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8-K - FORM 8-K - QUIKSILVER INC | a57969e8vk.htm |
EX-10.1 - EXHIBIT 10.1 - QUIKSILVER INC | a57969exv10w1.htm |
EX-99.2 - EXHIBIT 99.2 - QUIKSILVER INC | a57969exv99w2.htm |
EX-10.2 - EXHIBIT 10.2 - QUIKSILVER INC | a57969exv10w2.htm |
Exhibit 99.1
Company Contact: | Bruce Thomas | |||
Vice President, Investor Relations | ||||
Quiksilver, Inc. | ||||
+1 (714) 889-2200 |
Quiksilver, Inc. Announces Preliminary Estimated Results for Q4 and Full-
Year Fiscal 2010 and Preliminary Outlook for Fiscal 2011
Year Fiscal 2010 and Preliminary Outlook for Fiscal 2011
| Q4 Net Revenues expected to be higher than companys outlook provided in September | |
| Pro-forma Adjusted EBITDA for fiscal 2010 expected to be up at least 30% from fiscal 2009 | |
| Fiscal 2011 pro-forma Adjusted EBITDA expected to be approximately in line with that of fiscal 2010 |
Huntington Beach, California, November 29, 2010Quiksilver, Inc. (NYSE:ZQK) today announced
preliminary estimated financial results for the fourth quarter of fiscal 2010 and the full fiscal
year ended October 31, 2010. Based on preliminary data, the company estimates that fourth quarter
fiscal 2010 net revenues were between $492 million and $497 million, compared to net revenues of
$538.7 million for the fourth quarter ended October 31, 2009, and that fourth quarter fiscal 2010
pro-forma Adjusted EBITDA was between 10% and 20% higher than pro-forma Adjusted EBITDA of $49.9
million for the fourth quarter ended October 31, 2009. Loss from continuing operations for the
fourth quarter ended October 31, 2009 was $15.7 million. A reconciliation of GAAP results to
pro-forma Adjusted EBITDA is provided in the accompanying table.
Also based on preliminary data, the company estimates that full-year net revenues for fiscal 2010
were between $1,835 million and $1,840 million, compared to net revenues of $1,977.5 million for
fiscal 2009, and that full-year pro-forma Adjusted EBITDA for fiscal 2010 was up at least 30%
from pro-forma Adjusted EBITDA of $160.3 million for fiscal 2009. Loss from continuing operations
for fiscal 2009 was $73.2 million. A reconciliation of GAAP results to pro-forma Adjusted EBITDA
is provided in the accompanying table.
These
preliminary estimated results are higher than the most recent outlook provided in September, at
which time the company had expected fourth quarter revenues to be down in the mid-teens on a
percentage basis compared to the same quarter a year ago and anticipated that full-year fiscal 2010
pro-forma Adjusted EBITDA would be up approximately 25% when compared to fiscal 2009. However, at
this time the company is maintaining its outlook for fourth quarter earnings per share on a diluted
basis in the mid-single-digit cents range, pending determination of final results.
Because financial statements for the fourth quarter and full fiscal year 2010 are not yet
available, these fourth quarter and full fiscal year estimates are preliminary, unaudited, subject
to completion, reflective of the companys current best estimates and may be revised as a result of
managements further review of results, including determination of the Companys income from
continuing operations for the periods presented above. During the course of the preparation of
consolidated annual financial statements and related notes, the company may identify items that
would require material adjustments to the preliminary financial information presented above.
With
respect to fiscal 2011, the company currently expects that pro-forma Adjusted EBITDA for the full
fiscal year will be approximately in line with that of fiscal 2010. However, pro-forma Adjusted EBITDA in the
first quarter of fiscal 2011 is expected to be approximately $5
million to $10 million lower than in the first quarter of fiscal
2010. This anticipated near-term period-over-period decline in pro-forma Adjusted EBITDA is due
primarily to increased spending in brand development, including the
Quiksilver, Inc. Announces Preliminary Estimated Results for Fiscal Q4 2010 and Full Fiscal Year 2010 and Preliminary Outlook for Fiscal 2011
November 29, 2010
Page 2 of 3
November 29, 2010
Page 2 of 3
new Quiksilver Girls collection
and higher overall marketing spend, as well as the effects of selling a few minor brands last year
and the effects of foreign currency translation. The company expects capital expenditures during
fiscal 2011 could be approximately $15 million to $20 million higher
than that of fiscal 2010, the difference driven principally by the
companys investments in retail stores and its initial investment in a global Enterprise Resource Planning system. These trends are
based only on estimates of what management currently believes is accurate and realizable. Actual
results will vary and the variations may be material. In addition, visibility into fiscal 2011
revenues and earnings remains limited due to global economic conditions.
The company plans to issue a press release disclosing fiscal 2010 fourth quarter financial results
soon after the close of market on Thursday, December 16, 2010, and will conduct a conference call
to review its results on that same day. Details concerning the earnings conference call will be forthcoming.
About Quiksilver:
Quiksilver, Inc. (NYSE:ZQK) is the worlds leading outdoor sports lifestyle company, which designs,
produces and distributes a diversified mix of branded apparel, footwear, accessories, snowboards
and related products. The Companys apparel and footwear brands represent a casual lifestyle for
young-minded people that connect with its boardriding culture and heritage.
The reputation of Quiksilvers brands is based on outdoor action sports. The Companys Quiksilver,
Roxy, DC, Lib Tech and Hawk brands are synonymous with the heritage and culture of surfing,
skateboarding and snowboarding.
The Companys products are sold in over 90 countries in a wide range of distribution, including
surf shops, skate shops, snow shops, its proprietary Boardriders Club shops and other company-owned
retail stores, other specialty stores and select department stores. Quiksilvers corporate and
Americas headquarters are in Huntington Beach, California, while its European headquarters are in
St. Jean de Luz, France, and its Asia/Pacific headquarters are in Torquay, Australia.
Forward looking statements:
This press release contains forward-looking statements including but not limited to statements
regarding the companys revenue guidance, pro-forma Adjusted EBITDA guidance, earnings per share
guidance, proposed capital and other expenditures and other future activities. These
forward-looking statements are subject to risks and uncertainties, and actual results may differ
materially. Please refer to Quiksilvers SEC filings for more information on the risk factors that
could cause actual results to differ materially from expectations, specifically the sections titled
Risk Factors and Forward-Looking Statements in Quiksilvers Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q.
* * * * *
NOTE: For further information about Quiksilver, Inc., you are invited to take a look at our
world at www.quiksilver.com, www.roxy.com, www.dcshoes.com,
www.lib-tech.com and www.hawkclothing.com.
Quiksilver, Inc. Announces Preliminary Estimated Results for Fiscal Q4 2010 and Full Fiscal Year 2010 and Preliminary Outlook for Fiscal 2011
November 29, 2010
Page 3 of 3
November 29, 2010
Page 3 of 3
PRO FORMA ADJUSTED EBITDA RECONCILIATION
Three Months | ||||||||
Ended | Fiscal Year Ended | |||||||
October 31, 2009 | October 31, 2009 | |||||||
Amounts in thousands: |
||||||||
Loss from continuing operations |
$ | (15,711 | ) | $ | (73,215 | ) | ||
Income taxes |
6,162 | 66,667 | ||||||
Interest |
20,871 | 63,924 | ||||||
Depreciation and amortization |
14,616 | 55,004 | ||||||
Non-cash stock-based compensation expense |
996 | 8,415 | ||||||
Non-cash asset impairments |
10,737 | 10,737 | ||||||
Adjusted EBITDA |
$ | 37,671 | $ | 131,532 | ||||
Restructuring charges |
12,254 | 28,775 | ||||||
Pro-forma Adjusted EBITDA |
$ | 49,925 | $ | 160,307 | ||||
Definition of Adjusted EBITDA and pro-forma Adjusted EBITDA:
Adjusted EBITDA is defined as income or loss from continuing operations before (i) interest
expense, (ii) income tax expense, (iii) depreciation and amortization, (iv) non-cash stock-based
compensation expense and (v) asset impairments. Adjusted EBITDA is not defined under generally
accepted accounting principles (GAAP), and it may not be comparable to similarly titled measures
reported by other companies. Pro-forma Adjusted EBITDA is defined as income or loss from continuing
operations before (i) interest expense, (ii) income tax expense, (iii) depreciation and
amortization, (iv) non-cash stock-based compensation expenses, (v) non-cash asset impairments and
(vi) restructuring charges. We use Adjusted EBITDA, along with other GAAP measures, as a measure
of profitability because Adjusted EBITDA helps us to compare our performance on a consistent basis
by removing from our operating results the impact of our capital structure, the effect of operating
in different tax jurisdictions, the impact of our asset base, which can differ depending on the
book value of assets, the accounting methods used to compute depreciation and amortization, the
existence or timing of asset impairments and the effect of non-cash stock-based compensation
expense. We believe EBITDA is useful to investors as it is a widely used measure of performance and
the adjustments we make to EBITDA provide further clarity on our profitability. We remove the
effect of non-cash stock-based compensation from our earnings which can vary based on share price,
share price volatility and expected life of the equity instruments we grant. In addition, this
stock-based compensation expense does not result in cash payments by us. We remove the effect of
asset impairments from Adjusted EBITDA for the same reason that we remove depreciation and
amortization as it is part of the impact of our asset base. Adjusted EBITDA has limitations as a
profitability measure in that it does not include the interest expense on our debts, our provisions
for income taxes, the effect of our expenditures for capital assets and certain intangible assets,
the effect of non-cash stock-based compensation expense and the effect of asset impairments. We
remove restructuring charges from pro-forma Adjusted EBITDA because such charges are non-operating
items that do not reflect our core operations.