Quiksilver, Inc. announced financial results for the fiscal 2014 second quarter ended April 30, 2014.
Second Quarter Review:
The following comparisons refer to results of continuing operations for the second quarter of fiscal 2014 versus the second quarter of fiscal 2013.
-Net revenues were $408 million compared with $456 million, and were down 9%, or $42 million, in constant currency.
-Americas net revenues decreased 18% to $186 million from $226 million, and were down 16% in constant currency.
-EMEA net revenues decreased 2% to $162 million from $165 million, and were down 5% in constant currency.
-APAC net revenues decreased 6% to $60 million from $64 million, but were up 3% in constant currency.
-Gross margin increased to 48.7% from 45.9%. The 280 basis point improvement in gross margin reflects the sales growth in our direct to consumer channels, reduced clearance activity in the wholesale channel of certain regions and benefits of licensing activities.
-SG&A expense decreased $3 million to $214 million from $217 million, primarily due to reduced selling expenses associated with the decline in net revenues, reduced employee compensation expenses and event spending, partially offset by an increase in bad debt expense.
-Asset impairments increased to $20 million from $5 million due to a $15 million write-down of Surfdome goodwill and intangible assets in connection with the reclassification of Surfdome from discontinued operations to continuing operations.
-Pro-forma Adjusted EBITDA decreased to $12 million from $18 million.
-Net loss from continuing operations attributable to Quiksilver, Inc. was $46 million, or $0.27 per share, compared with $33 million, or $0.20 per share.
-Pro-forma loss from continuing operations, which excludes the after-tax impact of restructuring and other special charges and non-cash asset impairments, increased to $25 million, or $0.15 per share, compared with $21 million, or $0.12 per share.
Q2 Net Revenue Highlights:
Net revenues from continuing operations by brand and channel for the second quarter of fiscal 2014 compared with the second quarter of fiscal 2013 were as follows.
Brands (constant currency):
-Quiksilver decreased $13 million, or 7%, to $167 million.
-Roxy decreased $7 million, or 6%, to $121 million.
-DC decreased $24 million, or 19%, to $103 million.
-Distribution channels (constant currency):
-Wholesale revenues decreased 15% to $286 million.
-Retail revenues were flat at $90 million. Same-store sales in company-owned retail stores increased 1%.
-Company-owned retail stores totaled 658 at the end of the fiscal 2014 second quarter compared with 630 at the end ofthe fiscal 2013 second quarter.
-E-commerce revenues grew 23% to $30 million.
-Emerging markets generated net revenue growth of 28% in constant currency.