Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Volcom Inc | d8k.htm |
Exhibit 99.1
NEWS RELEASE
| Contacts: | Volcom, Inc. Doug Collier, CFO (949) 646-2175 | PondelWilkinson Inc. Rob Whetstone (310) 279-5963 rwhetstone@pondel.com |
VOLCOM REPORTS FINANCIAL RESULTS FOR
2011 FIRST QUARTER
COSTA MESA, CA – May 3, 2011 – Volcom, Inc. (NASDAQ: VLCM) today announced financial results for the first quarter ended March 31, 2011.
For the 2011 first quarter, total consolidated revenues increased 13% to $87.1 million, compared with $77.4 million in the first quarter of 2010. Total revenues in the company’s U.S. segment were $50.3 million, compared with $48.2 million in the prior-year period. Total revenues in the company’s Europe segment were $24.8 million, compared with $23.6 million in the same period in 2010. Total revenues in the company’s Electric segment were $6.9 million, compared with $5.6 million in 2010. Total revenues in the company’s Australia segment were $5.2 million.
Consolidated gross profit for the 2011 first quarter was $43.6 million, equal to 50% of total revenues, compared with $42.0 million, equal to 54.2% of total revenues, in the first quarter of 2010.
Selling, general and administrative expenses on a consolidated basis were $36.6 million in the 2011 first quarter versus $31.0 million in the comparable period in 2010.
Net income for the 2011 first quarter was $4.6 million, or $0.19 per diluted share, compared with $7.5 million, or $0.31 per diluted share, in the first quarter of 2010.
Volcom, Inc. – 2011 First Quarter Results
At March 31, 2011 the company had cash, cash equivalents and short-term investments totaling $91.4 million, and no long-term debt. Total stockholders’ equity was $225.0 million at year-end.
Financial Outlook and Conference Call Information
Yesterday, Volcom announced it has entered into a definitive merger agreement with PPR. Terms of this agreement may be found in the news release that was issued on May 2, 2011 at www.volcom.com/investorrelations. Given this announcement, the company has suspended its practice of providing quarterly and annual financial guidance, and will not host a conference call today to review the results as previously announced.
About Volcom, Inc.
Volcom is an innovative designer, marketer and distributor of premium quality young mens and womens clothing, accessories
and related products. The Volcom brand, symbolized by The Stone
, is athlete-driven, creative and forward thinking. Volcom has consistently followed its motto of “youth against establishment,” and the brand is inspired by the energy of youth culture. Volcom and Electric
branded products are sold throughout the United States and internationally. Volcom’s news announcements and SEC filings are available through the company’s website at www.volcom.com.
Safe Harbor Statement
Certain statements in this press release and oral statements made from time to time by representatives of the company are forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995, including statements in connection with or related to any discussion of or reference to Volcom’s future operations, opportunities or financial performance. In particular, statements regarding the company’s guidance and future financial performance contained under the section entitled 2011 Second Quarter Financial Outlook are forward-looking statements. These forward-looking statements are based on management’s current expectations but they involve a number of risks and uncertainties. Volcom’s 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, including, without limitation, further softening of the retail environment, sales of our products by key retailers, changes in fashion trends and consumer preferences, general economic conditions, the impact of sourcing costs, and additional factors which are detailed in our filings with the Securities and Exchange Commission, including the Risk Factors contained in the company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) and the subsequently filed Quarterly Reports on Form 10-Q, all of which are available at www.sec.gov. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Volcom is under no obligation, and expressly disclaims any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.
(tables follow)
VOLCOM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except share and per share data)
| Three Months
Ended March 31, |
||||||||
| 2011 | 2010 | |||||||
| Revenues: |
||||||||
| Product revenues |
$ | 86,838 | $ | 76,834 | ||||
| Licensing revenues |
299 | 586 | ||||||
| Total revenues |
87,137 | 77,420 | ||||||
| Cost of goods sold |
43,561 | 35,425 | ||||||
| Gross profit |
43,576 | 41,995 | ||||||
| Selling, general and administrative expenses |
36,596 | 31,008 | ||||||
| Operating income |
6,980 | 10,987 | ||||||
| Other income: |
||||||||
| Interest income, net |
55 | 109 | ||||||
| Foreign currency gain (loss) |
180 | (10 | ) | |||||
| Total other income |
235 | 99 | ||||||
| Income before provision for income taxes |
7,215 | 11,086 | ||||||
| Provision for income taxes |
2,605 | 3,552 | ||||||
| Net income |
$ | 4,610 | $ | 7,534 | ||||
| Net income per share: |
||||||||
| Basic |
$ | 0.19 | $ | 0.31 | ||||
| Diluted |
$ | 0.19 | $ | 0.31 | ||||
| Weighted average shares outstanding: |
||||||||
| Basic |
24,405,753 | 24,356,857 | ||||||
| Diluted |
24,466,757 | 24,376,971 | ||||||
VOLCOM, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands)
| March 31, 2011 |
December 31, 2010 |
|||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 81,453 | $ | 80,300 | ||||
| Short-term investments |
9,987 | 9,987 | ||||||
| Accounts receivable — net of allowances |
73,165 | 66,542 | ||||||
| Inventories |
29,971 | 41,449 | ||||||
| Prepaid expenses and other current assets |
6,628 | 5,997 | ||||||
| Income taxes receivable |
136 | 1,170 | ||||||
| Deferred income taxes |
9,460 | 9,326 | ||||||
| Total current assets |
210,800 | 214,771 | ||||||
| Property and equipment — net |
27,244 | 26,652 | ||||||
| Deferred income taxes |
2,651 | 2,651 | ||||||
| Intangible assets — net |
11,889 | 10,872 | ||||||
| Goodwill |
1,635 | 1,610 | ||||||
| Other assets |
1,065 | 1,003 | ||||||
| Total assets |
$ | 255,284 | $ | 257,559 | ||||
| Liabilities and Stockholders’ Equity |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 15,217 | $ | 22,902 | ||||
| Accrued expenses and other current liabilities |
13,611 | 16,162 | ||||||
| Current portion of capital lease obligations |
19 | 19 | ||||||
| Total current liabilities |
28,847 | 39,083 | ||||||
| Long-term capital lease obligations |
20 | 23 | ||||||
| Other long-term liabilities |
1,259 | 1,261 | ||||||
| Income taxes payable – non-current |
94 | 131 | ||||||
| Deferred income taxes – non-current |
101 | 103 | ||||||
| Stockholders’ equity: |
||||||||
| Common stock |
24 | 24 | ||||||
| Additional paid-in capital |
95,110 | 94,733 | ||||||
| Retained earnings |
126,164 | 121,555 | ||||||
| Accumulated other comprehensive income |
3,665 | 646 | ||||||
| Total stockholders’ equity |
224,963 | 216,958 | ||||||
| Total liabilities and stockholders’ equity |
$ | 255,284 | $ | 257,559 | ||||
VOLCOM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
| Three Months
Ended March 31, |
||||||||
| 2011 | 2010 | |||||||
| Cash flows from operating activities: |
||||||||
| Net income |
$ | 4,610 | $ | 7,534 | ||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
||||||||
| Depreciation and amortization |
1,660 | 1,517 | ||||||
| Provision for doubtful accounts |
586 | (217 | ) | |||||
| Loss on disposal of property and equipment |
23 | 3 | ||||||
| Stock-based compensation |
387 | 550 | ||||||
| Deferred income taxes |
(136 | ) | (201 | ) | ||||
| Changes in operating assets and liabilities: |
||||||||
| Accounts receivable |
(6,129 | ) | (8,010 | ) | ||||
| Inventories |
12,011 | 6,532 | ||||||
| Prepaid expenses and other current assets |
(523 | ) | (904 | ) | ||||
| Income taxes receivable/payable |
831 | 3,488 | ||||||
| Other assets |
(54 | ) | (69 | ) | ||||
| Accounts payable |
(8,362 | ) | (11,608 | ) | ||||
| Accrued expenses |
(3,252 | ) | 140 | |||||
| Other long-term liabilities |
(10 | ) | 14 | |||||
| Net cash provided by (used in) operating activities |
1,642 | (1,231 | ) | |||||
| Cash flows from investing activities: |
||||||||
| Purchase of property and equipment |
(1,142 | ) | (1,005 | ) | ||||
| Intangible assets acquired |
(1,150 | ) | — | |||||
| Proceeds from sale of property and equipment |
10 | — | ||||||
| Purchase of short-term investments |
— | (20,000 | ) | |||||
| Sale of short-term investments |
— | 10,000 | ||||||
| Net cash used in investing activities |
(2,282 | ) | (11,005 | ) | ||||
| Cash flows from financing activities: |
||||||||
| Principal payments on capital lease obligations |
(4 | ) | (4 | ) | ||||
| Net cash used in financing activities |
(4 | ) | (4 | ) | ||||
| Effect of exchange rate changes on cash |
1,797 | 52 | ||||||
| Net increase (decrease) in cash and cash equivalents |
1,153 | (12,188 | ) | |||||
| Cash and cash equivalents — Beginning of period |
80,300 | 76,180 | ||||||
| Cash and cash equivalents — End of period |
$ | 81,453 | $ | 63,992 | ||||
VOLCOM, INC. AND SUBSIDIARIES
OPERATING SEGMENT INFORMATION (UNAUDITED)
(in thousands)
| Three Months
Ended March 31, |
||||||||
| 2011 | 2010 | |||||||
| Total revenues: |
||||||||
| United States |
$ | 50,303 | $ | 48,179 | ||||
| Europe |
24,763 | 23,626 | ||||||
| Electric |
6,916 | 5,615 | ||||||
| Australia |
5,155 | — | ||||||
| Consolidated |
$ | 87,137 | $ | 77,420 | ||||
| Gross profit: |
||||||||
| United States |
$ | 23,751 | $ | 24,224 | ||||
| Europe |
13,594 | 14,277 | ||||||
| Electric |
4,017 | 3,494 | ||||||
| Australia |
2,214 | — | ||||||
| Consolidated |
$ | 43,576 | $ | 41,995 | ||||
| Operating income (loss): |
||||||||
| United States |
$ | 897 | $ | 2,744 | ||||
| Europe |
5,990 | 7,977 | ||||||
| Electric |
119 | 266 | ||||||
| Australia |
(26 | ) | — | |||||
| Consolidated |
$ | 6,980 | $ | 10,987 | ||||