Sports apparel retailer Zumiez, Inc. (ZUMZ) reported Thursday a profit for the first quarter that increased from last year, reflecting improved margins and strong sales at established stores. Both earnings per share and quarter sales topped analysts' expectations. The company also provided earnings guidance for the second quarter, below Street view.
"We are pleased to start the year off with such strong performance. While the first quarter represents only a small percentage of our annual sales and earnings, theses results are further validation that our strategies to profitably grow the business are working," CEO Rich Brooks said in a statement.
The Everett, Washington-based company reported net income of $4.5 million, or $0.14 per share for the first quarter, higher than $1.9 million, or $0.06 per share in the prior-year quarter.
On average, 18 analysts polled by Thomson Reuters expected earnings of $0.11 per share for the quarter. Analysts' estimates typically exclude special items.
The results for the latest quarter include costs of about $0.3 million or $0.01 per share related to the relocation of the company's e-commerce fulfillment center from Everett, Washington to Edwardsville, Kansas.
Total net sales for the quarter increased 22.7 percent to $129.90 million from $105.85 million in the same quarter last year, and topped eighteen Wall Street analysts' consensus estimate of $128.84 million by a whisker.
Comparable store sales for the quarter increased 12.9 percent on top of an increase of 12.6 percent in the year-ago quarter.
Operating margin percentage for the quarter expanded 320 basis points to 5.6 percent from last year's 2.4 percent as gross margin improved 110 basis points and selling, general and administrative expenses as a percentage of total sales declined 210 basis points.
Looking ahead to the second quarter, the company expects earnings in a range of $0.04 to $0.06 per share, on projected revenues between $128 and $130 million, with comparable store sales increase in the high-single-digit range.
Street is currently looking for earnings of $0.10 per share on revenues of $128.81 million for the second quarter.
The company also currently intends to open about 50 new stores in fiscal 2012, including up to 10 stores in Canada.
"Our teams are energized and focused on carrying our current momentum into summer and positioning the Company for a successful back half of the year," Brooks added.
ZUMZ closed Thursday's regular trading session at $35.16, down $1.75 or 4.74% on a volume of 0.78 million shares.
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