Volcom's net profit was halved to $1.6 million in the fourth quarter of 2010 from $3.4 million a year earlier as the U.S. apparel company suffered from falling margins. Sales rose by 22.4 percent to $78.6 million in the quarter. U.S revenues rose to $54.3 million from $46.0 million a year earlier while European sales were down slightly to $12.8 million from $12.9 million. Sales for the Electric range were up to $6.4 million from $5.3 million. Australian sales totaled $5.1 million.
The gross margin slipped to 45.0 percent from 49.2 percent due to lower margins for the U.S. segment, offset partially by higher margins in the Electric apparel segment.
The company put an end to license agreements for 10 Volcom outlet stores located in California, four units, Nevada, three locations, Washington, two, and Utah, one. The assets will be acquired and the deal is scheduled to be completed by mid-2011
In the first quarter, the company expects to post revenues of $83-86 million, representing year-on-year growth of between 7-11 percent, and fully diluted earnings per share (EPS) of 16-19 cents. For the full financial year, Volcom forecasts a 13-15 percent rise in revenues to $366-371 million and fully diluted EPS of $1.08-1.14.
