LONDON, UK / ACCESSWIRE / September 25, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Genesco Inc. (NYSE: GCO), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=GCO, following the Company's release of its second quarter fiscal 2018 financial results on August 31, 2017. The seller of footwear, hats, clothing, and accessories reported a y-o-y decline in sales and earnings and also updated its guidance for the fiscal year. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Earnings Reviewed

For the second quarter ended July 29, 2017, Genesco's net sales decreased 1.4% to $617 million for Q2 FY18 from $626 million in Q2 FY17. The Company noted that without the sale in December 2016 of the SureGrip business and the impact of foreign exchange, revenue would have been flat. Genesco's sales fell short of Wall Street's estimates of $632.4 million

During Q2 FY18, Genesco's consolidated comparable sales, including same-store sales and comparable ecommerce and catalog sales, were flat, with a 1% increase in the Journeys Group, a 2% decrease in the Lids Sports Group, a 3% increase in the Schuh Group, and a 1% decrease in the Johnston & Murphy Group. The Company's comparable sales included a 2% decrease in same-store sales and a 30% increase in ecommerce sales.

Genesco reported a loss from continuing operations of $3.9 million, or $0.20 per diluted share, for Q2 FY18 compared to earnings from continuing operations of $14.5 million, or $0.72 per diluted share, for Q2 FY17. The Company's reported quarter results reflected the negative impact from new accounting guidelines for share-based payments totaling $2.2 million, or $0.11 per diluted share after-tax, while Q2 FY17 results reflected a pretax gain of $10.4 million, or $0.34 per diluted share, after tax.

Adjusted for items described in both periods, Genesco's loss from continuing operations was $2.0 million, or $0.10 per diluted share, for Q2 FY18 compared to earnings from continuing operations of $6.9 million, or $0.34 per diluted share, for Q2 FY17. The Company's losses were wider than analysts' forecasts of $0.06 per share.

Genesco's Segment Results

During Q2 FY18, Genesco's Journeys Group's sales totaled $258.95 million compared to sales of $252.12 million in Q2 FY17. The segment recorded operating loss of $2.19 million versus operating income of $4.48 million in the year-ago corresponding period.

For Q2 FY18, Lids Sports Group recorded sales of $180.23 million from sales of $188.91 million in Q2 FY17. The division posted operating income of $3.04 million compared to operating income of $7.13 million in the year-earlier comparable quarter.

The Schuh Group's net sales came in at $97.63 million for Q2 FY18 compared to $96.96 million in Q2 FY17. The segment generated operating income of $4.54 million in the reported quarter versus operating income of $5.69 million in the prior year's same quarter.

Cash Matters

During Q2 FY18, Genesco's total inventory was up 1% on a sales decrease of 1%. The Company's capital expenditures for the reported quarter were $37 million, and depreciation and amortization was $19 million. Genesco did not repurchase any shares during Q2 FY18. The Company had $24 million remaining under the current $100 million repurchase authorization. As of July 29, 2017, Genesco's cash and cash equivalents totaled $43.52 million compared to cash worth $41.47 million as on July 30, 2016.

Outlook

Genesco stated that it has adopted a more conservative outlook for store-based sales given the anemic level of mall traffic year-to-date and the more pronounced shift in consumer spending away from stores to online. Therefore, the Company now expects adjusted diluted earnings per share for the year in the range of $3.35 to $3.65 compared to its previously issued guidance range of $3.90 to $4.05. Genesco noted that these expectations do not include projected non-cash asset impairments and other charges in the range of $4.7 million to $5.8 million pretax, or $0.16 to $0.20 per share after tax, for the full fiscal year. The Company's guidance assumes comparable sales in the range of -1% to 1% for FY18.

Stock Performance

On Friday, September 22, 2017, the stock closed the trading session at $25.70, climbing 3.63% from its previous closing price of $24.80. A total volume of 360.61 thousand shares have exchanged hands. Genesco's stock price advanced 6.42% in the last one month. The stock is trading at a PE ratio of 7.23 and currently has a market cap of $488.56 million.

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