Quiksilver Rebounds With $593,000 First-Quarter Profit
A 5.4% revenue increase and tighter cost controls helped Quiksilver Inc. to generate a $593,000 profit for its latest fiscal quarter. The surf wear manufacturer had reported a $1.8-million loss for the same period a year earlier.
Quiksilver’s sales for its first fiscal quarter, which ended Jan. 31, rose to $19 million from $18 million a year earlier. Revenue was driven by European sales, which increased to $7.2 million from $5.4 million a year earlier. Domestic sales declined to $11.9 million from $12.7 million.
The recently completed quarter was the second consecutive period when both revenue and earnings exceeded the previous year’s totals. During eight previous quarters, Quiksilver had reported lower earnings.
Randall L. Herrel, Quiksilver’s chief operating office, linked the improved profit to a 30% reduction in operating expenses. “We’ve made very tough guidelines and adopted budgets that will allow us to be profitable,” he said, “regardless of what happens in the economy this year.”
In recent months, Quiksilver cut its employee count from 200 to 170. The company, based in Newport Beach, also let go five top-level managers, cut its lease costs by 30% and trimmed other operating expenses.
The company anticipates yearly revenue that will be “flat or up slightly,” Herrel said, although income will rise because of the ongoing cost-cutting, Herrel said. “What we’ve done is very proactive.”