Quiksilver to eliminate 200 positions as part of $40 million cost-saving plan
Quiksilver (NYSE: ZQK) said it is enacting cost-savings measures to reduce expenses in the Americas region by more than 10 percent — about $40 million annually — impacting nearly all functional areas and eliminating 200 positions. The reduction-in-force includes approximately 150 employees, accounting for roughly one-third of the annual cost reductions.
Quiksilver said these moves are part of an overall restructuring effort to reposition its business and in response to the continued decline in the consumer retail environment. It added that it expects to record a charge of approximately $5 million in its first fiscal quarter as a result of these actions.
These cost reduction measures are in addition to expense reductions made by the company in 2008 and other actions already taken in the company’s European and Asia Pacific regional businesses.
“Our spending cuts are across-the-board, touching each of our internal organizations and systems in the Americas, but have been designed to drive improved efficiency while minimizing the impact to our customers and other business partners,” said Robert McKnight, Quiksilver’s chairman, president and CEO, in a statement. “All levels of our organization are affected by these actions as nearly 20 percent of the employees involved in the reduction hold manager-level titles or higher.”
As a part of its reduction in payroll, Quiksilver provided news of further pay cuts for members of its executive management team in an SEC filing last week.
The company also reaffirmed that its efforts to restructure its uncommitted debt in Asia Pacific and Europe remain on track for completion in February.
Separately, Quiksilver shares increased nearly 50 percent — $0.70 to close at $2.21 — on Jan. 26 after a report that the company could be selling some of its brands or even the company. The stock has traded between $0.80 and $10.67 during the past 52 weeks.
An article in Women’s Wear Daily reported Quiksilver is close to selling its DC Shoes brand to VF Corp. (NYSE: VFC) and said the company could be in talks with Nike (NYSE: NKE) to sell the company outright.
Quiksilver said in November it was reviewing private-equity investment capital and other strategic alternatives with Morgan Stanley.
Eddie Bauer shares nearly double
After announcing preliminary fourth-quarter and FY ’08 sales results, Eddie Bauer (Nasdaq: EBHI) shares nearly doubled in price Jan. 22.
Shares jumped 93 percent, rising $0.45 to close at $0.93 cents per share on a volume of 1.015 million. During day’s trading it also hit a high of $1.22.
The day before, Eddie Bauer said 2008 net sales declined to $971.3 million from $989.4 million a year earlier, despite having 16 fewer retail stores and one more outlet store in 2008.
For fiscal 2008, the company said EBITDA will rise to between $50 million and $55 million, an increase of between $8 million to $13 million a year earlier.
Deckers receives analyst kudos on Ahnu buy
An analyst gave Deckers Outdoor (Nasdaq: DECK), parent of Teva, Ugg and Simple, the thumbs-up over its acquisition of Ahnu, saying the buy is a good fit for the company.
Deckers said in a statement the brand will help it gain more market share in the outdoor category. The deal is expected to close in the first quarter.
Lazard Capital Markets analyst Todd Slater said in a note to investors that Ahnu is a fit with Decker’s Teva line. He said that along with Deckers’ Simple and Tsubo shoes, Ahnu shoes will be a good “incubator” brand with “strong long-term growth prospects.
He reiterated his “Buy” rating and $100 price target on Deckers.
Cabela’s board member resigns
Cabela’s (NYSE: CAB) said Stephen P. Murray resigned from the board of directors effective Jan. 20 to address other extensive business commitments.
Murray joined the board in December 2005. During his tenure, he served as a member of the compensation committee and the nominating and corporate governance committee.
No replacement has been announced.
–Compiled by Wendy Geister
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