QUOTE AND NEWS
StreetInsider.com  Oct 14  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Management+Changes/Quicksilver+%28ZQK%29+CEO+Mooney+Assumes+Chairman+Role/9909774.html for the full story.
Benzinga  Oct 14  Comment 
Quiksilver, Inc. (NYSE: ZQK) today announced that the company is taking the next step in its transfer of leadership, which began with the appointment of Andy Mooney as chief executive officer in January 2013. Following a successful handover, Bob...
newratings.com  Oct 8  Comment 
WASHINGTON (dpa-AFX) - Ryan Drexler, president and shareholder of Consac LLC, said on Wednesday that he believes footwear retailer Quiksilver Inc's (ZQK) turnaround plan is a failure and called on the board to explore options to sell the...
Motley Fool  Oct 2  Comment 
With its shares crushed, its sales falling, and its outlook dim, Quiksilver has more hurdles to clear than Lolo Jones.
SeekingAlpha  Sep 10  Comment 
By Zacks Investment Research: Quiksilver, Inc. (NYSE:ZQK) recently posted its second big miss in a row as the retail environment remains challenging. This Zacks Rank #5 (Strong Sell) is trying to turn it around but shares have plunged to a 5-year...
DailyFinance  Sep 9  Comment 
Filed under: Company News, Earnings, Market News, Industry News, Investing Richard Levine/Alamy Things continue to go from bad to worse for Quiksilver (ZQK). The once-trendy retailer and distributor of extreme sports apparel and footwear for...
Clusterstock  Sep 5  Comment 
Quiksilver shares are crashing. Shares of the surf apparel retailer were down more than 30% on Friday after the company reported a $220 million loss in its third quarter on Thursday night. Revenue fell 19% in the third quarter to $396 million...
Benzinga  Sep 5  Comment 
Recro Pharma (NASDAQ: REPH) dipped 46.41% to $3.06 after the company reported that its trial study is not seen reaching statistical significance. Golden Minerals Company (NYSE: AUMN) declined 25.74% to $0.75 after the company announced a...
USAToday.com  Sep 5  Comment 
Shares of Quiksilver are a total wipeout after earnings report




 

Quiksilver (NYSE: ZQK) designs and sells sportswear and equipment for young, outdoorsy costumers. Its Roxy and Quiksilver brands, which together account for almost 60% of revenue, sell casual apparel, wetsuits, and winter gear, while its popular DC brand targets young skateboarders. The company sells its products through its own company stores and through department and sports specialty stores. The company earned $2 billion in revenue but incurred a net loss of $192 million in 2009.[1]

In a sluggish economy, retailers like Quiksilver suffer because consumers cut back on spending on discretionary items. Rather than spending money on full-priced brand name items, consumers can find the same items for lower prices at discount retailers like TJX Companies (TJX).

Company Overview

Quiksilver brands represent a casual lifestyle for young-minded people that connect with our boardriding culture and heritage. The company believes that surfing, skateboarding, snowboarding and other outdoor sports influence the apparel choices made by consumers as these activities are communicated to a global audience by television, the internet, movies and magazines. People are attracted to the venues in which these sports are performed and the values they represent, including individual expression, adventure and creativity. The company's products are sold in over 90 countries in surf shops, skateboard shops, snowboard shops, proprietary stores, and select department stores.[2]

Brands[3]

  • Quiksilver (39% of revenue) - include shirts, walkshorts, t-shirts, fleece, pants, jackets, snowboardwear, footwear, hats, backpacks, wetsuits, watches, eyewear and other accessories.
  • Roxy (33% of revenue) - is a brand for young women that includes a full range of sportswear, swimwear, footwear, backpacks, snowboardwear, snowboards, bedroom furnishings and other accessories.
  • DC (23% of revenue) - specializes in performance skateboard shoes, snowboard boots, sandals and apparel for both young men and juniors.
  • Other Brands (5% of revenue) - includes the swimwear labels Raisins, Radio Fiji, and Leilani, the skateboarding brand Hawk, and the snowboard/accessories brands Lib Technologies, Gnu, and Bent Metal.

Product Categories[4]

  • Apparel - 66% of net revenue
  • Footwear - 20% of net revenue
  • Accessories - 14% of net revenue

The majority of Quicksilver’s revenue comes from its apparel segment, which the company sells through its network shops and in department stores. With the weakness in its sporting goods business, the apparel segment is likely to increase in the future, as it has generated strong earnings for the company.

Distribution[5]

  • Core market shops - 39% of revenue
  • Specialty stores - 37% of revenue
  • Department stores - 10% of revenue
  • US exports - 9% of revenue
  • Distributors - 5% of revenue

Like many sporting goods companies, most of Quicksilver’s sports apparel and equipment are sold in specialty stores and sports shops, which account for over three quarters of revenue. Included in this number are some 500 stores that Quicksilver either owns or with which it maintains licensing arrangements. The company distributes casual apparel through Macy’s, Dillard's, and Bloomingdales department stores, which account for about a tenth of revenue.

Geographically, the company's revenue distribution is:

  • United States - 38% of revenue
  • Other Americas - 9% of revenue
  • France - 11% of revenue
  • United Kingdom and Spain - 11% of revenue
  • Other European Countries - 18% of revenue
  • Asia/Pacific - 13% of revenue

Business Growth

FY 2009 (ended October 31, 2009)[1]

  • Net revenue fell 13% to $2 billion. Revenue decreased in all of the company's geographic regions due to the struggling global economy.
  • The company incurred a net loss of $192 million, an improvement over the net loss of $226 million in the previous year.

Trends and Forces

Economic Conditions

Recent trouble in the credit markets, coupled with high gasoline prices, have the potential to depress consumer spending, thereby impacting Quiksilver's bottom line. If these factors lead consumers scale back on vacation travels to beaches and ski resorts, Quiksilver's equipment business is particularly vulnerable.

However, some factors may serve to protect Quiksilver's bottom line: its products are moderately priced and are focused on a very specific segment of the market—those interested in purchasing wetsuits and snowboards have a relatively small variety of businesses to choose from.

Dependency on Department Stores

Department stores in the United States have undergone significant changes in recent years. In response to declining margins, stores have implemented tighter inventory controls and have scaled back the quantities of merchandise that they purchase from wholesalers like Quiksilver. As a means of increasing market share, companies have also sought to differentiate themselves from the competition by demanding exclusive contracts and store-specific private labels (e.g. Ralph Lauren's "American Living" line for J.C. Penney).

Although department stores currently account for only 10% of Quiksilver's distribution, retail apparel and footwear have been the company's strongest segment in recent years. As the company seeks to capitalize on this growth (and shy away from its equipment business), department stores may become a bigger part of Quiksilver's business model.

Competition

Quiksilver competes with a variety of brands in the outdoorswear and sporting goods industry. V.F. Corporation owns Reef and Vans, two popular brands in the surfing community that compete against Roxy and Quiksilver for that community's dollar. Quiksilver also competes with Nike, as both companies sell skateboarding and aquatic apparel and footwear.

References

  1. 1.0 1.1 ZQK ZQK 2009 10-K "Selected Financial Data" pg. 18
  2. ZQK 2009 10-K "Introduction" pg. 1
  3. ZQK 2009 10-K "Products and Brands" pg. 2
  4. ZQK 2009 10-K "Product Categories" pg. 2-3
  5. ZQK 2009 10-K "Customers and Sales" pg. 4-5
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