In a pre-recorded call today Zumiez Inc reported a “wider-than-expected 3.4 percent fall in June sales at stores open at least a year.” This sent the stock down eight percent.
Footwear and skate hard goods posted positive comps for the month, offset by negative comps in accessories, juniors, men’s and boys apparel,” Zumiez CFO Trevor Lang said in a pre-recorded call.
The good news: total sales were up 10.2 percent to $34.7 million.
[Link: Reuters]
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Most of this is old news (especially after all the conference calls last month), but hard times in the financial world have impacted teen fashion spending according to a story on Blumberg.com.
“There is absolutely a slowdown in teen spending,” said Holly Guthrie, an analyst at Janney Montgomery Scott LLC in Philadelphia.
Retailers dependent on that group are feeling the pinch. First-quarter net income at American Eagle plunged 44 percent because of discounting, and the retailer may post its first annual profit drop in five years. . . . At Gap Inc.’s Old Navy chain, sales in May were off 25 percent from a year earlier. Abercrombie’s same- store sales dropped in five of the past six quarters.
“While we believe the teen customer has slightly more discretionary income than their parents, they’re still impacted by the sluggish economy,” Zumiez Inc. Chief Executive Officer Richard Brooks said on a May 22 earnings call.
Zumiez’s 309 stores . . . reported its first quarterly profit drop since going public in 2005.
[Link: Bloomberg]
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And the latest in Billabong’s run to soak up every solid brand in the US comes news that the company has purchased Sector 9 for and undisclosed sum.
Queensland-based Billabong expects the business to add about 2% to group sales, implying the business generates $25 million to $30 million in sales.
“Sector 9’s products, primarily its longboards, really differentiate it from other brands in the boardsports channel and have appeal to surfers, skateboarders and the broader youth market,” Billabong chief executive Derek O’Neill said.
Steve Lake, Dennis Telfer and co-owner Dave Klimkiewicz will continue on with what we’re guessing are nice looking buyouts for increasing sales down the road. Watchout, Burton.
[Link: The Age]
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Teton Gravity Research, the company most widely known for their ski movies (that occasionally include snowboarding) and their popular website, has been purchased by private equity firm BlackHawk Capital Management for an undisclosed amount, according to a press release posted on Private Equity Hub.
BlackHawk Capital Management recently completed the purchase of Jackson Hole, WY based Teton Gravity Research (TGR), a feature film and TV production company referred to by Outside Magazine as “one of the most influential companies in the outdoor industry.” TGR has produced 23 award winning films and 53 half hours of television programming over the past 12 years while establishing the leading brand in adrenaline sports.
Guess we’ll see how the Jones boys like having business jocks for bosses. They’ll probably be really optimistic about it for about three or four weeks.
[Link: PEHub]
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For a long while people didn’t really understand that Dragon was owned by Oakley. Then when Oakley was purchased by the largest eyewear company in the world, most didn’t realize that Dragon was a tiny piece of that deal.
Now, according to a press release Dragon has announced that Founder and CEO Will Howard and General Manager Aaron Behle were able to take Dragon private.
“We want to thank Scott Olivet and the rest of the Oakley team for their support over the years and during this transition,” says Howard. “In two very different business plans, we collectively saw an opportunity to allow Dragon to break off and do its own thing in the marketplace.”
“We have restructured Dragon to fully leverage a decade of brand authenticity and capitalize on what we believe is a paradigm shift in the action sports market,” said Behle. “We have a unique position with a unique plan. More importantly, we have a young and passionate team with the ability to ‘zig’ while the market ‘zags’ and enjoy ourselves along the way.”
Congrats, Will. It’s about time.
[Link: Dragon Alliance via Freeskier]
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Guess everyone needs more side projects these days. In an announcement today Kohl’s big box clothing stores based in Menomonee Falls, Wisconsin said they were bringing Hang Ten back to life with a little help from Quiksilver, the company who helped them with the Hawk line of clothing.
The licensing agreement with American Brand Holdings will make Kohl’s (NYSE: KSS) the exclusive U.S. retailer for the California lifestyle brand. Kohl’s also announced an agreement with Quiksilver Inc. (NYSE: ZQK) to design the collection and its packaging. Quiksilver, of Huntington Beach, Calif., designed the Tony Hawk action sportswear brand that Kohl’s launched in 2006.
What are Quiksilver’s designers just sitting around with nothing to do?
[Link: Bizjournals.com]
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Volcom CEO and Chariman of the Board Richard “Wooly” Woolcott sold 15,000 shares of his company today as part of a prearranged 10b5-1 trading plan for a cool $375,000. That should keep him rolling for a while (seems like we always say that when VeeCo shareholders get paid).
[Link: Forbes.com]
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On their quarterly conference call today at 1:30 PM PST, Quiksilver, Inc. announced results for the second quarter ended April 30, 2008. The call included Bob McKnight, Joe Scirocco, Marty Samuels, and Bruce Thomas.
Consolidated net revenues from continuing operations for the second quarter of fiscal 2008 increased 15% to $596.3 million, from $520.4 million in the second quarter of fiscal 2007. Consolidated income from continuing operations for the second quarter of fiscal 2008 was $38.7 million, or $0.30 per share, compared to $32.4 million, or $0.25 per share, for the second quarter of fiscal 2007.
As usual Bob McKnight opened and closed the comments, Joe spoke the most, and Joe and Marty answered most of the questions.
Here are some highlights from the call:
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In it’s first quarter for 2008 (ending April 26, 2008) Canadian action sports retailer West 49 is reporting a net loss of $4.2 million and a same-store sales drop of 8.1 percent according to a story on Thestar.com.
The $4.2-million net loss – blamed on “the expected challenges posed by cross-border shopping and market conditions in Ontario” – was worth seven cents per share. This compared with a year-ago loss of $3.2 million or five cents per share, which included $400,000 in restructuring costs.
“To lessen the impact of cross-border shopping, we continued to lower our prices to be more in line with U.S. prices,” stated CEO Sam Baio.
[Link: Thestar.com]
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Considering all the chaos going on the the financial world Pac Sun being down only two percent in May vs. 2007. Same store sales, however, were down three percent according to a press release.
Total PacSun sales for the first 17 weeks of fiscal 2008 were $353.7 million versus total PacSun sales of $356.4 million during the same period last year. PacSun same store sales decreased two percent during the same period.
Seems like it could be so much worse.
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