Genesco profits rise, but less than expected
Genesco Inc. cited construction expenses and currency pressures as reasons for the company’s weaker-than-expected fourth quarter earnings.
The company posted earnings from continuing operations of $51.8 million, or $2.18 per diluted share, for the quarter ended Jan. 31. The numbers are an improvement from the year-ago period, which saw earnings from continuing operations of $42.2 million or $1.79 per diluted share.
"While our bottom line results for fiscal 2015 were lower than we planned, we are pleased with the health of our footwear businesses, and especially with Journeys' continuing strength,” said Robert J. Dennis, chairman, president and CEO of Genesco. “At the same time, we are confident that the Lids Sports Group's strategic potential remains considerable despite current competitive and operational issues and are focused on improving the Group's long-term profitability."
Net sales at Genesco increased 13% to $893 million from $793 million. Same-store sales increased 10%.
“Fourth quarter sales were strong, exceeding our expectations,” Dennis added. “However, gross margin pressure, lower than planned contribution from new stores and acquisitions in the Lids Sports Group and unfavorable trends in foreign exchange rates resulted in disappointing earnings.”
Genesco also is updating its 2016 guidance due to currency pressures and supply chain uncertainties from the backlog related to West Coast port delays.
"While our bottom line results for Fiscal 2015 were lower than we planned, we are pleased with the health of our footwear businesses, and especially with Journeys' continuing strength. At the same time, we are confident that the Lids Sports Group's strategic potential remains considerable despite current competitive and operational issues and are focused on improving the Group's long-term profitability," Dennis said.
Nashville-based Genesco Inc. has more than 2,820 retail stores and leased departments throughout the U.S., Canada, the United Kingdom and the Republic of Ireland.