- New York-based specialty athletic retailer Foot Locker Inc FL reported a second-quarter FY22 sales decline of 9.2% year-on-year to $2.065 billion, missing the consensus of $2.07 billion.
- Adjusted EPS of $1.10 beat the analyst consensus of $0.80.
- Comparable store sales decreased 10.3% versus last year.
- "Despite an increasingly challenging macroeconomic backdrop, we delivered a solid quarter against the favorable fiscal stimulus and promotional environment from last year," said Richard Johnson, Chairman, and CEO.
- Related: Foot Locker's Q2 Likely To Reflect Sales & Operating Margin Pressure, Says This Analyst
- The gross margin contracted 340 basis points, driven mainly by higher markdowns, as the promotional environment started to normalize after last year's unusually favorable backdrop, followed by supply chain costs and occupancy deleverage.
- Selling, general and administrative expenses rose 0.4% Y/Y to $452 million. SG&A deleveraged by 210 basis points, driven mainly by labor inflation and the decline in sales.
- The operating margin was 6.7%, and operating income for the quarter declined 47.3% to $139 million.
- The company held $386 million in cash and equivalents as of July 30, 2022.
- Management Change: Foot Locker has selected Mary N. Dillon, former Executive Chair and CEO of Ulta Beauty, Inc. ULTA, as its President and CEO, effective September 1, 2022.
- The present CEO, Richard A. Johnson is set to retire on September 1 as part of a planned succession process.
- Johnson will continue as Executive Chairman of the Board through January 31, 2023, with Lead Independent Director Dona D. Young becoming non-Executive Chair, effective February 1, 2023.
- CFO Andrew Page said, "Following our solid results for the second quarter, against record results last year, we remain confident in our ability to achieve earnings within our original guidance range. But recognizing that the back half will likely see more pressure than we originally anticipated, we now expect to be at the lower end."
- Outlook: Foot Locker sees FY22 sales to decline 6% - 7% (previous outlook upper end of 4% decline – 6% decline).
- It expects FY22 EPS of $4.25 - $4.45 (prior view upper end of $4.25-$4.60), versus the consensus of $4.42.
- Price Action: FL shares are trading higher by 24.11% at $39.69 in premarket on the last check Friday.
- Photo Via Wikimedia Commons
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
Posted In: EarningsNewsGuidanceManagementMoversTrading IdeasGeneralBriefspremarket tradingwhy it's moving
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in
