Nashville–Genesco Inc. reported Friday a 7% decline in its fourth quarter profit as the footwear, apparel and accessories company was hit by one-time costs. The company added though that it remains cautious about the near future.
For the quarter ended Feb. 2, the owner of Lids and Journeys posted net earnings of $38.5 million, or $1.65 a share, compared to $41.5 million, or $1.97 a share, in the year-ago quarter. The company said the quarter’s net reflected $19.3 million in taxes and impairment charges giving it an adjusted earnings of $51.4 million, or $2.16 a share.
Net sales increased 10.1% to $797 million. Analysts’ average estimate expected earnings of $2.12 a share on sales of $774.52 million.
Comparable store and online sales decreased 2%. By retail division, Journeys Group had a 1% decline in comp sales; Lids Sports Group had a 10% drop; Schuh Group post a 7% comp store increase and Johnson & Murphy had a 2% increase.
‘Cautious in the Near Term’
The company noted that United Kingdom-based Schuh grew despite “challenging market conditions in the U.K. and gives us confidence that accelerating Schuh’s store growth will position us for additional gains when the economy eventually recovers.
“Based on current visibility, we expect adjusted Fiscal 2014 diluted earnings per share to be in the range of $5.57 to $5.67, which represents a 10% to 12% increase over fiscal 2013’s adjusted earnings per share of $5.06,” said Robert Dennis, chief executive.
Commenting on the slow start to the company’s fiscal 2014 year, Dennis added, “We believe that most of the negative factors we have identified in our recent performance, including a delay in initial federal tax refunds and the timing of new product deliveries versus a year ago, are temporary. Comparable sales improved in the course of February, but we remain cautious in our near-term outlook given continuing uncertainty in the economy and in some of our markets and the relatively strong prior-year comparisons we face in the first half of this year.”
Genesco ended its fiscal year with a net income increase of 34.9% to $110.5 million compared to $82 million in the prior year. Net sales for the year rose 13.6% to $2.60 billion over $2.29 billion last year.