The Finish Line, Inc. reported net sales of $258.0 million for the thirteen weeks ended May 29, 2004, an increase of 24% over net sales of $207.8 million for Q1 last year which ended May 31, 2003. Comparable store net sales for Q1 increased 14% on top of a 14% increase reported for the comparable period last year.
Effective with the beginning of Fiscal 2005 the Company has included the internet business in the comparable sales calculation. This change had the effect of increasing Q1 comparable sales by 1%.
Mr. Alan H. Cohen, Finish Line's Chairman and Chief Executive Officer stated: “We are extremely pleased with our sales performance in Q1 and our continued momentum from last year. The breadth of our product assortment remains a key driver of sales gains and has allowed us to continue to gain market share in all footwear segments including men's, women's and kids'.”
During Q1, footwear comparable store sales increased 16%, and apparel/accessories comparable store sales increased 5%. For Q1 the gross profit percentage will improve over Q1 LY as a result of continuing strong sell-through of higher-priced performance and premium footwear, led by Nike. The success of performance product has also contributed to a 5% increase in the footwear average selling price for the quarter. Inventory levels are expected to be up 10-12 percent per square foot at the end of Q1 and are in line with the Company's plan. The percentage of aged inventory has improved versus the same period a year ago.
Due to sales exceeding plan, the Company now anticipates that diluted income per share for the 1st quarter will range from $.41 – $.43 cents as compared to previous guidance of diluted income per share of $.37 to $.39 cents. The first quarter was negatively effected by $.02 – $.03 cents for costs incurred related to the unsuccessful acquisition of Footaction stores. For Q1 LY, the Company reported diluted income per share of $.28 cents.
For Q2, which will end August 28, 2004, comparable sales guidance is being increased to 5% (from 3%) with total sales of $310,000,000(up from $304,000,000). Full fiscal year comp sales guidance is 6% (up from 4%) with full year sales of $1,150,000,000 (up from $1,119,000,000). For the current fiscal year, net income is now expected within a range of $2.39 – $2.43 per share up from previous guidance of $2.29 to $2.33 per share.
During Q1, the Company opened 21 new stores, remodeled 8 stores and closed two stores. For the current fiscal year, the Company expects to open 70 new stores, an increase over the previous new store guidance of 60 stores, remodel 25 existing stores and close 5-7 stores. As of May 29, 2004, the Company operated 550 stores compared to 490 at May 31, 2003, an increase of twelve percent. In addition, store square footage increased nine percent to 3,164,000 square feet compared to 2,890,000 square feet at the end of Q1 last year.
