Genesco increases profitability in Q1 led by Lids Sports Group

By

Obi Anyanwu

Published
May 26, 2016

Genesco, Inc. on Thursday announced its financial results for the first quarter ended April 30, 2016.

 
First quarter net sales decreased 2% to $649 million from $661 million. Consolidated comparable sales, including same store sales and comparable e-commerce and catalog sales, increased 1% with Journeys Group increasing 1%, Lids increasing 2%, Johnston & Murphy increasing 6% and Schuh Group decreasing 5%.
 
Earnings from continued operations increased to $10.6 million, or $0.50 per diluted share, from $9.9 million, or $0.42 per diluted share, in the previous first quarter.

"We are pleased with the increase in first quarter profitability, which exceeded our expectations, driven by a significantly better performance from the Lids Sports Group," said Robert J. Dennis, chairman, president and chief executive officer of Genesco. "While overall comparable sales were at the lower end of our projected range, this was more than offset by a meaningful improvement in gross margin.
 
Genesco also announced that its Board of Directors has replaced the remaining $11 million balance of a previous $100 million repurchase program authorized in January 2016 with a new authorization to repurchase up to $100 million of common stock. In addition, the company repurchased 1.1 million shares of common stock in the first quarter at a total cost of $73 million and an average price of $66.75 per share.
 
Dennis concluded, “Based on our first quarter performance, we are reiterating our full year outlook taking into account some external headwinds pressuring sales and expenses. We still expect adjusted diluted earnings per share for the fiscal year ending January 28, 2017, in the range of $4.80 to $4.90, which represents a 12% to 14% increase over Fiscal 2016's adjusted earnings per share of $4.29."