- Prachi Singh |
Zumiez, for the second quarter ended August 1, 2015 reported total net sales rise of 1.8 percent to 179.8 million dollars from 176.7 million dollars in the quarter ended August 2, 2014. This comparison includes the negative impact of foreign currency translation in the quarter of approximately 4.4 million dollars. Comparable sales decreased 4.5 percent compared to a comparable sales increase of 3.4 percent, same quarter last year.
“We are disappointed in our recent performance which reflects a slowdown in domestic sales. The response to our merchandise offering fell short of expectations, requiring us to become more promotional than planned to clear slow moving inventory ahead of the back-to-school selling season. On a more positive note, the momentum in our European business continues to be strong, reinforcing our confidence in the long-term prospects of this market,” said Rick Brooks, Chief Executive Officer of Zumiez.
Low consumer demand impacts results
Net income in the second quarter decreased 56.9 percent to 3.2 million dollars, or 0.11 dollar per diluted share, compared to net income of 7.5 million dollars, or 0.26 dollar per diluted share, in the second quarter of the prior fiscal year.
Total net sales for the six months ended August 1, 2015 increased 5.2 percent to 357.4 million dollars from 339.6 million dollars reported for the six months ended August 2, 2014. This comparison includes the negative impact of foreign currency translation for the 26 week period of approximately 9.5 million dollars. Comparable sales decreased 0.9 percent compared to a comparable sales increase of 2.6 percent for the twenty six weeks ended August 2, 2014.
Net income decreased 39.9 percent to 6 million dollars, or 0.21 dollar per diluted share, compared to net income for the first six months of the prior fiscal year of 10 million dollars, or 0.34 dollar per diluted share.
Total net sales for the four-week period ended August 29, 2015 decreased 7.2 percent to 87.3 million dollars, compared to 94 million dollars for the four-week period ended August 30, 2014. The company's comparable sales decreased 10.7 percent compared to a comparable sales increase of 2 percent for the four-week period ended August 30, 2014.
Fiscal 2015 third quarter outlook
The company is introducing guidance for the three months ending October 31, 2015. Net sales are projected to be in the range of 202 dollars to 206 million dollars resulting in net income per diluted share of approximately 0.27 dollar to 0.31 dollar. This guidance is based on an anticipated comparable sales decrease in the 7 percent to 9 percent range. The company currently intends to open approximately 57 new stores in fiscal 2015, including up to seven stores in Canada and six stores in Europe.