Genesco lowers earnings forecast

Genesco is lowering its earnings forecast for the fiscal year despite a 3% increase in same-store sales over the holiday period.



The company said same-store sales increased 3% for the quarter-to-date period ended Jan.2. Sales for the company's e-commerce and catalog direct sales businesses increased 20% on a comparable basis for that period.



"We are pleased with the top line performance of all our North American businesses during a generally difficult Holiday selling season," said Robert J. Dennis, chairman, president and CEO of Genesco. "We are especially pleased with the strong performance at Journeys, which delivered another exceptional Holiday season. Consistent with our commitment to do what is necessary to enter the new fiscal year with clean inventories in the Lids Sports Group, we anticipate a final, aggressive push to liquidate excess inventory by year end, which will take fourth quarter earnings below our previous guidance. We are confident that this final step is the appropriate one to position the Lids Sports business for stronger performance in the coming year. "



The company also announced that it now expects adjusted earnings per diluted share for the fiscal year ending Jan. 30 in the range of $4.30 to $4.40 per share. The reduction from the previous, most recently announced guidance range of $4.50 to $4.60 per share reflects measures planned to complete the Lids Sports Group's year-long inventory reduction program in the fourth quarter and current challenges in the Schuh Group's business, the company said.



"Overall, our outlook for fiscal 2017 is positive, reflecting both the current favorable trends at Journeys and Johnston & Murphy and expected improvement in the Lids Sports Group, given the anticipated benefits of the additional inventory reduction initiatives and the relatively easier comparisons to this year's performance, which included heavy promotional activity related to those initiatives," Dennis added.