The Nashville, Tenn.-based company, which also owns Schuh, Johnston & Murphy and struggling hat chain Lids, reported second-quarter 2019 earnings on Friday, posting a 3 percent increase in comparable sales, beating the consensus estimate of 1.3 percent growth. Most notable, however, was the 10 percent lift at Journeys, which executives credited largely to strong shoe sales and which propelled the company to its fastest growth in two years.
“The significant improvement in our U.S. footwear businesses, especially Journeys, more than offset the headwinds at Lids and across the Atlantic,” Robert J. Dennis, Genesco’s chairman, president and CEO, said on a call with analysts and investors.
Overall net sales rose to $653.9 million, from $616.5 million, a 6 percent gain year over year. Sales at Journeys were up 17.8 percent to $305 million. The company reported earnings of $0.2 million, or 1 cent per diluted share, compared with a loss of $3.9 million, or 20 cents per diluted share, in the second quarter last year. Both the top- and bottom-line results topped Wall Street’s forecast for sales of $641 million and a loss of 3 cents per share.
Dennis also commented on the consumer trends the company has seen from the front lines of one of the most maligned areas of retail right now: the mall.
“We’ve gone through, I think, four years where traffic into footwear and apparel has declined significantly, and all of a sudden, we’ve reached a year where it’s flattened out a little bit — not for all of retail but for footwear and apparel as a category,” he told investors during today’s conference call. “And so we’re seeing, for reasons that we can’t completely understand … a flattening out of that, and so that’s giving us, from a macro standpoint, an opportunity to do better.”
The company reiterated its full-year 2019 of comparable sales up 1 percent to 3 percent.