The Finish Line saw much of what the rest of the retail market saw in February, but was perhaps also impacted by the shift of some Marquee product launches into the January period. The Air Max 360 was a hit for most everyone in January, which is clearly reflected in FINLs high-single-digit comp sales gain for footwear in the month, but Nike also rolled out heavier allocations of the white-white Air Force 1 in January, something the brand has been reluctant to do in the past. The other shift comes as more consumers move to the fashion athletic category where lower average selling prices are pushing sales down across the channel.
FINL reported that consolidated net sales increased 10.4% to $399.0 million for the fiscal fourth quarter ended February 25 from $361.4 million for Q4 last year, an increase at least partially attributed to the inclusion of sales from the acquired Man Alive stores. Comparable store sales, which do not include the Man Alive business or stores open less than a year, were flat for the period.
Management said that mens and kids footwear comps were up in low-single-digits for the quarter, while the womens business posted a high-single-digit decline for the period, due primarily to a weaker running business. The mens business was said to be strong in both running and athletic casual for the quarter, but continued weakness in the basketball category offset much of the gains. The company said that signature basketball product continued to perform well during Q4, a key period due to the number of NBA All Star game launches. Brand Jordan was said to have performed at a high level, led by the Defining Moments package and the Jordan 21. Still, the weakness in basketball and a shift to the lower price-points in the athletic casual business led to a 4% decline in the average selling price in the quarter.
Finish Line management said they will continue to invest in the athletic casual category, particularly with Puma, K-Swiss, and adidas Originals. They also highlighted the launch of the Hurricane from 310 Motoring. They said they are expanding the store base carrying Puma as well.
On the softgoods side, which includes apparel and accessories, the slight improvement for the month was attributed to “significant gains” in private label sales, along with branded product from Brand Jordan that performed well during the period. In licensed apparel, the retailer comped down in the quarter despite a successful holiday fleece program, due primarily to a decrease in the ASP in the licensed business.
Internet sales were up more than 50% in the fourth quarter, thanks in part to a 25% increase in magalog distribution over the holiday period that benefited both online and in-store sales.
FINL reiterated guidance for both the fourth quarter and next year. They opened two new Finish Line stores in Q4 and closed three stores. For the year, the retailer opened a total of 66 new stores and closed seven for a total of 657 stores at year-end. Square footage increased 9% to 3.7 million square feet. FINL opened two Man Alive stores in Q4 and 14 for the whole year to end the fiscal year with 51 stores totaling roughly 159,000 square feet.
Management said inventories are expected to be flat on a per square foot basis at year-end, while aged inventory makes up less than 1% of total inventory for the third straight year.
>>> The shift in womens running here isnt a surprise as this consumer moves to pumps, sandals, and mules and away from Shox as a fashion play. The performance end remains intact…
| The Finish Line | |||
| Fourth Quarter Comp Store Sales | |||
| Period | Footwear | App/Acc | Total |
| December | +3% | -1% | +2% |
| LY | +13% | +1% | +9% |
| January | +8% | +5% | +8% |
| LY | +8% | -4% | +5% |
| February | -8% | +3% | -6% |
| LY | +11% | -5% | +8% |
| Fourth Qtr | flat | +1% | flat |
| LY | +11% | -2% | +8% |
