After alerting the market in February about its slow fourth quarter (see SEW_0509), Forzani Group last week reported its audited financial results for Q4 and fiscal 2004, revealing that the recent clarification by the SEC regarding lease accounting practices would result in a
$200,000 increase in corporate store operating expenses. The change also contributed a bit to a decline in net income to $12.7 million, down 21.1% from $13.0 million in last year’s fourth quarter. Diluted EPS was 40 cents per diluted share, compared to 50 cents per diluted share in Q4 last year.

Revenue decreased 2.3% to $274.3 million. Corporate comparable store sales decreased 7.7% while, in the franchise division, comparable store sales increased 7.1%. Gross margins for the quarter decreased 140 basis points, from the prior year, to 37.4%.

The decrease in Q4 corporate store comparable sales was said to be primarily due to the 14.1% decline in sales of ski and snowboard equipment. Outerwear sales were down 3.2%, while the licensed clothing category fell 39.5% for the quarter, due to the NHL lockout.

Revenue for fiscal 2005 was $985.1 million, a 1.8% increase over the previous year. Consolidated comparable store sales decreased 2.6%, Corporate comparable store sales decreased 5.1%, and franchise store sales grew by 2.2%.

Gross margin decreased 50 basis points for the year to 33.9%. Net earnings were $21.5 million for the year after the accounting change, a decrease of 23.5% compared to $28.1 million in fiscal 2004. Diluted earnings per share were 66 cents after the impact of the change in accounting versus 87 cents per share in the previous year.

During fiscal 2005, FGL opened 20 new corporate stores, seven of which were opened during the fourth quarter. The franchise division opened four new stores. This growth translates to an additional 226,530 square feet of retail space, an increase of 4.9% over the previous year. With the company's acquisition of Nevada Bob's locations and National Sports, FGL now has over 5.5 million square feet of retail selling space in 446 total locations.

After alerting the market in February about its slow fourth quarter (see BOSS_0509), Forzani Group last week reported its audited financial results for Q4 and fiscal 2004, revealing that the recent clarification by the SEC regarding lease accounting practices would result in a $200,000 increase in corporate store operating expenses. The change also contributed a bit to a decline in net income to $12.7 million, down 21.1% from $13.0 million in last year’s fourth quarter. Diluted EPS was 40 cents per diluted share, compared to 50 cents per diluted share in Q4 last year.

As previously reported, Q4 revenue decreased 2.3% to $274.3 million. Corporate store revenues of CN$229.5 million ($188.2 mm) were 4.1% below last year's revenues of CN$239.2 million ($181.8 mm). Wholesale sales for the quarter were CN$44.8 million ($36.7 mm), up 7.4% from the prior year, driven by strong product sales into the company's franchise network and by the volume contributed by Gen-X.

Corporate comparable store sales decreased 7.7% while, in the franchise division, comparable store sales increased 7.1%. Gross margins for the quarter decreased 140 basis points, from the prior year, to 37.4%. The decrease in Q4 corporate store comparable sales was said to be primarily due to the 14.1% decline in sales of ski and snowboard equipment. Outerwear sales were down 3.2%, while the licensed clothing category fell 39.5% for the quarter, due to the NHL lockout.

Revenue for fiscal 2005 was $985.1 million, a 1.8% increase over the previous year. Consolidated comparable store sales decreased 2.6%, corporate comparable store sales decreased 5.1%, and franchise store sales grew by 2.2%.

Gross margin decreased 50 basis points for the year to 33.9%. Net earnings were $21.5 million for the year after the accounting change, a decrease of 23.5% compared to $28.1 million in fiscal 2004. Diluted earnings per share were 66 cents after the impact of the change in accounting versus 87 cents per share in fiscal 2004.

FGL opened 20 new corporate stores during fiscal 2005, seven of which were opened during the fourth quarter. The franchise division opened four new stores. This growth translates to an additional 226,530 square feet of retail space, an increase of 4.9% over the previous year. With the company's acquisition of Nevada Bob's locations and National Sports, FGL now has over 5.5 million square feet of retail selling space in 446 total locations.