REI (Recreational Equipment, Inc.), a national retailer of quality outdoor gear and apparel, today announced 2010 sales of $1.66 billion, up 14 percent from $1.46 billion the previous year. Operating income for the year was a record $115.4 million, an increase of 15 percent over $100.6 million in 2009. Net income in 2010 was $30.2 million, up 1.4 percent from $29.8 million in the previous year. The company’s direct sales channel, which includes online and catalog sales, grew by 22.9 percent. Comp store sales grew by 8.1 percent, up from negative 3.5 percent in 2009.
“REI achieved remarkable results last year in an economy that remained uncertain, and I credit the dedication and commitment of our more than 9,500 employees who are focused on serving our members and customers. Our performance positions REI well for ongoing strategic growth and business investments,” said Ivar Chhina, REI’s chief financial officer and executive vice president. “As the nation’s largest consumer cooperative, we are extremely pleased to also share our success with our members, communities and employees.”
Each year, REI shares its profits with its members through an annual patronage refund in proportion to their eligible purchases. Based on the co-op’s 2010 performance, $94.3 million in patronage refunds will be distributed to 4.4 million active members at the end of March, marking the co-op’s highest-ever refund. While anyone may shop at REI, only members may share in the co-op’s profits. In addition, REI Visa card holders will receive $35 million in rebates from purchases using their REI Visa cards during last year. As a result, more than $129 million will be returned to REI members, an all-time high.
The co-op’s strong financial performance also benefits the communities where REI has a presence. Last year, REI invested $3.7 million in national and community-based nonprofit organizations dedicated to engaging volunteers in conserving local natural spaces. In addition, the company also made a grant of $2.5 million to the REI Foundation, an independent 501(c) 3 nonprofit organization established by the co-op in 1993. The Foundation works to support efforts to increase diversity and youth participation in the outdoors.
In recognition of their contributions to REI’s performance in 2010, employees received a total of $58.6 million through the company’s annual incentive, retirement and profit sharing plans. The rewards included the distribution of $32.7 million in performance incentives to employees and a $25.9 million contribution for retirement and profit sharing. The co-op’s exceptional performance allowed the retirement and profit sharing plan to achieve its maximum contribution, which is 15 percent of eligible employee’s base salary.
By year-end 2010, REI operated 114 stores, including four new stores in Arizona, Connecticut, Maryland and Montana. The company also relocated two stores last year in California and Montana. Seven new stores will open in 2011, including Dublin and Santa Barbara, Calif.; Paramus, N.J.; Carle Place, Manhattan and Yonkers, N.Y.; Olympia, Wash.
REI’s exclusive in-house Gear and Apparel brand continued to earn recognition awards from key reviewers last year, including Backpacker magazine’s “2010 Editors’ Choice Gold” for the REI Half Dome 2 Tent and Outside magazine’s “2010 Gear of the Year” for the REI Half Dome 2 Plus Tent. In addition, for the 14th consecutive year, the co-op was named to FORTUNE magazine’s “100 Best Companies to Work For” list. REI is currently ranked number nine on the 2011 list.
REI is a national outdoor retailer co-op dedicated to inspiring, educating and outfitting its members and the community for a lifetime of outdoor adventure and stewardship. Founded in 1938 by a group of Pacific Northwest mountaineers seeking quality outdoor equipment, REI is committed to promoting environmental stewardship and increasing access to outdoor recreation through volunteerism, gear donations and financial contributions.
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EDITOR’S NOTE: REI’s condensed consolidated balance sheets and statements of income for 2009 and 2010 can be viewed at http://www.rei.com/pdf/aboutrei/2010REIFinancialStatements.pdf.