Volcom Inc., the Costa Mesa, Calif.-based marketer of young men’s and women’s apparel, saw its first-quarter profits dwindle on a 13 percent rise in sales in the first quarter.
The firm, which earlier this week agreed to be acquired by PPR, said Tuesday that net income for the three months ended March 31 declined 38.8 percent to $4.6 million, or 19 cents a diluted share, from $7.5 million, or 31 cents, in the prior-year quarter.
Revenues rose 12.6 percent to $87.1 million from $77.4 million despite a 49 percent drop in licensing revenues, to $299,000 from $586,000.
Gross profit increased 23 percent to $43.6 million from $35.4 million, lifting gross margin to 50 percent of sales from 45.8 percent a year ago. However, the gain was erased by an 18 percent boost in selling, general and administrative expense, to $36.6 million from $31 million.
Following the announcement of its merger agreement with PPR, the firm canceled plans for a conference call to discuss the first-quarter results and provide forward-looking guidance.
Volcom markets sports-oriented apparel to young men and women under the Volcom and Electric brands.