US: Quiksilver swings to Q1 profit
- Q1 net profit of US$15.4m
- Gross margin flat at 50.9%
- Sales drop to $393m
Quiksilver narrowed its loss in the first quarter
US surfwear brand Quiksilver swung to a profit in the first quarter but saw sales decline in all of its geographic regions.
In the three months to the end of January, Quiksilver recorded earnings of US$15.4m. This compared to a net loss of $31.1m a year earlier.
In December, the company unveiled plans to pursue the sale and exit of several more non-core businesses following the divestiture of its Mervin snowboard unit a month previous.
Gross margin in the period remained flat at 50.9%. Modest improvements in gross margins in the Americas and EMEA segments offset increased promotional activity in the APAC segment.
Sales dropped to $393m from $412m a year earlier with declines spanning all of the firm's geographic markets, partly due to negative currency impacts.
In the Americas sales declined 5% to $173m, the EMEA region saw revenues fall 4% to $149m, and in the APAC region sales were down 4% to $70m.
"We continued to execute our Profit Improvement Plan over the last few months," said CEO Andy Mooney. "During the first quarter, we further reduced our expense structure and made progress on optimising our supply chain and laying the foundation for stabilizing and expanding revenues."
Roth Capital Partners analyst David King said Quiksilver’s results "fell short" mainly due to lower revenues.
"Looking forward, ecommerce and emerging markets growth should continue to offset weakness in the Americas and Europe wholesales business should continue through Fall 2014, when new product lines launch and segmentation strategies take hold. We remain impressed by management and its ability to execute a turnaround, but worry that revenue pressures could persist and necessitate more significant cost cuts."
This report provides information, analysis and valuable insight on developments relating to the performance apparel industry in the following categories:...
Surf-led fashion business Quiksilver has completed the sale of its majority stake in Surfdome to Australia's SurfStitch Group....
- Why fast fashion isn't a case of one size fits all
- Sir Philip Green blamed for the collapse of BHS
- Brexit blow to global apparel industry confidence
- TPP tariff phase-out guides Vietnam sourcing plans
- Brexit Trade Focus – How a CANZ-UK FTA stacks up
- VF Corp cuts guidance as Q2 profit plunges 70%
- Vietnam mulls wage freeze to boost competitiveness
- US Q2 in brief - Carter's, Wolverine Worldwide
- Ethiopia opens flagship textile and apparel park
- Teijin launches polyester hook-and-loop fastener
- Central America strategic sourcing review - a focus on Guatemala, El Salvador and Honduras
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar
- Southeast Asia & Central America strategic sourcing reviews package deal
- World Textile and Apparel Trade and Production Trends: the EU - June 2016
- Primark Stores Limited: Retailing - Company Profile & SWOT Analysis