Genesco Inc. reported last week that it expects to report net sales in the range of $303 million to $304 million for the second quarter, up from $275 million during last year’s second quarter, but a bit short of the $308 million expected by Wall Street. GCO shares were down 7.6% for the week to close at $26.25 on Friday. The company now sees second quarter EPS in the range of 20 cents to 21 cents per share, compared to 27 cents per share last year and far short of the 28 cents expected by analysts.
The company said that comp store sales for the second quarter-to-date are up between 1% and 2%, with the Journeys stores up 5%, Hat World flat, the Underground Station Group down 5%, and Johnston & Murphy down 2%.
Hal Pennington, Genesco chairman, president and CEO, said that, while performance was good at Journeys, a “challenging urban market,” which he said was reflected in the same-store sales results at Underground Station and the more urban-influenced of the Hat World stores, was the primary factor leading them to temper their expectations for the quarter. He said they were “confident” about their merchandise selection for the back-to-school season, and said that early BTS indications were “encouraging” at Journeys.
As reported in SEW_0622, management has acknowledged that Nike will not be part of the mix at Underground Station after the back-to-school deliveries. Nike, which apparently pulled the brand as part of an overall shift in its urban strategy, represented a low-double-digit share of the Underground business.
