Genesco 3Q results top Street, 4Q starts off slow

Associated Press

NASHVILLE, Tenn. (AP) — Genesco's third -quarter net income climbed 57 percent as strong sales of shoes, hats, clothing and accessories pushed it past Wall Street expectations. But shares slide 4 percent before the opening bell on what appears to be a slow start to the final quarter of the year.

Chairman and CEO Robert Dennis said that comparable store sales dipped in November, partly because of Superstorm Sandy, which effected 24 states.

Shares of Genesco declined $3.57, or 5.9 percent, to $57 in premarket trading.

The Nashville, Tenn. company earned $40.9 million, or $1.70 per share, compared with $26.1 million, or $1.09 per share, a year earlier.

Removing a compensation expense and other items, earnings from continuing operations were $1.44 per share.

Analysts surveyed by FactSet forecast earnings of $1.33 per share.

Revenue for the three months ended Oct. 27 rose 8 percent to $664.5 million from $616.5 million. This beat Wall Street's $659.9 million estimate.

Genesco reported sales increases for Journeys Group, Schuh Group, Lids Sports Group, and the Johnston & Murphy Group. Its licensed brands also posted higher sales.

Revenue at stores open at least a year, a key indicator of a retailer's health, increased 4 percent. This metric excludes the volatility of stores recently opened or closed.

Genesco said that same-store revenue climbed 8 percent for Journeys Group, 9 percent for the Schuh Group and 6 percent for the Johnston & Murphy Group. The metric dropped 5 percent for Lids Sports Group.

Dennis said that revenue at stores open at least a year dropped 4 percent in November, with Superstorm Sandy lowering the performance by about 1 percent to 2 percent. Revenue at U.S. stores open at least a year reported a low single digit percentage increase for the Thanksgiving weekend, he added.

For fiscal 2013, Genesco now anticipates adjusted earnings in a range of $5 to $5.08 per share. Its prior outlook called for $4.88 to $5 per share.

Analysts expect earnings of $5.02 per share.

Genesco Inc. has more than 2,440 stores in the U.S., Canada, U.K. and Ireland.