No One’s Board at This Meeting
It’s annual meeting season for the region’s publicly traded companies, which typically entertain shareholders with flashy PowerPoint presentations and food and drink at corporate headquarters or in fancy hotel ballrooms.
And then there’s Volcom Inc.
The youth apparel maker honed its offbeat image Thursday at its first-ever shareholders meeting.
Rather than assembling at its Costa Mesa headquarters, an office building once occupied by industry giant Quiksilver Inc., Volcom bused employees and shareholders to another of its properties -- an industrial shop with concrete floors and a roof made partly of corrugated metal where boats were once built.
The ambience was decidedly eclectic: clementines and doughnut holes were served near a pair of outdoor toilets that were hauled in for the occasion.
Not showy perhaps, but “the vibe” was right, a spokesman said.
Young attendees, including a few who arrived on skateboard, seemed to appreciate the effort, sipping cappuccinos as the sounds of Valient Thorr, a heavy-metal band on Volcom’s record label, ripped through speakers.
Shareholders and financial advisors had more mundane matters on their minds.
Can Volcom’s sales keep spiraling upward, given intense competition? What are its marketing plans? Will the company meet its delivery goals after it takes charge of its European operations?
“I guess what I’m here to see is, is it a fad or not?” said Kevin Bush, a printing and graphics consultant who bought stock in the company in August, after it went public June 30.
Said Lucy Walther, an investment representative with Edward Jones in Newport Beach: “Is it another Quiksilver? That’s what we want to know.”
Volcom, founded in 1991, is well past the fad stage, said D.A. Davidson & Co. analyst Mitch Kummetz. He predicts the company’s sales will be about $200 million this year, which would be a 25% increase from last year.
Eventually, Volcom could be as big as Quiksilver, which last year boasted sales of $1.78 billion, said Kummetz, whose New York-based firm was co-lead manager of Volcom’s initial public offering and retains the company as a banking client.
“Ten years ago, Quiksilver was about the same size as Volcom is today,” Kummetz said. The smaller company has many growth avenues it could pursue, he said, including adding more products and expanding its domestic distribution and its girls’ business.
The trick will be to carefully manage its expansion while focusing on its core customers, especially surfers, skateboarders and snowboarders, he and other analysts say.
Volcom has plenty to juggle in the coming year as it prepares to take control of its European operations -- now handled by a licensee -- and establishes a headquarters for Europe in southwest France, as have other surf and skate apparel businesses.
“The challenge is: Will they be able to get Europe up and running on the budget and time frame that they have set?” said analyst Jeffrey Mintz of Wedbush Morgan Securities in Los Angeles.
Volcom had plenty to brag about Thursday during its official presentation in the shop, which the company now uses for art shows and other events. The meeting mixed garden-variety business matters with an offbeat video that ended with co-founder and Chief Executive Richard Woolcott saying, “Just buckle in because we’re on the ride of our life. It’s all good. Is that stupid?”
Volcom’s operating income rose to $38.4 million last year, a 57% increase from 2004. Its stock is up 92% from the $19 IPO price, closing Thursday at $36.39, down 83 cents.
The last year has been a wild ride for Woolcott, 40, who wore a white long-sleeved shirt (with the tails hanging out) to the meeting, his blond hair curling at the collar. He stuck Volcom pins on his shirt so he had to relegate his name tag to his pant leg. Rather than a briefcase, he toted a green backpack.
Woolcott, who was inducted into the National Scholastic Surfing Assn. Hall of Fame in 2004, said he still found time for the sports he loves, including surfing and snowboarding. Before Thursday’s big meeting, he rode his mountain bike.
“My responsibilities are first, but I’ve got to have that other side to my life too,” said Woolcott, who has added yoga and acupuncture to his regime. “You have to really work at balance, because the job will beat you up.”
It also can make you rich. According to the company’s proxy, Woolcott owns 16.2% of the company’s stock, which at Thursday’s closing price would be worth about $143 million.