Pro-forma Adjusted EBITDA in line with plan - Quiksilver
Quiksilver Inc announced operating results for the first fiscal quarter ended January 31, 2011. Revenues were $426.5 million as compared to $432.7 million in the first quarter of fiscal 2010 but were up compared to the same period last year in constant currency.
Consolidated gross profit of $223.5 million exceeded that of the first quarter of fiscal 2010 as gross margin expanded 110 basis points to 52.4% of revenues. As previously communicated, the company invested in several new business initiatives in the first quarter ahead of revenue generation.
Therefore, pro-forma Adjusted EBITDA of $28.2 million was down $10.6 million, as planned, compared to the same quarter a year ago. This result was in line with the company's expectations for the first quarter, in which revenues are historically lower than for the remaining three quarters of the year.
The pro-forma loss from continuing operations was $7.7 million or $0.05 per share compared to a loss of $2.5 million or $0.02 per share in the first quarter of fiscal 2010. The pro-forma loss for the first quarter of fiscal 2011 excludes $8.6 million of net after-tax charges, primarily comprised of a non-cash write-off of deferred debt issuance costs associated with previous financings. Including this amount, the loss from continuing operations was $16.3 million, or $0.10 per share, compared to $5.4 million, or $0.04 per share, for the first quarter of fiscal 2010. A reconciliation of GAAP results to pro-forma results is provided in the accompanying tables.
Robert B. McKnight, Jr., Chairman of the Board, Chief Executive Officer and President of Quiksilver, Inc., commented, “We're very pleased with our results for the first quarter. Our top line and operating performance continue to improve with revenues up in constant currency for the first time in 9 quarters and gross profit margins expanding to 52.4% as the level of discounting in our business continues to decline.
“We also feel very good about new growth initiatives presently underway. As we've indicated in the past, now that our financial restructuring is complete, we have shifted our focus toward investing in our brands and their long-term potential. Looking forward, we expect fiscal 2011 as a whole to be a transition year with growth accelerating in the second half of the year and beyond as these initiatives gain traction.”
Net revenues in the Americas increased 4% during the first quarter of fiscal 2011 to $193.8 million from $187.0 million in the first quarter of fiscal 2010. In constant currency, European segment net revenues increased 1% in the first quarter of fiscal 2011 compared to the prior year. As measured in U.S. dollars and reported in the financial statements,
European net revenues decreased 7% to $165.2 million from $177.9 million in the first quarter of fiscal 2010. In constant currency, Asia/Pacific segment net revenues decreased 8% in the first quarter of fiscal 2011 compared to the prior year. As measured in U.S. dollars and reported in the financial statements, Asia/Pacific net revenues remained unchanged at $67.0 million as compared to $67.1 million in the first quarter of fiscal 2010. Please refer to the accompanying tables in order to better understand the impact of foreign currency exchange rates on revenue trends in the European and Asia/Pacific segments.