Finish Line’s Continuing Profits Jump 43% in Second Quarter

Consolidated merchandise inventories decreased by 2.0% to $217.0 million at the end of the quarter compared to $221.4 million a year ago. On a per-square-foot basis, inventories were up 0.6%.

At quarter end, the company had no interest-bearing debt and $253.7 million in cash and cash equivalents, up from $142.9 million at the end of the second quarter a year ago.

Finish Line repurchased 1.2 million shares of its outstanding common stock in the second quarter totaling $15.8 million.

“A 48% increase in earnings per share and improved operating margins on a 2% comp store sales increase is a productive quarter,” said Finish Line Chairman and Chief Executive Officer Glenn Lyon. “We continue to prove that we can effectively leverage even a modest sales gain as we did this quarter and we are making investments within our existing business to drive top line growth. At the same time, we are also assessing growth opportunities outside of our core business. As we pursue these opportunities, we will continue to be disciplined in the process and build upon our core competencies as well as the strong bond we've forged with our customers.”

Year-to-Date Results

Net sales increased 4.6% to $583.5 million, compared to $557.8 million for the same period a year ago. Year-to-date comparable store net sales increased 6.1% versus a 7.2% decrease last year.

For the 26 weeks ended August 28, 2010, Finish Line reported income from continuing operations of $30.5 million, or $0.56 per diluted share versus income from continuing operations of $13.5 million, or $0.24 per diluted share for the same period a year ago. The $0.56 per share represents a 133% increase over the prior year.

September Sales Update

Comparable store net sales, on a month-to-date basis for the period of August 29 through September 19, increased 6.2% on top of a 7.0% increase for the same period one year ago.