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Finish Line's Net Falls 8%; Will Open Women's Stores
SEPTEMBER 23, 2005 --
The Finish Line's 2Q net income was $18.9 million (38¢ per diluted share) a decrease of 8% versus net income of $20.5 million (42¢ per diluted share) for 2Q last year. Diluted weighted average shares outstanding were 49,854,000 for Q2 versus 49,226,000 shares outstanding for Q2 last year. The company also announced it would launch a thirds banner, yet unnamed. Five stores will open in April that will cater to active women 25-40 with household incomes of $80,000 and up. The stores will be 70% soft goods and 30% footwear.
Finish Line hired Jeff Pofsky as its new VP/GMM of the women's concept along with a dedicated staff of merchants. He is a 20-year retail veteran coming to us from Target where he was a senior women's apparel buyer. The new concept will have separate and dedicated teams related to product development, merchandising, marketing and store operations and will utilize the company's existing infrastructure when it makes sense to assist in development and profitability.
The company's 2Q net sales increased 9% to $341.6 million. Comp-store net sales decreased 2% for 2Q as compared to a 6% increase.
YTD net income was $31.6 million (63¢ per diluted share) an increase of 3% versus net income of $30.8 million (63¢ per diluted share). Net sales increased 11% to $632.8 million for YTD compared to $570.1 million. YTD comp-store net sales were flat versus a 10% increase last year.
CEO Alan Cohen stated, "Our diluted income per share of 38¢ is within the range of 37¢-39¢ we announced in our August 30 release. Our sales performance during the Back-To-School selling season was below expectations and promotional, and we expect business to remain challenging during the second half of the fiscal year. This does not change our long term plans to grow market share and sales, improve our operating efficiencies and grow earnings for our shareholders."
Merchandise inventories on a consolidated basis (including Man Alive) were $280.0 million. Finish Line store merchandise inventories were $273.6 million compared to $241.4 million. On a per-square-foot basis, Finish Line store merchandise inventories increased approximately 2% compared to one year ago.
The company operated 639 Finish Line stores at August 27, '05, an increase of 13% over the 564 stores operated one year ago. For the quarter, Finish Line opened 16 new stores, remodeled seven existing stores and closed two stores with retail square footage increasing 11% to 3,605,000 at versus 3,247,000. The company did not open any Man Alive stores during the quarter and operates 38 stores totaling 107,000 square feet.
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Categories
Sporting goods industry
Apparel manufacturing
Apparel
Sales
Companies
The Finish Line Inc.
Man Alive
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Finish Line
diluted share
merchandise inventories
net income
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Alan Cohen
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