Quiksilver have reported a first quarter loss of US$10.8 million but have beat analysts expectations on a loss per share basis and total revenue. The market expected around $336 million and CEO Andy Mooney delivered $340 million which was on guidance (this was in constant currency terms – taking into account the current exchange rate, they beat guidance by $15 million). The loss worked out at 7c a share when the expectation was 14c.
One interesting note from the results call was Andy Mooney talking about the industrial relations actions being taken at the ports in California. Where this caused supply issues on some lines, the company elected to supply the wholesale customers ahead of their direct sales to consumers via the website. A nice little nod to the stores that have supported them over the long term. And in talking with major retail partners the brand has amended its approach to discounting online, only doing so on previous season items from now on.
And on core media, they are still tracking for a 40% increase in spend on core retail point of sale and core press advertising – Andy Mooney talked about core surf magazines worldwide getting full page ads for the new AG 47 boardshort featuring three of the younger team riders. If you’re selling ads in the core mag, now is the time to get on the phone to the Torquay office – they’re under instruction to make it rain on you.
They’re powering on the CapEx spending to rework their IT and retail infrastructure – $16 million into the $25 million slated for the year. I’m looking forward to seeing the results of this spending – is it a great backend software sales person selling a dud, or a system that will genuinely improve their business.
Interesting times for the company.