“The [earnings] were impressive,” said Gilford Securities retail analyst Bernie Sosnick. “Under [chairman, president and CEO] Ken Hicks, the business is being managed with much greater vision and more boldly than ever in the past, probably since the day it was started. They have a whole new approach and it’s driven by lifestyle differentiation. There is a lot more [sales potential] for Foot Locker going forward because of this merchandising change.”
Sterne Agee analyst Sam Poser, too, said he was surprised at the swift pace of the company’s evolution. “The results were much better than I expected,” he said. “They’re moving along toward their longer-terms goals far [faster] than what I thought they were going to be able to pull off, and they have several levers left to pull.”
For its fourth quarter ended Jan. 29, the New York-based firm reported earnings more than doubled to $57 million, or 36 cents a diluted share, from $23 million, or 14 cents, in the year-ago quarter. Excluding nonrecurring items in both periods, income was $61 million, or 39 cents a diluted share, versus $39 million, or 24 cents, a year ago. That exceeded analyst estimates by 2 cents, as polled by Yahoo Finance. Sales were $1.39 billion compared with $1.33 billion last year. Comps increased 7.3 percent.
“We generated strong comp-store sales and profit increases in both our store and dot-com businesses,” Hicks said.
Executives said the firm’s execution of its new plan has led to “positive strides toward achieving our long-term financial objectives.” Features of the plan include diversification of its footwear offerings and a greater emphasis on both branded and private-label apparel.