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Published:
Genesco Reports Second Quarter Fiscal 2009 ResultsNASHVILLE, Tenn., Aug. 28 /PRNewswire-FirstCall/ -- Genesco Inc. (NYSE:
GCO) reported a loss from continuing operations of Adjusting for the listed items in both periods, earnings from continuing
operations were As part of its March 2008 litigation settlement with The Finish Line, the
Company received shares of Finish Line common stock, which it agreed to
distribute to the Company's shareholders. The shares appreciated in value by
approximately The Company also recorded an after-tax charge of Net sales for the second quarter of fiscal 2009 increased by 8% to Genesco President and Chief Executive Officer Second Quarter Business Unit Performance "Net sales in the Journeys Group grew 9% from the prior year period to
"Net sales in the Hat World Group increased 13% from the prior year period
to approximately "Net sales for the Underground Station Group, which includes the remaining
Jarman stores, were "Johnston & Murphy Group's net sales were approximately "Second quarter sales of Licensed Brands increased 16% from the prior year
period to approximately Fiscal 2009 Outlook The Company said it has raised its previously announced earnings per share
outlook for the current fiscal year. The Company now expects earnings per
share in the range of Cautionary Note Concerning Forward-Looking Statements This release contains forward-looking statements, including those regarding the performance outlook for the Company and its individual businesses, and all other statements not addressing solely historical facts or present conditions. Actual results could vary materially from the expectations reflected in these statements. A number of factors could cause differences. These include adjustments to estimates reflected in forward-looking statements and post closing adjustments to financial information reported, including the income tax liability related to the Finish Line shares, continuing weakness in the consumer economy, fashion trends that affect the sales or product margins of the Company's retail product offerings, changes in the timing of holidays or in the onset of seasonal weather affecting period-to-period sales comparisons, changes in buying patterns by significant wholesale customers, bankruptcies or deterioration in financial condition of significant wholesale customers, disruptions in product supply or distribution, further unfavorable trends in fuel costs, foreign exchange rates, foreign labor and materials costs, and other factors affecting the cost of products, and competition in the Company's markets. Additional factors that could affect the Company's prospects and cause differences from expectations include the ability to open, staff and support additional retail stores on schedule and at acceptable expense levels and to renew leases in existing stores on schedule and at acceptable expense levels, the ability to negotiate acceptable lease terminations and otherwise to execute the previously announced store closing plans on schedule and at expected expense levels, unexpected changes to the market for our shares, the impact of any future stock repurchases, variations from expected pension-related charges caused by conditions in the financial markets, and the outcome of litigation, investigations and environmental matters involving the Company, including but not limited to the outcome of the negotiations with the Environmental Protection Agency noted in this announcement. Additional factors are cited in the "Risk Factors," "Legal Proceedings" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of, and elsewhere, in our SEC filings, copies of which may be obtained from the SEC website, www.sec.gov, or by contacting the investor relations department of Genesco via our website, www.genesco.com. Many of the factors that will determine the outcome of the subject matter of this release are beyond Genesco's ability to control or predict. Genesco undertakes no obligation to release publicly the results of any revisions to these forward looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Forward-looking statements reflect the expectations of the Company at the time they are made. The Company disclaims any obligation to update such statements. Conference Call The Company's live conference call on August 28, 2008, at 7:30 a.m. (Central time) may be accessed through the Company's internet website, www.genesco.com. To listen live, please go to the website at least 15 minutes early to register, download and install any necessary software. About Genesco Inc. Genesco Inc., aNashville-based specialty retailer, sells footwear, headwear and accessories in more than 2,200 retail stores inthe United States andCanada, principally under the names Journeys, Journeys Kidz, Shi by Journeys, Johnston & Murphy, Underground Station, Hatworld, Lids, Hat Shack, Hat Zone, Head Quarters and Cap Connection, and on internet websites www.journeys.com, www.journeyskidz.com, www.shibyjourneys.com, www.undergroundstation.com, www.johnstonmurphy.com, www.dockersshoes.com, and www.lids.com. The Company also sells footwear at wholesale under its Johnston & Murphy brand and under the licensed Dockers brand. Additional information on Genesco and its operating divisions may be accessed at its website www.genesco.com
GENESCO INC.
Consolidated Earnings Summary
Three Months Ended Six Months Ended
August 2, August 4, August 2, August 4,
In Thousands 2008 2007 2008 2007
Net sales $353,138 $327,977 $710,073 $662,628
Cost of sales 171,814 164,358 347,354 327,165
Selling and administrative
expenses 173,420 166,059 353,466 325,132
Restructuring and other, net 3,261 158 (198,577) 6,753
Earnings (loss) from operations 4,643 (2,598) 207,830 3,578
Interest expense, net 2,114 3,000 4,317 5,402
Earnings (loss) before income
taxes from continuing operations 2,529 (5,598) 203,513 (1,824)
Income tax expense (benefit) 7,458 (2,658) 78,550 (1,087)
Earnings (loss) from continuing
operations (4,929) (2,940) 124,963 (737)
Provision for discontinued
operations (5,361) (1,225) (5,454) (1,225)
Net Earnings (Loss) $(10,290) $(4,165) $119,509 $(1,962)
Earnings Per Share Information
Three Months Ended Six Months Ended
August 2, August 4, August 2, August 4,
In Thousands (except per share 2008 2007 2008 2007
amounts)
Preferred dividend requirements $50 $54 $99 $118
Average common shares - Basic EPS 18,513 22,415 19,782 22,403
Basic earnings (loss) per share:
Before discontinued operations ($0.27) ($0.13) $6.31 ($0.04)
Net earnings (loss) ($0.56) ($0.19) $6.04 ($0.09)
Average common and common
equivalent shares - Diluted EPS 18,513 22,415 24,508 22,403
Diluted earnings (loss) per share:
Before discontinued operations ($0.27) ($0.13) $5.15 ($0.04)
Net earnings (loss) ($0.56) ($0.19) $4.93 ($0.09)
GENESCO INC.
Consolidated Earnings Summary
Three Months Ended Six Months Ended
August 2, August 4, August 2, August 4,
In Thousands 2008 2007 2008 2007
Sales:
Journeys Group $160,960 $148,091 $329,722 $304,012
Underground Station Group 23,597 24,520 52,601 54,330
Hat World Group 102,169 90,460 189,906 169,304
Johnston & Murphy Group 44,014 45,657 90,585 91,951
Licensed Brands 22,145 19,059 46,893 42,588
Corporate and Other 253 190 366 443
Net Sales $353,138 $327,977 $710,073 $662,628
Operating Income (Loss):
Journeys Group $2,388 $983 $7,686 $11,800
Underground Station Group (3,038) (4,893) (4,019) (7,061)
Hat World Group 11,454 7,418 15,179 10,070
Johnston & Murphy Group 2,994 3,612 6,677 8,082
Licensed Brands 2,091 2,148 5,646 5,174
Corporate and Other* (11,246) (11,866) 176,661 (24,487)
Earnings (loss) from
operations 4,643 (2,598) 207,830 3,578
Interest, net 2,114 3,000 4,317 5,402
Earnings (loss) before income
taxes from continuing operations 2,529 (5,598) 203,513 (1,824)
Income tax expense (benefit) 7,458 (2,658) 78,550 (1,087)
Earnings (loss) from continuing
operations (4,929) (2,940) 124,963 (737)
Provision for discontinued
operations (5,361) (1,225) (5,454) (1,225)
Net Earnings (Loss) $(10,290) $(4,165) $119,509 $(1,962)
*Includes $3.3 million of other charges in the second quarter of Fiscal
2009 which includes $2.4 million in asset impairments, $0.6 million for
lease terminations and $0.3 million for other legal matters and includes
$198.6 million credit in the first six months of Fiscal 2009 of which
$204.1 million were proceeds as a result of the settlement of merger-
related litigation with The Finish Line and its investment bankers offset
by $3.6 million in asset impairments, $1.1 million for other legal
matters and $0.8 million for lease terminations. The second quarter and
six months of Fiscal 2009 also includes $0.3 million and $7.6 million,
respectively, of merger-related expenses.
Includes $0.2 million of other charges in the second quarter of Fiscal
2008 which includes $0.4 million of asset impairments offset by a $0.2
million excise tax refund and includes $6.8 million of other charges in
the first six months of Fiscal 2008 of which $6.7 million is asset
impairments and $0.3 million for lease terminations offset by a $0.2
million excise tax refund. The second quarter and six months of Fiscal
2008 also includes $5.4 million and $5.5 million, respectively, of
merger-related expenses.
GENESCO INC.
Consolidated Balance Sheet
August 2, August 4,
In Thousands 2008 2007
Assets
Cash and cash equivalents $24,283 $22,129
Accounts receivable 23,015 22,154
Inventories 327,986 347,574
Other current assets 41,199 54,610
Total current assets 416,483 446,467
Property and equipment 249,067 236,154
Other non-current assets 172,669 171,948
Total Assets $838,219 $854,569
Liabilities and Shareholders' Equity
Accounts payable $133,806 $119,727
Other current liabilities 85,995 56,374
Total current liabilities 219,801 176,101
Long-term debt 106,220 188,220
Other long-term liabilities 86,977 86,271
Shareholders' equity 425,221 403,977
Total Liabilities and Shareholders' Equity $838,219 $854,569
GENESCO INC.
Retail Units Operated - Six Months Ended August 2, 2008
Balance Balance Balance
02/03/07 Open Conv Close 02/02/08 Open Conv Close 08/02/08
Journeys Group 853 118 0 4 967 28 0 2 993
Journeys 768 41 0 4 805 10 0 2 813
Journeys Kidz 73 42 0 0 115 13 0 0 128
Shi by
Journeys 12 35 0 0 47 5 0 0 52
Underground
Station Group 223 2 0 33 192 0 0 7 185
Hat World Group 785 98 0 21 862 16 0 9 869
Johnston & Murphy
Group 148 11 0 5 154 3 0 2 155
Shops 109 8 0 4 113 1 0 2 112
Factory
Outlets 39 3 0 1 41 2 0 0 43
Total Retail
Units 2,009 229 0 63 2,175 47 0 20 2,202
Retail Units Operated - Three Months Ended August 2, 2008
Balance Balance
05/03/08 Open Conv Close 08/02/08
Journeys Group 985 10 0 2 993
Journeys 812 3 0 2 813
Journeys Kidz 123 5 0 0 128
Shi by Journeys 50 2 0 0 52
Underground Station Group 190 0 0 5 185
Hat World Group 868 5 0 4 869
Johnston & Murphy Group 156 0 0 1 155
Shops 113 0 0 1 112
Factory Outlets 43 0 0 0 43
Total Retail Units 2,199 15 0 12 2,202
Constant Store Sales
Three Months Ended Six Months Ended
August 2, August 4, August 2, August 4,
2008 2007 2008 2007
Journeys Group 2% -7% 1% -2%
Underground Station Group 9% -23% 9% -22%
Hat World Group 7% -2% 5% -3%
Johnston & Murphy Group -4% 5% -3% 4%
Shops -3% 5% -2% 4%
Factory Outlets -7% 6% -5% 6%
Total Constant Store Sales 4% -6% 3% -4%
Genesco Inc.
Adjustments to Reported Loss from Continuing Operations
Three Months Ended August 2, 2008 and August 4, 2007
3 mos Impact 3 mos Impact
In Thousands (except per Aug 2,2008 on EPS Aug 4,2007 on EPS
(share amounts)
Loss from continuing operations,
as reported (4,929) $(0.27) (2,940) (0.13)
Adjustments: (1)
Merger-related expenses 202 0.01 2,878 0.13
Impairment & lease termination
charges 1,780 0.07 83 0.00
Other legal matters 190 0.01 - -
Impact of higher effective tax
rate (2) 6,366 0.36 - -
Adjusted earnings from continuing
operations (3) 3,609 $0.18 21 $0.00
(1) All adjustments are net of tax. The tax rate for the second quarter
of Fiscal 2009 before the impact of the settlement of merger-related
litigation and deductibility of prior year merger-related expenses is
40.2% excluding a FIN 48 discreet item of $74,000. The tax rate for
the second quarter of Fiscal 2008 is 47.5%.
(2) Includes added tax on Finish Line share appreciation and impact on EPS
calculation from additional tax.
(3) Reflects 23.3 million share count which includes convertible shares
and common stock equivalents.
The Company believes that disclosure of earnings and earnings per share
from continuing operations on a pro forma basis adjusted for the items not
reflected in the previously announced expectations will be meaningful to
investors, in light of the impact of a higher effective tax rate and other
items not reflected in those expectations.
Genesco Inc.
Adjustments to Forecasted Earnings from Continuing Operations
Fiscal Year Ending January 31, 2009
High Guidance Low Guidance
In Thousands (except per share Fiscal 2009 Fiscal 2009
amounts)
Forecasted earnings from
continuing operations 164,905 $6.97 163,608 $6.92
Adjustments: (1)
Settlement of merger-related
litigation (122,037) $(5.09) (122,037) (5.09)
Merger-related expenses 4,531 $0.19 4,531 0.19
Impairment and lease termination
charges 6,008 $0.25 6,008 0.25
Other legal matters 638 $0.03 638 0.03
Lower effective tax rate (3,512) $(0.15) (3,512) (0.15)
Adjusted forecasted
earnings from continuing
operations 50,533 $2.20 49,236 $2.15
(1) All adjustments are net of tax. The tax rate for Fiscal 2009 before
the impact of the settlement of merger-related litigation and
deductibility of prior year merger-related expenses is 40.2% excluding
FIN 48 discreet items of $322,000.
This reconciliation reflects estimates and current expectations of future
results. Actual results may vary materially from these expectations and
estimates, for reasons including those included in the discussion of
forward-looking statements elsewhere in this release. The Company
disclaims any obligation to update such expectations and estimates.
SOURCE Genesco Inc. Tags: ,REA,FAS,ERN,CCA,ERP,TN-Genesco-earns _ _     Is your favorite bookmark site missing? Ask for it. |
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