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06/06/24
Zumiez Inc. Announces Fiscal 2024 First Quarter Results
Board Approves New Stock Repurchase Authorization

LYNNWOOD, Wash., June 06, 2024 (GLOBE NEWSWIRE) -- Zumiez Inc. (NASDAQ: ZUMZ), a leading specialty retailer of apparel, footwear, equipment and accessories for young men and women, today reported results for the first quarter ended May 4, 2024.

Net sales for the first quarter ended May 4, 2024 (13 weeks) decreased 3.0% to $177.4 million from $182.9 million in the first quarter ended April 29, 2023 (13 weeks). Net loss in the first quarter of fiscal 2024 was $16.8 million, or $0.86 loss per diluted share, compared to a net loss of $18.4 million, or $0.96 loss per diluted share, in the first quarter of the prior fiscal year.

At May 4, 2024, the Company had cash and current marketable securities of $146.6 million compared to cash and current marketable securities of $155.3 million at April 29, 2023. The decrease was driven by capital expenditures of $17.5 million over this time period, offset by $9.1 million provided by operating activities.

Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, “Fiscal 2024 is off to an encouraging start as we once again achieved sequential improvement in our year-over-year quarterly sales trends and both top and bottom line results exceeded our initial outlook for the quarter. The results were driven by our North American region which inflected positive in the first quarter. At the same time, our focus on improving full priced selling in Europe helped expand merchandise margins, which more than offset expense deleverage and fueled enhanced operating performance versus a year ago, even as overall sales remained under pressure. We still have much work to do to return to historic levels of both sales and profitability, but I am confident that our strategies to reinvigorate growth and reduce our cost base have us on the path to deliver further progress over the remainder of this year and beyond.”

May 2024 Sales
Net sales for the four-week period ended June 1, 2024 increased 1.8% compared to the four-week period ended May 27, 2023. Comparable sales for the four-week period ending June 1, 2024 decreased 0.2% from the comparable period in the prior year.

Fiscal 2024 Second Quarter Outlook
The Company is introducing guidance for the three months ending August 3, 2024. Net sales are projected to be in the range of $199 to $204 million. Loss per share is expected to be between $0.30 to $0.40.

The Company currently intends to open approximately 10 new stores in fiscal 2024, including up to 3 stores in North America, 3 stores in Europe and 4 stores in Australia.

Stock Repurchase Authorization
On June 5, 2024, Zumiez Inc. approved the repurchase of up to an aggregate of $25 million of common stock. The repurchase program is expected to continue through June 30, 2025 unless the time period is extended or shortened by the Board of Directors.

Conference call Information
To access today’s first quarter 2024 earnings call at 5:00 PM ET, please pre-register using this link (Registration Link). Registrants will receive confirmation with dial-in details. The conference call will also be available to interested parties through a live webcast at https://ir.zumiez.com. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time. A replay of the webcast will also be available for a limited time at https://ir.zumiez.com.

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 June 1, 2024, we operated 751 stores, including 593 in the United States, 47 in Canada, 86 in Europe and 25 in Australia. We operate under the names Zumiez, Blue Tomato and Fast Times. Additionally, we operate ecommerce web sites at zumiez.com, zumiez.ca, 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 January 28, 2023 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 LOSS
(In thousands, except per share amounts)
(Unaudited)
 
    Three Months Ended
    May 4, 2024   % of Sales     April 29, 2023   % of Sales
Net sales   $ 177,388     100.0 %   $ 182,887     100.0 %
Cost of goods sold     125,489     70.7 %     133,529     73.0 %
Gross profit     51,899     29.3 %     49,358     27.0 %
Selling, general and administrative expenses     72,054     40.6 %     70,712     38.7 %
Operating loss     (20,155 )   -11.3 %     (21,354 )   -11.7 %
Interest income, net     1,321     0.7 %     858     0.5 %
Other expense, net     (767 )   -0.4 %     (541 )   -0.3 %
Loss before income taxes     (19,601 )   -11.0 %     (21,037 )   -11.5 %
Benefit from income taxes     (2,821 )   -1.6 %     (2,655 )   -1.4 %
Net loss   $ (16,780 )   -9.4 %   $ (18,382 )   -10.1 %
Basic loss per share   $ (0.86 )       $ (0.96 )    
Diluted loss earnings per share   $ (0.86 )       $ (0.96 )    
Weighted average shares used in computation of loss per share:                
Basic     19,465           19,197      
Diluted     19,465           19,197      

 

 
ZUMIEZ INC. 
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
 
    May 4, 2024   February 3, 2024   April 29, 2023
    (Unaudited)       (Unaudited)
Assets            
Current assets            
Cash and cash equivalents   $ 74,864     $ 88,875     $ 66,655  
Marketable securities     71,757       82,704       88,684  
Receivables     13,415       13,780       20,655  
Inventories     146,815       128,827       147,871  
Prepaid expenses and other current assets     14,177       12,401       12,755  
Total current assets     321,028       326,587       336,620  
Fixed assets, net     89,831       90,508       94,419  
Operating lease right-of-use assets     192,607       196,775       216,091  
Goodwill     15,385       15,374       56,925  
Intangible assets, net     14,117       14,200       14,404  
Deferred tax assets, net     11,158       8,623       11,034  
Other long-term assets     12,495       12,159       12,005  
Total long-term assets     335,593       337,639       404,878  
Total assets   $ 656,621     $ 664,226     $ 741,498  
             
Liabilities and Shareholders’ Equity            
Current liabilities            
Trade accounts payable   $ 62,301     $ 38,885     $ 59,551  
Accrued payroll and payroll taxes     16,958       18,431       18,378  
Operating lease liabilities     59,191       60,885       63,866  
Other current liabilities     18,869       25,886       19,298  
Total current liabilities     157,319       144,087       161,093  
Long-term operating lease liabilities     155,040       159,877       182,507  
Other long-term liabilities      6,927       7,052       6,055  
Total long-term liabilities     161,967       166,929       188,562  
Total liabilities     319,286       311,016       349,655  
             
Shareholders’ equity            
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding     —       —       —  
Common stock, no par value, 50,000 shares authorized; 20,318 shares issued and outstanding at May 4, 2024 and 19,833 shares issued and outstanding at February 3, 2024     198,047       196,144       190,599  
Accumulated other comprehensive loss     (20,025 )     (19,027 )     (19,077 )
Retained earnings     159,313       176,093       220,321  
Total shareholders’ equity     337,335       353,210       391,843  
Total liabilities and shareholders’ equity   $ 656,621     $ 664,226     $ 741,498  


 
ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
 
    Three Months Ended
    May 4, 2024   April 29, 2023
Cash flows from operating activities:        
Net loss   $ (16,780 )   $ (18,382 )
Adjustments to reconcile net loss to net cash used in operating activities:        
Depreciation, amortization and accretion     5,561       5,379  
Noncash lease expense     14,522       16,313  
Deferred taxes     (2,590 )     (2,912 )
Stock-based compensation expense     1,675       1,906  
Impairment of long-lived assets     101       312  
Other     525       375  
Changes in operating assets and liabilities:        
Receivables     1,077       1,030  
Inventories     (18,876 )     (13,091 )
Prepaid expenses and other assets     1,754       (925 )
Trade accounts payable     21,763       18,868  
Accrued payroll and payroll taxes     (1,458 )     2,087  
Income taxes payable     (797 )     (301 )
Operating lease liabilities     (17,276 )     (18,609 )
Other liabilities     (7,778 )     (4,929 )
Net cash used in operating activities     (18,577 )     (12,879 )
Cash flows from investing activities:        
Additions to fixed assets     (2,546 )     (5,438 )
Purchases of marketable securities and other investments     (1,967 )     (1,850 )
Sales and maturities of marketable securities and other investments     12,510       5,571  
Net cash provided by (used in) investing activities     7,997       (1,717 )
Cash flows from financing activities:        
Proceeds from revolving credit facilities     3,220       1,549  
Payments on revolving credit facilities     (3,220 )     (1,549 )
Proceeds from issuance and exercise of stock-based awards     358       460  
Payments for tax withholdings on equity awards     (130 )     (185 )
Net cash provided by financing activities     228       275  
Effect of exchange rate changes on cash, cash equivalents, and restricted cash     (245 )     (509 )
Net decrease in cash, cash equivalents, and restricted cash     (10,597 )     (14,830 )
Cash, cash equivalents, and restricted cash, beginning of period     94,284       88,453  
Cash, cash equivalents, and restricted cash, end of period   $ 83,687     $ 73,623  
Supplemental disclosure on cash flow information:        
Cash paid during the period for income taxes   $ 654     $ 536  
Accrual for purchases of fixed assets     2,094       2,323  
         

Company Contact:
Darin White
Director of Finance &
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1337

Investor Contact:
ICR
Brendon Frey
(203) 682-8200


Zumiez Inc