07 Jun Zumiez Q1 Easily Tops Guidance
Zumiez Inc. reported total net sales for the first quarter ended May 4, 2019 (13 weeks) increased 3.2 percent to $212.9 million from $206.3 million in the first quarter ended May 5, 2018 (13 weeks). Comparable sales for the thirteen weeks ended May 4, 2019 increased 3.3 percent on top of a comparable sales increase of 8.3 percent for the thirteen weeks ended May 5, 2018.
Net income in the first quarter of fiscal 2019 was $0.8 million, or 3 cents per diluted share, compared to a net loss of $2.6 million, or 10 cents per diluted share, in the first quarter of the prior fiscal year.
Guidance from the company had called for sales in the range of $202 million to $206 million, including anticipated comparable sales growth of between negative 2.0 percent and flat to prior year. Consolidated operating margins are expected to be between negative 2.0 percent and negative 1.0 percent, resulting in a net loss between 13 cents to 7 cents a share.
At May 4, 2019, cash and current marketable securities increased 42.4 percent to $168.0 million, compared to cash and current marketable securities of $118.0 million at May 5, 2018. The increase in cash and current marketable securities was driven by cash generated through operations partially offset by capital expenditures.
“We delivered better than expected results to start the year due to strong performance in the last two months of the first quarter,” commented Rick Brooks, chief executive officer of Zumiez Inc. “Our performance reflects a continuation of our strategy focusing on full price, full margin selling and leveraging our broad assortment to service the customer. Our customer-focused execution continues to drive comparable sales gains and margin expansion and the operating model we have built around a singular cost structure continues to generate increased profitability. With our distinct approach to retailing, authentic brand positioning and strong balance sheet, I am confident that Zumiez is poised to capture additional market share and return increased value to shareholders in the near and long-term.”
May 2019 Sales
The company’s comparable sales increased 2.4 percent for the four-week period ended June 1, 2019 compared to a comparable sales increase of 7.5 percent for the four-week period ended June 2, 2018.
Fiscal 2019 Second Quarter Outlook
The company is introducing guidance for the three months ending August 3, 2019. Net sales are projected to be in the range of $220 million to $224 million including anticipated comparable sales growth of between 0.0 percent and 2.0 percent. Consolidated operating margins are expected to be between 2.2 percent and 3.2 percent resulting in net income per share of approximately $0.14 to $0.20. The company currently intends to open approximately 15 new stores in fiscal 2019, including up to 6 stores in North America, 7 stores in Europe and 2 stores in Australia