marketing, senior producer (who produced all of the events and television for the last three years), athlete coordinator and one sales person out of the Indialantic, Florida office were all laid off. As our source says:
It seems the company is changing direction away from competitive events and more into “customized corporate marketing solutions” or as the rest of the industry calls them . . . demos.
And maybe some of that direction change is showing up at BFD.com.
by The Editors on December 17, 2008
We’ll probably hear more about this in the conference call tomorrow, but ASR is reporting that Quiksilver (and all its brands but DC Shoes) will “miss the January event for the first time since ASR was held in Long Beach,” according to a Shop-eat-surf.com.
Today Quiksilver told organizers that the brand will miss the January event for the first time since ASR was held in Long Beach,” the statement said. . . . “ASR continues to look for ways to work with Quiksilver and the industry as a whole through these hard times.”
Anyone want to buy a great surfwear brand?
[Link: Shop-eat-surf]
by The Editors on December 16, 2008
The New York-based private equity firm of Goode Partners LLC has announced that they are taking a minority investment in Rick Alden’s Skullycandy action electronics company.
We are thrilled to be part of the Skullcandy team and growth plan. Rick Alden and Jeremy Andrus have assembled a truly dynamic and knowledgeable team to accelerate the Skullcandy® brand worldwide. They have clearly leveraged their experience and knowledge of the global action sport marketplace to position the Skullcandy and 2XL brands for mainstream success”, said David Oddi, Partner of Goode Partners.
And, not surprisingly, Rick Alden is excited about getting more money. Why wouldn’t he be?
[Link: PEhub.com]
by The Editors on December 16, 2008
This should be entertaining. This Thursday, December 18, 2008 at 1:30 PST Quiksilver will host a “conference call to review its fiscal 2008 fourth quarter and year-end financial results
The broadcast will be hosted at www.quiksilverinc.com and at www.viavid.net. To listen to the broadcast, your computer must have Windows Media Player installed. If you do not have Windows Media Player, go to the latter site prior to the call, where you can download the software for free.
Get your rig ready and listen up.
[Link: Welt.de]
Bob McKnight, Joe Scirocco, Bruce Thomas, and Marty Samuels covered a lot of ground in last week’s conference call, but there was one topic that they didn’t go over: the rumor that Quiksilver is actively negotiating the sale of DC Shoes.
