Finish Line 4Q net income falls on weak demand

Published March 28, 2013 12:59pm ET



INDIANAPOLIS (AP) — Athletic footwear and clothing company Finish Line Inc. said Thursday that its fiscal fourth-quarter net income dropped 18 percent, hurt by lackluster sales at its stores open at least a year.

Finish Line Chairman and CEO Glenn Lyon said that while the quarterly results were in line with company expectations, the second half of the year was tough, with weak results at Finish Line’s running business.

Its adjusted earnings topped Wall Street forecasts while revenue missed. Its shares edged up in premarket trading.

For the quarter ended March 2, Finish Line earned $34.3 million, or 69 cents per share, down from $41.9 million, or 80 cents per share, in the same quarter last year.

Excluding one-time items, the company posted an adjusted profit of 76 cents per share. Analysts surveyed by FactSet expected earnings of 75 cents per share.

Revenue fell 3 percent to $442.7 million from $456.3 million. Analysts, on average, expected $451.7 million in revenue.

The recent quarter’s results got a boost from an extra week compared with the prior-year period that contributed $30.5 million in sales and about 7 cents in earnings per share, the company said.

Revenue at stores open at least a year edged up 0.7 percent, helped by a 21 percent jump in digital sales. The metric is a key measure of a retailer’s health, because it excludes revenue at stores that recently opened or closed.

For the full fiscal year 2013, Finish Line earned $71.5 million, or $1.40 per share, compared with $84.8 million, or $1.59 per share, in fiscal 2012. Revenue rose to $1.44 billion from $1.37 billion. Excluding one-time items, the company earned $1.47 per share for fiscal 2013.

For the current fiscal year, Finish Line said it expects a “mid-single digit” percent increase in earnings per share over fiscal 2013’s adjusted results. Revenue at stores open at least a year are expected to rise “slightly,” the company said.

Its shares rose 8 cents to $18.37 in premarket trading. They are up from a 52-week low of $16.87 in January. They peaked at $25.36 almost a year ago.