On Oct. 26, Volcom (NASDAQ:VLCM), which retails clothing to the skateboard crowd, released third-quarter earnings for the period ended Sept. 30, 2006.
- Revenues and earnings per share beat analyst estimates.
- Revenues rose by 19.3%, but net profit dropped on lower margins. Selling, general, and administrative expenses alone increased 43%.
- Free cash flow declined by 3.6% because of increased capital spending, partially offset by a rise in cash from operations.
- Management raised high-end guidance for FY 2006 EPS to $1.17 from $1.14.
(Figures in thousands, except per-share data)
Income Statement Highlights
|
Avg. Est. |
Q3 2006 |
Q3 2005 |
Change | |
|---|---|---|---|---|
|
Sales |
$59,595 |
$61,049 |
$51,192 |
19.3% |
|
Net Profit* |
-- |
$10,163 |
$11,292 |
(10.0%) |
|
EPS |
$0.39 |
$0.42 |
$0.47 |
(10.6%) |
|
Diluted Shares |
-- |
24,235 |
24,066 |
0.7% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q3 2006 |
Q3 2005 |
Change* | |
|---|---|---|---|
|
Gross Margin |
50.63% |
51.00% |
(0.37) |
|
Operating Margin |
25.49% |
30.16% |
(4.67) |
|
Net Margin |
16.65% |
22.06% |
(5.41) |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$84,561 |
$65,678 |
28.8% |
|
Accounts Rec. |
$35,978 |
$27,781 |
29.5% |
|
Inventory |
$12,706 |
$11,566 |
9.9% |
|
Liabilities |
Q3 2006 |
Q3 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$11,042 |
$6,906 |
59.9% |
|
Capital Leases |
$125 |
$202 |
(38.1%) |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
YTD 2006 |
YTD 2005 |
Change | |
|---|---|---|---|
|
Cash From Ops. |
$18,104 |
$15,653 |
15.7% |
|
Capital Expenditures |
$5,693 |
$2,775 |
105.2% |
|
Free Cash Flow |
$12,411 |
$12,878 |
(3.6%) |
Find out why Fools always follow the money.
Related companies:
- Zumiez (NASDAQ:ZUMZ)
- Pacific Sunwear (NASDAQ:PSUN)
- Quicksilver (NYSE:ZQK)
- Wolverine World Wide (NYSE:WWW)
Related Foolishness:
Volcom and Zumiez are Motley Fool Hidden Gems recommendations. Pacific Sunwear is a Motley Fool Stock Advisor selection.For a fun new way to do research on stocks, check out CAPS, the Fool's new investment community.
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