Zumiez Inc. (NASDAQ: ZUMZ) today reported results for the fourth
quarter and year ended January 30, 2021.
Total net sales for the fourth quarter ended
January 30, 2021 (13 weeks) increased 0.8% to $331.5 million from
$328.8 million in the quarter ended February 1, 2020 (13 weeks).
Comparable sales for the thirteen weeks ended January 30, 2021
increased 4.7% compared to a comparable sales increase of 6.4% for
the thirteen weeks ended February 1, 2020. Net income for the
fourth quarter of fiscal 2020 was $42.8 million, or $1.68 per
diluted share, compared to net income of $37.9 million, or $1.48
per diluted share in the fourth quarter of the prior fiscal
year.
Total net sales for fiscal 2020 (52 weeks) ended
January 30, 2021 decreased 4.2% to $990.7 million from $1.034
billion in fiscal 2019 (52 weeks) ended February 1, 2020.
Comparable sales for the fifty-two week period ended January 30,
2021 increased 13.6% compared the same fifty-two week period ended
February 1, 2020. Net income in fiscal 2020 increased 14.0% to
$76.2 million, or $3.00 per diluted share, compared to net income
in the prior fiscal year of $66.9 million, or $2.62 per diluted
share.
At January 30, 2021, the Company had cash and
current marketable securities of $375.5 million compared to cash
and current marketable securities of $251.2 million at February 1,
2020. The increase in cash and current marketable securities was
driven by cash generated through operations including cash
deferment of $30.1 million composed of lower inventory levels,
landlord payments, extended vendor terms and payroll tax payments
as well as net income improvements related to abatements, credits
and expense reductions. This increase was partially offset by $13.4
million of share repurchases through the Company’s stock buyback
program prior to our stores closing in March due to COVID-19 and
other planned capital expenditures.
Rick Brooks, Chief Executive Officer of Zumiez
Inc., stated, “We are extremely proud of how our organization
executed during a year of significant and unfamiliar challenges.
Our one channel approach to retail and relentless focus on serving
the consumer allowed to us to achieve annual sales close to fiscal
2019 levels and record profitability despite our stores around the
world being closed for approximately 22% of the possible operating
days. Our recent performance, including during the holiday season,
has strengthened our operation and financial foundation and
enhanced our competitive advantages. While the near-term
environment is likely to remain volatile due to uncertainty
surrounding the virus, we believe we are well positioned with a
strong balance sheet and differentiated strategies to further
expand our global market share and continue generating meaningful
value for our shareholders in the years ahead.”
Fiscal First Quarter-to-Date Sales
Total first quarter-to-date sales for the 35 days
ended March 6, 2021 were down approximately 3.8%, compared with the
same 35 day time period in the prior year ended March 7, 2020.
Comparable sales for the 35 days ended March 6, 2021 decreased
0.4%. By channel, open store comparable sales decreased 6.9% and
e-commerce sales increased 29.5%. During this timeframe, we had
roughly 7% fewer open store days than last year due to governmental
orders and potential safety concerns. We also experienced
significant metering of traffic and reduced hours where required by
local governments. We expect that the store closures and various
other operating restrictions will fluctuate as we move through the
quarter.
Outlook
Due to the continued fast-moving nature of this
situation and the uncertainty of impacts on revenue and costs, the
Company is not providing an outlook at this time for the first
quarter or the year.
Conference call Information
A conference call will be held today to discuss
fourth quarter fiscal 2020 results and will be webcast at 5:00 p.m.
ET on http://ir.zumiez.com. Participants may also dial (574)
990-9934 followed by the conference identification code of
1986667.
About Zumiez Inc.
Zumiez is a leading specialty retailer of apparel,
footwear, accessories and hardgoods for young men and women who
want to express their individuality through the fashion, music, art
and culture of action sports, streetwear, and other unique
lifestyles. As of March 6, 2021, we operated 722 stores, including
602 in the United States, 52 in Canada, 54 in Europe and 14 in
Australia. We operate under the names Zumiez, Blue Tomato and Fast
Times. Additionally, we operate ecommerce web sites at zumiez.com,
blue-tomato.com and fasttimes.com.au.
Safe Harbor Statement
Certain statements in this press release and oral
statements relating thereto made from time to time by
representatives of the Company may constitute forward-looking
statements for purposes of the safe harbor provisions under the
Private Securities Litigation Reform Act of 1995. These statements
include, without limitation, predictions and guidance relating to
the Company's future financial performance, brand and product
category diversity, ability to adjust product mix, integration of
acquired businesses, growing customer demand for our products and
new store openings. In some cases, you can identify forward-looking
statements by terminology such as, "may," "should," "expects,"
"plans," "anticipates," "believes," "estimates," "predicts,"
"potential," "continue," or the negative of these terms or other
comparable terminology. These forward-looking statements are based
on management's current expectations but they involve a number of
risks and uncertainties. Actual results and the timing of events
could differ materially from those anticipated in the
forward-looking statements as a result of risks and uncertainties,
which include, without limitation, those described in the Company’s
annual report on Form 10-K for the fiscal year ended February 1,
2020 as filed with the Securities and Exchange Commission and
available at www.sec.gov. You are urged to consider these factors
carefully in evaluating the forward-looking statements herein and
are cautioned not to place undue reliance on such forward-looking
statements, which are qualified in their entirety by this
cautionary statement. The forward-looking statements speak only as
of the date on which they are made and the Company undertakes no
obligation to publicly update such forward-looking statements to
reflect subsequent events or circumstances.
ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
|
|
|
Three Months Ended |
|
|
|
January 30, |
|
%
of |
|
February
1, |
|
%
of |
|
|
|
2021 |
|
Sales |
|
2020 |
|
Sales |
|
|
|
(Unaudited) |
|
|
|
(Unaudited) |
|
|
Net sales |
|
$ |
331,536 |
|
100.0 |
% |
|
|
328,754 |
|
100.0 |
% |
Cost of
goods sold |
|
|
201,913 |
|
60.9 |
% |
|
|
200,427 |
|
61.0 |
% |
Gross profit |
|
|
129,623 |
|
39.1 |
% |
|
|
128,327 |
|
39.0 |
% |
Selling,
general and administrative expenses |
|
|
75,814 |
|
22.9 |
% |
|
|
79,471 |
|
24.1 |
% |
Operating profit |
|
|
53,809 |
|
16.2 |
% |
|
|
48,856 |
|
14.9 |
% |
Interest
income, net |
|
|
881 |
|
0.3 |
% |
|
|
1,002 |
|
0.3 |
% |
Other
expense, net |
|
|
1,417 |
|
0.4 |
% |
|
|
545 |
|
0.1 |
% |
Earnings before income taxes |
|
|
56,107 |
|
16.9 |
% |
|
|
50,403 |
|
15.3 |
% |
Provision
for income taxes |
|
|
13,310 |
|
4.0 |
% |
|
|
12,518 |
|
3.8 |
% |
Net
income |
|
$ |
42,797 |
|
12.9 |
% |
|
$ |
37,885 |
|
11.5 |
% |
Basic
earnings per share |
|
$ |
1.71 |
|
|
|
$ |
1.50 |
|
|
Diluted
earnings per share |
|
$ |
1.68 |
|
|
|
$ |
1.48 |
|
|
Weighted
average shares used in computation of Earnings per share: |
|
|
|
|
|
|
|
Basic |
|
|
25,024 |
|
|
|
|
25,281 |
|
|
Diluted |
|
|
25,462 |
|
|
|
|
25,662 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ZUMIEZ INC. CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (In thousands, except per
share amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended |
|
|
|
January 30, |
|
%
of |
|
February
1, |
|
%
of |
|
|
|
2021 |
|
Sales |
|
2020 |
|
Sales |
|
|
|
(Unaudited) |
|
|
|
|
|
|
Net
sales |
|
$ |
990,652 |
|
100.0 |
% |
|
$ |
1,034,129 |
|
100.0 |
% |
Cost of
goods sold |
|
|
640,637 |
|
64.7 |
% |
|
|
667,566 |
|
64.6 |
% |
Gross profit |
|
|
350,015 |
|
35.3 |
% |
|
|
366,563 |
|
35.4 |
% |
Selling,
general and administrative expenses |
|
|
253,077 |
|
25.5 |
% |
|
|
280,756 |
|
27.1 |
% |
Operating profit |
|
|
96,938 |
|
9.8 |
% |
|
|
85,807 |
|
8.3 |
% |
Interest
income, net |
|
|
3,518 |
|
0.3 |
% |
|
|
3,654 |
|
0.4 |
% |
Other
expense, net |
|
|
2,001 |
|
0.2 |
% |
|
|
1,532 |
|
0.1 |
% |
Earnings before income taxes |
|
|
102,457 |
|
10.3 |
% |
|
|
90,993 |
|
8.8 |
% |
Provision
for income taxes |
|
|
26,230 |
|
2.6 |
% |
|
|
24,112 |
|
2.3 |
% |
Net
income |
|
$ |
76,227 |
|
7.7 |
% |
|
$ |
66,881 |
|
6.5 |
% |
Basic
earnings per share |
|
$ |
3.06 |
|
|
|
$ |
2.65 |
|
|
Diluted
earnings per share |
|
$ |
3.00 |
|
|
|
$ |
2.62 |
|
|
Weighted
average shares used in computation of Earnings per share: |
|
|
|
|
|
|
|
Basic |
|
|
24,942 |
|
|
|
|
25,200 |
|
|
Diluted |
|
|
25,398 |
|
|
|
|
25,535 |
|
|
ZUMIEZ INC. CONDENSED
CONSOLIDATED BALANCE SHEETS (In
thousands)
|
|
January 30, 2021 |
|
February 1, 2020 |
|
|
(Unaudited) |
|
|
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
73,622 |
|
$ |
52,428 |
|
Marketable
securities |
|
|
301,920 |
|
|
198,768 |
|
Receivables |
|
|
16,558 |
|
|
16,841 |
|
Inventories |
|
|
134,354 |
|
|
135,095 |
|
Prepaid
expenses and other current assets |
|
|
8,823 |
|
|
9,456 |
|
Total current assets |
|
|
535,277 |
|
|
412,588 |
|
Fixed
assets, net |
|
|
98,352 |
|
|
113,051 |
|
Operating
lease right-of-use assets |
|
|
267,152 |
|
|
301,784 |
|
Goodwill |
|
|
61,470 |
|
|
57,099 |
|
Intangible
assets, net |
|
|
16,029 |
|
|
14,564 |
|
Deferred tax
assets, net |
|
|
9,927 |
|
|
6,303 |
|
Other
long-term assets |
|
|
10,157 |
|
|
8,869 |
|
Total long-term assets |
|
|
463,087 |
|
|
501,670 |
|
Total assets |
|
$ |
998,364 |
|
$ |
914,258 |
|
|
|
|
|
|
Liabilities and Shareholders’ Equity |
|
|
|
|
Current liabilities |
|
|
|
|
Trade
accounts payable |
|
$ |
69,751 |
|
$ |
47,787 |
|
Accrued
payroll and payroll taxes |
|
|
27,911 |
|
|
23,653 |
|
Income taxes
payable |
|
|
6,317 |
|
|
4,686 |
|
Operating
lease liabilities |
|
|
66,993 |
|
|
61,800 |
|
Other
liabilities |
|
|
24,480 |
|
|
21,784 |
|
Total current liabilities |
|
|
195,452 |
|
|
159,710 |
|
Long-term
operating lease liabilities |
|
|
246,123 |
|
|
284,717 |
|
Other
long-term liabilities |
|
|
4,193 |
|
|
3,745 |
|
Total long-term liabilities |
|
|
250,316 |
|
|
288,462 |
|
Total liabilities |
|
|
445,768 |
|
|
448,172 |
|
|
|
|
|
|
Shareholders’ equity |
|
|
|
|
Preferred
stock, no par value, 20,000 shares authorized; none issued and
outstanding |
|
|
— |
|
|
— |
|
Common
stock, no par value, 50,000 shares authorized; 25,599 shares
issued and outstanding at January 30, 2021 and 25,828 shares issued
and outstanding at February 1, 2020 |
|
|
171,628 |
|
|
161,458 |
|
Accumulated
other comprehensive income (loss) |
|
|
939 |
|
|
(12,591 |
) |
Retained
earnings |
|
|
380,029 |
|
|
317,219 |
|
Total shareholders’ equity |
|
|
552,596 |
|
|
466,086 |
|
Total liabilities and shareholders’ equity |
|
$ |
998,364 |
|
$ |
914,258 |
|
|
|
|
|
|
ZUMIEZ INC. CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (In
thousands)
|
|
Fiscal Year Ended |
|
|
January 30,2020 |
|
February 1,2020 |
|
|
(Unaudited) |
|
|
Cash
flows from operating activities: |
|
|
|
|
Net income |
|
$ |
76,227 |
|
|
$ |
66,881 |
|
Adjustments
to reconcile net income to net cash provided by operating
activities: |
|
|
|
|
Depreciation, amortization and accretion |
|
|
24,059 |
|
|
|
25,449 |
|
Noncash
lease expense |
|
|
61,694 |
|
|
|
58,223 |
|
Deferred
taxes |
|
|
(3,890 |
) |
|
|
899 |
|
Stock-based
compensation expense |
|
|
6,448 |
|
|
|
6,382 |
|
Impairment
of long-lived assets |
|
|
4,803 |
|
|
|
215 |
|
Other |
|
|
(570 |
) |
|
|
(656 |
) |
Changes in
operating assets and liabilities: |
|
|
|
|
Receivables |
|
|
928 |
|
|
|
3,396 |
|
Inventories |
|
|
3,946 |
|
|
|
(6,825 |
) |
Prepaid expenses and other current assets |
|
|
1,010 |
|
|
|
861 |
|
Trade accounts payable |
|
|
20,797 |
|
|
|
12,756 |
|
Accrued payroll and payroll taxes |
|
|
3,841 |
|
|
|
2,735 |
|
Income taxes payable |
|
|
1,602 |
|
|
|
(1,127 |
) |
Operating lease liabilities |
|
|
(65,479 |
) |
|
|
(62,217 |
) |
Other liabilities |
|
|
2,996 |
|
|
|
(902 |
) |
Net
cash provided by operating activities |
|
|
138,412 |
|
|
|
106,070 |
|
Cash
flows from investing activities: |
|
|
|
|
Additions to
fixed assets |
|
|
(9,057 |
) |
|
|
(18,818 |
) |
Purchases of
marketable securities and other investments |
|
|
(222,785 |
) |
|
|
(236,838 |
) |
Sales and
maturities of marketable securities and other investments |
|
|
121,301 |
|
|
|
152,725 |
|
Net
cash used in investing activities |
|
|
(110,541 |
) |
|
|
(102,931 |
) |
Cash
flows from financing activities: |
|
|
|
|
Proceeds
from issuance and exercise of stock-based awards |
|
|
3,877 |
|
|
|
2,332 |
|
Payments for
tax withholdings on equity awards |
|
|
(154 |
) |
|
|
(322 |
) |
Common stock
repurchased |
|
|
(13,417 |
) |
|
|
— |
|
Net
cash (used in) provided by financing activities |
|
|
(9,694 |
) |
|
|
2,010 |
|
Effect of exchange rate changes on cash and cash
equivalents |
|
|
3,522 |
|
|
|
(429 |
) |
Net
increase in cash and cash equivalents |
|
|
21,699 |
|
|
|
4,720 |
|
Cash
and cash equivalents, beginning of period |
|
|
58,991 |
|
|
|
54,271 |
|
Cash
and cash equivalents, end of period |
|
$ |
80,690 |
|
|
$ |
58,991 |
|
Supplemental disclosure on cash flow
information: |
|
|
|
|
Cash paid
during the period for income taxes |
|
$ |
27,598 |
|
|
$ |
24,138 |
|
Accrual for
purchases of fixed assets |
|
|
231 |
|
|
|
1,152 |
|
Company Contact:Darin WhiteDirector of Finance
& Investor RelationsZumiez Inc.(425) 551-1500, ext. 1337
Investor Contact:ICRBrendon Frey (203)
682-8200
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