by The Editors on November 20, 2008
Helmet maker Giro is looking into leaving its current location in Santa Cruz for a new larger location in Scotts Valley, California, according to a story in the San Jose Mercury News.
Giro, a division of Easton-Bell Sports with other offices in Los Angeles, Dallas and Chicago, has outgrown the 30,000-square-foot building it has occupied in the Harvey West business park since 1994, and will ask the company’s board of directors to approve the move in December, according to Kwai Kong, Giro’s president of specialty retail business.
Not bad when the city of Scotts Valley is throwing in $75,000 in “redevelopment funds” to help them move.
[Link: San Jose Mercury News]
by The Editors on November 20, 2008
Moody’s Investors Service downgraded Quiksilver’s stock on Wednesday thanks to what it calls “a ‘significant’ level of short-term debt in its capital structure, according to a story on Yahoo Business.
Moody’s downgraded the company’s corporate family rating and probability of default rating two notches to “B2” — a speculative or “junk bond” rating five notches below investment-grade status — from “Ba3,” which is three notches below investment-grade status.
The stock has been down to 91 cents this morning, but it’s back up just over a dollar.
[Link: Yahoo Business]
by The Editors on November 20, 2008
It’s that third quarter financial results time of year and Zumiez will be spilling it all for the analysts on their conference call today, November 20, 2008. This should be a good one. Let’s just hope it goes better than the PacSun call on Tuesday. Click here to listen live online: http://ir.zumiez.com.
[Link: BusinessWire]
by The Editors on November 19, 2008
Those with a stomach for SEC filings should bump on over to EDGAR and check out Quiksilver’s 8K filing relating to their sale of Rossignol to Chartreuse et Mont Blanc LLC. The most interesting piece of info we stumbled onto was that selling Rossignol is going to cost Quiksilver $14.7 million.
Transaction costs: $ 9.9 million. Employee-related costs: $ 1.8 million. Other costs: $ 3.0 million. Total costs before taxes: $14.7 million.
That kind of eats into the $40 million Chartreuse et Mont Blanc paid. We didn’t know selling something could be so expense. Quik stock closed down today at $1.04.
[Link: Edgar Online]
by The Editors on November 19, 2008
In May, 2008 Walt Disney’s ESPN sued Quiksilver for copyright infringement on the use of the letter “X” in Quik’s Generation X line of clothing.
Then a month later Quiksilver sued ESPN saying they had been using the X since 1994 (two years before ESPN began using the letter for its X Games).
Now a federal judge in New York has ruled that ESPN must face allegations.
The emblem for ESPN’s extreme-sports franchise is “strikingly similar” to the stylized X used by Quiksilver in the Gen X line of clothing, U.S. District Judge Colleen McMahon said in a Friday ruling in New York. . . “Quiksilver thoroughly laid out its long history of many types of X usage,” McMahon said, rejecting ESPN’s bid to dismiss the claims. “Quiksilver has also adequately pled that ESPN’s use of the X mark is likely to cause consumer confusion.”
We kind of hope Quiksilver makes the mouse pay through the nose. They could use some cash right now.
[Link: Los Angeles Times]
by The Editors on November 18, 2008
Today at 1:30 PM PST Pacific Sunwear’s CEO Sally Frame Kasaks and CFO Michael Henry spent a little over 40 minutes answering analyst’s questions. It sounded a lot like good news for people who like bad news. Here are some highlights from the call:
- Juniors sales up 16 percent in the quarter driven primarily by their house brand Bullhead denim and tops.
- Young men’s sales saw a slight decline in denim and tops
- Branded goods represent 71 percent of total sales.
- The company continues to review fashion brands by their collections and no one is a done deal. “I’m not sure I want to refer to any of our brands as tried and true,” Kasaks said.
- Accessory sales were down 28 percent, but they hope to better manage the category to about 15 percent of sales rolling forward
- Inventory are high and the company will be going very promotional in Q4. Sally Kasaks said the company would “aggressively clear inventory while holiday traffic is available to us.. . . We may have bought too much this year, and I will take full responsiblity for that. On the other hand I think we have done a good job managing the new brands.”
- Approximately 100 of the 940 stores are not profitable, 24 are cashflow negative
- PacSun has said all along that they would be closing 30-40 stores a year as part of normal business. They see no reason to close a larger number of stores this year, mostly because getting out of leases is costly and could take up to two years.
- Footwear down to 4 percent of the business; will be 3 percent by the end of the year
- Capital expenditures for 2009 will be cut by over 50 percent to $30 million total.
- The e-commerce business growth is outpacing the retail store environment so “we will continue to fund that.”
- Michael Henry says they are planning for the market to remain tough for the foreseeable future.
Guess we’ll know tomorrow how the market reacts in the stocks that are listed in the upper right hand corner of the site. It doesn’t sound good. To read a transcript of the entire call click here.
by The Editors on November 18, 2008
Today at 1:30 PM PST Pac Sun will hold a conference call to discuss what will probably be one of their worst quarters ever (we’re just guessing here).
The call will be open to all interested investors through a live audio Web broadcast at Pacific Sunwear’s investor relations Web site. A telephonic replay of the conference call will be available, beginning approximately two hours following the call, for one week and can be accessed in the United States/Canada at (800) 642-1687 or internationally at (706) 645-9291; pass code: 72074140.
Dial up and get a first hand view of how the macroeconomic conditions are crushing teen clothing sales.
[Link: MarketWatch]
by The Editors on November 17, 2008
Is Quiksilver’s stock price really going to drop below the one buck line today? Because with twenty minutes to go it’s hovering at $1.25. But it got an immediate 18 cent bounce in after hours trading. . . wonder what’s up?
[Link: Yahoo Finance]
by The Editors on November 13, 2008
We’ll see next week how PacSun and Zumiez did when they report third quarter numbers, but Urban Outfitters is showing that all is not dead in the teen clothing sector. They reported “record third-quarter earnings of $59 million, a 31 percent gain.”
The company cited higher profit margins and a tight control of sales-and-administrative expenses. Going into the key holiday-shopping season, the company said it has maintained “rigorous management of inventory and expenses.” In the recent quarter, tighter control of inventory meant fewer items marked down for discount sale.
Yeah, we’re doing well because they think they are geniuses. Maybe.
[Link: BizJournals]
by The Editors on November 13, 2008
Looks like Bob McKnight and the boys at Quiksilver have finally dumped Rossignol off on Chartreuse & Mont Blanc for EU30 million in cash and a EU10 million note, according to Forbes. As we mentioned before, it’s way less than originally planned, but at least they’re out.
“The completion of this sale represents the culmination of our efforts to eliminate our exposure to hardgoods manufacturing,” Chief Executive Robert McKnight Jr., said in a statement. “We’re delighted that we can now return to our roots, do what we do best and once again fully concentrate our efforts on our core apparel and footwear brands Quiksilver, Roxy and DC.”
And it looks like that is going to take an awesome amount of concentration.
[Link: Forbes]
Helmet maker Giro is looking into leaving its current location in Santa Cruz for a new larger location in Scotts Valley, California, according to a story in the San Jose Mercury News.
