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06/03/21
Zumiez Inc. Announces Record Fiscal 2021 First Quarter Results

Net Sales Increased 102.6% to $279.1 Million
Diluted Earnings Per Share Improved to $1.03

LYNNWOOD, Wash., June 03, 2021 (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 1, 2021.

Net sales for the first quarter ended May 1, 2021 (13 weeks) increased 102.6% to $279.1 million from $137.8 million in the first quarter ended May 2, 2020 (13 weeks). Compared to the first quarter ended May 4, 2019 (13 weeks), first quarter 2021 net sales increased 31.1%. Net income in the first quarter of fiscal 2021 was $26.4 million, or $1.03 per diluted share, compared to a net loss of $21.1 million, or $(0.84) per diluted share, in the first quarter of the prior fiscal year. Net income for the first quarter of 2019 was $0.08 million, or $0.03 per diluted share.

At May 1, 2021, the Company had cash and current marketable securities of $400.4 million compared to cash and current marketable securities of $217.2 million at May 2, 2020. The increase in cash and current marketable securities was driven by cash generated through operations partially offset by capital expenditures.   

“After demonstrating great resiliency during the height of the pandemic, our business has exceeded pre-COVID levels even as a portion of our global store fleet remains closed. Our performance amidst very challenging conditions over the past year, and more recently as the operating environment has improved, underscores our market leading position and the strength of our business model. Sales trends accelerated as the first quarter progressed driven by our ability to capture meaningful share of the heightened discretionary spending in the U.S. related to government stimulus, especially in our stores, as customers are becoming increasingly comfortable returning to in person shopping. The strong sales gains on both a one and two year basis combined with the shift back to our historical channel mix following elevated online spending in 2020, fueled a dramatic increase in first quarter profitability. We are very pleased with our start to 2021 and are optimistic that we can maintain our positive momentum over the remainder of the year. With our strong balance sheet and differentiated strategies, we are well positioned to add to our global market share and return increased value to our shareholders over the long-term.”

May 2021 Sales
Net sales for the four-week period ended May 29, 2021 increased 42.4% compared to the four-week period ended May 30, 2020 and increased 30.5% compared to the four-week period ended June 1, 2019.

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 second quarter or the year.

Conference call Information
A conference call will be held today to discuss first quarter fiscal 2021 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 7239969.

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 May 29, 2021, we operated 723 stores, including 602 in the United States, 52 in Canada, 54 in Europe and 15 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 30, 2021 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 (LOSS)
(In thousands, except per share amounts)
(Unaudited)
     
    Three Months Ended
    May 1, 2021   % of Sales     May 2, 2020   % of Sales
Net sales   $ 279,069   100.0 %   $ 137,772     100.0 %
Cost of goods sold     175,900   63.0 %     114,036     82.8 %
Gross profit     103,169   37.0 %     23,736     17.2 %
Selling, general and administrative expenses     68,889   24.7 %     51,584     37.4 %
Operating profit (loss)     34,280   12.3 %     (27,848 )   (20.2 %)
Interest income, net     975   0.3 %     1,074     0.8 %
Other income, net     254   0.1 %     106     0.0 %
Earnings (loss) before income taxes     35,509   12.7 %     (26,668 )   (19.4 %)
Provision for (benefit from) income taxes     9,124   3.2 %     (5,567 )   (4.1 %)
Net income (loss)   $ 26,385   9.5 %   $ (21,101 )   (15.3 %)
Basic earnings (loss) per share   $ 1.05       $ (0.84 )    
Diluted earnings (loss) per share   $ 1.03       $ (0.84 )    
Weighted average shares used in computation of earnings (loss) per share:                
Basic     25,167         25,040      
Diluted     25,676         25,040      
                     


ZUMIEZ INC. 
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
             
    May 1, 2021   January 30, 2021   May 2, 2020
    (Unaudited)       (Unaudited)
Assets            
Current assets            
Cash and cash equivalents   $ 81,503   $ 73,622   $ 63,731  
Marketable securities     318,888     301,920     153,494  
Receivables     20,481     16,558     16,837  
Inventories     136,498     134,354     136,354  
Prepaid expenses and other current assets     9,481     8,823     5,179  
Total current assets     566,851     535,277     375,595  
Fixed assets, net     96,004     98,352     109,573  
Operating lease right-of-use assets     259,790     267,152     285,416  
Goodwill     61,307     61,470     56,706  
Intangible assets, net     15,996     16,029     14,366  
Deferred tax assets, net     6,168     9,927     11,206  
Other long-term assets     11,688     10,157     8,571  
Total long-term assets     450,953     463,087     485,838  
Total assets   $ 1,017,804   $ 998,364   $ 861,433  
             
Liabilities and Shareholders’ Equity            
Current liabilities            
Trade accounts payable   $ 75,610   $ 69,751   $ 49,497  
Accrued payroll and payroll taxes     24,784     27,911     13,173  
Income taxes payable     3,698     6,317     4,430  
Operating lease liabilities     67,433     66,993     70,584  
Other liabilities     21,721     24,480     19,197  
Total current liabilities     193,246     195,452     156,881  
Long-term operating lease liabilities     238,553     246,123     269,608  
Other long-term liabilities     4,224     4,193     3,790  
Total long-term liabilities     242,777     250,316     273,398  
Total liabilities     436,023     445,768     430,279  
             
Shareholders’ equity            
Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding     —     —     —  
Common stock, no par value, 50,000 shares authorized; 25,780 shares issued and
outstanding at May 1, 2021, 25,599 shares issued and outstanding at January 30,
2021, and and 25,431 shares issued and outstanding at May 1, 2021		     174,921     171,628     163,349  
Accumulated other comprehensive income (loss)     446     939     (14,896 )
Retained earnings     406,414     380,029     282,701  
Total shareholders’ equity     581,781     552,596     431,154  
Total liabilities and shareholders’ equity   $ 1,017,804   $ 998,364   $ 861,433  
                   


ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
     
    Three Months Ended
    May 1, 2021   May 2, 2020
Cash flows from operating activities:        
Net income (loss)   $ 26,385     $ (21,101 )
Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:		        
Depreciation, amortization and accretion     5,889       6,096  
Noncash lease expense     15,968       14,996  
Deferred taxes     4,063       (4,856 )
Stock-based compensation expense     1,740       1,556  
Impairment of long-lived assets     2,079       1,514  
Other     (246 )     (173 )
Changes in operating assets and liabilities:        
Receivables     (2,019 )     1,918  
Inventories     (1,813 )     (2,031 )
Prepaid expenses and other assets     (2,098 )     4,354  
Trade accounts payable     5,796       1,074  
Accrued payroll and payroll taxes     (3,141 )     (10,423 )
Income taxes payable     (3,690 )     (1,078 )
Operating lease liabilities     (18,776 )     (6,948 )
Other liabilities     (3,212 )     (2,440 )
Net cash provided by (used in) operating activities     26,925       (17,542 )
Cash flows from investing activities:        
Additions to fixed assets     (2,825 )     (2,504 )
Purchases of marketable securities and other investments     (60,692 )     (9,106 )
Sales and maturities of marketable securities and other investments     42,249       54,344  
Net cash (used in) provided by investing activities     (21,268 )     42,734  
Cash flows from financing activities:        
Proceeds from issuance and exercise of stock-based awards     2,039       428  
Payments for tax withholdings on equity awards     (486 )     (93 )
Common stock repurchased     —       (13,417 )
Net cash provided by (used in) financing activities     1,553       (13,082 )
Effect of exchange rate changes on cash, cash equivalents, and restricted cash     766       (853 )
Net increase (decrease) in cash, cash equivalents, and restricted cash     7,976       11,257  
Cash, cash equivalents, and restricted cash, beginning of period     80,690       58,991  
Cash, cash equivalents, and restricted cash, end of period   $ 88,666     $ 70,248  
Supplemental disclosure on cash flow information:        
Cash paid during the period for income taxes   $ 8,738     $ 343  
Accrual for purchases of fixed assets     553       1,976  
         

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