Foot Locker Inc (FL)

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Foot Locker, Inc. Reports Second Quarter Results

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Foot Locker (NYSE:FL)
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Today : Friday 23 August 2013
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NEW YORK, Aug. 23, 2013 /PRNewswire/ -- Foot Locker, Inc. (NYSE: FL), the New York-based specialty athletic retailer, today reported financial results for its second quarter ended August 3, 2013.

Second Quarter Results
Net income for the Company's second quarter ended August 3, 2013 was $66 million, or $0.44 per share, compared with net income of $59 million, or $0.39 per share, last year, an increase in earnings per share of 13 percent.

Second quarter comparable-store sales increased 1.8 percent. Total second quarter sales increased 6.4 percent, to $1,454 million this year, compared with sales of $1,367 million for the corresponding prior-year period. Excluding the effect of foreign currency fluctuations, total sales for the second quarter increased 5.9 percent. Total second quarter sales results include one month of Runners Point Group's operations.

Year-To-Date Results
Net income for the Company's first six months of the year increased to $204 million, or $1.34 per share, compared to net income of $187 million, or $1.21 per share, for the corresponding period in 2012. Earnings per share for the six month period have increased 11 percent compared to the same period in 2012. Year-to-date sales were $3,092 million, an increase of 5 percent compared to sales of $2,945 million in the corresponding six month period of 2012. Year-to-date comparable store sales increased 3.5 percent. Excluding the effect of foreign currency fluctuations, total sales year-to-date increased 4.9 percent

Non-GAAP Adjustment
During the second quarter, the Company incurred approximately $5 million, pre-tax, in costs related to the acquisition of Runners Point Group and the closing of the CCS Retail stores. Excluding these expenses, second quarter earnings were $0.46 per share on a non-GAAP basis, an increase of 21 percent compared to the $0.38 that the Company earned in the second quarter last year. For the first six months of 2013, non-GAAP net income was $1.37 per share, an increase of 14 percent over the $1.20 per share earned in the corresponding period of 2012.

"Sales in the second quarter were more challenging than we planned for, especially in the United States. Despite this headwind, we produced second quarter ongoing profit and sales results that were our best ever as Foot Locker, Inc., demonstrating that the execution of our strategic priorities continues to deliver solid financial and operational results for our shareholders and other stakeholders" said Ken C. Hicks, Chairman of the Board and Chief Executive Officer. "We remain confident that we can achieve a mid-single digit comparable sales gain and a double digit percentage profit increase for fiscal 2013, as we build momentum in our operational and financial performance now and over the long term."

Financial Position
At August 3, 2013, the Company's merchandise inventory was $1,306 million, 6 percent higher than at the end of the second quarter last year. Excluding Runners Point Group, inventory increased approximately 3 percent.

During the second quarter, the Company repurchased approximately 2.83 million shares of its common stock for $100 million.

The Company's cash, cash equivalents, and short-term investments totaled $836 million, while the debt on its balance sheet was $141 million. The Company's total cash position, net of debt, was $8 million higher than at the same time last year.

Store Base Update
During the second quarter, the Company opened 24 new stores, remodeled/relocated 89 stores and closed 44 stores. With the addition of 194 stores acquired in the Runners Point Group transaction, the Company operated 3,495 stores in 23 countries in North America, Europe, Australia, and New Zealand as of August 3, 2013. In addition, 45 franchised Foot Locker stores were operating in the Middle East and South Korea, as well as 24 Runners Point and Sidestep franchised stores, which were added as part of the RPG acquisition.

The Company is hosting a live conference call at 9:00 a.m. (EDT) today, August 23, 2013, to discuss these results and provide comments on the status of its current initiatives, and discuss trends in its business and the athletic industry. This conference call may be accessed live by dialing 888-446-3850 (U.S. and Canada) or 630-691-2739 (International) using the passcode 35433909, or via the Investor Relations section of the Foot Locker, Inc. website at http://www.footlocker-inc.com. Please log on to the website 15 minutes prior to the call in order to download any necessary software. A replay of the call will be available via webcast from the same Investor Relations section of the Foot Locker, Inc. website at http://www.footlocker-inc.com through September 6, 2013.