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Sep 6, 2009
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Quiksilver posts third quarter profit in line with estimates

By
Reuters
Published
Sep 6, 2009

Sept 3 (Reuters) - Apparel maker Quiksilver Inc (ZQK.N) posted a quarterly profit that was in line with market expectations as improved cost-cutting efforts partially offset a continued slump in sales, but it expects to post a fourth-quarter loss in the mid-single digit range.

Quiksilver
Quiksilver

For the third quarter ended July 31, the company, which makes surf-inspired apparel, posted net income of $1.3 million, or 1 cent a share, compared with $2.9 million, or 2 cents a share, in the year-ago quarter.

Excluding items, the company posted a profit of 3 cents a share, in line with analysts' consensus view, according to Reuters Estimates.

Revenue fell to $501.4 million. Selling, general and administrative expenses fell about 9 percent to $211.8 million.

In January, the retailer had announced cost-saving measures, including plans of cutting 200 jobs and later said it would cut a further 160 jobs.

"The retail environment remains very challenging and we will continue to adapt our cost structure to this trend as we go forward," Chief Executive Robert McKnight said in a statement.

The company, which has been hurt by a sustained sales slump, has been trying to improve its liquidity position by securing additional financing. In June, it agreed with private equity firm Rhone to take a five-year loan of about $150 million. It had also agreed with Bank of America and GE Capital for a new credit facility.

Shares of the Huntington Beach, California-based company were down 16 cents at $2.70 after the bell. They closed at $2.86 Thursday 3 September on the New York Stock Exchange. (Reporting by Mihir Dalal in Bangalore; Editing by Anil D'Silva )

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