Q1 comp store sales increased 5.0%; Q1 GAAP EPS improved to
For the thirteen weeks ended
-
Consolidated net sales were
$406.5 million , an increase of 15.8% over the prior year period. -
Finish Line comparable store sales increased 5.0%. -
On a GAAP basis, diluted earnings per share increased to
$0.25 from$0.10 in the prior year. -
Non-GAAP diluted earnings per share, which excludes the impact of
impairment charges in the current year and the impact of start-up
costs related to the launch of the company’s operations in Macy’s in
the prior year, increased 40.0% to
$0.28 compared to$0.20 in the prior year.
“We are very pleased with the strong start to fiscal 2015 we delivered
in the first quarter,” said
Balance Sheet
As of
The company repurchased 700,000 shares of its common stock in the first
quarter, totaling
As of
Outlook
For the fiscal year ending
Q1 Fiscal 2015 Conference Call Today,
The company will host a conference call
for investors today,
Disclosure Regarding Non-GAAP Measures
This
report refers to certain financial measures that are identified as
non-GAAP. The company believes that these non-GAAP measures, including
gross profit, selling, general and administrative expenses, operating
income, net income attributable to The
About The
The
Forward-Looking Statements
This news
release includes statements that are or may be considered
“forward-looking” within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
These forward-looking statements generally can be identified by the use
of words or phrases such as “believe,” “expect,” “anticipate,” “intend,”
“plan,” “foresee,” “may,” “should,” “will,” “estimates,” “outlook,”
“potential,” “optimistic,” “confidence,” “continue,” “evolve,” “expand,”
“growth” or words and phrases of similar meaning. Statements that
describe objectives, plans or goals also are forward-looking statements.
All of these forward-looking statements are subject to risks, management
assumptions and uncertainties that could cause actual results to differ
materially from those contemplated by the relevant forward-looking
statements. The principal risk factors that could cause actual
performance and future actions to differ materially from the
forward-looking statements include, but are not limited to, the
company’s reliance on a few key vendors for a majority of its
merchandise purchases (including a significant portion from one key
vendor); the availability and timely receipt of products; the ability to
timely fulfill and ship products to customers; fluctuations in oil
prices causing changes in gasoline and energy prices, resulting in
changes in consumer spending as well as increases in utility, freight
and product costs; product demand and market acceptance risks;
deterioration of macro-economic and business conditions; the inability
to locate and obtain or retain acceptable lease terms for the company’s
stores; the effect of competitive products and pricing; loss of key
employees; execution of strategic growth initiatives (including actual
and potential mergers and acquisitions and other components of the
company’s capital allocation strategy); and the other risks detailed in
the company’s
| The Finish Line, Inc. | ||||||||||
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Consolidated Statements of Income |
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(In thousands, except per share and |
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store/shop data) |
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| Thirteen Weeks Ended | ||||||||||
| May 31, | June 1, | |||||||||
| 2014 | 2013 | |||||||||
| (Unaudited) | (Unaudited) | |||||||||
| Net sales | $ | 406,531 | $ | 351,053 | ||||||
| Cost of sales (including occupancy costs) | 277,651 | 244,058 | ||||||||
| Gross profit | 128,880 | 106,995 | ||||||||
| Selling, general and administrative expenses | 108,896 | 99,356 | ||||||||
| Store closing costs | 246 | 186 | ||||||||
| Impairment charges | 2,068 | — | ||||||||
| Operating income | 17,670 | 7,453 | ||||||||
| Interest income, net | 7 | 14 | ||||||||
| Income before income taxes | 17,677 | 7,467 | ||||||||
| Income tax expense | 7,022 | 2,953 | ||||||||
| Net income | 10,655 | 4,514 | ||||||||
| Net loss attributable to redeemable noncontrolling interest | 1,780 | 561 | ||||||||
| Net income attributable to The Finish Line, Inc. | $ | 12,435 | $ | 5,075 | ||||||
| Diluted earnings per share attributable to The Finish Line, Inc. shareholders | $ | 0.25 | $ | 0.10 | ||||||
| Diluted weighted average shares | 48,360 | 48,732 | ||||||||
| Dividends declared per share | $ | 0.08 | $ | 0.07 | ||||||
| Finish Line store activity for the period: | ||||||||||
| Beginning of period | 645 | 645 | ||||||||
| Opened | 3 | 10 | ||||||||
| Closed | (3 | ) | (4 | ) | ||||||
| End of period | 645 | 651 | ||||||||
| Square feet at end of period | 3,512,190 | 3,531,314 | ||||||||
| Average square feet per store | 5,445 | 5,424 | ||||||||
| Branded shops within department stores activity for the period: | ||||||||||
| Beginning of period | 185 | 3 | ||||||||
| Opened | 77 | 41 | ||||||||
| Closed | — | — | ||||||||
| End of period | 262 | 44 | ||||||||
| Square feet at end of period | 294,978 | 41,995 | ||||||||
| Average square feet per shop | 1,126 | 954 | ||||||||
| Running Specialty store activity for the period: | ||||||||||
| Beginning of period | 48 | 27 | ||||||||
| Acquired | 8 | 9 | ||||||||
| Opened | 2 | 2 | ||||||||
| Closed | — | — | ||||||||
| End of period | 58 | 38 | ||||||||
| Square feet at end of period | 199,905 | 117,614 | ||||||||
| Average square feet per store | 3,447 | 3,095 | ||||||||
| Thirteen Weeks Ended | ||||||||
| May 31, | June 1, | |||||||
| 2014 | 2013 | |||||||
| Net sales | 100.0 | % | 100.0 | % | ||||
| Cost of sales (including occupancy costs) | 68.3 | 69.5 | ||||||
| Gross profit | 31.7 | 30.5 | ||||||
| Selling, general and administrative expenses | 26.8 | 28.3 | ||||||
| Store closing costs | 0.1 | 0.1 | ||||||
| Impairment charges | 0.5 | — | ||||||
| Operating income | 4.3 | 2.1 | ||||||
| Interest income, net | — | — | ||||||
| Income before income taxes | 4.3 | 2.1 | ||||||
| Income tax expense | 1.7 | 0.8 | ||||||
| Net income | 2.6 | 1.3 | ||||||
| Net loss attributable to redeemable noncontrolling interest | 0.5 | 0.1 | ||||||
| Net income attributable to The Finish Line, Inc. | 3.1 | % | 1.4 | % | ||||
| Condensed Consolidated Balance Sheets | ||||||||||||
| May 31, | June 1, | March 1, | ||||||||||
| 2014 | 2013 | 2014 | ||||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| ASSETS | ||||||||||||
| Cash and cash equivalents | $ | 196,583 | $ | 195,906 | $ | 229,079 | ||||||
| Merchandise inventories, net | 294,990 | 292,551 | 304,209 | |||||||||
| Other current assets | 26,526 | 19,574 | 33,675 | |||||||||
| Property and equipment, net | 228,722 | 183,593 | 223,182 | |||||||||
| Goodwill | 29,458 | 21,544 | 25,608 | |||||||||
| Other assets, net | 8,422 | 22,070 | 9,192 | |||||||||
| Total assets | $ | 784,701 | $ | 735,238 | $ | 824,945 | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
| Current liabilities | $ | 162,361 | $ | 162,662 | $ | 193,670 | ||||||
| Deferred credits from landlords | 28,674 | 27,618 | 27,658 | |||||||||
| Other long-term liabilities | 21,632 | 17,441 | 19,659 | |||||||||
| Redeemable noncontrolling interest, net | 561 | 3,097 | 1,774 | |||||||||
| Shareholders' equity | 571,473 | 524,420 | 582,184 | |||||||||
| Total liabilities and shareholders' equity | $ | 784,701 | $ | 735,238 | $ | 824,945 | ||||||
|
The Finish Line, Inc. |
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Reconciliation of Gross Profit, GAAP to Gross Profit, Non-GAAP (unaudited) |
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(In thousands) |
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| Thirteen Weeks Ended | ||||||||||||||||||
| May 31, 2014 | June 1, 2013 | |||||||||||||||||
| Gross profit, GAAP | $ | 128,880 | 31.7 | % | $ | 106,995 | 30.5 | % | ||||||||||
| Start-up costs | — | — | 5,758 | 1.6 | ||||||||||||||
| Gross profit, Non-GAAP | $ | 128,880 | 31.7 | % | $ | 112,753 | 32.1 | % | ||||||||||
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Reconciliation of Selling, General and Administrative Expenses, GAAP to |
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Selling, General and Administrative Expenses, Non-GAAP (unaudited) |
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(In thousands) |
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| Thirteen Weeks Ended | ||||||||||||||||||
| May 31, 2014 | June 1, 2013 | |||||||||||||||||
| Selling, general and administrative expenses, GAAP | $ | 108,896 | 26.8 | % | $ | 99,356 | 28.3 | % | ||||||||||
| Start-up costs | — | — | (2,202 | ) | (0.6 | ) | ||||||||||||
| Selling, general and administrative expenses, Non-GAAP | $ | 108,896 | 26.8 | % | $ | 97,154 | 27.7 | % | ||||||||||
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Reconciliation of Operating Income, GAAP to Operating Income, Non-GAAP (unaudited) |
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(In thousands) |
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| Thirteen Weeks Ended | ||||||||||||||||||
| May 31, 2014 | June 1, 2013 | |||||||||||||||||
| Operating income, GAAP | $ | 17,670 | 4.3 | % | $ | 7,453 | 2.1 | % | ||||||||||
| Impairment charges | 2,068 | 0.5 | — | — | ||||||||||||||
| Start-up costs | — | — | 7,960 | 2.3 | ||||||||||||||
| Operating income, Non-GAAP | $ | 19,738 | 4.8 | % | $ | 15,413 | 4.4 | % | ||||||||||
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Reconciliation of Net Income Attributable to The Finish Line, Inc., GAAP to |
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Net Income Attributable to The Finish Line, Inc., Non-GAAP (unaudited) |
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(In thousands) |
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| Thirteen Weeks Ended | ||||||||||||||||||
| May 31, 2014 | June 1, 2013 | |||||||||||||||||
| Net income attributable to The Finish Line, Inc., GAAP | $ | 12,435 | 3.1 | % | $ | 5,075 | 1.4 | % | ||||||||||
| Impairment charges* | 1,977 | 0.5 | — | — | ||||||||||||||
| Start-up costs | — | — | 7,960 | 2.3 | ||||||||||||||
| Decrease in income tax expense | (761 | ) | (0.2 | ) | (3,109 | ) | (0.9 | ) | ||||||||||
| Net income attributable to The Finish Line, Inc., Non-GAAP | $ | 13,651 | 3.4 | % | $ | 9,926 | 2.8 | % | ||||||||||
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* Net of decrease to net loss attributable to redeemable noncontrolling interest related to impairment charges of $91. |
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Reconciliation of Diluted Earnings Per Share Attributable to The Finish Line, Inc. Shareholders, GAAP to |
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Diluted Earnings Per Share Attributable to The Finish Line, Inc. Shareholders, Non-GAAP (unaudited) |
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| Thirteen Weeks Ended | |||||||||
| May 31, 2014 | June 1, 2013 | ||||||||
| Diluted earnings per share attributable to The Finish Line, Inc. shareholders, GAAP | $ | 0.25 | $ | 0.10 | |||||
| Impairment charges, net of income taxes and redeemable noncontrolling interest | 0.03 | — | |||||||
| Start-up costs, net of income taxes | — | 0.10 | |||||||
| Diluted earnings per share attributable to The Finish Line, Inc. shareholders, Non-GAAP | $ | 0.28 | $ | 0.20 | |||||
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Note: See Disclosure Regarding Non-GAAP Measures above. |
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Source: The
The Finish Line, Inc.
Media Contact:
Dianna L. Boyce,
Corporate Communications, 317-613-6577
or
Investor Contact:
Ed
Wilhelm, Chief Financial Officer, 317-613-6914
