Collective Brands Inc. reaffirmed its comparable store sales for the fiscal year, while providing further details of the impact from its acquisition of Stride Rite. The company confirmed expectations for comps to be below its long term target of low-single-digit growth. The company said it expects operating profit growth to be in mid-teens over time.
Collective Brands also expects the August 2007 acquisition of Stride Rite to be accretive to earnings in 2008 on a non-GAAP basis, excluding the impact of purchase accounting. On a GAAP basis, however, the acquisition is not anticipated to be earnings accretive for the current fiscal year.
The company also noted that it expects the acquisition to result in cost synergies of approximately $6 million for 2008. For 2009, cost synergies are estimated to be $15 million over 2007, and for 2010, synergies are expected to result in savings of approximately $25 million over 2007.
