Tumi Holdings Shares Tumble As Q2 Results Miss View, Outlook Lowered

(RTTNews) - Shares of Tumi Holdings, Inc. (TUMI) tumbled more than 13 percent in extended trades Wednesday after the luxury travel product maker's second-quarter results missed analysts' estimates and the company lowered its fiscal 2013 financial outlook.

New Jersey-based Tumi, which made its market debut last April on the New York Stock Exchange, makes wheeled travel products as well as satchels, garment bags, and business cases.

Tumi's second-quarter net income was $11.19 million or $0.16 per share, up from $6.49 million or $0.10 per share in the same period last year.

In the latest quarter, Tumi incurred a $1.5 million charge in connection with the early termination of an agreement with its web services provider. The company intends to implement an internal web-service function next year.

Excluding items, adjusted earnings for the quarter were $12.1 million or $0.18 per share, compared to $11.2 million or $0.18 per share in the same period last year. On average, eight analysts polled by Thomson Reuters expected the company to earn $0.19 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter rose 13 percent to $108.19 million from $95.82 million in the year-ago period. Analysts had a consensus revenue estimate of $114.03 million.

Total comparable store sales for all Direct-to-Consumer channels, including company-owned websites, increased 4.6 percent in the quarter. This compared to an increase of 8.0 percent in the prior-year period.

Direct-to-Consumer North America comparable store sales, including e-commerce sales, increased 3.6 percent in the quarter. This compared to an increase of 8.4 percent in the year-ago period.

Direct-to-Consumer International comparable store sales, including e-commerce sales, increased 13.3 percent in local currency, compared to an increase of 16.2 percent in the previous-year quarter.

Gross margin for the quarter rose to 57.6 percent from 57.1 percent in the year-ago period.

Looking ahead to fiscal 2013, Tumi lowered its adjusted earnings outlook to a range of $0.76 to $0.82 per share from the prior guidance range of $0.82 to $0.86 per share. The company now forecasts net sales for the year to increase 16 percent to 18 percent, down from the prior range of 18 percent to 20 percent.

Analysts currently expect the company to report full-year earnings of $0.87 per share for the year on revenues of $477.09 million.

Tumi said its forecast includes an anticipated increased marketing investment in the fourth quarter and acceleration of its upfront investment in the second half of 2013 in its website redesign and transition to a more cost effective as well as improved web services platform.

TUMI closed Wednesday's regular trading session at $25.44, up $0.75 or 3.04 percent on a volume of 660,803 shares. However, in after-hours, the stock declined $3.44 or 13.52 percent to $21.60.