Zumiez Inc. Announces Record Fiscal 2012 Fourth Quarter and Full Year Results

Zumiez Inc. Announces Record Fiscal 2012 Fourth Quarter and Full Year Results 
Fourth Quarter 2012 Diluted EPS Increased 23.3% to a Record $0.74;
Fiscal 2012 Full Year Diluted EPS Increased 12.5% to $1.35 
LYNNWOOD, WA -- (Marketwire) -- 03/14/13 --  Zumiez Inc. (NASDAQ:
ZUMZ) a leading multi-channel specialty retailer of action sports
related apparel, footwear, hardgoods and accessories, today reported
record results for the fourth quarter and fiscal year ended February
2, 2013. 
Fourth Quarter Results 
Total net sales for the fourth quarter ended February 2, 2013 (14
weeks) increased 22.1% to $224.4 million from $183.9 million in the
quarter ended January 28, 2012 (13 weeks). Comparable store sales for
the 14-week period ended February 2, 2013 decreased 1.0% compared to
the same 14-week period ended February 4, 2012. Net income in the
fourth quarter of fiscal 2012 increased 22.1% to $22.9 million, or
$0.74 per diluted share from net income of $18.7 million, or $0.60
per diluted share in the fourth quarter of the prior fiscal year. The
results for fiscal 2012 include $0.9 million, or approximately $0.02
per diluted share, of intangible amortization and inventory step-up
costs associated with the acquisition of Blue Tomato, and a net
benefit of $0.4 million, or approxi
mately $0.01 per diluted share, of
contingent earn-out associated with the Blue Tomato transaction. 
Full Year Results 
Total net sales for fiscal 2012 (53 weeks) increased 20.4% to $669.4
million from $555.9 million in fiscal 2011 (52 weeks). Comparable
store sales for the 53-week period ended February 2, 2013 increased
5.0% compared to the same 53-week period ended February 4, 2012. Net
income in fiscal 2012 increased 12.9% to $42.2 million, or $1.35 per
diluted share compared to net income in the prior fiscal year of
$37.4 million, or $1.20 per diluted share. Results for fiscal 2012
include approximately $7.3 million, or $0.19 per diluted share, of
Blue Tomato acquisition related costs and operations, and
approximately $2.1 million, or $0.04 per diluted share, of costs
associated with the relocation the Company's ecommerce fulfillment
center to Edwardsville, Kansas and corporate offices to Lynnwood,
Washington from Everett, Washington. 
Share Repurchase Program 
During the fourth quarter 2012, the Company repurchased approximately
1.3 million shares of its common stock, at an average cost per share
of $20.43, for a total of $25.8 million. As of February 2, 2012, the
$22 million repurchase program announced in November 2012 had been
completed and the Company had $16 million authorized repurchase funds
remaining under its $20 million stock repurchase program announced in
December 2012.  
Cash and Current Marketable Securities 
At February 2, 2013, the Company had cash and current marketable
securities of $103.2 million, compared to cash and current marketable
securities of $172.8 million at January 28, 2012. The decrease in
cash and current marketable securities is a result of the acquisition
of Blue Tomato, which was funded by the Company's cash and current
marketable securities balance, as well as capital expenditures and
stock repurchases, offset by cash generated through operations.  
Rick Brooks, Chief Executive Officer of Zumiez Inc., stated, "We are
pleased with the quality of our fourth quarter results. Our ability
to deliver better than expected sales and earnings underscores the
strength of our business model which is rooted in a diverse branded
merchandising strategy, highly differentiated shopping experience,
and unique culture. It's these principles that have allowed us to
consistently drive Zumiez forward. With the consumers use of
technology evolving and reshaping the retail landscape we are
confident that the investments we continue to make in our people,
systems and processes will allow us to build on our position as the
global leader in action sports retail for many years to come." 
Fiscal 2013 First Quarter Outlook 
The Company is introducing guidance for the three months ending May
4, 2013. Net sales are projected to be in the range of $141 to $144
million resulting in net income per diluted share of approximately
$0.04 to $0.07, which includes an estimated $1.6 million, or
approximately $0.04 per diluted share, for charges associated with
the acquisition of Blue Tomato. This guidance is based on an
anticipated comparable store sales decrease in the mid single digit
range for the first quarter of fiscal 2013.  
The Company currently intends to open approximately 60 new stores in
fiscal 2013, including up to 10 stores in Canada and 6 stores in
Europe. 
A conference call will be held today to discuss fourth quarter and
fiscal 2012 year-end results and will be webcast at 5:00 p.m. ET on
http://ir.zumiez.com. Participants may also dial (617)-213-8841
followed by the conference identification code of 85861294.  
About Zumiez Inc. 
Zumiez is a leading multi-channel specialty retailer of action sports
related apparel, footwear, equipment and accessories, focusing on
skateboarding, snowboarding, surfing, motocross and BMX for young men
and women. As of March 2,
 2013 we operated 501 stores, 472 in the
United States, 21 in Canada, and 8 in Europe. We operate under the
name Zumiez and Blue Tomato. Additionally, we operate ecommerce web
sites at www.zumiez.com and www.blue-tomato.com. 
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 quarterly report
on Form 10-Q for the quarter ended October 27, 2012 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.                                
                      CONSOLIDATED STATEMENTS OF INCOME                     
                  (In thousands, except per share amounts)                  
                                 (Unaudited)                                
                                                                            
                                         Three Months Ended                 
                          ------------------------------------------------  
                                                                            
                          February 2,              January 28,              
                              2013     % of Sales      2012     % of Sales  
                          -----------  ----------  -----------  ----------  
Net sales                 $   224,405       100.0% $   183,859       100.0% 
Cost of goods sold            138,722        61.8%     112,356        61.1% 
                          -----------  ----------  -----------  ----------  
Gross profit                   85,683        38.2%      71,503        38.9% 
                                                                            
Selling, general and                                                        
 administrative expenses       49,582        22.1%      40,190        21.9% 
                          -----------  ----------  -----------  ----------  
Operating profit               36,101        16.1%      31,313        17.0% 
                                                                            
Interest income, net              258         0.1%         449         0.2% 
Other expense, net               (116)        0.0%        (308)       (0.1%)
                          -----------  ----------  -----------  ----------  
Earnings before income                                                      
 taxes                         36,243        16.2%      31,454        17.1% 
                                                                            
Provision for income                                                        
 taxes                         13,359         6.0%      12,717         6.9% 
                          -----------  ----------  -----------  ----------  
                                                                            
Net income                $    22,884        10.2% $    18,737        10.2% 
                          ===========  ==========  ===========  ==========  
                                                                            
Basic earnings per share  $      0.75              $      0.61              
                          ===========              ===========              
                                                                            
Diluted earnings per                                                        
 share                    $      0.74              $      0.60              
                          ===========              ===========              
                                                                            
Weighted average shares                                                     
 used in computation of                                                     
 earnings per share:                                                        
  Basic                        30,348                   30,646              
                                                                            
  Diluted                      30,774                   31,211              
                                                                            
                                                                            
                                                                            

 
                                 ZUMIEZ INC.                                
                      CONSOLIDATED STATEMENTS OF INCOME   
                  
                  (In thousands, except per share amounts)                  
                                                                            
                                         Twelve Months Ended                
                           -----------------------------------------------  
                                                                            
                           February 2,             January 28,              
                               2013    % of Sales      2012     % of Sales  
                           ----------- ----------  -----------  ----------  
                           (unaudited)                                      
Net sales                  $   669,393      100.0% $   555,874       100.0% 
Cost of goods sold             428,109       64.0%     354,198        63.7% 
                           ----------- ----------  -----------  ----------  
Gross profit                   241,284       36.0%     201,676        36.3% 
                                                                            
Selling, general and                 
                                       
 administrative expenses       172,742       25.8%     141,444        25.5% 
                           ----------- ----------  -----------  ----------  
Operating profit                68,542       10.2%      60,232        10.8% 
                                                                            
Interest income, net             1,410        0.2%       1,836         0.4% 
Other income (expense),                                                     
 net                               327        0.1%        (379)       (0.1%)
                           ----------- ----------  -----------  ----------  
Earnings before income                                                      
 taxes                          70,279       10.5%      61,689        11.1% 
                                                                            
Provision for income taxes      28,115        4.2%      24,338         4.4% 
                           ----------- ----------  -----------  ----------  
                                                                            
Net income                 $    42,164        6.3% $    37,351         6.7% 
                           =========== ==========  ===========  ==========  
                                                                            
Basic earnings per share   $      1.37             $      1.22              
                           ===========             ===========              
                                                                            
Diluted earnings per share $      1.35             $      1.20              
                           ===========             ===========              
                                                                            
Weighted average shares                                                     
 used in computation of                                                     
 earnings per share:                                                        
  Basic                         30,742                  30,527              
                                                                            
  Diluted                       31,273                  31,119              
                                                                            
                                                                            
                                                                            
                                 ZUMIEZ INC.                                
                         CONSOLIDATED BALANCE SHEETS                        
                               (In thousands)                               
                                                                            
                                                  February 2,   January 28, 
                                                      2013          2012    
                                                 ------------- -------------
                     Assets                       (unaudited)               
Current assets                                                              
Cash and cash equivalents                        $      17,579 $      14,779
Marketable securities                                   85,593       158,019
Receivables                                              9,467         6,284
Inventories                                             77,598        65,037
Prepaid expenses and other                               9,192         7,907
Deferred tax assets                                      3,885         1,477
                                                 ------------- -------------
  Total current assets                                 203,314       253,503
                                                                            
Fixed assets, net                                      115,474        89,478
Goodwill                                                64,576        13,154
Intangible assets, nets                                 20,480             -
Long-term other assets                                   5,254         6,022
                                                 ------------- -------------
  Total long-term assets                               205,784       108,654
                                                                            
  Total assets                                   $     409,098 $     362,157
                                                 ============= =============
                                                                            
      Liabilities and Shareholders' Equity                                  
Current liabilities                                                         
Trade accounts payable                           $      16,052 $      21,743
Accrued payroll and payroll taxes                       11,057         9,062
Income taxes payable                                     6,957         5,835
Deferred rent and tenant allowances                      4,901         4,230
Other liabilities                                       18,232        14,706
                                                 ------------- -------------
  Total current liabilities                             57,199        55,576
                                                                            
Long-term deferred rent and tenant allowances           36,928        32,321
Long-term deferr
ed tax liabilities                       5,544             -
Long-term debt and other liabilities                     6,006         1,983
                                                 ------------- -------------
  Total long-term liabilities                           48,478        34,304
                                                                            
                                                 ------------- -------------
  Total liabilities                                    105,677        89,880
                                                 ------------- -------------
Commitments and contingencies                                               
                                                                            
Shareholders' equity                                                        
Preferred stock, no par value, 20,000 shares                                
 authorized; none issued and outstanding                     -             -
Common stock, no par value, 50,000 shares                                   
 authorized; 30,114 shares issued and                                       
 outstanding at February 2, 2013 and 31,170                                 
 shares issued and outstanding at January 28,                               
 2012                                                  108,360        99,412
Accumulated other comprehensive income                   6,010           135
Retained earnings                                      189,051       172,730
                                                 ------------- -------------
  Total shareholders' equity                           303,421       272,277
                                                 ------------- -------------
                                                                            
  Total liabilities and shareholders' equity     $     409,098 $     362,157
                                                 ============= =============
                                                                            
                                                                            
                                                                            
                                 ZUMIEZ INC.                                
                    CONSOLIDATED STATEMENTS OF CASH FLOWS                   
                               (In thousands)                               
                                                                            
                                                     Fiscal Year Ended      
                                               ---------------------------- 
                                                February 3,    January 28,  
                                                    2013           2012     
                                               -------------  ------------- 
                                                (unaudited)                 
Cash flows from operating activities:                                       
Net income                                     $      42,164  $      37,351 
Adjustments to reconcile net income to net                                  
 cash provided by operating activities:                                     
Depreciation, amortization and accretion              22,957         19,744 
Deferred taxes                                        (1,630)         3,441 
Stock-based compensation expense                       5,996          5,303 
Excess tax benefit from stock-based                                         
 compensation                                         (2,094)        (1,826)
Lease termination costs                                1,397              - 
Other                                                    389            608 
Changes in operating assets and liabilities:                                
  Receivables                                         (2,568)          (671)
  Inventories                                         (2,987)        (8,833)
  Prepaid expenses and other                          (1,125)          (607)
  Trade accounts payable                              (5,626)         4,295 
  Accrued payroll and payroll taxes                    1,207          1,485 
  Income taxes payable                                 1,843          2,868 
  Deferred rent and tenant allowances                  5,469          5,334 
  Other liabilities                                      833           (427)
                                               -------------  ------------- 
Net cash provided by operating activities             66,225         68,065 
                                               -------------  ------------- 
                                                                            
Cash flows from investing activities:                                       
Additions to fixed assets                            (41,070)       (25,508)
Acqusitions, net of cash acquired                    (70,711)             - 
Purchases of marketable securities and other                                
 investments                                        (121,003)      (194,531)
Sales and maturities of marketable securities                               
 and other investments                               191,705        151,965 
                                               -------------  ------------- 
Net cash used in investing activities                (41,079)       (68,074)
                                               -------------  ------------- 
                                                                            
Cash flows from financing activities:                                       
Payments on long-term debt                              (258)             - 
Repurchase of common stock                           (25,213)             - 
Proceeds from exercise of stock-based                                       
 compensation, net of withholding tax payments           858          1,589 
Excess tax benefit from stock-based                                         
 compensation                                          2,094          1,826 
                                               -------------  ------------- 
Net cash (used in) provided by financing                                    
 activities                                          (22,519)         3,415 
                                               -------------  ------------- 
                                                                            
Effect of exchange rate changes on cash and                                 
 cash equivalents                                        173             16 
                                                                            
Net increase in cash and cash equivalents              2,800          3,422 
Cash and cash equivalents, beginning of period        14,779         11,357 
                                               -------------  ------------- 
Cash and cash equivalents, end of period       $      17,579  $      14,779 
                                               =============  ============= 
                                                                            
Supplemental disclosure on cash flow                                        
 information:                                                               
Cash paid during the period for income taxes   $      27,840  $      18,014 
Accrual for purchases of fixed assets                  1,942          3,083 
Accrual for repurchase of common stock                   630              - 

  
Company Contact:
Brian Leith
Director of Finance & 
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1610 
Investor Contact:
ICR
Brendon Frey 
(203) 68
2-8200