Item 1. Financial Statements (unaudited)
The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.
The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.
The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.
The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.
The accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.
Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 1
Summary of Significant Accounting Policies
Basis of Presentation
The Condensed Consolidated Financial Statements and Notes contained in this report are unaudited but reflect all adjustments, including normal recurring adjustments, necessary for a fair presentation of the results for the interim periods of the fiscal year ending January 29, 2022 ("Fiscal 2022") and of the fiscal year ended January 30, 2021 ("Fiscal 2021"). All subsidiaries are consolidated in the Condensed Consolidated Financial Statements. All significant intercompany transactions and accounts have been eliminated. The results of operations for any interim period are not necessarily indicative of results for the full year. The Condensed Consolidated Financial Statements and the related Notes have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by U.S. Generally Accepted Accounting Principles (“GAAP”) for complete financial statements. The Condensed Consolidated Balance Sheet as of January 30, 2021 has been derived from the audited financial statements at that date. These Condensed Consolidated Financial Statements should be read in conjunction with our Consolidated Financial Statements and Notes for Fiscal 2021, which are contained in our Annual Report on Form 10-K as filed with the SEC on March 31, 2021.
Nature of Operations
Genesco Inc. and its subsidiaries (collectively the "Company", "we", "our", or "us") business includes the sourcing and design, marketing and distribution of footwear and accessories through retail stores in the U.S., Puerto Rico and Canada primarily under the Journeys®, Journeys Kidz®, Little Burgundy® and Johnston & Murphy® banners and under the Schuh® banner in the United Kingdom (“U.K.”) and the Republic of Ireland (“ROI”); through catalogs and e-commerce websites including the following: journeys.com, journeyskidz.com, journeys.ca, schuh.co.uk, schuh.ie, schuh.eu, johnstonmurphy.com, johnstonmurphy.ca and littleburgundyshoes.com and at wholesale, primarily under our Johnston & Murphy brand, the licensed Levi's® brand, the licensed Dockers® brand, the licensed G.H. Bass® brand and other brands that we license for footwear. At July 31, 2021, we operated 1,439 retail stores in the U.S., Puerto Rico, Canada, the U.K. and the ROI.
During the three and six months ended July 31, 2021 and August 1, 2020, we operated four reportable business segments (not including corporate): (i) Journeys Group, comprised of the Journeys, Journeys Kidz and Little Burgundy retail footwear chains and e-commerce operations; (ii) Schuh Group, comprised of the Schuh retail footwear chain and e-commerce operations; (iii) Johnston & Murphy Group, comprised of Johnston & Murphy retail operations, e-commerce operations and wholesale distribution of products under the Johnston & Murphy brand; and (iv) Licensed Brands, comprised of the licensed Dockers, Levi's, and G.H. Bass brands, as well as other brands we license for footwear.
Selling and Administrative Expenses
Wholesale costs of distribution are included in selling and administrative expenses on the Condensed Consolidated Statements of Operations in the amount of $3.6 million and $2.2 million for the second quarters of Fiscal 2022 and Fiscal 2021, respectively, and $7.2 million and $4.6 million for the first six months of Fiscal 2022 and Fiscal 2021, respectively.
Retail occupancy costs recorded in selling and administrative expense were $75.1 million and $71.5 million for the second quarters of Fiscal 2022 and Fiscal 2021, respectively, and $145.9 million and $148.7 million for the first six months of Fiscal 2022 and Fiscal 2021, respectively.
Advertising Costs
Advertising costs were $23.5 million and $14.1 million for the second quarters of Fiscal 2022 and Fiscal 2021, respectively, and $44.6 million and $28.6 million for the first six months of Fiscal 2022 and Fiscal 2021, respectively.
Vendor Allowances
Vendor reimbursements of cooperative advertising costs recognized as a reduction of selling and administrative expenses were $2.4 million and $0.9 million for the second quarters of Fiscal 2022 and Fiscal 2021, respectively, and $5.4 million and $2.7 million for the first six months of Fiscal 2022 and Fiscal 2021, respectively. During the first six months of each of Fiscal 2022 and Fiscal 2021, our cooperative advertising reimbursements received were not in excess of the costs incurred.
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Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 1
Summary of Significant Accounting Policies, Continued
New Accounting Pronouncements
In December 2019, the Financial Accounting Standards Board issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes”. This guidance aims to simplify the accounting for income taxes by removing certain exceptions to the general principles within the current guidance and by clarifying and amending the current guidance. The guidance is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2020. We adopted ASU No. 2019-12 in the first quarter of Fiscal 2022. This guidance did not have a material impact on our Condensed Consolidated Financial Statements.
Note 2
COVID-19
In March 2020, the World Health Organization categorized the outbreak of COVID-19 as a pandemic. To help control the spread of the virus and protect the health and safety of our employees and customers, we temporarily closed or modified operating models and hours of our retail stores in North America, the U.K. and the ROI beginning in March 2020 both in response to governmental requirements including “stay-at-home” orders and similar mandates and voluntarily, beyond the requirements of local government authorities. A portion of our store fleet remained closed during Fiscal 2021 and the first six months of Fiscal 2022. As of August 31, 2021, we are operating in substantially all locations.
Changes made in our operations, including temporary closures, combined with reduced customer traffic due to concerns over COVID-19, resulted in a material impact on our business since then. This prompted us to update our impairment analyses of our retail store portfolios and related lease right-of-use assets. For certain lower-performing stores, we compared the carrying value of store assets to undiscounted cash flows with updated assumptions on near-term profitability.
We evaluated our goodwill and indefinite-lived intangible assets for indicators of impairment at the end of each quarter of Fiscal 2021 and the quarters ended May 1, 2021 and July 31, 2021 of Fiscal 2022. During the first quarter of Fiscal 2021, such evaluation caused us to determine that, when considering the impact of COVID-19, indicators of impairment existed relating to the goodwill associated with Schuh Group and certain other trademarks. Therefore, we updated the goodwill impairment analysis for Schuh Group, and as a result, recorded a goodwill impairment charge of $79.3 million during the quarter ended May 2, 2020. In addition, we updated our impairment analysis for other intangible assets and, as a result, recorded a trademark impairment charge of $5.3 million during the quarter ended May 2, 2020. There were no impairment indicators for the quarters ended August 1, 2020, May 1, 2021 or July 31, 2021.
We evaluated our remaining tangible assets, particularly accounts receivable and inventory. Our wholesale businesses sell primarily to independent retailers and department stores across the United States. Receivables arising from these sales are not collateralized. Customer credit risk is affected by conditions or occurrences within the economy and the retail industry, such as COVID-19, as well as by customer specific factors. We establish an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information.
We also record reserves for obsolete and slow-moving inventory and for estimated shrinkage between physical inventory counts. We recorded incremental inventory reserve provisions as a result of excess inventory due to the impact of COVID-19 on retail traffic and demand for certain products. Depending on future customer behavior, among other factors, we may incur additional inventory reserve provisions.
Since the first quarter of Fiscal 2021, we have withheld certain contractual rent payments generally correlating with time periods when our stores were closed and/or correlating with sales declines from Fiscal 2020. We continue to recognize rent expense in accordance with the contractual terms. We are working with landlords in various markets seeking commercially reasonable lease concessions given the current environment, and while a number of agreements have been reached, some negotiations remain ongoing. In cases where the agreements do not result in a substantial increase in the rights of the lessor or the obligation of the lessee such that the total cash flows of the modified lease are substantially the same or less than the total cash flows of the existing lease, we have not reevaluated the contract terms. For these lease agreements, we have recognized a reduction in variable rent expense in the period that the concession was granted.
On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which among other things, provided employer payroll tax credits for wages paid to employees who were unable to work during the COVID-19 pandemic and options to defer payroll tax payments. Based on our evaluation of the CARES Act, we qualified for certain employer payroll tax credits as well
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Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 2
COVID-19, Continued
as the deferral of payroll and other tax payments in the future, which were treated as government subsidies to offset related operating expenses. During the quarters ended May 2, 2020, August 1, 2020, May 1, 2021 and July 31, 2021, qualified payroll tax credits under the CARES Act and other foreign subsidy programs reduced our selling and administrative expenses by approximately $7.0 million, $3.8 million, $5.0 million and $2.5 million, respectively, on our Condensed Consolidated Statements of Operations. We intend to continue to defer qualified payroll and other tax payments as permitted by the CARES Act.
Savings from the government program in the U.K. have provided property tax relief for the quarters ended May 1, 2021 and July 31, 2021 of approximately $4.7 million and $3.8 million, respectively. Other government relief programs in the U.K., ROI and Canada provided savings for the quarters ended May 1, 2021 and July 31, 2021 of approximately $3.2 million and $1.2 million, respectively.
The COVID-19 pandemic continues to evolve. The emergence of variants from the original strain, its economic impact and actions taken in response thereto, including, without limitation, the timing and availability of effective medical treatments and the ongoing rollout and acceptance of vaccines in response to the COVID-19 pandemic, may result in prolonged or recurring periods of store closures and modified operating schedules and may result in changes in customer behaviors, including a potential reduction in consumer discretionary spending in our stores and online. These may lead to increased asset recovery and valuation risks, such as impairment of our store and other assets and an inability to realize deferred tax assets due to sustaining losses in certain jurisdictions. The uncertainties in the global economy have and are likely to continue to impact the financial viability of our suppliers, and other business partners, which have interrupted and may continue to interrupt, our supply chain, limit our ability to collect receivables and require other changes to our operations. These and other factors have and may continue to adversely impact our net sales, gross margin, operating income and earnings per share financial measures.
Note 3
Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill by segment were as follows:
(In thousands)
|
|
Journeys
Group
|
|
|
Licensed
Brands
Group
|
|
|
Total
Goodwill
|
|
Balance, January 30, 2021
|
|
$
|
10,082
|
|
|
$
|
28,468
|
|
|
$
|
38,550
|
|
Effect of foreign currency exchange rates
|
|
|
238
|
|
|
|
(1
|
)
|
|
|
237
|
|
Balance, July 31, 2021
|
|
$
|
10,320
|
|
|
$
|
28,467
|
|
|
$
|
38,787
|
|
Other intangibles by major classes were as follows:
|
|
Trademarks (1)
|
|
Customer Lists
|
|
|
Other
|
|
|
Total
|
|
(In thousands)
|
|
July 31, 2021
|
|
|
Jan. 30,
2021
|
|
July 31, 2021
|
|
|
Jan. 30,
2021
|
|
|
July 31, 2021
|
|
|
Jan. 30,
2021
|
|
|
July 31, 2021
|
|
|
Jan. 30,
2021
|
|
Gross other intangibles
|
|
$
|
26,860
|
|
|
$
|
26,443
|
|
$
|
6,640
|
|
|
$
|
6,617
|
|
|
$
|
400
|
|
|
$
|
400
|
|
|
$
|
33,900
|
|
|
$
|
33,460
|
|
Accumulated amortization
|
|
|
—
|
|
|
|
—
|
|
|
(2,437
|
)
|
|
|
(2,131
|
)
|
|
|
(400
|
)
|
|
|
(400
|
)
|
|
|
(2,837
|
)
|
|
|
(2,531
|
)
|
Net Other Intangibles
|
|
$
|
26,860
|
|
|
$
|
26,443
|
|
$
|
4,203
|
|
|
$
|
4,486
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
31,063
|
|
|
$
|
30,929
|
|
(1) Includes a $23.4 million trademark at July 31, 2021 related to Schuh Group and $3.4 million trademark related to Journeys Group.
Note 4
Asset Impairments and Other Charges
We recorded pretax charges of $7.1 million in the second quarter of Fiscal 2022, including $6.2 million for professional fees related to actions of an activist shareholder and $1.4 million for retail store asset impairments, partially offset by a $0.6 million insurance gain. We recorded
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Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 4
Asset Impairments and Other Charges, Continued
pretax charges of $9.7 million in the first six months of Fiscal 2022, including $8.5 million for professional fees related to actions of an activist shareholder and $1.8 million for retail store asset impairments, partially offset by a $0.6 million insurance gain. We recorded pretax charges of $1.7 million in the second quarter of Fiscal 2021 for retail store asset impairments. We recorded pretax charges of $9.6 million in the first six months of Fiscal 2021, including $5.3 million for trademark impairments and $4.8 million for retail store asset impairments, partially offset by a $0.4 million gain for the release of an earnout related to the Togast acquisition.
Note 5
Inventories
(In thousands)
|
|
July 31, 2021
|
|
|
January 30, 2021
|
|
Wholesale finished goods
|
|
$
|
12,515
|
|
|
$
|
27,851
|
|
Retail merchandise
|
|
|
313,962
|
|
|
|
263,115
|
|
Total Inventories
|
|
$
|
326,477
|
|
|
$
|
290,966
|
|
Note 6
Fair Value
Fair Value of Financial Instruments
The carrying amounts and fair values of our financial instruments at July 31, 2021 and January 30, 2021 are as follows:
Fair Values
|
|
|
|
(In thousands)
|
|
July 31, 2021
|
|
|
January 30, 2021
|
|
|
|
Carrying
Amount
|
|
|
Fair
Value
|
|
|
Carrying
Amount
|
|
|
Fair
Value
|
|
U.S. Revolver Borrowings
|
|
$
|
15,851
|
|
|
$
|
16,024
|
|
|
$
|
32,986
|
|
|
$
|
33,612
|
|
UK Revolver Borrowings
|
|
|
4,171
|
|
|
|
4,181
|
|
|
|
—
|
|
|
|
—
|
|
As of July 31, 2021, we have $10.8 million of long-lived assets held and used which were measured using Level 3 inputs within the fair value hierarchy.
Note 7
Earnings Per Share
Weighted-average number of shares used to calculate earnings per share are as follows:
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
(Shares in thousands)
|
|
July 31, 2021
|
|
|
August 1, 2020
|
|
|
July 31, 2021
|
|
|
August 1, 2020
|
|
Weighted-average number of shares - basic
|
|
|
14,339
|
|
|
|
14,179
|
|
|
|
14,313
|
|
|
|
14,145
|
|
Common stock equivalents
|
|
|
272
|
|
|
|
-
|
|
|
|
344
|
|
|
|
-
|
|
Weighted-average number of shares - diluted
|
|
|
14,611
|
|
|
|
14,179
|
|
|
|
14,657
|
|
|
|
14,145
|
|
Due to the loss from continuing operations in the three months and six months ended August 1, 2020, share-based awards are excluded from the diluted earnings per share calculation for those periods because they would be antidilutive.
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Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 8
Long-Term Debt
(In thousands)
|
|
July 31, 2021
|
|
|
January 30, 2021
|
|
U.S. revolver borrowings
|
|
$
|
15,851
|
|
|
$
|
32,986
|
|
U.K. revolver borrowings
|
|
|
4,171
|
|
|
|
—
|
|
Total long-term debt
|
|
|
20,022
|
|
|
|
32,986
|
|
Current portion
|
|
|
—
|
|
|
|
—
|
|
Total Noncurrent Portion of Long-Term Debt
|
|
$
|
20,022
|
|
|
$
|
32,986
|
|
We were in compliance with all the relevant terms and conditions of the Credit Facility and Facility Letter as of July 31, 2021.
During the second quarter of Fiscal 2022, we paid off the $17.5 million First-in, Last-out tranche of our Credit Facility.
Note 9
Legal Proceedings
Environmental Matters
New York State Environmental Matters
In August 1997, the New York State Department of Environmental Conservation (“NYSDEC”) and the Company entered into a consent order whereby we assumed responsibility for conducting a remedial investigation and feasibility study and implementing an interim remedial measure with regard to the site of a knitting mill operated by a former subsidiary of ours from 1965 to 1969. The United States Environmental Protection Agency (“EPA”), which assumed primary regulatory responsibility for the site from NYSDEC, issued a Record of Decision in September 2007. The Record of Decision specified a remedy of a combination of groundwater extraction and treatment and in-situ chemical oxidation.
In September 2015, the EPA adopted an amendment to the Record of Decision eliminating the separate ground-water extraction and treatment systems and the use of in-situ oxidation from the remedy adopted in the Record of Decision. The amendment provides for the continued operation and maintenance of the existing wellhead treatment systems on wells operated by the Village of Garden City, New York (the "Village"). It also requires us to perform certain ongoing monitoring, operation and maintenance activities and to reimburse EPA's future oversight cost, involving future costs to us estimated to be between $1.7 million and $2.0 million, and to reimburse EPA for approximately $1.25 million of interim oversight costs. On August 15, 2016, the Court entered a Consent Judgment implementing the remedy provided for by the amendment.
The Village additionally asserted that we are liable for the costs associated with enhanced treatment required by the impact of the groundwater plume from the site on two public water supply wells, including historical total costs ranging from approximately $1.8 million to in excess of $2.5 million, and future operation and maintenance costs which the Village estimated at $126,400 annually while the enhanced treatment continues. On December 14, 2007, the Village filed a complaint (the "Village Lawsuit") against us and the owner of the property under the Resource Conservation and Recovery Act (“RCRA”), the Safe Drinking Water Act, and the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) as well as a number of state law theories in the U.S. District Court for the Eastern District of New York, seeking an injunction requiring the defendants to remediate contamination from the site and to establish their liability for future costs that may be incurred in connection with it.
In June 2016 we reached an agreement with the Village providing for the Village to continue to operate and maintain the well head treatment systems in accordance with the Record of Decision and to release its claims against us asserted in the Village Lawsuit in exchange for a lump-sum payment of $10.0 million by us. On August 25, 2016, the Village Lawsuit was dismissed with prejudice. The cost of the settlement with the Village and the estimated costs associated with our compliance with the Consent Judgment were covered by our existing provision for the site. The settlement with the Village did not have, and we expect that the Consent Judgment will not have, a material effect on our financial condition or results of operations.
In April 2015, we received from EPA a Notice of Potential Liability and Demand for Costs (the "Notice") pursuant to CERCLA regarding the site in Gloversville, New York of a former leather tannery operated by us and by other, unrelated parties. The Notice demanded payment of approximately $2.2 million of response costs claimed by EPA to have been incurred to conduct assessments and removal activities at the site. In February 2017, we entered into a settlement agreement with EPA resolving their claim for past response costs in exchange for a payment by us of $1.5 million which was paid in May 2017. Our environmental insurance carrier has reimbursed us for 75% of the settlement amount, subject to a $500,000 self-insured retention. We do not expect any additional cost related to the matter.
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Table of Contents
Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 9
Legal Proceedings, Continued
Whitehall Environmental Matters
We have performed sampling and analysis of soil, sediments, surface water, groundwater and waste management areas at our former Volunteer Leather Company facility in Whitehall, Michigan.
In October 2010, we entered into a Consent Decree with the Michigan Department of Natural Resources and Environment providing for implementation of a remedial Work Plan for the facility site designed to bring the site into compliance with applicable regulatory standards. The Work Plan's implementation is substantially complete and we expect, based on our present understanding of the condition of the site, that our future obligations with respect to the site will be limited to periodic monitoring and that future costs related to the site should not have a material effect on our financial condition or results of operations.
Accrual for Environmental Contingencies
Related to all outstanding environmental contingencies, we had accrued $1.4 million as of July 31, 2021, $1.5 million as of January 30, 2021 and $1.5 million as of August 1, 2020. All such provisions reflect our estimates of the most likely cost (undiscounted, including both current and noncurrent portions) of resolving the contingencies, based on facts and circumstances as of the time they were made. There is no assurance that relevant facts and circumstances will not change, necessitating future changes to the provisions. Such contingent liabilities are included in the liability arising from provision for discontinued operations on the accompanying Condensed Consolidated Balance Sheets because it relates to former facilities operated by us. We have made pretax accruals for certain of these contingencies which were not material for the first six months of Fiscal 2022 and Fiscal 2021. These charges are included in gain (loss) from discontinued operations, net in the Consolidated Statements of Operations and represent changes in estimates.
In addition to the matters specifically described in this Note, we are a party to other legal and regulatory proceedings and claims arising in the ordinary course of our business. While management does not believe that our liability with respect to any of these other matters is likely to have a material effect on our financial statements, legal proceedings are subject to inherent uncertainties and unfavorable rulings could have a material adverse impact on our financial statements.
Note 10
Commitments
As part of our Togast business, we have a commitment to Samsung C&T America, Inc. (“Samsung”) related to the ultimate sale and valuation of inventories owned by Samsung. If product is sold below Samsung’s cost, we are required to pay to Samsung the difference between the sales price and its cost. At July 31, 2021, the inventory owned by Samsung had a historical cost of $7.8 million. As of July 31, 2021, we believe that we have appropriately accounted for any differences between the fair value of the Samsung inventory and Samsung’s historical cost.
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Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 11
Business Segment Information
Three Months Ended July 31, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
Journeys
Group
|
|
|
Schuh
Group
|
|
|
Johnston
& Murphy
Group
|
|
|
Licensed
Brands
|
|
|
Corporate
& Other
|
|
|
Consolidated
|
|
Sales
|
|
$
|
346,275
|
|
|
$
|
106,079
|
|
|
$
|
61,159
|
|
|
$
|
41,966
|
|
|
$
|
—
|
|
|
$
|
555,479
|
|
Intercompany sales
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(296
|
)
|
|
|
—
|
|
|
|
(296
|
)
|
Net sales to external customers
|
|
$
|
346,275
|
|
|
$
|
106,079
|
|
|
$
|
61,159
|
|
|
$
|
41,670
|
|
|
$
|
—
|
|
|
$
|
555,183
|
|
Segment operating income (loss)
|
|
$
|
30,368
|
|
|
$
|
3,623
|
|
|
$
|
3,951
|
|
|
$
|
991
|
|
|
$
|
(18,962
|
)
|
|
$
|
19,971
|
|
Asset impairments and other (1)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,070
|
)
|
|
|
(7,070
|
)
|
Operating income (loss)
|
|
|
30,368
|
|
|
|
3,623
|
|
|
|
3,951
|
|
|
|
991
|
|
|
|
(26,032
|
)
|
|
|
12,901
|
|
Other components of net periodic benefit cost
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(56
|
)
|
|
|
(56
|
)
|
Interest expense
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(752
|
)
|
|
|
(752
|
)
|
Interest income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
135
|
|
|
|
135
|
|
Earnings (loss) from continuing operations before income taxes
|
|
$
|
30,368
|
|
|
$
|
3,623
|
|
|
$
|
3,951
|
|
|
$
|
991
|
|
|
$
|
(26,705
|
)
|
|
$
|
12,228
|
|
Total assets (2)
|
|
$
|
765,100
|
|
|
$
|
247,833
|
|
|
$
|
132,639
|
|
|
$
|
50,438
|
|
|
$
|
462,610
|
|
|
$
|
1,658,620
|
|
Depreciation and amortization
|
|
|
7,107
|
|
|
|
1,813
|
|
|
|
1,191
|
|
|
|
270
|
|
|
|
364
|
|
|
|
10,745
|
|
Capital expenditures
|
|
|
4,923
|
|
|
|
529
|
|
|
|
1,003
|
|
|
|
215
|
|
|
|
773
|
|
|
|
7,443
|
|
(1) Asset impairments and other includes a $6.2 million charge for professional fees related to the actions of an activist shareholder and a $1.4 million charge for retail store asset impairments, which includes $0.6 million in Journeys Group, $0.7 million in Schuh Group and $0.1 million in Johnston & Murphy Group, partially offset by a $0.6 million insurance gain.
(2) Of our $812.9 million of long-lived assets, $129.4 million and $30.3 million relate to long-lived assets in the U.K. and Canada, respectively.
15
Table of Contents
Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 11
Business Segment Information, Continued
Three Months Ended August 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
Journeys
Group
|
|
|
Schuh
Group
|
|
|
Johnston
& Murphy
Group
|
|
|
Licensed
Brands
|
|
|
Corporate
& Other
|
|
|
Consolidated
|
|
Sales
|
|
$
|
276,631
|
|
|
|
71,732
|
|
|
$
|
24,097
|
|
|
$
|
19,114
|
|
|
$
|
—
|
|
|
$
|
391,574
|
|
Intercompany sales
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(357
|
)
|
|
|
—
|
|
|
|
(357
|
)
|
Net sales to external customers
|
|
$
|
276,631
|
|
|
$
|
71,732
|
|
|
$
|
24,097
|
|
|
$
|
18,757
|
|
|
$
|
—
|
|
|
$
|
391,217
|
|
Segment operating income (loss)
|
|
$
|
10,160
|
|
|
$
|
(6,838
|
)
|
|
$
|
(18,243
|
)
|
|
$
|
(1,222
|
)
|
|
$
|
(4,118
|
)
|
|
$
|
(20,261
|
)
|
Asset impairments and other (1)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,733
|
)
|
|
|
(1,733
|
)
|
Operating income (loss)
|
|
|
10,160
|
|
|
|
(6,838
|
)
|
|
|
(18,243
|
)
|
|
|
(1,222
|
)
|
|
|
(5,851
|
)
|
|
|
(21,994
|
)
|
Other components of net periodic benefit income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
182
|
|
|
|
182
|
|
Interest expense
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,965
|
)
|
|
|
(1,965
|
)
|
Interest income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
47
|
|
|
|
47
|
|
Earnings (loss) from continuing operations before income taxes
|
|
$
|
10,160
|
|
|
$
|
(6,838
|
)
|
|
$
|
(18,243
|
)
|
|
$
|
(1,222
|
)
|
|
$
|
(7,587
|
)
|
|
$
|
(23,730
|
)
|
Total assets (2)
|
|
$
|
855,201
|
|
|
|
249,666
|
|
|
$
|
185,375
|
|
|
$
|
84,730
|
|
|
$
|
395,056
|
|
|
$
|
1,770,028
|
|
Depreciation and amortization
|
|
|
7,271
|
|
|
|
2,318
|
|
|
|
1,452
|
|
|
|
356
|
|
|
|
390
|
|
|
|
11,787
|
|
Capital expenditures
|
|
|
2,660
|
|
|
|
145
|
|
|
|
891
|
|
|
|
103
|
|
|
|
101
|
|
|
|
3,900
|
|
(1) Asset impairments and other includes a $1.7 million charge for retail store asset impairments, which includes $0.4 million in Schuh Group and $1.3 million in Journeys Group.
(2) Of our $890.8 million of long-lived assets, $151.3 million and $39.8 million relate to long-lived assets in the U.K. and Canada, respectively.
Six Months Ended July 31, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
Journeys
Group
|
|
|
Schuh
Group
|
|
|
Johnston
& Murphy
Group
|
|
|
Licensed
Brands
|
|
|
Corporate
& Other
|
|
|
Consolidated
|
|
Sales
|
|
$
|
722,823
|
|
|
$
|
174,790
|
|
|
$
|
109,921
|
|
|
$
|
86,798
|
|
|
$
|
—
|
|
|
$
|
1,094,332
|
|
Intercompany sales
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(454
|
)
|
|
|
—
|
|
|
|
(454
|
)
|
Net sales to external customers
|
|
$
|
722,823
|
|
|
$
|
174,790
|
|
|
$
|
109,921
|
|
|
$
|
86,344
|
|
|
$
|
—
|
|
|
$
|
1,093,878
|
|
Segment operating income (loss)
|
|
$
|
63,492
|
|
|
$
|
(224
|
)
|
|
$
|
771
|
|
|
$
|
3,552
|
|
|
$
|
(29,423
|
)
|
|
$
|
38,168
|
|
Asset impairments and other(1)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(9,740
|
)
|
|
|
(9,740
|
)
|
Operating income (loss)
|
|
|
63,492
|
|
|
|
(224
|
)
|
|
|
771
|
|
|
|
3,552
|
|
|
|
(39,163
|
)
|
|
|
28,428
|
|
Other components of net periodic benefit cost
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(17
|
)
|
|
|
(17
|
)
|
Interest expense
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,621
|
)
|
|
|
(1,621
|
)
|
Interest income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
275
|
|
|
|
275
|
|
Earnings (loss) from continuing
operations before income taxes
|
|
$
|
63,492
|
|
|
$
|
(224
|
)
|
|
$
|
771
|
|
|
$
|
3,552
|
|
|
$
|
(40,526
|
)
|
|
$
|
27,065
|
|
Depreciation and amortization
|
|
$
|
14,389
|
|
|
$
|
3,681
|
|
|
$
|
2,312
|
|
|
$
|
554
|
|
|
$
|
698
|
|
|
$
|
21,634
|
|
Capital expenditures
|
|
|
13,773
|
|
|
|
1,227
|
|
|
|
2,562
|
|
|
|
480
|
|
|
|
1,503
|
|
|
|
19,545
|
|
(1) Asset impairments and other includes an $8.5 million charge for professional fees related to the actions of an activist shareholder and a $1.8 million charge for retail store asset impairments, which includes $0.2 million in Johnston & Murphy Group, $0.8 million in Schuh Group and $0.8 million in Journeys Group, partially offset by a $0.6 million insurance gain.
16
Table of Contents
Genesco Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements (unaudited)
Note 11
Business Segment Information, Continued
Six Months Ended August 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
Journeys
Group
|
|
|
Schuh
Group
|
|
|
Johnston
& Murphy
Group
|
|
|
Licensed
Brands
|
|
|
Corporate
& Other
|
|
|
Consolidated
|
|
Sales
|
|
$
|
445,556
|
|
|
$
|
118,897
|
|
|
$
|
62,946
|
|
|
$
|
43,795
|
|
|
$
|
—
|
|
|
$
|
671,194
|
|
Intercompany sales
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(745
|
)
|
|
|
—
|
|
|
|
(745
|
)
|
Net sales to external customers
|
|
$
|
445,556
|
|
|
$
|
118,897
|
|
|
$
|
62,946
|
|
|
$
|
43,050
|
|
|
$
|
—
|
|
|
$
|
670,449
|
|
Segment operating loss
|
|
$
|
(26,923
|
)
|
|
$
|
(21,924
|
)
|
|
$
|
(27,827
|
)
|
|
$
|
(3,723
|
)
|
|
$
|
(8,762
|
)
|
|
$
|
(89,159
|
)
|
Goodwill impairment(1)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(79,259
|
)
|
|
|
(79,259
|
)
|
Asset impairments and other(2)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(9,594
|
)
|
|
|
(9,594
|
)
|
Operating loss
|
|
|
(26,923
|
)
|
|
|
(21,924
|
)
|
|
|
(27,827
|
)
|
|
|
(3,723
|
)
|
|
|
(97,615
|
)
|
|
|
(178,012
|
)
|
Other components of net periodic benefit income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
306
|
|
|
|
306
|
|
Interest expense
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(3,014
|
)
|
|
|
(3,014
|
)
|
Interest income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
240
|
|
|
|
240
|
|
Earnings (loss) from continuing
operations before income taxes
|
|
$
|
(26,923
|
)
|
|
$
|
(21,924
|
)
|
|
$
|
(27,827
|
)
|
|
$
|
(3,723
|
)
|
|
$
|
(100,083
|
)
|
|
$
|
(180,480
|
)
|
Depreciation and amortization
|
|
$
|
14,724
|
|
|
$
|
4,957
|
|
|
$
|
2,928
|
|
|
$
|
823
|
|
|
$
|
778
|
|
|
$
|
24,210
|
|
Capital expenditures
|
|
|
5,852
|
|
|
|
1,838
|
|
|
|
2,568
|
|
|
|
75
|
|
|
|
309
|
|
|
|
10,642
|
|
(1) Goodwill impairment of $79.3 million is related to Schuh Group.
(2) Asset impairments and other includes a $4.8 million charge for retail store asset impairments, which includes $1.2 million in Johnston & Murphy, $1.6 million in Schuh Group and $2.0 million in Journeys Group, and a $5.3 million trademark impairment, which includes $4.9 million in Journeys Group and $0.4 million in Johnston & Murphy Group.
17
Table of Contents