Breathing Heavy at the Finish Line
[2008-4-1]
After Finish Line's (Nasdaq: FINL) proposed buyout of shoe and hat retailer Genesco (NYSE: GCO) collapsed well short of completion, the athletic footwear retailer suffered the heartburn of $81.5 million in merger-related costs.
These charges resulted in a fourth-quarter loss of $38.8 million, or $0.82 per share. Even after excluding the one-time costs, the company earned just $0.45 per share from continuing operations, 11.8% below last year's $0.51. The figure did trample the $0.35 predicted by analysts.
However, Finish Line is definitely feeling winded from sluggish consumer spending, as revenue fell 10% to $382.8 million, while the key retail metric of comparable-store sales fell by 6%.
Sales of higher-margin products, a gross margin improvement of 30 basis points, and inventory reduced by 4% per square foot were positive notes in the release. Still, with virtually every footwear retailer from well-heeled Foot Locker (NYSE: FL) to the industry's top performers, such as Dick's Sporting Goods (NYSE: DKS), feeling the pain of a threatening economic recession, this industry looks to be in for a long test of endurance.
These charges resulted in a fourth-quarter loss of $38.8 million, or $0.82 per share. Even after excluding the one-time costs, the company earned just $0.45 per share from continuing operations, 11.8% below last year's $0.51. The figure did trample the $0.35 predicted by analysts.
However, Finish Line is definitely feeling winded from sluggish consumer spending, as revenue fell 10% to $382.8 million, while the key retail metric of comparable-store sales fell by 6%.
Sales of higher-margin products, a gross margin improvement of 30 basis points, and inventory reduced by 4% per square foot were positive notes in the release. Still, with virtually every footwear retailer from well-heeled Foot Locker (NYSE: FL) to the industry's top performers, such as Dick's Sporting Goods (NYSE: DKS), feeling the pain of a threatening economic recession, this industry looks to be in for a long test of endurance.
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