Specialty retailer Genesco, Inc. (GCO) Friday reported lower profit for the fourth quarter, as higher expenses more than offset a 10 percent increase in revenues. Adjusted earnings and revenue topped Wall Street expectations and the firm sees fiscal 2014 earnings in line with view.
Net earnings for the quarter declined to $38.53 million from last year's $41.47 million. Earnings per share fell to $1.62 from $1.72. Earnings from continuing operations was $1.63 per share last year.
The latest results reflect expenses of $0.53 per share, including $15.4 million related to the 2010 network intrusion, $3.2 million related to deferred purchase price payments and $0.7 million in asset impairment charges.
Last year's results reflect expenses of $0.25 per share, primarily including deferred purchase price expenses and asset impairments, other legal matters and acquisition expenses.
Adjusted earnings from continuing operations totaled $2.16 per share, while it amounted to $1.97 per share last year. On average, 9 analysts polled by Thomson Reuters expected earnings of $2.12 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales increased to $796.69 million from $723.37 million, with the extra week in fiscal 2013 accounting for around half of the increase. Analysts expected revenues of $774.51 million.
All the businesses - Journeys Group, Lids Sports Group, Schuh Group and Johnston & Murphy Group - saw sales growth in the quarter.
Comparable sales, including same store sales and comparable e-commerce and catalog sales, decreased 2 percent on a 14-week basis, with a 1 percent decrease in the Journeys Group and a 10 percent decline in the Lids Sports Group. The firm saw a 7 percent increase in the Schuh Group and a 2 percent rise in the Johnston & Murphy Group.
Genesco said fiscal 2014 has started off somewhat slowly, with February consolidated comparable sales falling 9 percent.
According to the retailer, most of the negative factors identified in the recent performance, including a delay in initial federal tax refunds and the timing of new product deliveries compared to last year, are temporary.
Comparable sales improved in the course of February, but the firm remains cautious in its near-term outlook due to continuing uncertainty in the economy and in some of its markets as well as the relatively strong prior year comparisons in the first half of this year.
Genesco expects adjusted Fiscal 2014 earnings per share to be in the range of $5.57 to $5.67, which represents a 10 percent to 12 percent increase over fiscal 2013's adjusted earnings per share of $5.06. This guidance assumes comparable sales increases in the low single digit range. Wall Street expects earnings of $5.57 per share for the year.
GCO closed at $61.17 on Thursday.
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