Foot Locker’s Profits Soar on Double-Digit Comp Gain

Net income for the company's second quarter ended July 30, 2011 was $37 million, or 24 cents per share, compared with net income of $6 million, or 4 cents per share, last year. Second quarter sales increased 16.3 percent, to $1,275 million this year, compared with sales of $1,096 million for the corresponding prior-year period.  Second quarter comparable-store sales increased 11.8 percent.  Excluding the effect of foreign currency fluctuations, total sales for the second quarter increased 11.7 percent.

“Our associates worldwide are doing an excellent job executing the initiatives of our strategic plan,” said Ken C. Hicks, chairman and chief executive officer of Foot Locker, Inc., in a statement.  “As a result, we were able to deliver strong sales and profit results in the second quarter, including a comparable store sales gain of 11.8 percent and earnings of 24 cents per share.  In addition to the outstanding second quarter results, I am also pleased to be reporting our sixth consecutive quarter of sales and profit growth, versus the comparable prior-year periods.  The results over this longer time period encourage us to believe that we have the right strategies in place to create shareholder value on a sustained basis.”  

Year-to-Date Results

Net income for the company's first six months of the year increased 121 percent to $131 million, or 84 cents per share, compared with net income of $60 million, or 38 cents per share, for the corresponding period last year.  Year-to-date sales increased 14.7 percent, to $2,727 million, compared with sales of $2,377 million last year. Year-to-date comparable-store sales increased 12.3 percent. Excluding the effect of foreign currency fluctuations, total sales year-to-date increased 11.9 percent.

Financial Position

The company's merchandise inventory at the end of the second quarter was $1,269 million, or 4.1 percent, higher than at the end of the second quarter last year.

During the second quarter of 2011, the company repurchased approximately 1.3 million shares of its common stock for $29 million under the company's $250 million share repurchase program.  Year-to-date, the company has repurchased approximately 2.8 million shares of its common stock for $59 million.

At July 30, 2011, the company's cash and short-term investments totaled $681 million, while the debt on its balance sheet was $136 million.  The company's total cash position, net of debt, was $163 million higher than the same time last year.

Store Base Update

During the first six months of the year, the company opened 35 new stores, remodeled/relocated 95 stores and closed 54 stores.  At July 30, 2011, the Company operated 3,407 stores in 22 countries in North America, Europe, Australia, and New Zealand.  In addition, 25 franchised stores were operating in the Middle East and South Korea.