The Finish Line, Inc. reported that consolidated net sales for the fiscal second quarter ended September 1 increased 1.3% to $343 million from $338.6 million in the year-ago quarter.  Total company comparable store net sales decreased 4.7%, with comps at the namesake concept, Finish Line, decreasing 4.8% and Man Alive comps decreasing 2.4% versus Q2 last year.  As seen with other retailers, July sales were negatively affected by a shift in sales tax holidays from July to August, as well as some states going to back to school later.


Finish Line comp store footwear sales decreased 2.8% on top of a 5.1% comp decrease in the year-ago period.  Softgoods comps decreased 15.5% for the quarter on top of a 13.9% decline last year.


In a pre-recorded statement, management said that Finish Line posted a double-digit decline in the women's footwear category, a low-single-digit decline in the men's business, and a mid-single-digit increase in the kid’s business.  They said they continued to see strong demand for premium products, such as Jordan and Shox running in men's, and also posted growth in the men's and women's technical running category and the men's sport casual category.


Contributing to the overall weakness in footwear was a decline in the average selling price of 5.1% for the quarter.  Excluding the effect of sandal sales, average selling prices declined 1.2% for the quarter.


Finish Line did see positive momentum in a new Under Armour program and NCAA licensed product.


The direct-to-consumer sales through FinishLine.com and catalog saw double-digit growth for the quarter and year-to-date.  Management said they continue to invest in direct business to support additional growth.


Consolidated sales for the quarter were less than planned. However, Finish Line product margins were above last-year levels.


The Man Alive stores posted a 2.4% comp store sales decrease on top of a 4.8% decrease last year, despite a positive start to the quarter.  Man Alive posted a mid-single-digit increase in juniors apparel and a low-single-digit decrease in men's apparel.


On a year-to-date basis, Finish Line comparable store sales decreased 4.5% and Man Alive comparable sales decreased 1.1%.


Inventory levels are below last year as FINL continues to work to improve the overall mix of inventory.  The retailer expects occupancy costs and SG&A expenses to de-leverage compared to the prior year, based on the negative comparable sales.


Based on the preliminary results for the quarter, FINL expects to report a loss per diluted share in the range of 4 cents to 6 cents for Q2, as compared to income per diluted share of 21 cents reported for the year-ago period.  This forecast includes an estimated pre-tax charge of approximately $14 million ,or 18 cents per diluted share for the impairment of assets, write-down of inventory, and certain facility closing costs related to the recently announced closure of the 15 Paiva stores. Excluding these charges, the EPS guidance range would be diluted EPS of 12 cents to 14 cents per share.