NASHVILLE, Tenn., Sept. 7, 2018 /PRNewswire/ --
Second Quarter Fiscal 2019 Financial Summary
- Net sales increased 6% to $654
million
- Comparable sales increased 3%
- GAAP EPS from continuing operations was $0.01
- Non-GAAP EPS from continuing operations was $0.04 1
Genesco Inc. (NYSE: GCO) for the three months ended August 4, 2018, today reported GAAP earnings from
continuing operations per diluted share of $0.01, compared to a loss per diluted share of
$(0.20) in the second quarter last
year. Adjusted for the Excluded Items in both periods, the
Company reported second quarter earnings from continuing operations
per diluted share of $0.04, compared
to a loss per diluted share of $(0.10) last year.
Robert J. Dennis, Chairman,
President and Chief Executive Officer, said:
"Our second quarter performance was highlighted by our
strongest quarterly comparable sales increase in more than two
years. Sales trends at Journeys and Johnston & Murphy
accelerated compared with solid first quarter results driven by
positive store comps at both businesses, leading to our first
overall positive store comp in eight quarters. This positive store
comp allowed us to leverage expenses, which along with the move of
an important back-to-school sales week into the second quarter due
to the calendar shift, led to a significant improvement in overall
profitability versus the prior year period. Comparable sales
at the Lids Sports Group remained negative, although trends once
again improved on a sequential basis. Similarly, Schuh's comp
result was meaningfully better versus the first quarter, however,
it was still negative as several factors in the U.K. combined to
create a challenging selling environment during the second
quarter.
"The third quarter so far has seen an acceleration in comparable
sales over the second quarter driven by the continued strength of
our U.S. footwear businesses during the heart of the important
back-to-school season. We are encouraged by the momentum at
Journeys and Johnston & Murphy but remain cautious in our
outlook for Lids and Schuh over the remainder of the fiscal year
due to the lack of visibility into improving trends. Longer-term,
we continue to believe that the work we are doing to transform our
operating model in response to changing consumer behavior and the
evolving retail environment will lead to enhanced profitability and
greater shareholder value."
Second Quarter Review
Net sales for the second quarter of Fiscal 2019 increased 6% to
$654 million from $617 million in the second quarter of Fiscal
2018. Comparable sales increased 3%, with stores up 2% and direct
up 7%. Direct-to-consumer sales were 10% of total retail sales for
the quarter, up a little over last year.
Comparable
Sales
|
|
|
|
Comparable Same
Store and Direct Sales:
|
2QFY19
|
2QFY18
|
Journeys
Group
|
10%
|
1%
|
Schuh
Group
|
(7)%
|
3%
|
Lids Sports
Group
|
(5)%
|
(2)%
|
Johnston & Murphy
Group
|
8%
|
(1)%
|
Total Genesco
Comparable Sales
|
3%
|
0%
|
Same Store
Sales
|
2%
|
(2)%
|
Comparable Direct
Sales
|
7%
|
30%
|
Second quarter gross margin this year was 49.2% compared with
49.7% last year. The 50 basis point decrease reflects primarily
increased markdowns to clear slower-moving product at Schuh and
Johnston & Murphy's wholesale operations, as well as at
Journeys due in part to the shift in the calendar, partially offset
by better full price selling in the Company's other business
segments.
Selling and administrative expense for the second quarter this
year was 48.8%, down 120 basis points, compared to 50.0% of sales
for the same period last year. The decrease as a percentage
of sales reflects the leveraging of rents, selling salaries, and
several other expense categories on higher sales, partially offset
by higher bonus accruals.
Genesco's GAAP operating income for the second quarter was
$1.4 million this year compared with
an operating loss of $2.0 million
last year. Adjusted for the Excluded Items in both periods,
operating income for the second quarter was $2.4 million this year compared with an operating
loss of $1.6 million last year.
Adjusted operating margin was 0.4% of sales in the second quarter
of Fiscal 2019 and (0.3)% last year.
The effective tax rate for the quarter was 35.5% in Fiscal 2019
compared to -18.9% last year. The adjusted tax rate,
reflecting Excluded Items, was 37.6% in Fiscal 2019 compared to
31.9% last year. The higher adjusted tax rate for this year
reflects the inability to recognize a tax benefit for certain
overseas losses, partially offset by the lower U.S. federal income
tax rate following the passage of the Tax Cut and Jobs Act in
December 2017.
GAAP earnings from continuing operations were $0.2 million in the second quarter of Fiscal
2019, compared to a loss of $3.9
million in the second quarter last year. Adjusted for
the Excluded Items in both periods, second quarter earnings from
continuing operations were $0.8
million in Fiscal 2019, compared with a loss of $2.0 million last year.
Cash, Borrowings and Inventory
Cash and cash equivalents at August 4,
2018 were $49.8 million,
compared with $43.5 million at
July 29, 2017. Total debt
at the end of the second quarter of Fiscal 2019 was $83.3 million compared with $190.9 million at the end of last year's second
quarter, a decrease of 56%. Inventories decreased 9% in the second
quarter of Fiscal 2019 on a year-over-year
basis.
Capital Expenditures and Store Activity
For the second quarter, capital expenditures were $12 million, which consisted of $7 million related to store remodels and new
stores and $5 million related to
direct to consumer, omnichannel, information technology,
distribution center and other projects.
Depreciation and amortization was $19 million. During the quarter, the
Company opened eight new stores and closed 31 stores.
Excluding Locker Room by Lids in Macy's stores, the Company ended
the quarter with 2,540 stores compared with 2,621 stores at the end
of the second quarter last year, or a decrease of 3%. Square
footage was down 2% on a year-over-year basis, both including and
excluding Lids Locker Room departments in Macy's stores.
Fiscal 2019 Outlook
For Fiscal 2019, the Company is reiterating its previously
announced full-year guidance and expects:
- Comparable sales to be up 1% to 3%, and
- Adjusted diluted earnings per share in the range of
$3.05 to $3.45.2
Access the conference call referenced below for details
regarding changes in guidance assumptions.
Conference Call, Management Commentary and Investor
Presentation
The Company has posted detailed financial commentary and a
supplemental financial presentation of second quarter results and
guidance on its website, www.genesco.com, in the investor relations
section. The Company's live conference call on September 7, 2018, at 7:30
a.m. (Central time), may be accessed through the Company's
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.
Safe Harbor Statement
This release contains
forward-looking statements, including those regarding the
performance outlook for the Company and its individual businesses
(including, without limitation, sales, expenses, margins and
earnings) 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 and projections reflected in forward-looking statements,
including the level and timing of promotional activity necessary to
maintain inventories at appropriate levels; the Company's ability
to complete the sale of the Lids Sports Group business on
acceptable terms and the timing of any sale transaction; the
imposition of tariffs on imported products or the disallowance of
tax deductions on imported products; disruptions in product supply
or distribution; unfavorable trends in fuel costs, foreign exchange
rates, foreign labor and material costs, and other factors
affecting the cost of products; the effects of the British decision
to exit the European Union, including potential effects on consumer
demand, currency exchange rates, and the supply chain; the
effectiveness of the Company's omnichannel initiatives; costs
associated with changes in minimum wage and overtime requirements;
costs associated with wage pressure associated with a full
employment environment in the U.S. and the U.K.; weakness in the
consumer economy and retail industry; competition in the Company's
markets, including online and including competition from some of
the Company's vendors in both the licensed sports and branded
footwear markets; fashion trends that affect the sales or product
margins of the Company's retail product offerings; weakness in
shopping mall traffic and challenges to the viability of malls
where the Company operates stores, related to planned closings of
department stores or other factors; risks related to the potential
for terrorist events, especially in malls and shopping districts;
the effects of the implementation of federal tax reform on the
estimated tax rate reflected in certain forward-looking statements;
changes in buying patterns by significant wholesale customers;
bankruptcies or deterioration in financial condition of significant
wholesale customers or the inability of wholesale customers or
consumers to obtain credit; the Company's ability to continue to
complete and integrate acquisitions, expand its business and
diversify its product base; changes in the timing of holidays or in
the onset of seasonal weather affecting period-to-period sales
comparisons; and the performance of athletic teams, the
participants in major sporting events such as the NBA finals, Super
Bowl and World Series, developments with respect to certain
individual athletes, and other sports-related events or changes
that may affect period-to-period comparisons in the Company's Lids
Sports Group retail businesses. Additional factors that could
affect the Company's prospects and cause differences from
expectations include the ability to build, open, staff and support
additional retail stores and to renew leases for existing stores
and control occupancy costs, and to conduct required remodeling or
refurbishment on schedule and at expected expense levels;
deterioration in the performance of individual businesses or of the
Company's market value relative to its book value, resulting in
impairments of fixed assets or intangible assets or other adverse
financial consequences and the timing and amount of such
impairments or other consequences; unexpected changes to the market
for the Company's shares; variations from expected pension-related
charges caused by conditions in the financial markets; costs and
reputational harm as a result of disruptions in the Company's
business or information technology systems either by security
breaches and incidents or by potential problems associated with the
implementation of new or upgraded systems; the Company's ability to
execute its cost-reduction initiatives and to achieve acceptable
levels of expense in a changing retail environment; and the
cost and outcome of litigation, investigations and environmental
matters involving the Company. 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.
About Genesco Inc.
Genesco Inc., a Nashville-based
specialty retailer, sells footwear, headwear, sports apparel and
accessories in more than 2,650 retail stores and leased departments
throughout the U.S., Canada, the
United Kingdom, the Republic of Ireland and Germany, principally under the names Journeys,
Journeys Kidz, Shi by Journeys, Schuh, Schuh Kids, Little Burgundy,
Lids, Locker Room by Lids, Johnston & Murphy, and on internet
websites www.journeys.com, www.journeyskidz.com, www.journeys.ca,
www.shibyjourneys.com, www.schuh.co.uk,
www.littleburgundyshoes.com, www.johnstonmurphy.com, www.lids.com,
www.lids.ca, www.lidslockerroom.com, www.trask.com, and
www.dockersshoes.com. The Company's Lids Sports Group
division operates the Lids headwear stores, the Locker Room by Lids
and other team sports fan shops and single team clubhouse
stores. In addition, Genesco sells wholesale footwear
under its Johnston & Murphy brand, the Trask brand, the
licensed Dockers brand, and other brands. For more information on
Genesco and its operating divisions, please visit
www.genesco.com.
1 Excludes asset impairment charges, legal and
other matters, and a gain related to Hurricane Maria, net of tax
effect and other tax items ("Excluded Items"). A reconciliation of
earnings/loss and earnings/loss per share from continuing
operations in accordance with U.S. Generally Accepted Accounting
Principles ("GAAP") with the adjusted earnings/loss and
earnings/loss per share numbers is set forth on Schedule B to this
press release. The Company believes that disclosure of earnings and
earnings per share from continuing operations adjusted for the
items not reflected in the previously announced expectations will
be meaningful to investors, especially in light of the impact of
such items on the results.
2 A reconciliation of the adjusted financial measures
cited in the guidance to their corresponding measures as reported
pursuant to GAAP is included in Schedule B to this press
release.
|
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
|
Condensed
Consolidated Statements of Operations
|
|
(in thousands,
except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
|
Aug.
4,
|
%
of
|
|
July 29,
|
% of
|
|
|
|
|
|
2018
|
Net
Sales
|
|
2017
|
Net Sales
|
|
|
Net sales
|
|
|
$
653,892
|
100.0%
|
|
$ 616,506
|
100.0%
|
|
|
Cost of
sales
|
|
332,450
|
50.8%
|
|
309,999
|
50.3%
|
|
|
Gross
margin
|
|
321,442
|
49.2%
|
|
306,507
|
49.7%
|
|
|
Selling and
administrative expenses
|
319,042
|
48.8%
|
|
308,435
|
50.0%
|
|
|
Asset impairments and
other, net
|
1,039
|
0.2%
|
|
58
|
0.0%
|
|
|
Earnings (loss) from operations
|
1,361
|
0.2%
|
|
(1,986)
|
-0.3%
|
|
|
Other components of
net periodic benefit cost
|
(1)
|
0.0%
|
|
24
|
0.0%
|
|
|
Interest expense,
net
|
|
1,103
|
0.2%
|
|
1,249
|
0.2%
|
|
|
Earnings (loss) from continuing operations
before
|
|
|
|
|
|
|
|
income
taxes
|
|
259
|
0.0%
|
|
(3,259)
|
-0.5%
|
|
|
Income tax
expense
|
|
92
|
0.0%
|
|
616
|
0.1%
|
|
|
Earnings (loss) from continuing operations
|
167
|
0.0%
|
|
(3,875)
|
-0.6%
|
|
|
Provision for
discontinued operations, net
|
(182)
|
0.0%
|
|
(73)
|
0.0%
|
|
|
Net
Loss
|
|
|
$
(15)
|
0.0%
|
|
$
(3,948)
|
-0.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
|
|
|
Before discontinued operations
|
$
0.01
|
|
|
$
(0.20)
|
|
|
|
Net earnings (loss)
|
|
$
-
|
|
|
$
(0.21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding - Basic
|
19,342
|
|
|
19,152
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share:
|
|
|
|
|
|
|
|
Before discontinued operations
|
$
0.01
|
|
|
$
(0.20)
|
|
|
|
Net earnings (loss)
|
|
$
-
|
|
|
$
(0.21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding - Diluted
|
19,442
|
|
|
19,152
|
|
|
|
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
|
Condensed
Consolidated Statements of Operations
|
|
(in thousands,
except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
Aug.
4,
|
%
of
|
|
July 29,
|
% of
|
|
|
|
|
|
2018
|
Net
Sales
|
|
2017
|
Net Sales
|
|
|
Net sales
|
|
|
$
1,298,851
|
100.0%
|
|
$
1,259,874
|
100.0%
|
|
|
Cost of
sales
|
|
655,581
|
50.5%
|
|
634,454
|
50.4%
|
|
|
Gross
margin
|
|
643,270
|
49.5%
|
|
625,420
|
49.6%
|
|
|
Selling and
administrative expenses
|
641,166
|
49.4%
|
|
624,403
|
49.6%
|
|
|
Asset impairments and
other, net
|
2,591
|
0.2%
|
|
177
|
0.0%
|
|
|
Earnings (loss) from operations
|
(487)
|
0.0%
|
|
840
|
0.1%
|
|
|
Other components of
net periodic benefit cost
|
19
|
0.0%
|
|
56
|
0.0%
|
|
|
Interest expense,
net
|
|
2,131
|
0.2%
|
|
2,426
|
0.2%
|
|
|
Loss
from continuing operations before income taxes
|
(2,637)
|
-0.2%
|
|
(1,642)
|
-0.1%
|
|
|
Income tax expense
(benefit)
|
(496)
|
0.0%
|
|
1,236
|
0.1%
|
|
|
Loss
from continuing operations
|
(2,141)
|
-0.2%
|
|
(2,878)
|
-0.2%
|
|
|
Provision for
discontinued operations, net
|
(205)
|
0.0%
|
|
(185)
|
0.0%
|
|
|
Net
Loss
|
|
|
$
(2,346)
|
-0.2%
|
|
$
(3,063)
|
-0.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic loss per
share:
|
|
|
|
|
|
|
|
|
Before discontinued operations
|
$
(0.11)
|
|
|
$
(0.15)
|
|
|
|
Net loss
|
|
|
$
(0.12)
|
|
|
$
(0.16)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding - Basic
|
19,310
|
|
|
19,171
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share:
|
|
|
|
|
|
|
|
|
Before discontinued operations
|
$
(0.11)
|
|
|
$
(0.15)
|
|
|
|
Net loss
|
|
|
$
(0.12)
|
|
|
$
(0.16)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding - Diluted
|
19,310
|
|
|
19,171
|
|
|
|
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
|
Sales/Earnings
Summary by Segment
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
|
Aug.
4,
|
%
of
|
|
July 29,
|
% of
|
|
|
|
|
|
2018
|
Net
Sales
|
|
2017
|
Net Sales
|
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
Journeys Group
|
|
$
304,995
|
46.6%
|
|
$ 258,953
|
42.0%
|
|
|
Schuh Group
|
|
98,159
|
15.0%
|
|
97,625
|
15.8%
|
|
|
Lids Sports Group
|
|
166,877
|
25.5%
|
|
180,230
|
29.2%
|
|
|
Johnston & Murphy Group
|
68,441
|
10.5%
|
|
64,860
|
10.5%
|
|
|
Licensed Brands
|
|
15,336
|
2.3%
|
|
14,697
|
2.4%
|
|
|
Corporate and Other
|
|
84
|
0.0%
|
|
141
|
0.0%
|
|
|
Net Sales
|
|
|
$
653,892
|
100.0%
|
|
$ 616,506
|
100.0%
|
|
|
Operating Income
(Loss):
|
|
|
|
|
|
|
|
|
Journeys Group (1)
|
|
$
7,661
|
2.5%
|
|
$
(2,194)
|
-0.8%
|
|
|
Schuh Group
|
|
1,073
|
1.1%
|
|
4,538
|
4.6%
|
|
|
Lids Sports Group
|
|
1,152
|
0.7%
|
|
3,040
|
1.7%
|
|
|
Johnston & Murphy Group
|
928
|
1.4%
|
|
1,547
|
2.4%
|
|
|
Licensed Brands
|
|
(396)
|
-2.6%
|
|
(1,051)
|
-7.2%
|
|
|
Corporate and Other(2)
|
|
(9,057)
|
-1.4%
|
|
(7,866)
|
-1.3%
|
|
|
Earnings (loss) from
operations
|
1,361
|
0.2%
|
|
(1,986)
|
-0.3%
|
|
|
Other components of
net periodic benefit cost
|
(1)
|
0.0%
|
|
24
|
0.0%
|
|
|
Interest,
net
|
|
|
1,103
|
0.2%
|
|
1,249
|
0.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
from continuing operations
before
|
|
|
|
|
|
|
income taxes
|
|
259
|
0.0%
|
|
(3,259)
|
-0.5%
|
|
|
Income tax
expense
|
|
92
|
0.0%
|
|
616
|
0.1%
|
|
|
Earnings (loss) from
continuing operations
|
167
|
0.0%
|
|
(3,875)
|
-0.6%
|
|
|
Provision for
discontinued operations, net
|
(182)
|
0.0%
|
|
(73)
|
0.0%
|
|
|
Net
Loss
|
|
|
$
(15)
|
0.0%
|
|
$
(3,948)
|
-0.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Includes a $0.3 million charge for
acquisition transition expenses in the second quarter of Fiscal
2018.
|
|
|
|
|
(2)Includes a $1.0 million charge in the
second quarter of Fiscal 2019 which includes $0.9 million for asset
impairments and $0.6 million in
|
|
legal and other
matters, partially offset by a $0.5 million gain related to
Hurricane Maria. Includes a $0.1 million charge in the second
quarter
|
|
of Fiscal 2018 for
asset impairments.
|
|
|
|
|
|
|
GENESCO
INC.
|
|
Sales/Earnings
Summary by Segment
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
Six Months
Ended
|
|
|
|
|
|
Aug.
4,
|
%
of
|
|
July 29,
|
% of
|
|
|
|
|
|
2018
|
Net
Sales
|
|
2017
|
Net Sales
|
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
Journeys Group
|
|
$
611,137
|
47.1%
|
|
$
543,072
|
43.1%
|
|
|
Schuh Group
|
|
178,425
|
13.7%
|
|
174,081
|
13.8%
|
|
|
Lids Sports Group
|
|
325,617
|
25.1%
|
|
357,131
|
28.3%
|
|
|
Johnston & Murphy Group
|
144,125
|
11.1%
|
|
137,653
|
10.9%
|
|
|
Licensed Brands
|
|
39,401
|
3.0%
|
|
47,707
|
3.8%
|
|
|
Corporate and Other
|
|
146
|
0.0%
|
|
230
|
0.0%
|
|
|
Net Sales
|
|
|
$
1,298,851
|
100.0%
|
|
$
1,259,874
|
100.0%
|
|
|
Operating Income
(Loss):
|
|
|
|
|
|
|
|
|
Journeys Group (1)
|
|
$
21,298
|
3.5%
|
|
$
5,278
|
1.0%
|
|
|
Schuh Group
|
|
(4,567)
|
-2.6%
|
|
3,851
|
2.2%
|
|
|
Lids Sports Group
|
|
(4,210)
|
-1.3%
|
|
1,254
|
0.4%
|
|
|
Johnston & Murphy Group
|
5,934
|
4.1%
|
|
5,367
|
3.9%
|
|
|
Licensed Brands
|
|
(90)
|
-0.2%
|
|
1,224
|
2.6%
|
|
|
Corporate and Other(2)
|
|
(18,852)
|
-1.5%
|
|
(16,134)
|
-1.3%
|
|
|
Earnings (loss) from
operations
|
(487)
|
0.0%
|
|
840
|
0.1%
|
|
|
Other components of
net periodic benefit cost
|
19
|
0.0%
|
|
56
|
0.0%
|
|
|
Interest,
net
|
|
|
2,131
|
0.2%
|
|
2,426
|
0.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
continuing operations before income taxes
|
(2,637)
|
-0.2%
|
|
(1,642)
|
-0.1%
|
|
|
Income tax expense
(benefit)
|
(496)
|
0.0%
|
|
1,236
|
0.1%
|
|
|
Loss from continuing
operations
|
(2,141)
|
-0.2%
|
|
(2,878)
|
-0.2%
|
|
|
Provision for
discontinued operations, net
|
(205)
|
0.0%
|
|
(185)
|
0.0%
|
|
|
Net
Loss
|
|
|
$
(2,346)
|
-0.2%
|
|
$
(3,063)
|
-0.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)Includes a $0.3 million charge for
acquisition transition expenses in the first six months of Fiscal
2018.
|
|
|
|
|
|
(2)Includes a $2.6 million charge in the
first six months of Fiscal 2019 which includes $2.2 million for
asset impairments and $1.0 million in legal and
|
|
other matters,
partially offset by a $0.6 million gain related to Hurricane
Maria. Includes a $0.2 million charge in the first six months
of Fiscal 2018 for
|
|
asset
impairments.
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
|
|
Condensed
Consolidated Balance Sheets
|
|
|
(in
thousands)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aug. 4,
2018
|
|
July 29,
2017
|
|
|
Assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
49,786
|
|
$
43,520
|
|
|
Accounts
receivable
|
|
|
38,483
|
|
39,411
|
|
|
Inventories
|
|
|
606,748
|
|
670,104
|
|
|
Other current
assets
|
|
|
79,338
|
|
83,578
|
|
|
Total
current assets
|
|
|
774,355
|
|
836,613
|
|
|
Property and
Equipment
|
|
|
365,926
|
|
362,304
|
|
|
Goodwill and other
intangibles
|
|
|
179,295
|
|
364,488
|
|
|
Other non-current
assets
|
|
|
48,220
|
|
34,108
|
|
|
Total
Assets
|
|
|
$
1,367,796
|
|
$
1,597,513
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
$
215,528
|
|
$
242,729
|
|
|
Current portion
long-term debt
|
|
|
1,625
|
|
2,051
|
|
|
Other current
liabilities
|
|
|
100,966
|
|
106,252
|
|
|
Total
current liabilities
|
|
|
318,119
|
|
351,032
|
|
|
Long-term
debt
|
|
|
81,712
|
|
188,823
|
|
|
Pension
liability
|
|
|
-
|
|
5,989
|
|
|
Deferred rent and
other long-term liabilities
|
143,807
|
|
134,772
|
|
|
Equity
|
|
|
824,158
|
|
916,897
|
|
|
Total
Liabilities and Equity
|
|
|
$
1,367,796
|
|
$
1,597,513
|
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
Store Count
Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
|
|
|
|
Balance
|
|
|
|
|
Balance
|
|
01/28/17
|
Open
|
Close
|
|
02/03/18
|
|
Open
|
Close
|
|
08/04/18
|
Journeys
Group
|
1,249
|
45
|
74
|
|
1,220
|
|
13
|
18
|
|
1,215
|
Schuh
Group
|
128
|
7
|
1
|
|
134
|
|
4
|
3
|
|
135
|
Lids Sports Group
(1)
|
1,240
|
18
|
99
|
|
1,159
|
|
11
|
45
|
|
1,125
|
Johnston & Murphy
Group
|
177
|
7
|
3
|
|
181
|
|
1
|
-
|
|
182
|
Total Retail
Units
|
2,794
|
77
|
177
|
|
2,694
|
|
29
|
66
|
|
2,657
|
|
|
|
|
|
|
|
|
|
|
|
(1)Includes 117 Locker Room by Lids in
Macy's stores as of August 4, 2018.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GENESCO
INC.
|
Store Count
Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
|
|
|
|
Balance
|
|
|
05/5/18
|
Open
|
Close
|
|
08/04/18
|
|
Journeys
Group
|
1,221
|
3
|
9
|
|
1,215
|
|
Schuh
Group
|
136
|
-
|
1
|
|
135
|
|
Lids Sports Group
(1)
|
1,141
|
5
|
21
|
|
1,125
|
|
Johnston & Murphy
Group
|
182
|
-
|
-
|
|
182
|
|
Total Retail
Units
|
2,680
|
8
|
31
|
|
2,657
|
|
|
|
|
|
|
|
|
(1)Includes 117 Locker Room by Lids in
Macy's stores as of August 4, 2018.
|
|
|
|
GENESCO
INC.
|
Comparable
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
|
Aug.
4,
|
|
July 29,
|
|
|
Aug.
4,
|
|
July 29,
|
|
|
|
2018
|
|
2017
|
|
|
2018
|
|
2017
|
Journeys
Group
|
|
|
10%
|
|
1%
|
|
|
8%
|
|
(2)%
|
Schuh
Group
|
|
|
(7)%
|
|
3%
|
|
|
(10)%
|
|
6%
|
Lids Sports
Group
|
|
|
(5)%
|
|
(2)%
|
|
|
(6)%
|
|
(1)%
|
Johnston & Murphy
Group
|
|
|
8%
|
|
(1)%
|
|
|
7%
|
|
(2)%
|
Total
Comparable Sales
|
|
|
3%
|
|
0%
|
|
|
1%
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
Same Store
Sales
|
|
|
2%
|
|
(2)%
|
|
|
0%
|
|
(3)%
|
Comparable Direct
Sales
|
|
|
7%
|
|
30%
|
|
|
9%
|
|
29%
|
|
|
|
|
|
|
|
|
|
|
|
Schedule B
|
|
Genesco
Inc.
|
Adjustments to
Reported Earnings (Loss) from Continuing Operations
|
Three Months Ended
August 4, 2018 and July 29, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
August 4,
2018
|
|
July 29,
2017
|
|
|
|
Net
of
|
Per
Share
|
|
|
Net
of
|
Per
Share
|
In Thousands (except
per share amounts)
|
|
Pretax
|
Tax
|
Amounts
|
|
Pretax
|
Tax
|
Amounts
|
Earnings (loss) from
continuing operations, as reported
|
|
|
$
167
|
$
0.01
|
|
|
$
(3,875)
|
$
(0.20)
|
|
|
|
|
|
|
|
|
|
Pretax
adjustments:
|
|
|
|
|
|
|
|
|
Impairment
charges
|
|
$
928
|
591
|
0.03
|
|
$
58
|
44
|
-
|
Other legal
matters
|
|
614
|
429
|
0.02
|
|
-
|
-
|
-
|
Gain on Hurricane
Maria
|
|
(503)
|
(369)
|
(0.02)
|
|
-
|
-
|
-
|
Acquisition
transition expenses
|
|
-
|
-
|
-
|
|
288
|
199
|
0.01
|
Total
adjustments
|
|
$
1,039
|
651
|
0.03
|
|
$
346
|
243
|
0.01
|
|
|
|
|
|
|
|
|
|
Tax impact for
share-based awards
|
|
|
452
|
0.02
|
|
|
2,167
|
0.11
|
Other tax
items
|
|
|
(460)
|
(0.02)
|
|
|
(520)
|
(0.02)
|
Adjusted earnings
(loss) from continuing operations(1)and
(2)
|
|
$
810
|
$
0.04
|
|
|
$
(1,985)
|
$
(0.10)
|
|
|
|
|
|
|
.
|
|
|
|
|
|
|
|
|
|
|
|
(1)The
adjusted tax rate for the second quarter of Fiscal 2019 is 37.6%
including a FIN 48 discrete item of less than $0.1 million.
The adjusted tax rate for
|
the second quarter of Fiscal
2018 is 31.9% including a FIN 48 discrete item of less than $0.1
million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)EPS
reflects 19.4 million and 19.2 million share count for Fiscal 2019
and 2018, respectively, which includes common stock equivalents in
only Fiscal 2019.
|
|
|
|
|
|
|
|
|
|
The Company believes
that disclosure of earnings and earnings per share from continuing
operations adjusted for the items not reflected in the
previously
|
announced
expectations will be meaningful to investors, especially in light
of the impact of such items on the results.
|
|
|
Genesco
Inc.
|
Adjustments to
Reported Operating Income (Loss)
|
Three Months Ended
August 4, 2018 and July 29, 2017
|
|
|
|
|
|
|
|
Three Months
Ended August 4, 2018
|
|
|
Operating
|
|
Adj
Operating
|
In
Thousands
|
|
Income
(Loss)
|
Adjust
|
Income
(Loss)
|
Journeys
Group
|
|
$
7,661
|
$
-
|
$
7,661
|
Schuh
Group
|
|
1,073
|
-
|
1,073
|
Lids Sports
Group
|
|
1,152
|
-
|
1,152
|
Johnston & Murphy
Group
|
|
928
|
-
|
928
|
Licensed
Brands
|
|
(396)
|
-
|
(396)
|
Corporate and
Other
|
|
(9,057)
|
1,039
|
(8,018)
|
Total Operating
Income
|
|
$
1,361
|
$
1,039
|
$
2,400
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended July 29, 2017
|
|
|
Operating
|
|
Adj
Operating
|
In
Thousands
|
|
Income
(Loss)
|
Adjust
|
Income
(Loss)
|
Journeys
Group
|
|
$
(2,194)
|
$
288
|
$
(1,906)
|
Schuh
Group
|
|
4,538
|
-
|
4,538
|
Lids Sports
Group
|
|
3,040
|
-
|
3,040
|
Johnston & Murphy
Group
|
|
1,547
|
-
|
1,547
|
Licensed
Brands
|
|
(1,051)
|
-
|
(1,051)
|
Corporate and
Other
|
|
(7,866)
|
58
|
(7,808)
|
Total Operating
Loss
|
|
$
(1,986)
|
$
346
|
$
(1,640)
|
Schedule B
|
|
Genesco
Inc.
|
Adjustments to
Reported Earnings (Loss) from Continuing Operations
|
Six Months Ended
August 4, 2018 and July 29, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
August 4,
2018
|
|
July 29,
2017
|
|
|
|
Net
of
|
Per
Share
|
|
|
Net
of
|
Per
Share
|
In Thousands (except
per share amounts)
|
|
Pretax
|
Tax
|
Amounts
|
|
Pretax
|
Tax
|
Amounts
|
Earnings (loss) from
continuing operations, as reported
|
|
|
$
(2,141)
|
$
(0.11)
|
|
|
$
(2,878)
|
$
(0.15)
|
|
|
|
|
|
|
|
|
|
Pretax
adjustments:
|
|
|
|
|
|
|
|
|
Impairment
charges
|
|
$
2,202
|
1,652
|
0.08
|
|
$
177
|
122
|
-
|
Other legal
matters
|
|
992
|
744
|
0.04
|
|
-
|
-
|
-
|
Gain on Hurricane
Maria
|
|
(603)
|
(452)
|
(0.02)
|
|
-
|
-
|
-
|
Acquisition
transition expenses
|
|
-
|
-
|
-
|
|
288
|
199
|
0.01
|
Total
adjustments
|
|
$
2,591
|
1,944
|
0.10
|
|
$
465
|
321
|
0.01
|
|
|
|
|
|
|
|
|
|
Tax impact for
share-based awards
|
|
|
452
|
0.02
|
|
|
2,167
|
0.11
|
Other tax
items
|
|
|
(585)
|
(0.03)
|
|
|
(496)
|
(0.02)
|
Adjusted earnings
(loss) from continuing operations(1)and
(2)
|
|
$
(330)
|
$
(0.02)
|
|
|
$
(886)
|
$
(0.05)
|
|
|
|
|
|
|
.
|
|
|
|
|
|
|
|
|
|
|
|
(1)The
adjusted tax rate for the first six months of Fiscal 2019 is 618%
including a FIN 48 discrete item of less than $0.1 million.
The adjusted tax rate for
|
the first six months of
Fiscal 2018 is 24.7% including a FIN 48 discrete item of less than
$0.1 million.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)EPS
reflects 19.3 million and 19.2 million share count for Fiscal 2019
and 2018, respectively, which excludes common stock equivalents in
both years.
|
|
|
|
|
|
|
|
|
|
The Company believes
that disclosure of earnings and earnings per share from continuing
operations adjusted for the items not reflected in the
previously
|
announced
expectations will be meaningful to investors, especially in light
of the impact of such items on the results.
|
|
|
Genesco
Inc.
|
Adjustments to
Reported Operating Income (Loss)
|
Six Months Ended
August 4, 2018 and July 29, 2017
|
|
|
|
|
|
|
|
Six Months
Ended August 4, 2018
|
|
|
Operating
|
|
Adj
Operating
|
In
Thousands
|
|
Income
(Loss)
|
Adjust
|
Income
(Loss)
|
Journeys
Group
|
|
$
21,298
|
$
-
|
$
21,298
|
Schuh
Group
|
|
(4,567)
|
-
|
(4,567)
|
Lids Sports
Group
|
|
(4,210)
|
-
|
(4,210)
|
Johnston & Murphy
Group
|
|
5,934
|
-
|
5,934
|
Licensed
Brands
|
|
(90)
|
-
|
(90)
|
Corporate and
Other
|
|
(18,852)
|
2,591
|
(16,261)
|
Total Operating
Income (Loss)
|
|
$
(487)
|
$
2,591
|
$
2,104
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended July 29, 2017
|
|
|
Operating
|
|
Adj
Operating
|
In
Thousands
|
|
Income
(Loss)
|
Adjust
|
Income
(Loss)
|
Journeys
Group
|
|
$
5,278
|
$
288
|
$
5,566
|
Schuh
Group
|
|
3,851
|
-
|
3,851
|
Lids Sports
Group
|
|
1,254
|
-
|
1,254
|
Johnston & Murphy
Group
|
|
5,367
|
-
|
5,367
|
Licensed
Brands
|
|
1,224
|
-
|
1,224
|
Corporate and
Other
|
|
(16,134)
|
177
|
(15,957)
|
Total Operating
Income
|
|
$
840
|
$
465
|
$
1,305
|
Schedule B
|
|
Genesco
Inc.
|
Adjustments to
Forecasted Earnings from Continuing Operations
|
Fiscal Year Ending
February 2, 2019
|
|
|
|
|
|
|
In Thousands (except
per share amounts)
|
|
High
Guidance
|
Low
Guidance
|
|
|
Fiscal
2019
|
Fiscal
2019
|
Forecasted earnings
from continuing operations
|
|
$
63,053
|
$
3.23
|
$
54,554
|
$
2.80
|
|
|
|
|
|
|
Adjustments:
(1)
|
|
|
|
|
|
Store impairment,
other legal matters, gain on hurricane
|
|
3,854
|
0.20
|
4,579
|
0.23
|
Tax impact for
share-based awards
|
|
452
|
0.02
|
452
|
0.02
|
|
|
|
|
|
|
Adjusted forecasted
earnings from continuing operations (2)
|
$
67,359
|
$
3.45
|
$
59,585
|
$
3.05
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)All
adjustments are net of tax where applicable. The forecasted
tax rate for Fiscal 2019 is approximately 27.5%.
|
|
|
|
|
|
|
(2)EPS
reflects 19.5 million share count for Fiscal 2019 which includes
common stock equivalents.
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/genesco-inc-reports-fiscal-2019-second-quarter-results-300708577.html
SOURCE Genesco Inc.