Wash.-based retailer of sports-related teen apparel,
) reported a 1.0% increase in comps for the 5-weeks ended Jul 6,
2013 that remains below the analysts' expectations. This compares
to a comps rise of 8.2% reported for the 5-weeks ended Jun 30,
2012. Net sales for June increased 14.5% to $58.8 million from
$51.3 million reported in the year-ago period.
Of late, the company's comps have been witnessing a declining
trend due to the continued fall in comparable store transactions.
Looking at the trailing six months performance, we note that the
company's comps growth rate has displayed a declining trend every
month, with the exception of April when it rose 4.6% and
February, when the company posted negative 8.9% comps.
Further, the company reported a comps decline of 0.7% in the
first-quarter of fiscal 2013 compared with an increase of 12.9%
reported in the year-ago quarter. The company's comps suffered
due to a decline in comparable store transactions, offset by an
increase in dollars per transaction, which mainly benefited from
higher average per unit retail price and year-over-year increase
in units per transaction.
Net sales for the quarter increased 14.3% to $148.5 million from
$129.9 million in the comparable last-year quarter. The
year-over-year growth in revenues was primarily driven by
excellent full price selling for the combined March/April month,
offset by a decline in comps. Quarterly sales were almost in line
with the Zacks Consensus Estimate of $148.0 million.
Looking into the second quarter of fiscal 2013, the company
anticipates revenues in the range of $155-$158 million, while
comps are likely to range from flat to a 2% increase.
Coming to the company's earnings, Zumiez reported adjusted
earnings of 13 cents per share in the first quarter, marginally
surpassing the Zacks Consensus Estimate of 12 cents but declining
20% from 15 cents earned in the year-ago quarter. Bottom-line
results benefited from the successful execution of its long-term
growth strategies and the strength of its extremely distinguished
and varied assortments.
Based on sales projections for the second quarter, the company
expects earnings per share in the band of 12-14 cents.
We believe that the company's well-balanced store expansion and
e-Commerce strategies will drive its top line further. Zumiez is
targeting to augment its store network to 600-700 stores in the
The company plans to expand its store base by opening 58 new
stores in fiscal 2013, comprising 9 stores in Canada and 6 in
Europe. As of Jul 6, 2013, the company operated 522 stores,
including 490 in the United States, 25 in Canada and 7 in Europe.
Zumiez carries a Zacks Rank #3 (Hold). Other stocks worth
considering among apparel/shoe retailers are
Wet Seal Inc
Fossil Group, Inc.
). All these carry a Zacks Rank #2 (Buy).
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ZUMIEZ INC (ZUMZ): Free Stock Analysis Report
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