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Zumiez Stock Plunges On Weak Q2 Profit, Outlook

Zumiez Inc. (ZUMZ) Thursday reported a lower profit for the second quarter, hurt mainly by costs related to Blue Tomato acquisition and ecommerce fulfillment center relocation. The sports apparel retailer forecast a weak outlook for the third quarter, indicated to miss current street estimates. Shares of Zumiez slipped 13 percent in after hours trade on the news.

Everett, Washington-based Zumiez's second-quarter profit dropped to $2.1 million or $0.07 per share from $2.6 million or $0.08 per share last year.

The recent second quarter results include a cost of $0.07 per share for the acquisition of Blue Tomato, and $0.03 per share cost for the relocation of ecommerce fulfillment center and corporate offices. In June, Zumiez agreed to buy Blue Tomato, an action sports retailer based in Austria, for about 59.5 million euros.

Analysts polled by Thomson Reuters expected earnings of $0.13 per share for the second quarter. Analysts' estimates typically exclude special times.

Chief Executive Rick Brooks said, "The second quarter was a productive and transformational period for our Company. We continued to expand our North American footprint while at the same time driving a high single digit comparable sales gain."

Zumiez said sales for the quarter grew 20.4 percent to $135.1 million from $112.2 million a year ago. The results include Blue Tomato acquisition, the company noted. Analysts expected revenues of $135.52 million for the second quarter.

Same-store sales for the quarter increased 9.5 percent on top of a 7.5 percent increase in second quarter last year.

Looking forward to the third quarter, Zumiez expects earnings of $0.42 to $0.45 per share and net sales of $181 million to $185 million. Analysts currently expect earnings of $0.56 per share on revenue of $183.79 million for the third quarter.

ZUMZ closed Thursday's trading at $32.22, up $0.65 or 2.06%, on a volume of 1.3 million shares. The stock, however, lost $3.66 or 11.36% in after-hours trade.

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