UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM
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CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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On March 10, 2022, Zumiez Inc. issued a press release (the "Press Release") reporting its financial results for the fourth quarter and year ended January 29, 2022, a copy of which is attached hereto as Exhibit 99.1 and the contents of which are incorporated herein by this reference.
In accordance with General Instruction B.2. of Form 8-K, the information contained in this report and the Press Release shall not be deemed "Filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
| 99.1 | Press Release dated March 10, 2022 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Zumiez Inc. | ||
| Date: March 10, 2022 | By: | /s/ Richard M. Brooks |
| Richard M. Brooks | ||
| Chief Executive Officer | ||
EXHIBIT 99.1
Zumiez Inc. Announces Fiscal 2021 Fourth Quarter Results
LYNNWOOD, Wash., March 10, 2022 (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 year ended January 29, 2022.
Net sales for the fourth quarter ended January 29, 2022 (13 weeks) increased 4.6% to $346.7 million from $331.5 million in the fourth quarter ended January 30, 2021 (13 weeks). Compared to the fourth quarter ended February 1, 2020 (13 weeks), fourth quarter 2021 net sales increased 5.5%. Net income in the fourth quarter of fiscal 2021 was $38.2 million, or $1.70 per diluted share, compared to net income of $42.8 million, or $1.68 per diluted share, in the fourth quarter of the prior fiscal year. Net income for the fourth quarter of 2019 was $37.9 million, or $1.48 per diluted share.
Total net sales for fiscal 2021 (52 weeks) ended January 29, 2022 increased 19.5% to $1,183.9 million from $990.7 million reported for fiscal 2020 (52 weeks) ended January 30, 2021. Compared to the fiscal 2019 (52 weeks) ended February 1, 2020, net sales increased 14.5%. Net income for fiscal 2021 was $119.3 million, or $4.85 per diluted share, compared to net income for fiscal 2020 of $76.2 million, or $3.00 per diluted share, and compared to net income for fiscal 2019 of $66.9 million, or $2.62 per diluted share.
At January 29, 2022, the Company had cash and current marketable securities of $294.5 million compared to cash and current marketable securities of $375.5 million at January 30, 2021. The decrease in cash and current marketable securities was driven by share repurchases and capital expenditures partially offset by cash generated through operations. The Company repurchased 4.6 million shares during fiscal 2021 an average cost of $43.30 per share and a total cost of $198.4 million.
Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, “Fiscal 2021 was a year of tremendous growth and record profitability for Zumiez. Our multi-year success is directly attributable to the execution of the long-term consumer centric growth strategy the Company has been building and evolving since its inception. This strategy, which requires significant agility in navigating the trend cycles and speed desired by our customer, has produced a 36.1% five-year compound annual growth rate in diluted earnings per share and generated $422 million in free cash flow over the same period. And in 2021, we further enhanced our shareholder value creation through the repurchase of 4.6 million shares or 18% of our common stock. We are pleased with our many recent accomplishments and we are excited about the opportunities to profitably expand our global reach in the years to come.”
Fiscal First Quarter-to-Date Sales
Total first quarter-to-date sales for the 35 days ended March 5, 2022 decreased 1.9%, compared with the same 35 day time period in the prior year ended March 6, 2021. First quarter-to-date as of March 5, 2022, the Company has repurchased an additional 1.2 million shares of stock at an average price of $44.47 and a total cost of $54.3 million.
Outlook
Given the positive impact of stimulus on net sales in the first quarter of fiscal 2021 and the current economic uncertainty, the Company anticipates that net sales for the first quarter of fiscal 2022 will be between $215 million and $221 million, down meaningfully to the prior year. With this reduction in sales the Company expects deleverage in the income statement related to both fixed costs as well as the re-introduction of expenses forgone in 2021 as a result of the COVID-19 pandemic such as store wages, training and travel. Earnings per diluted share for the quarter are expected to be break-even to positive $0.10 per diluted share.
The Company currently intends to open approximately 34 new stores in fiscal 2022, including up to 15 stores in North America, 14 stores in Europe and 5 stores in Australia.
Conference call Information
A conference call will be held today to discuss fourth quarter and fiscal 2021 results and will be webcast at 5:00 p.m. ET on http://ir.zumiez.com. Participants may also dial (844) 309-0606 (domestic) or (574) 990-9934 (international) followed by the conference identification code of 4186044.
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 26, 2022, we operated 738 stores, including 602 in the United States, 52 in Canada, 67 in Europe and 17 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
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended | ||||||||||||||
| January 29, | % of | January 30, | % of | |||||||||||
| 2022 | Sales | 2021 | Sales | |||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||
| Net sales | $ | 346,677 | 100.0 | % | 331,536 | 100.0 | % | |||||||
| Cost of goods sold | 212,744 | 61.4 | % | 201,913 | 60.9 | % | ||||||||
| Gross profit | 133,933 | 38.6 | % | 129,623 | 39.1 | % | ||||||||
| Selling, general and administrative expenses | 82,198 | 23.7 | % | 75,814 | 22.9 | % | ||||||||
| Operating profit | 51,735 | 14.9 | % | 53,809 | 16.2 | % | ||||||||
| Interest income, net | 759 | 0.2 | % | 881 | 0.3 | % | ||||||||
| Other (expense) income, net | (1,462 | ) | -0.4 | % | 1,417 | 0.4 | % | |||||||
| Earnings before income taxes | 51,032 | 14.7 | % | 56,107 | 16.9 | % | ||||||||
| Provision for income taxes | 12,828 | 3.7 | % | 13,310 | 4.0 | % | ||||||||
| Net income | $ | 38,204 | 11.0 | % | $ | 42,797 | 12.9 | % | ||||||
| Basic earnings per share | $ | 1.73 | $ | 1.71 | ||||||||||
| Diluted earnings per share | $ | 1.70 | $ | 1.68 | ||||||||||
| Weighted average shares used in computation of earnings per share: | ||||||||||||||
| Basic | 22,056 | 25,024 | ||||||||||||
| Diluted | 22,451 | 25,462 | ||||||||||||
| Fiscal Year Ended | ||||||||||||||
| January 29, | % of | January 30, | % of | |||||||||||
| 2022 | Sales | 2021 | Sales | |||||||||||
| (Unaudited) | ||||||||||||||
| Net sales | $ | 1,183,867 | 100.0 | % | $ | 990,652 | 100.0 | % | ||||||
| Cost of goods sold | 727,137 | 61.4 | % | 640,637 | 64.7 | % | ||||||||
| Gross profit | 456,730 | 38.6 | % | 350,015 | 35.3 | % | ||||||||
| Selling, general and administrative expenses | 298,920 | 25.3 | % | 253,077 | 25.5 | % | ||||||||
| Operating profit | 157,810 | 13.3 | % | 96,938 | 9.8 | % | ||||||||
| Interest income, net | 3,592 | 0.4 | % | 3,518 | 0.3 | % | ||||||||
| Other (expense) income, net | (891 | ) | -0.1 | % | 2,001 | 0.2 | % | |||||||
| Earnings before income taxes | 160,511 | 13.6 | % | 102,457 | 10.3 | % | ||||||||
| Provision for income taxes | 41,222 | 3.5 | % | 26,230 | 2.6 | % | ||||||||
| Net income | $ | 119,289 | 10.1 | % | $ | 76,227 | 7.7 | % | ||||||
| Basic earnings per share | $ | 4.93 | $ | 3.06 | ||||||||||
| Diluted earnings per share | $ | 4.85 | $ | 3.00 | ||||||||||
| Weighted average shares used in computation of earnings per share: | ||||||||||||||
| Basic | 24,187 | 24,942 | ||||||||||||
| Diluted | 24,593 | 25,398 | ||||||||||||
ZUMIEZ INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| January 29, 2022 | January 30, 2021 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 117,223 | $ | 73,622 | ||||
| Marketable securities | 177,260 | 301,920 | ||||||
| Receivables | 14,427 | 16,558 | ||||||
| Inventories | 128,728 | 134,354 | ||||||
| Prepaid expenses and other current assets | 10,011 | 8,823 | ||||||
| Total current assets | 447,649 | 535,277 | ||||||
| Fixed assets, net | 91,451 | 98,352 | ||||||
| Operating lease right-of-use assets | 230,187 | 267,152 | ||||||
| Goodwill | 57,560 | 61,470 | ||||||
| Intangible assets, net | 14,698 | 16,029 | ||||||
| Deferred tax assets, net | 8,659 | 9,927 | ||||||
| Other long-term assets | 11,808 | 10,157 | ||||||
| Total long-term assets | 414,363 | 463,087 | ||||||
| Total assets | $ | 862,012 | $ | 998,364 | ||||
| Liabilities and Shareholders’ Equity | ||||||||
| Current liabilities | ||||||||
| Trade accounts payable | $ | 55,638 | $ | 69,751 | ||||
| Accrued payroll and payroll taxes | 31,209 | 27,911 | ||||||
| Income taxes payable | 1,137 | 6,317 | ||||||
| Operating lease liabilities | 63,577 | 66,993 | ||||||
| Other liabilities | 32,878 | 24,480 | ||||||
| Total current liabilities | 184,439 | 195,452 | ||||||
| Long-term operating lease liabilities | 204,309 | 246,123 | ||||||
| Other long-term liabilities | 4,946 | 4,193 | ||||||
| Total long-term liabilities | 209,255 | 250,316 | ||||||
| Total liabilities | 393,694 | 445,768 | ||||||
| Shareholders’ equity | ||||||||
| Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding | — | — | ||||||
| Common stock, no par value, 50,000 shares authorized; 21,215 shares issued and outstanding at January 29, 2022 and 25,599 shares issued and outstanding at January 30, 2021 | 180,824 | 171,628 | ||||||
| Accumulated other comprehensive (loss) income | (13,463 | ) | 939 | |||||
| Retained earnings | 300,957 | 380,029 | ||||||
| Total shareholders’ equity | 468,318 | 552,596 | ||||||
| Total liabilities and shareholders’ equity | $ | 862,012 | $ | 998,364 | ||||
ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Fiscal Year Ended | |||||||||
| January 29, 2022 | January 30, 2021 | ||||||||
| (Unaudited) | |||||||||
| Cash flows from operating activities: | |||||||||
| Net income | $ | 119,289 | $ | 76,227 | |||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
| Depreciation, amortization and accretion | 22,930 | 24,059 | |||||||
| Noncash lease expense | 64,466 | 61,694 | |||||||
| Deferred taxes | 2,374 | (3,890 | ) | ||||||
| Stock-based compensation expense | 6,816 | 6,448 | |||||||
| Impairment of long-lived assets | 2,229 | 4,803 | |||||||
| Other | 2,728 | (570 | ) | ||||||
| Changes in operating assets and liabilities: | |||||||||
| Receivables | 2,884 | 928 | |||||||
| Inventories | 2,587 | 3,946 | |||||||
| Prepaid expenses and other assets | (2,824 | ) | 1,010 | ||||||
| Trade accounts payable | (14,060 | ) | 20,797 | ||||||
| Accrued payroll and payroll taxes | 3,649 | 3,841 | |||||||
| Income taxes payable | (5,101 | ) | 1,602 | ||||||
| Operating lease liabilities | (77,657 | ) | (65,479 | ) | |||||
| Other liabilities | 4,640 | 2,996 | |||||||
| Net cash provided by operating activities | 134,950 | 138,412 | |||||||
| Cash flows from investing activities: | |||||||||
| Additions to fixed assets | (15,749 | ) | (9,057 | ) | |||||
| Purchases of marketable securities and other investments | (160,328 | ) | (222,785 | ) | |||||
| Sales and maturities of marketable securities and other investments | 277,720 | 121,301 | |||||||
| Net cash provided by (used in) investing activities | 101,643 | (110,541 | ) | ||||||
| Cash flows from financing activities: | |||||||||
| Proceeds from issuance and exercise of stock-based awards | 3,001 | 3,877 | |||||||
| Payments for tax withholdings on equity awards | (621 | ) | (154 | ) | |||||
| Common stock repurchased | (193,789 | ) | (13,417 | ) | |||||
| Net cash (used in) provided by financing activities | (191,409 | ) | (9,694 | ) | |||||
| Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (1,822 | ) | 3,522 | ||||||
| Net increase in cash, cash equivalents, and restricted cash | 43,362 | 21,699 | |||||||
| Cash, cash equivalents, and restricted cash, beginning of period | 80,690 | 58,991 | |||||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 124,052 | $ | 80,690 | |||||
| Supplemental disclosure on cash flow information: | |||||||||
| Cash paid during the period for income taxes | $ | 42,767 | $ | 27,598 | |||||
| Accrual for repurchase of common stock | 4,572 | — | |||||||
| Accrual for purchases of fixed assets | 984 | 231 | |||||||
Company Contact:
Darin White
Director of Finance &
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1337
Investor Contact:
ICR
Brendon Frey
(203) 682-8200