[prior-sept-05/ Fashion News ASAP - Keep up to date with trendy Apparel Industry News ]

The Finish Line Revised Sales

From: ASAP


The Finish Line, Inc. (NASDAQ: FINL) announced revised sales and earnings guidance for its second quarter ending August 31, 2002 ("Q2").

Finish Line stated that it expects to report total sales for Q2 in the range of $203 million to $205 million, compared to $196.8 million reported for the second quarter ended September 1, 2001 ("Q2LY") and expects comparable store sales for Q2 to come in flat to up 1%. This compares to previous guidance for Q2 of $210 million in total sales and a positive 4% for comparable store sales.

The Company is revising down Q2 earnings guidance due to the decrease in sales, significant margin pressure resulting from a very promotional environment, as well as negative leverage on selling, general & administrative expenses ("SG&A"). The Company's new guidance for diluted earnings per share is a range of $.34 to $.36 compared to previous guidance of $.45 to $.47 per diluted share. The Company earned $.41 per diluted share for Q2LY.

Alan H. Cohen, President and CEO said, "After starting the quarter on a strong note with the June period comp store sales increasing 8%, we have seen a significant drop-off in sales beginning in the second half of July and continuing through August. July period comp sales were a negative 1% and August month to date comp sales are currently negative 4%. Almost half of Q2's sales occur from late July through the end of August. The promotional environment for the back to school period has been very high and we have reacted with increased price promotions in our stores, which has led to lower than expected product margins. We are working diligently to keep our inventories in line, and we expect to report an increase of 5-7% per square foot at the end of Q2 compared to Q2LY.

"Most of our sales disappointment has occurred in footwear with weakness in Men's running and slowing sales in our kid's department. The basketball category, which was up approximately 30% in June, comped positive in July & August, but much less than expected. On a positive note softgood sales continue to improve and are expected to comp positive for a third consecutive quarter."

The Company remains cautiously optimistic regarding the 2nd half of the fiscal year. However, given the slowing footwear sales trend and the continued promotional environment, the Company believes it is prudent to reduce its guidance for the remainder of the year. For Q3, we expect sales to be approximately $147 million based on a flat comp sales plan and diluted earnings per share to be a loss in the range of -$.11 to -$.13. Q4 sales are expected to be approximately $214 million based on a 1% comp increase with diluted earnings per share in the range of $.35 to $.37. For the full fiscal year, sales are expected to approximate $736 million with diluted earnings per share in the range of $.72 to $.76.

The Company has experienced, and expects to continue to experience, significant variability in net sales, comparable store net sales and net earnings from quarter to quarter. Therefore, the results of the periods presented herein are not necessarily indicative of the results to be expected for any other future period or year.

Certain statements contained in this press release regard matters that are not historical facts and are forward looking statements (as such term is defined in the rules promulgated pursuant to the Securities Act of 1933, as amended). Because such forward looking statements contain risks and uncertainties, actual results may differ materially from those expressed in or implied by such forward looking statements. Factors that could cause actual results to differ materially include, but are not limited to: changing consumer preferences; the Company's inability to successfully market its footwear, apparel, accessories and other merchandise; price, product and other competition from other retailers (including internet and direct manufacturer sales); the unavailability of products; the inability to locate and obtain favorable lease terms for the Company's stores; the loss of key employees, general economic conditions and adverse factors impacting the retail athletic industry; management of growth, potential strike by the longshoreman's union against the Pacific Maritime Association and the other risks detailed in the Company's Securities and Exchange Commission filings. The Company undertakes no obligation to release publicly the results of any revisions to these forward looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

The Finish Line is a specialty retailer of men's, women's and children's brand name athletic and lifestyle footwear, activewear and accessories. The Company currently operates 459 stores in 45 states.

ASAP Fashion News Fast - Fashion news for the apparel industry and consumers to learn more about the clothing business.

Apparel Search  ASAP News