Quiksilver (NYSE:ZQK) announced operating results for the first quarter ended January 31, 2003.
Consolidated net sales for the first quarter of fiscal 2003 increased 31 percent to 192.1-million dollars as compared to fiscal 2002 first quarter consolidated net sales of 147.0-million. Consolidated net income for the first quarter of fiscal 2003 was 6.6-million dollars as compared to 3.1-million. First quarter, fully diluted earnings per share was $0.24 versus $0.13 for the first quarter of fiscal 2002.
Quiksilver CEO Bob McKnight commented, “Our positive momentum from last year continued into fiscal 2003 as we exceeded expectations for the fifth consecutive quarter. We grew our top line by more than 30 percent, with robust sales across all channels of distribution, and nearly doubled our earnings per share. Our business remains strong, and we are confident in our ability to increase our earnings per share by at least 20 percent this year.”
Net sales in the Americas increased 14 percent during the first quarter of fiscal 2003 to 102.0-million dollars as compared to fiscal 2002 first quarter net sales of 89.8-million. As measured in U.S. dollars and reported in the financial statements, European net sales increased 38 percent during the first quarter of fiscal 2003 to 77.2-million dollars, as compared to fiscal 2002 first quarter European net sales of 56.0-million. As measured in euros, European net sales increased 19 percent for those same periods.
McKnight continued, “Summer bookings were strong, up 15 percent on a consolidated basis in the Americas and Europe, despite the challenges of the difficult retail climate. We continue to believe that our authentic lifestyle message, intense focus on our core customer, and diversified distribution structure are enabling us to prosper at a time when many of our competitors are struggling.”
Consolidated inventories increased 24 percent to 144.2-million dollars at January 31, 2003, compared to 116.4-million at January 31, 2002. Consolidated trade-accounts receivable increased 20 percent to 173.5-million dollars at January 31, 2003 from 145.0-million at January 31, 2002. Inventory growth was modest compared to the increase in sales. Inventories in the Americas and Europe grew 15 percent, with the new Asia/Pacific division accounting for the balance of the growth. Accounts receivable grew more slowly than sales as average days sales outstanding decreased about ten days.
Quiksilver President Bernard Mariette commented, “Our ability to significantly increase sales and earnings in a tough environment is testament to the ongoing strength of the Quiksilver brand and underscores our operational efficiencies. We move forward with solid momentum, a strong financial position, and a powerful growth platform. Quiksilver continues to benefit from demographic and lifestyle trends, and our highly diversified, global operating strategy gives us a compelling advantage in the industry. We have significant expansion potential ahead, and we are dedicated to fully maximizing the opportunities we have created.”
McKnight concluded, “As we approach the 1-billion-dollar sales mark, our philosophy remains the same as it was at inception: bring great product to market that is consistent with the lifestyle of our consumers and create unique marketing programs that both support the brand and further the boardsports culture. What has changed is that we are now doing these things in a global context.
“Today, we have an incredibly broad base of sales, both from a global perspective and with regard to our portfolio of brands,” he continued. “We also have a well-developed infrastructure to support future growth. Our goal is to continue to leverage our leadership position in the market, and we remain committed to becoming the dominant youth market brand around the world.”