Finish Line (FINL) Misses Q3 EPS by 4c; Plans Store Closings; Boosts Qtr. Dividend

Finish Line (NASDAQ: FINL) reported Q3 EPS of ($0.07), versus the analyst estimate of ($0.03). Revenue for the quarter came in at $382.1 million versus the consensus estimate of $408.86 million.

Finish Line comparable store sales decreased 5.8%

Store Profitability Improvement

The company also announced today that it will improve the profitability of its store fleet by closing up to 150 stores, or 25% of its store base over the next four years. These stores produce average annual sales of approximately $1 million, a portion of which the company expects to recapture at nearby locations and through its digital sites. The company expects the store closures to generate a 100 basis point improvement in store contribution margins.

Quarterly Cash Dividend Increased 11%

The board of directors has declared a quarterly cash dividend of $0.10 per share of outstanding common stock. This represents a $0.01 per share, or 11%, increase over the previous dividend paid by the company. The quarterly cash dividend will be payable on March 14, 2016 to shareholders of record as of February 26, 2016.

Lyon continued, “We are rigorously looking at all opportunities to strengthen every component of this enterprise. We are confident that the transformational changes we are making will positively impact our customer connections, and lead to increased earnings power and greater shareholder returns for years to come.”

Outlook

For the fiscal year ending February 27, 2016, the company now expects Finish Line comparable store sales to be up low-single digits and non-GAAP diluted earnings per share between $1.18 and $1.23.

For the fourth quarter ending February 27, 2016, the company expects Finish Line comparable store sales to be up in the low-single to mid-single digit range and non-GAAP diluted earnings per share between $0.78 and $0.83.

NOTE: The Street sees FY16 EPS of $1.74 and Q4 EPS of $0.91.

For earnings history and earnings-related data on Finish Line (FINL) click here.

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