Shares of Volcom Inc. shot up more than 12% in afterhours trading on Wednesday after the Costa Mesa surfwear designer reported a big gain in third-quarter sales and operating profit and upped its outlook.
Sales rose 38% from a year ago to $51.2 million, Volcom said. Operating profit rose 58% to $15.4 million.
Volcom focused on operating profits in its results because of a change in tax status after going public in late June.
Net income, based on a higher tax rate than a year ago, came in at $11.3 million, up from $10.1 million a year ago.
The results are Volcom’s second since going public. Some observers were watching the company to see if its results reflected any sign of consumer fatigue amid high oil prices and other factors.
Volcom seemed to dispel those concerns by upping its outlook for the rest of the year.
The company said it sees yearly sales growth of 39% to 41% up from a prior forecast of previous guidance of 34% to 37%.
Still Volcom was cautious: “In putting forth this outlook, the company reminds investors of the complexity of accurately assessing future revenue growth given the difficulty in predicting fashion trends and consumer preferences, boardsports popularity and participation rates, general economic conditions, and the impact of trade safeguards with China,” the company said.
Volcom and shareholders sold $89 million worth of stock in the company’s initial public offering, which created a buzz on Wall Street.
After an initial run-up, the company’s shares have pulled back of late. As of close of trading Wednesday, Volcom had a market value of nearly $700 million.
