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Zumiez Inc. Announces Record Fiscal 2021 First Quarter Results

Net Sales Increased 102.6% to $279.1 Million
Diluted Earnings Per Share Improved to $1.03

LYNNWOOD, Wash., June 03, 2021 (GLOBE NEWSWIRE) -- Zumiez Inc. (NASDAQ: ZUMZ) a leading specialty retailer of apparel, footwear, equipment and accessories for young men and women, today reported results for the first quarter ended May 1, 2021.

Net sales for the first quarter ended May 1, 2021 (13 weeks) increased 102.6% to $279.1 million from $137.8 million in the first quarter ended May 2, 2020 (13 weeks). Compared to the first quarter ended May 4, 2019 (13 weeks), first quarter 2021 net sales increased 31.1%. Net income in the first quarter of fiscal 2021 was $26.4 million, or $1.03 per diluted share, compared to a net loss of $21.1 million, or $(0.84) per diluted share, in the first quarter of the prior fiscal year. Net income for the first quarter of 2019 was $0.08 million, or $0.03 per diluted share.

At May 1, 2021, the Company had cash and current marketable securities of $400.4 million compared to cash and current marketable securities of $217.2 million at May 2, 2020. The increase in cash and current marketable securities was driven by cash generated through operations partially offset by capital expenditures.

“After demonstrating great resiliency during the height of the pandemic, our business has exceeded pre-COVID levels even as a portion of our global store fleet remains closed. Our performance amidst very challenging conditions over the past year, and more recently as the operating environment has improved, underscores our market leading position and the strength of our business model. Sales trends accelerated as the first quarter progressed driven by our ability to capture meaningful share of the heightened discretionary spending in the U.S. related to government stimulus, especially in our stores, as customers are becoming increasingly comfortable returning to in person shopping. The strong sales gains on both a one and two year basis combined with the shift back to our historical channel mix following elevated online spending in 2020, fueled a dramatic increase in first quarter profitability. We are very pleased with our start to 2021 and are optimistic that we can maintain our positive momentum over the remainder of the year. With our strong balance sheet and differentiated strategies, we are well positioned to add to our global market share and return increased value to our shareholders over the long-term.”

May 2021 Sales
Net sales for the four-week period ended May 29, 2021 increased 42.4% compared to the four-week period ended May 30, 2020 and increased 30.5% compared to the four-week period ended June 1, 2019.

Outlook
Due to the continued fast-moving nature of this situation and the uncertainty of impacts on revenue and costs, the Company is not providing an outlook at this time for the second quarter or the year.

Conference call Information
A conference call will be held today to discuss first quarter fiscal 2021 results and will be webcast at 5:00 p.m. ET on http://ir.zumiez.com. Participants may also dial (574) 990-9934 followed by the conference identification code of 7239969.

About Zumiez Inc.

Zumiez is a leading specialty retailer of apparel, footwear, accessories and hardgoods for young men and women who want to express their individuality through the fashion, music, art and culture of action sports, streetwear, and other unique lifestyles. As of May 29, 2021, we operated 723 stores, including 602 in the United States, 52 in Canada, 54 in Europe and 15 in Australia. We operate under the names Zumiez, Blue Tomato and Fast Times. Additionally, we operate ecommerce web sites at zumiez.com, zumiez.ca, blue-tomato.com and fasttimes.com.au.

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 annual report on Form 10-K for the fiscal year ended January 30, 2021 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.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(In thousands, except per share amounts)
(Unaudited)

Three Months Ended

May 1, 2021

% of Sales

May 2, 2020

% of Sales

Net sales

$

279,069

100.0

%

$

137,772

100.0

%

Cost of goods sold

175,900

63.0

%

114,036

82.8

%

Gross profit

103,169

37.0

%

23,736

17.2

%

Selling, general and administrative expenses

68,889

24.7

%

51,584

37.4

%

Operating profit (loss)

34,280

12.3

%

(27,848

)

(20.2

%)

Interest income, net

975

0.3

%

1,074

0.8

%

Other income, net

254

0.1

%

106

0.0

%

Earnings (loss) before income taxes

35,509

12.7

%

(26,668

)

(19.4

%)

Provision for (benefit from) income taxes

9,124

3.2

%

(5,567

)

(4.1

%)

Net income (loss)

$

26,385

9.5

%

$

(21,101

)

(15.3

%)

Basic earnings (loss) per share

$

1.05

$

(0.84

)

Diluted earnings (loss) per share

$

1.03

$

(0.84

)

Weighted average shares used in computation of earnings (loss) per share:

Basic

25,167

25,040

Diluted

25,676

25,040


ZUMIEZ INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

May 1, 2021

January 30, 2021

May 2, 2020

(Unaudited)

(Unaudited)

Assets

Current assets

Cash and cash equivalents

$

81,503

$

73,622

$

63,731

Marketable securities

318,888

301,920

153,494

Receivables

20,481

16,558

16,837

Inventories

136,498

134,354

136,354

Prepaid expenses and other current assets

9,481

8,823

5,179

Total current assets

566,851

535,277

375,595

Fixed assets, net

96,004

98,352

109,573

Operating lease right-of-use assets

259,790

267,152

285,416

Goodwill

61,307

61,470

56,706

Intangible assets, net

15,996

16,029

14,366

Deferred tax assets, net

6,168

9,927

11,206

Other long-term assets

11,688

10,157

8,571

Total long-term assets

450,953

463,087

485,838

Total assets

$

1,017,804

$

998,364

$

861,433

Liabilities and Shareholders’ Equity

Current liabilities

Trade accounts payable

$

75,610

$

69,751

$

49,497

Accrued payroll and payroll taxes

24,784

27,911

13,173

Income taxes payable

3,698

6,317

4,430

Operating lease liabilities

67,433

66,993

70,584

Other liabilities

21,721

24,480

19,197

Total current liabilities

193,246

195,452

156,881

Long-term operating lease liabilities

238,553

246,123

269,608

Other long-term liabilities

4,224

4,193

3,790

Total long-term liabilities

242,777

250,316

273,398

Total liabilities

436,023

445,768

430,279

Shareholders’ equity

Preferred stock, no par value, 20,000 shares authorized; none issued and outstanding

Common stock, no par value, 50,000 shares authorized; 25,780 shares issued and
outstanding at May 1, 2021, 25,599 shares issued and outstanding at January 30,
2021, and and 25,431 shares issued and outstanding at May 1, 2021

174,921

171,628

163,349

Accumulated other comprehensive income (loss)

446

939

(14,896

)

Retained earnings

406,414

380,029

282,701

Total shareholders’ equity

581,781

552,596

431,154

Total liabilities and shareholders’ equity

$

1,017,804

$

998,364

$

861,433


ZUMIEZ INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

Three Months Ended

May 1, 2021

May 2, 2020

Cash flows from operating activities:

Net income (loss)

$

26,385

$

(21,101

)

Adjustments to reconcile net income (loss) to net cash provided by (used in)
operating activities:

Depreciation, amortization and accretion

5,889

6,096

Noncash lease expense

15,968

14,996

Deferred taxes

4,063

(4,856

)

Stock-based compensation expense

1,740

1,556

Impairment of long-lived assets

2,079

1,514

Other

(246

)

(173

)

Changes in operating assets and liabilities:

Receivables

(2,019

)

1,918

Inventories

(1,813

)

(2,031

)

Prepaid expenses and other assets

(2,098

)

4,354

Trade accounts payable

5,796

1,074

Accrued payroll and payroll taxes

(3,141

)

(10,423

)

Income taxes payable

(3,690

)

(1,078

)

Operating lease liabilities

(18,776

)

(6,948

)

Other liabilities

(3,212

)

(2,440

)

Net cash provided by (used in) operating activities

26,925

(17,542

)

Cash flows from investing activities:

Additions to fixed assets

(2,825

)

(2,504

)

Purchases of marketable securities and other investments

(60,692

)

(9,106

)

Sales and maturities of marketable securities and other investments

42,249

54,344

Net cash (used in) provided by investing activities

(21,268

)

42,734

Cash flows from financing activities:

Proceeds from issuance and exercise of stock-based awards

2,039

428

Payments for tax withholdings on equity awards

(486

)

(93

)

Common stock repurchased

(13,417

)

Net cash provided by (used in) financing activities

1,553

(13,082

)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

766

(853

)

Net increase (decrease) in cash, cash equivalents, and restricted cash

7,976

11,257

Cash, cash equivalents, and restricted cash, beginning of period

80,690

58,991

Cash, cash equivalents, and restricted cash, end of period

$

88,666

$

70,248

Supplemental disclosure on cash flow information:

Cash paid during the period for income taxes

$

8,738

$

343

Accrual for purchases of fixed assets

553

1,976

Company Contact:
Darin White
Director of Finance &
Investor Relations
Zumiez Inc.
(425) 551-1500, ext. 1337

Investor Contact:
ICR
Brendon Frey
(203) 682-8200