Bret,
Good Earnings for GCO - News on extending repurchase plan:Genesco Reports Fourth Quarter Fully Taxed EPS Up 25% --Fiscal Year Fully Taxed EPS Grows 50%-- --Board Authorizes Repurchase of Additional One Million Shares--
NASHVILLE, Tenn., Feb. 29 /PRNewswire/ -- Genesco Inc. (NYSE: GCO - news) today reported fully taxed net earnings for the fourth quarter ended January 29, 2000 of $11.5 million, or $0.45 per diluted share. In the same quarter last year, net earnings on a fully taxed, pro forma basis would have been $0.36 per diluted share, before income tax benefits and other non-recurring items that added $1.00 per diluted share to the period's reported net earnings.
For the year ended January 29, 2000, net earnings were $25.9 million, or $1.05 per diluted share. Last year's fully-taxed, pro forma earnings were $0.70 per diluted share, before income tax benefits and other non-recurring items that added $1.13 per diluted share to reported net earnings for the year.
Net sales from ongoing operations increased in the fourth quarter by 22% to $171.7 million. Net sales from ongoing operations grew 18% to $564.9 million in fiscal 2000.
Genesco operates through five business segments: Journeys, Johnston & Murphy, Jarman, Licensed Brands (including Dockers Footwear and Nautica Footwear) and Volunteer Leather. Genesco's three largest divisions -- Journeys, Johnston & Murphy and Jarman -- accounted for 83% of the Company's ongoing net sales in fiscal 2000.
Genesco Chairman, President and Chief Executive Officer Ben T. Harris said, ``Journeys, our lifestyle footwear retail chain for the teen market, finished another year of high growth with a 16% same store sales increase in the fourth quarter and 13% for the full year. Journeys has generated double-digit increases in comparable store sales in four of the past five years. It is Genesco's largest and highest-growth division in both sales and profits. We ended the year with 323 Journeys stores and expect to reach 400 by the end of the current fiscal year.
``Johnston & Murphy remains a solid performer. The overall brand, including wholesale, retail, catalogue and internet operations, reported a 9% increase in total sales for the fourth quarter and 13% for the year. J&M shops' comparable store sales increased 5% for both the quarter and the year. The J&M brand continues its steady, profitable growth through its ongoing evolution as a lifestyle brand, broadening its product offerings and its customer base.
``Fiscal 2000 marked the beginning of a turnaround for Jarman, our mid-market retail chain. Same store sales increased 12% in the fourth quarter. Jarman began the year with flat same store sales and saw steady progress each quarter, producing 8% same store sales growth for the year. Jarman's operating income provided further evidence of the turnaround, improving by 45% for the year.
``Within our Licensed Brands segment, Dockers Footwear's strong performance for both the quarter and year was offset by weakness at Nautica Footwear. Our Leather operations improved their operating earnings for the year despite the effects of higher raw material prices in the fourth quarter.'
Genesco also announced that its board of directors had authorized the Company to repurchase up to one million shares of its common stock from time to time in the open market and in private transactions in addition to the 5.8 million shares previously authorized. As of February 29, 2000, the Company had repurchased a total of 5.8 million shares, or 21% of outstanding shares, since the stock repurchase program's inception in August 1998.
``Strong cash flow from operations has enabled us to use $51.8 million to repurchase our own shares while still having adequate cash flow to invest in our businesses,' said Harris. ``We view Genesco's stock as a compelling value at current market levels.'
Harris continued, ``Including the year just ended, Genesco has reported six consecutive years of growth in ongoing sales with strong operating earnings. All of our key businesses benefit from understanding their customers' lifestyle needs and a commitment to fulfill them, not only with the right footwear, but also in the right shopping environments, from our own stores and those of our wholesale customers, to consumers' living rooms served by our internet and catalogue businesses. We believe that this lifestyle focus has enabled us to lead the industry in recent years, giving us a 50% increase in fully-taxed earnings per share in the most recent year, and will be the key to maintaining the momentum and excitement in our businesses in the future.'
The forward-looking statements in this release involve a number of risks and uncertainties. Actual results could be materially different. The factors that could cause materially different results include changes in consumer demand or tastes that affect sales at retail or wholesale, changes in buying patterns by significant wholesale customers, changes in business strategies by the Company's competitors, the Company's ability to open, staff and support additional retail stores on schedule and at acceptable expense levels, the ability to execute its strategies to achieve improvements in Nautica's performance and the outcome of litigation and environmental matters involving the Company.
The Company's live conference call on February 29, 2000, at 10:00 a.m. (Central) may be accessed through the Company's Internet website, www.genesco.com, or through V-Call's website at www.vcall.com. To listen live, please go to either website at least 15 minutes early to register, download and install any necessary audio software. A replay will be available shortly after the call for 30 days.
Genesco, based in Nashville, operates 679 footwear retail stores in the U.S., principally under the names Journeys, Johnston & Murphy and Jarman. The Company also sells footwear at wholesale under its Johnston & Murphy brand and under the licensed Dockers and Nautica brands. It also produces leather through the Volunteer Leather Company. Additional information on Genesco and its operating divisions may be accessed at its website www.genesco.com.
GENESCO INC.
Consolidated Earnings Summary
In Thousands
Fourth Quarter Fiscal Year Ended
2000 1999 2000 1999
Net sales $173,193 $154,127 $573,720 $549,748
Cost of sales 95,897 83,553 316,628 305,366
Selling and
administrative
expenses 57,793 54,604 209,162 209,089
Restructuring income
and other charges,
net -- -- -- (2,403)
Earnings from
operations before
interest 19,503 15,970 47,930 37,696
Interest expense, net 1,537 1,486 5,987 6,611
Earnings before
income taxes,
discontinued
operations
and extraordinary
loss 17,966 14,484 41,943 31,085
Income tax expense
(benefit) 6,491 (23,753) 16,021 (23,838)
Earnings before
discontinued
operations
and extraordinary
loss 11,475 38,237 25,922 54,923
Excess provision for
discontinued
operations, net -- 450 -- 450
Earnings before
extraordinary loss 11,475 38,687 25,922 55,373
Extraordinary loss
from early retirement
of debt, net -- 1,406 -- (2,245)
Net Earnings $11,475 $40,093 $25,922 $53,128
GENESCO INC.
Earnings Per Share Information
In Thousands (except per share amounts)
Fourth Quarter Fiscal Year Ended
2000 1999 2000 1999
Preferred dividend
requirements $75 $75 $300 $300
Average common shares
- Basic EPS 21,759 24,293 22,392 25,461
Basic earnings per share:
Earnings before
discontinued
operations and
extraordinary loss $.52 $1.57 $1.14 $2.15
Discontinued operations $.00 $ .02 $ .00 $ .02
Extraordinary loss $.00 $ .06 $ .00 $(.10)
Net earnings $.52 $1.65 $1.14 $2.07
Average common and
common equivalent
shares - Diluted EPS 27,252 30,106 28,027 30,617
Diluted earnings per share:
Earnings before
discontinued
operations and
extraordinary loss $.45 $1.30 $1.05 $1.89
Discontinued operations $.00 $ .01 $ .00 $ .01
Extraordinary loss $.00 $ .05 $ .00 $(.07)
Net earnings $.45 $1.36 $1.05 $1.83
GENESCO INC.
Consolidated Earnings Summary
In Thousands
Fourth Quarter Fiscal Year Ended
2000 1999 2000 1999
Sales:
Journeys $74,863 $54,359 $215,318 $159,965
Jarman 29,294 27,438 86,897 83,315
Johnston & Murphy 45,839 42,051 166,340 147,434
Licensed Brands 15,796 11,658 74,122 67,356
Leather 5,946 5,083 22,203 18,934
Ongoing Sales 171,738 140,589 564,880 477,004
Other Retail(1) 1,455 13,538 8,840 56,184
Western Boot(2) -- -- -- 16,560
Net Sales 173,193 154,127 573,720 549,748
Pretax Earnings (Loss):
Journeys $12,238 $10,514 $29,719 $21,704
Jarman 3,317 2,939 4,336 2,983
Johnston & Murphy 7,345 5,865 22,187 19,708
Licensed Brands (420) (1,122) 2,487 2,435
Leather 270 558 1,363 898
Corporate and Other (2,726) (2,511) (10,868) (11,007)
Other Retail (256) 1,095 (500) 2,214
Western Boot -- 163 -- (1,309)
Nonrecurring Charges(3) (265) (1,531) (794) 70
Operating income 19,503 15,970 47,930 37,696
Interest, net 1,537 1,486 5,987 6,611
Total Pretax Earnings 17,966 14,484 41,943 31,085
Income tax expense
(benefit) 6,491 (23,753) 16,021 (23,838)
Earnings before
discontinued
operations and
extraordinary loss 11,475 38,237 25,922 54,923
Excess provision for
discontinued
operations, net -- 450 -- 450
Earnings before
extraordinary loss 11,475 38,687 25,922 55,373
Extraordinary loss
from early retirement
of debt, net -- 1,406 -- (2,245)
Net Earnings $11,475 $40,093 $25,922 $53,128
(1) Includes Jarman Leased and General Shoe Warehouse. The sale of the
remaining Jarman Leased departments was completed in the first quarter
of Fiscal 2000 while all but 5 General Shoe Warehouse outlets were
closed in the fourth quarter of Fiscal 2000.
(2) Laredo, Code West, Larry Mahan and Boot Factory businesses which were
sold effective July 14, 1998.
(3) Includes litigation, environmental and severance charges in Fiscal
2000 and 1999 and a restructuring gain of $2.4 million in Fiscal 1999.
GENESCO INC.
Consolidated Balance Sheet
In Thousands
January 29 January 30
2000 1999
Assets
Cash and short-term investments $57,860 $58,743
Accounts receivable 23,617 23,164
Inventories 109,815 108,067
Other current assets 23,707 26,043
Current assets of operations to be divested (1) -- 12,243
Total current assets 214,999 228,260
Plant, equipment and capital leases 68,661 57,624
Other non-current assets 17,505 20,551
Non-current assets of operations to be
divested (1) -- 763
Total Assets $301,165 $307,198
Liabilities and Shareholders' Equity
Total current liabilities 76,992 72,482
Long-term debt 103,500 103,500
Other long-term liabilities 12,431 14,637
Shareholders' equity 108,242 116,579
Total Liabilities and Shareholders' Equity $301,165 $307,198
(1) Assets of Jarman Leased.
GENESCO INC.
Ongoing Retail Units Operated - Twelve Months Ended January 29, 2000
Balance Balance
1/30/99 Open Conversions Close 01/29/00
Journeys 258 66 2 3 323
Jarman 166 9 -2 12 161
Johnston & Murphy 132 15 0 4 143
Shops 108 10 0 4 114
Factory Outlets 24 5 0 0 29
Nautica Leased
Depts. 24 23 0 0 47
Total Ongoing
Retail Units 580 113 0 19 674
General Shoe
Warehouse 16 0 0 11 5
Total Retail
Units 596 113 0 30 679
Ongoing Retail Units Operated - Three Months Ended January 29, 2000
Balance Balance
10/30/99 Open Conversions Close 01/29/00
Journeys 307 16 1 1 323
Jarman 159 5 -1 2 161
Johnston & Murphy 143 2 0 2 143
Shops 114 2 0 2 114
Factory Outlets 29 0 0 0 29
Nautica Leased
Depts. 41 6 0 0 47
Total Ongoing
Retail Units 650 29 0 5 674
General Shoe
Warehouse 15 0 0 10 5
Total Retail
Units 665 29 0 15 679
Ongoing Constant Store Sales
Three Months Ended Twelve Months Ended
January 29, January 30, January 29, January 30,
2000 1999 2000 1999
Journeys 16% 0% 13% 1%
Jarman 12% -7% 8% -7%
Johnston & Murphy 5% 8% 4% 8%
Shops 5% 8% 5% 8%
Factory Outlets 5% 8% 1% 6%
Total Ongoing Constant
Store Sales 12% 0% 9% 0%
SOURCE: Genesco Inc.
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