Exceeding the financial analysts’ projections, global sales jumped by 102.6 percent to $279.1 million in the first quarter ended May 1 for Zumiez, the U.S.-based action sports retailer whose assets include the physical and online shops of Blue Tomato in Europe. The strong performance led the company to post a net profit of $26.4 million for the quarter against a net loss of $21.1 million in the same period a year ago.
Even when compared with the first quarter of 2019, the turnover was up by 31.1 percent overall. The progress was particularly strong in the U.S., where Zumiez’ quarterly revenues of $248.7 million were 113 percent higher than in the year-ago period and 32 percent higher than in the first quarter of 2019. Besides the fact that its U.S. stores were open for 94 percent of the potential operating days, the company benefited from the U.S. government’s financial stimulus for discretionary spending.
With the company’s European and Canadian stores being open for only 40 percent and 77 percent of the normal operating days, respectively, Zumiez’ international sales were up by 43 percent to $30.4 million in the latest quarter, with increases of 30 percent in local currencies and 22 percent compared with 2019.
The gross margin improved by 19.8 percentage points to 37.0 percent for the quarter, including an increase in product margins of 3.9 percent, but most of the improvement came from leverage in occupancy costs as the channel mix returned to historical levels. The operating margin rose by 7.9 percentage points to 20.2 percent.
The company predicts an improvement in gross margins for the balance of the year on sales that will likely grow by low- to mid-teens as compared to 2019. In the four weeks ended May 29, total revenues were 42 percent above the prior year and 31 percent higher than in the same period of 2019.
