The Finish Line got their biggest gains from the childrens and womens business in the first quarter, while weakness in the licensed apparel category ate into gains in branded apparel and the total results for the retailer. Total net sales for the fiscal first quarter ended May 28, which includes the recentlyacquired Man Alive chain, were up 12.9% to $291.2 million, compared to $258.0 million in the year-ago period. Comparable store net sales increased 2% on top of a 14% increase in Q1 last year.
Alan Cohen, chairman and CEO, said that sales were “led by premium product including new technologies and marquee shoes”. He said that the average selling price for footwear rose 8% increase and product margins improved for the quarter.
The 3% comp sales increase for footwear came on top of a 16% in Q1 last year, while apparel/accessories comps declined 3% versus a 5% increase in the year-ago period.
| The Finish Line Fiscal First Quarter | ||||
| Comparable Store Sales Results | ||||
| Category | MAR | APR | MAY | QTR |
| Footwear | 5% | 1% | 1% | 3% |
| Apparel/Access. | -2% | -3% | -4% | -3% |
| Total | 4% | flat | flat | 2% |
Kids footwear was up in double-digits for the quarter and womens had a mid-single-digit gain. The mens business was flat. Running was cited as a strong category, as was the athletic casual category. FINL said that fashion footwear from Nike and adidas “continued to be a driver” for footwear sales growth for Q1. They also pointed to continued growth in classics from K-Swiss, adidas, New Balance, and Reebok.
In apparel, positive results in the branded business, highlighted by the exclusive Maddie girls line from Nike, and “significant gains” in private label, were not enough to offset the declines in the licensed business.
Internet sales grew more than 40% for the quarter, helping establish the Direct-to-Consumer piece as the fastest-growing segment at The Finish Line.
While total sales did not meet plan, margins exceeded plan, leading FINL to project that diluted EPS will end up in the mid- to upper-end of the previous guidance of 24 cents to 26 cents per share. Inventory levels remain on plan and are expected to be up 2% to 4% on a comparable per square foot basis.
The retailer opened 28 new Finish Line stores in the first quarter. They also remodeled seven stores and closed one store, for a total of 625 doors at quarter-end, or a net gain of 75 stores versus last year at the same time.
Square footage increased 12% to 3.55 million square feet. FINL also opened one Man Alive store for a total of 38 stores. For the year, FINL expects to open 70 new Finish Line stores and 10 to 15 Man Alive stores. They also expect to remodel a total of 25 Finish Line stores and close three to five stores throughout the year.
