News Release

LYNNWOOD, Wash., March 09, 2023 (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 fourth quarter and fiscal year ended January 28, 2023.

Net sales for the fourth quarter ended January 28, 2023 (13 weeks) decreased 19.2% to $280.1 million from $346.7 million in the fourth quarter ended January 29, 2022 (13 weeks). Net income in the fourth quarter of fiscal 2022 was $11.4 million, or $0.59 per diluted share, compared to net income of $38.2 million, or $1.70 per diluted share, in the fourth quarter of the prior fiscal year.

Total net sales for the twelve months (52 weeks) ended January 28, 2023 decreased 19.0% to $958.4 million from $1,183.9 million reported for the twelve months (52 weeks) ended January 29, 2022. Net income for fiscal 2022 was $21.0 million, or $1.08 per diluted share, compared to net income for fiscal 2021 of $119.3 million, or $4.85 per diluted share.

At January 28, 2023, the Company had cash and current marketable securities of $173.5 million compared to cash and current marketable securities of $294.5 million at January 29, 2022. The decrease was driven by share repurchases of $87.9 million and capital expenditures of $25.6 million over this time period.

Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, “We concluded a challenging fiscal 2022 with fourth quarter results that were ahead of our guidance, but below year ago levels. While the operating environment has been difficult and our recent financial performance disappointing, our commitment to serving consumers with world class service and highly differentiated, sought-after merchandise, is as strong as ever and has the business positioned to recover quickly when the macroeconomic conditions improve. I am confident that the channel-less retail model and strong corporate culture we have built and evolved over Zumiez’s 45-year history and brought to Canada, Europe and Australia will continue to separate our banners from the competition and drive profitable growth for our shareholders over the long-term.”

Fiscal First Quarter-to-Date Sales
Total first quarter-to-date sales for the 35 days ended March 4, 2023 decreased 15.5%, compared with the same 35-day time period in the prior year ended March 5, 2022. Total comparable sales for the 35-day period ending March 4, 2023 decreased 16.6% from the comparable period in the prior year.

Outlook
Fiscal 2023 First Quarter Outlook
The Company is introducing guidance for the three months ending April 29, 2023. Net sales are projected to be in the range of $178 to $184 million. Earnings per share are expected to be between a loss of $0.85 and a loss of $0.95.

The Company currently intends to open approximately 23 new stores in fiscal 2023, including up to 8 stores in North America, 10 stores in Europe and 5 stores in Australia.

Conference call Information
To access the conference call, 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 February 25, 2023, we operated 756 stores, including 607 in the United States, 50 in Canada, 78 in Europe and 21 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 29, 2022 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 OPERATIONS
(In thousands, except per share amounts)
(Unaudited)

			Three Months Ended
			January 28,			% of			January 29,				% of
			2023			Sales				2022			Sales
			(Unaudited)						(Unaudited)
Net sales		$	280,110			100.0	%			346,677			100.0	%
Cost of goods sold			184,841			66.0	%			212,744			61.4	%
Gross profit			95,269			34.0	%			133,933			38.6	%
Selling, general and administrative expenses			80,059			28.6	%			82,198			23.7	%
Operating profit			15,210			5.4	%			51,735			14.9	%
Interest income, net			645			0.2	%			759			0.2	%
Other income (expense), net			293			0.1	%			(1,462	)		-0.4	%
Earnings before income taxes			16,148			5.7	%			51,032			14.7	%
Provision for income taxes			4,716			1.7	%			12,828			3.7	%
Net income		$	11,432			4.0	%		$	38,204			11.0	%
Basic earnings per share		$	0.60						$	1.73
Diluted earnings per share		$	0.59						$	1.70
Weighted average shares used in computation of earnings per share:
Basic			19,114							22,056
Diluted			19,255							22,451
			Fiscal Year Ended
			January 28,			% of			January 29,				% of
			2023			Sales				2022			Sales
			(Unaudited)
Net sales		$	958,380			100.0	%		$	1,183,867			100.0	%
Cost of goods sold			633,702			66.1	%			727,137			61.4	%
Gross profit			324,678			33.9	%			456,730			38.6	%
Selling, general and administrative expenses			293,578			30.7	%			298,920			25.3	%
Operating profit			31,100			3.2	%			157,810			13.3	%
Interest income, net			1,924			0.3	%			3,592			0.4	%
Other expense, net			(557	)		-0.1	%			(891	)		-0.1	%
Earnings before income taxes			32,467			3.4	%			160,511			13.6	%
Provision for income taxes			11,433			1.2	%			41,222			3.5	%
Net income		$	21,034			2.2	%		$	119,289			10.1	%
Basic earnings per share		$	1.10						$	4.93
Diluted earnings per share		$	1.08						$	4.85
Weighted average shares used in computation of earnings per share:
Basic			19,208							24,187
Diluted			19,428							24,593

 

ZUMIEZ INC. 
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

		January 28, 2023				January 29, 2022
		(Unaudited)
Assets
Current assets
Cash and cash equivalents		$	81,503			$	117,223
Marketable securities			91,986				177,260
Receivables			20,613				14,427
Inventories			134,824				128,728
Prepaid expenses and other current assets			11,252				10,011
Total current assets			340,178				447,649
Fixed assets, net			93,746				91,451
Operating lease right-of-use assets			222,240				230,187
Goodwill			56,566				57,560
Intangible assets, net			14,443				14,698
Deferred tax assets, net			8,205				8,659
Other long-term assets			12,525				11,808
Total long-term assets			407,725				414,363
Total assets		$	747,903			$	862,012
Liabilities and Shareholders’ Equity
Current liabilities
Trade accounts payable		$	40,379			$	55,638
Accrued payroll and payroll taxes			16,321				31,209
Operating lease liabilities			65,460				63,577
Other liabilities			23,649				34,015
Total current liabilities			145,809				184,439
Long-term operating lease liabilities			188,835				204,309
Other long-term liabilities			5,931				4,946
Total long-term liabilities			194,766				209,255
Total liabilities			340,575				393,694
Shareholders’ equity
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding			—				—
Common stock, no par value, 50,000 shares authorized; 19,489 shares issued and outstanding at January 28, 2023 and 21,215 shares issued and outstanding at January 29, 2022			188,418				180,824
Accumulated other comprehensive loss			(19,793	)			(13,463	)
Retained earnings			238,703				300,957
Total shareholders’ equity			407,328				468,318
Total liabilities and shareholders’ equity		$	747,903			$	862,012

 

ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

		Fiscal Year Ended
		January 28, 2023				January 29, 2022
		(Unaudited)
Cash flows from operating activities:
Net income		$	21,034			$	119,289
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation, amortization and accretion			21,626				22,930
Noncash lease expense			67,394				64,466
Deferred taxes			2,485				2,374
Stock-based compensation expense			6,991				6,816
Impairment of long-lived assets			2,081				2,229
Other			1,176				2,728
Changes in operating assets and liabilities:
Receivables			(1,716	)			2,884
Inventories			(5,279	)			2,587
Prepaid expenses and other assets			(1,082	)			(2,824	)
Trade accounts payable			(15,484	)			(14,060	)
Accrued payroll and payroll taxes			(14,895	)			3,649
Income taxes payable			(2,320	)			(5,101	)
Operating lease liabilities			(76,605	)			(77,657	)
Other liabilities			(5,785	)			4,640
Net cash (used in) provided by operating activities			(379	)			134,950
Cash flows from investing activities:
Additions to fixed assets			(25,627	)			(15,749	)
Purchases of marketable securities and other investments			(1,914	)			(160,328	)
Sales and maturities of marketable securities and other investments			81,750				277,720
Net cash provided by investing activities			54,209				101,643
Cash flows from financing activities:
Proceeds from revolving credit facilities			3,979				—
Payments on revolving credit facilities			(3,979	)			—
Proceeds from issuance and exercise of stock-based awards			1,111				3,001
Payments for tax withholdings on equity awards			(508	)			(621	)
Common stock repurchased			(87,860	)			(193,789	)
Net cash used in financing activities			(87,257	)			(191,409	)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash			(2,172	)			(1,822	)
Net (decrease) increase in cash, cash equivalents, and restricted cash			(35,599	)			43,362
Cash, cash equivalents, and restricted cash, beginning of period			124,052				80,690
Cash, cash equivalents, and restricted cash, end of period		$	88,453			$	124,052
Supplemental disclosure on cash flow information:
Cash paid during the period for income taxes		$	11,309			$	42,767
Accrual for repurchase of common stock			-				4,572
Accrual for purchases of fixed assets			1,433				984

 

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