Form 8-K GENESCO INC For: Dec 03

December 3, 2021 7:19 AM EST

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Exhibit 99.1

 

 

 

 

 

 

 

GENESCO INC. REPORTS FISCAL 2022 THIRD QUARTER RESULTS

--Record Third Quarter EPS, Exceeding Expectations--

--Strong Back-to-School Season in U.S. and U.K.--

--Revenue and Earnings Continue to Exceed Pre-Pandemic Levels--

 

Third Quarter Fiscal 2022 Financial Summary

 

Net sales increased 25% from last year to $601 million

 

Net sales increased 12% over the third quarter two years ago

 

GAAP and Non-GAAP operating income both increased 69% over third quarter two years ago

 

Same store sales increased 25% over last year, store sales above pre-pandemic levels

 

E-commerce sales increased 79% from third quarter two years ago

 

Returned capital to shareholders with the repurchase of $31 million in stock

 

GAAP EPS from continuing operations increased to $2.26 vs. $0.52 last year and $1.31 two years ago

 

Non-GAAP EPS from continuing operations increased to $2.361 vs. $0.85 last year and $1.33 two years ago

 

NASHVILLE, Tenn., Dec. 3, 2021 --- Genesco Inc. (NYSE: GCO) today reported GAAP earnings from continuing operations per diluted share of $2.26 for the three months ended October 30, 2021, compared to $0.52 in the third quarter last year and $1.31 per diluted share two years ago.  Adjusted for the Excluded Items in all periods, the Company reported third quarter earnings from continuing operations per diluted share of $2.36, compared to $0.85 last year and $1.33 per diluted share two years ago.

 

Mimi E. Vaughn, Genesco board chair, president and chief executive officer, said, “Building off a very strong first half of Fiscal 2022, our excellent results this quarter were fueled by an outstanding back-to-school season in the United States and United Kingdom, reinforcing Journeys’ and Schuh’s positions as the leading destinations for teen and youth fashion footwear. We were especially pleased with the performance of our stores, as sales in our current fleet were up for the first time since prior to the pandemic. The improvement in traffic trends bolsters our view that teens like to shop in person, making our stores strategic assets that work in tandem with our digital capabilities, serving our customers whenever and wherever they choose to engage with our brands. Turning to the current quarter, we have been very pleased with our results to date, as sales tracked nicely ahead of pre-pandemic levels in November, and we are now into the all-important holiday selling season.  Given the recovery and confidence we have in our business, we are returning to giving guidance.  We expect adjusted earnings for Fiscal 2022 to be between $6.40 and $6.90 per share with an expectation that earnings will be near the mid-point of the range, an increase of 45% over pre-pandemic Fiscal 2020.

 

_____________________

1Excludes retail store asset impairments, professional fees related to the actions of a shareholder activist and expenses related to the Company’s new headquarters building, net of tax effect in the third quarter of Fiscal 2022 (“Excluded Items”). A reconciliation of earnings/loss and earnings/loss per share from continuing operations in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) with the adjusted earnings/loss and earnings/loss per share numbers is set forth on Schedule B to this press release. The Company believes that disclosure of earnings/loss and earnings/loss per share from continuing operations adjusted for the items not reflected in the previously announced expectations will be meaningful to investors, especially in light of the impact of such items on the results.


 


 

 

 

 

“We entered the pandemic in a position of strength, are navigating the pandemic well, and believe we will enter the post pandemic phase even stronger.  Our exceptional year-to-date results highlight the great execution by our teams, our strong vendor relationships, close consumer connections, and the strategic advantages enabled through our footwear focused strategy. Our opportunity to unlock value in Genesco is to further accelerate the digital and omnichannel growth in our retail business and to meaningfully grow our branded side.”

 

Thomas A. George, Genesco chief financial officer, commented, “Our third quarter results exceeded our expectations and were well above pre-pandemic levels. Strong sales growth, solid gross margins, and well managed expenses fueled a 69% increase in operating income versus the third quarter Fiscal 2020 two years ago, helping deliver record third quarter adjusted EPS of $2.36 compared to $1.33 in Fiscal 2020.”

 

Store Re-Opening Update

As of October 30, 2021, the Company is operating substantially all locations.

 

Third Quarter Review

Net sales for the third quarter of Fiscal 2022 increased 25% to $601 million from $479 million in the third quarter of Fiscal 2021 and increased 12% from $537 million in the third quarter of Fiscal 2020. The sales increase from Fiscal 2020, reflecting strong back-to-school sales, was driven by a 79% increase in e-commerce sales, increased wholesale sales, like-for-like store sales slightly above Fiscal 2020 levels, and the positive impact of changes in foreign exchange rates. Although the Company has disclosed comparable sales for the third quarter Fiscal 2022, it believes that overall sales is a more meaningful metric during this period due to the impact of COVID-19.

 

 

Comparable Sales

 

 

 

Comparable Same Store and Direct Sales:

3QFY22

3QFY21

Journeys Group

15%

(6)%

Schuh Group

23%

1%

Johnston & Murphy Group

77%

(43)%

Total Genesco Comparable Sales

21%

(9)%

    

Same Store Sales

25%

(18)%

Comparable Direct Sales

7%

62%

 

Overall sales for the third quarter this year compared to the third quarter of Fiscal 2021 were up 20% at Journeys, up 33% at Schuh, up 69% at Johnston & Murphy and up 6% at Licensed Brands. Overall sales compared to the third quarter of Fiscal 2020 were up 7% at Journeys, up 29% at Schuh and up 103% at Licensed Brands, partially offset by an 8% decrease in Johnston & Murphy sales.

 

            Third quarter gross margin this year was 49.2%, up 210 basis points, compared with 47.1% last year and flat compared with the third quarter of Fiscal 2020 at 49.2%. Although the increased ecommerce and wholesale mix, as well as freight and logistics cost increases put pressure on the Fiscal 2020 gross margin comparison, this was mitigated by fewer markdowns at Journeys and Johnston & Murphy.

 

 


 

 

GAAP selling and administrative expense for the third quarter this year decreased 220 basis points as a percentage of sales compared with last year and decreased 240 basis points compared with the third quarter of Fiscal 2020.  Adjusted selling and administrative expense for the third quarter this year decreased 250 basis points as a percentage of sales compared with last year and decreased 260 basis points compared with the third quarter of Fiscal 2020. The decrease from Fiscal 2020 is due primarily to reduced occupancy expense, along with selling salaries and depreciation, partially offset by increased marketing expenses. The reduction in occupancy expense is driven in part by rent abatement agreements with landlords and savings from government programs in Canada and the U.K.

 

Genesco’s GAAP operating income for the third quarter was $43.8 million, or 7.3% of sales this year, compared with $8.2 million, or 1.7% of sales last year, and $25.9 million, or 4.8% of sales in the third quarter of Fiscal 2020. Adjusted for the Excluded Items in all periods, operating income for the third quarter was $45.2 million this year compared to $13.9 million last year and $26.7 million in the third quarter of Fiscal 2020. Adjusted operating margin was 7.5% of sales in the third quarter of Fiscal 2022, 2.9% last year and 5.0% in the third quarter of Fiscal 2020.

 

The effective tax rate for the quarter was 23.5% in Fiscal 2022 compared to -7.4% last year and 25.4% in the third quarter of Fiscal 2020. The adjusted effective tax rate, reflecting Excluded Items, was 22.7% in the third quarter of Fiscal 2022 compared to 4.4% last year and 26.2% in the third quarter of Fiscal 2020.  The higher adjusted effective tax rate for this year as compared to last year reflects the inability to recognize a tax benefit for certain foreign losses and a higher mix of earnings in jurisdictions where the Company generates taxable income.

 

GAAP earnings from continuing operations were $33.0 million in the third quarter of Fiscal 2022, compared to $7.5 million in the third quarter last year and $19.0 million in the third quarter of Fiscal 2020. Adjusted for the Excluded Items in all periods, third quarter earnings from continuing operations were $34.5 million, or $2.36 per share, in Fiscal 2022, compared to $12.1 million, or $0.85 per share, last year and $19.4 million, or $1.33 per share, in the third quarter of Fiscal 2020.

 

Cash, Borrowings and Inventory

Cash and cash equivalents as of October 30, 2021, were $282.8 million, compared with $115.1 million as of October 31, 2020. Total debt at the end of the third quarter of Fiscal 2022 was $15.6 million compared with $32.9 million at the end of last year’s third quarter. Inventories decreased 8% in the third quarter of Fiscal 2022 on a year-over-year basis and decreased 28% versus the third quarter of Fiscal 2020.

 

Capital Expenditures and Store Activity

For the third quarter, capital expenditures were $15 million, related primarily to the new headquarters building and digital and omnichannel initiatives. Depreciation and amortization was $10 million.  During the quarter, the Company closed five stores. The Company ended the quarter with 1,434 stores compared with 1,476 stores at the end of the third quarter last year, or a decrease of 3%. Square footage was down 3% on a year-over-year basis.

 

Share Repurchases

The Company repurchased 521,693 shares during the third quarter of Fiscal 2022 at a cost of $30.6 million or an average of $58.71 per share. The Company currently has $59 million remaining on the $100 million board authorization from September 2019.

 


 


 

 

Fiscal 2022 Outlook

For Fiscal 2022, the Company expects:

 

Sales to be up 9% to 11%, compared to FY20

 

Adjusted diluted earnings per share from continuing operations in the range of $6.40 to $6.90, which represents growth of approximately 45% at the mid-point compared to Fiscal 2020, with an expectation that earnings per share for the year will be near the mid-point of the range.  

 

Please refer to the Q3FY22 conference call and Q3FY22 Summary Results presentation for details regarding guidance assumptions, including assumptions regarding COVID-19 and effects on the Company’s supply chain.

 

Conference Call, Management Commentary and Investor Presentation

The Company has posted detailed financial commentary and a supplemental financial presentation of third quarter results on its website, www.genesco.com, in the investor relations section.  The Company's live conference call on December 3, 2021, at 7:30 a.m. (Central time), may be accessed through the Company's website, www.genesco.com. To listen live, please go to the website at least 15 minutes early to register, download and install any necessary software.

 

Safe Harbor Statement  

This release contains forward-looking statements, including those regarding the performance outlook for the Company, expectations with respect to sales, earnings, growth, returning capital to shareholders and all other statements not addressing solely historical facts or present conditions.  Forward-looking statements are usually identified by or are associated with such words as “intend,” “expect,” “believe,” “anticipate,” “should,” “optimistic” and similar terminology.  Actual results could vary materially from the expectations reflected in these statements.  A number of factors could cause differences.  These include adjustments to projections reflected in forward-looking statements, including those resulting from the effects of COVID-19 on the Company’s business, including COVID-19 case spikes in locations in which the Company operates, store closures due to COVID-19,  weakness in store and shopping mall traffic, timing of in person back-to-work and back-to-school and sales with respect thereto, expectations regarding the COVID-19 vaccine rollout and acceptance, restrictions on operations imposed by government entities and/or landlords, changes in public safety and health requirements, and limitations on the Company’s ability to adequately staff and operate stores.  Differences from expectations could also result from store closures and effects on the business as a result of civil disturbances; the level and timing of promotional activity necessary to maintain inventories at appropriate levels; the imposition of tariffs on product imported by the Company or its vendors as well as the ability and costs to move production of products in response to tariffs; the Company’s ability to obtain from suppliers products that are in-demand on a timely basis and effectively manage disruptions in product supply or distribution, including disruptions as a result of COVID-19; unfavorable trends in fuel costs, foreign exchange rates, foreign labor and material costs, and other factors affecting the cost of products; the effects of the British decision to exit the European Union and other sources of market weakness in the U.K. and Republic of Ireland; the effectiveness of the Company's omnichannel initiatives; costs associated with changes in minimum wage and overtime requirements; wage pressure in the U.S. and the U.K.; weakness in the consumer economy and retail industry; competition and fashion trends in the Company's markets; risks related to the potential for terrorist events; risks related to public health and safety events; changes in buying patterns by significant wholesale customers; retained liabilities associated with divestitures of businesses including potential liabilities under leases as the prior tenant or as a guarantor; and changes in the timing of holidays or in the onset of seasonal weather affecting period-to-period sales comparisons.  Additional factors that could cause differences from expectations include the ability to renew leases in existing stores and control or lower occupancy costs, and to conduct required remodeling or refurbishment on schedule and at expected expense levels; the timing and amount of share repurchases; the Company’s ability to realize anticipated cost savings, including rent savings; the Company’s ability to achieve expected digital gains

 


 

and gain market share; deterioration in the performance of individual businesses or of the Company's market value relative to its book value, resulting in impairments of fixed assets, operating lease right of use assets or intangible assets or other adverse financial consequences and the timing and amount of such impairments or other consequences; unexpected changes to the market for the Company's shares or for the retail sector in general; costs and reputational harm as a result of disruptions in the Company’s business or information technology systems either by security breaches and incidents or by potential problems associated with the implementation of new or upgraded systems; the Company’s ability to realize any anticipated tax benefits; changes to U.S. tax laws impacting the Company’s tax liabilities; and the cost and outcome of litigation, investigations and environmental matters involving the Company.  Additional factors are cited in the "Risk Factors," "Legal Proceedings" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of, and elsewhere in, the Company’s SEC filings, copies of which may be obtained from the SEC website, www.sec.gov, or by contacting the investor relations department of Genesco via the Company’s website, www.genesco.com.  Many of the factors that will determine the outcome of the subject matter of this release are beyond Genesco's ability to control or predict.  Genesco undertakes no obligation to release publicly the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.  Forward-looking statements reflect the expectations of the Company at the time they are made.  The Company disclaims any obligation to update such statements.

 

About Genesco Inc.

Genesco Inc., a Nashville-based specialty retail and branded company, sells footwear and accessories in more than 1,430 retail stores throughout the U.S., Canada, the United Kingdom and the Republic of Ireland, principally under the names Journeys, Journeys Kidz, Little Burgundy, Schuh, Schuh Kids, Johnston & Murphy, and on internet websites www.journeys.com, www.journeyskidz.com, www.journeys.ca, www.littleburgundyshoes.com, www.schuh.co.uk, www.johnstonmurphy.com, www.johnstonmurphy.ca, www.nashvilleshoewarehouse.com, and www.dockersshoes.com. In addition, Genesco sells footwear at wholesale under its Johnston & Murphy brand, the licensed Levi’s brand, the licensed Dockers brand, the licensed Bass brand, and other brands. Genesco is committed to progress in its diversity, equity and inclusion efforts, and the Company’s environmental, social and governance stewardship. For more information on Genesco and its operating divisions, please visit www.genesco.com.

 

 

Genesco Inc. Financial Contact

Thomas A. George

(615) 367-7465

tgeorge@genesco.com

 

Genesco Inc. Media Contact

Claire S. McCall

(615) 367-8283

cmccall@genesco.com

 

 

 

 


 

 

GENESCO INC.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(Unaudited)

 

 

 

Quarter 3

 

 

Quarter 3

 

 

 

Oct. 30,

2021

 

 

% of

Net Sales

 

 

Oct. 31,

2020

 

 

% of

Net Sales

 

Net sales

 

$

600,546

 

 

 

100.0

%

 

$

479,280

 

 

 

100.0

%

Cost of sales

 

 

305,345

 

 

 

50.8

%

 

 

253,776

 

 

 

52.9

%

Gross margin

 

 

295,201

 

 

 

49.2

%

 

 

225,504

 

 

 

47.1

%

Selling and administrative expenses

 

 

251,131

 

 

 

41.8

%

 

 

210,961

 

 

 

44.0

%

Asset impairments and other, net

 

 

314

 

 

 

0.1

%

 

 

6,359

 

 

 

1.3

%

Operating income

 

 

43,756

 

 

 

7.3

%

 

 

8,184

 

 

 

1.7

%

Other components of net periodic benefit cost (income)

 

 

55

 

 

 

0.0

%

 

 

(182

)

 

 

0.0

%

Interest expense, net

 

 

585

 

 

 

0.1

%

 

 

1,404

 

 

 

0.3

%

Earnings from continuing operations before income taxes

 

 

43,116

 

 

 

7.2

%

 

 

6,962

 

 

 

1.5

%

Income tax expense (benefit)

 

 

10,135

 

 

 

1.7

%

 

 

(514

)

 

 

-0.1

%

Earnings from continuing operations

 

 

32,981

 

 

 

5.5

%

 

 

7,476

 

 

 

1.6

%

Loss from discontinued operations, net of tax

 

 

(86

)

 

 

0.0

%

 

 

(10

)

 

 

0.0

%

Net Earnings

 

$

32,895

 

 

 

5.5

%

 

$

7,466

 

 

 

1.6

%

Basic earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Before discontinued operations

 

$

2.30

 

 

 

 

 

 

$

0.52

 

 

 

 

 

Net earnings

 

$

2.30

 

 

 

 

 

 

$

0.52

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Before discontinued operations

 

$

2.26

 

 

 

 

 

 

$

0.52

 

 

 

 

 

Net earnings

 

$

2.25

 

 

 

 

 

 

$

0.52

 

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

14,314

 

 

 

 

 

 

 

14,283

 

 

 

 

 

Diluted

 

 

14,616

 

 

 

 

 

 

 

14,362

 

 

 

 

 

 


 

 

GENESCO INC.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(Unaudited)

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

Oct. 30,

2021

 

 

% of

Net Sales

 

 

Oct. 31,

2020

 

 

% of

Net Sales

 

Net sales

 

$

1,694,424

 

 

 

100.0

%

 

$

1,149,729

 

 

 

100.0

%

Cost of sales

 

 

869,039

 

 

 

51.3

%

 

 

637,081

 

 

 

55.4

%

Gross margin

 

 

825,385

 

 

 

48.7

%

 

 

512,648

 

 

 

44.6

%

Selling and administrative expenses

 

 

743,147

 

 

 

43.9

%

 

 

587,264

 

 

 

51.1

%

Goodwill impairment

 

 

 

 

 

0.0

%

 

 

79,259

 

 

 

6.9

%

Asset impairments and other, net

 

 

10,054

 

 

 

0.6

%

 

 

15,953

 

 

 

1.4

%

Operating income (loss)

 

 

72,184

 

 

 

4.3

%

 

 

(169,828

)

 

 

-14.8

%

Other components of net periodic benefit cost (income)

 

 

72

 

 

 

0.0

%

 

 

(488

)

 

 

0.0

%

Interest expense, net

 

 

1,931

 

 

 

0.1

%

 

 

4,178

 

 

 

0.4

%

Earnings (loss) from continuing operations before income taxes

 

 

70,181

 

 

 

4.1

%

 

 

(173,518

)

 

 

-15.1

%

Income tax expense (benefit)

 

 

17,432

 

 

 

1.0

%

 

 

(27,446

)

 

 

-2.4

%

Earnings (loss) from continuing operations

 

 

52,749

 

 

 

3.1

%

 

 

(146,072

)

 

 

-12.7

%

Loss from discontinued operations, net of tax

 

 

(39

)

 

 

0.0

%

 

 

(275

)

 

 

0.0

%

Net Earnings (Loss)

 

$

52,710

 

 

 

3.1

%

 

$

(146,347

)

 

 

-12.7

%

Basic earnings (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Before discontinued operations

 

$

3.69

 

 

 

 

 

 

$

(10.29

)

 

 

 

 

Net earnings (loss)

 

$

3.68

 

 

 

 

 

 

$

(10.31

)

 

 

 

 

Diluted earnings (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Before discontinued operations

 

$

3.60

 

 

 

 

 

 

$

(10.29

)

 

 

 

 

Net earnings (loss)

 

$

3.60

 

 

 

 

 

 

$

(10.31

)

 

 

 

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

14,313

 

 

 

 

 

 

 

14,191

 

 

 

 

 

Diluted

 

 

14,643

 

 

 

 

 

 

 

14,191

 

 

 

 

 

 


 

 

GENESCO INC.

Sales/Earnings Summary by Segment

(in thousands)

(Unaudited)

 

 

 

Quarter 3

 

 

Quarter 3

 

 

 

Oct. 30,

2021

 

 

% of

Net Sales

 

 

Oct. 31,

2020

 

 

% of

Net Sales

 

Sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Journeys Group

 

$

379,927

 

 

 

63.3

%

 

$

317,682

 

 

 

66.3

%

Schuh Group

 

 

119,791

 

 

 

19.9

%

 

 

90,021

 

 

 

18.8

%

Johnston & Murphy Group

 

 

66,835

 

 

 

11.1

%

 

 

39,655

 

 

 

8.3

%

Licensed Brands

 

 

33,993

 

 

 

5.7

%

 

 

31,922

 

 

 

6.7

%

Net Sales

 

$

600,546

 

 

 

100.0

%

 

$

479,280

 

 

 

100.0

%

Operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Journeys Group

 

$

43,403

 

 

 

11.4

%

 

$

24,035

 

 

 

7.6

%

Schuh Group

 

 

9,701

 

 

 

8.1

%

 

 

6,766

 

 

 

7.5

%

Johnston & Murphy Group

 

 

1,641

 

 

 

2.5

%

 

 

(11,137

)

 

 

-28.1

%

Licensed Brands

 

 

(132

)

 

 

-0.4

%

 

 

792

 

 

 

2.5

%

Corporate and Other(1)

 

 

(10,857

)

 

 

-1.8

%

 

 

(12,272

)

 

 

-2.6

%

Operating income

 

 

43,756

 

 

 

7.3

%

 

 

8,184

 

 

 

1.7

%

Other components of net periodic benefit cost (income)

 

 

55

 

 

 

0.0

%

 

 

(182

)

 

 

0.0

%

Interest, net

 

 

585

 

 

 

0.1

%

 

 

1,404

 

 

 

0.3

%

Earnings from continuing operations before income taxes

 

 

43,116

 

 

 

7.2

%

 

 

6,962

 

 

 

1.5

%

Income tax expense (benefit)

 

 

10,135

 

 

 

1.7

%

 

 

(514

)

 

 

-0.1

%

Earnings from continuing operations

 

 

32,981

 

 

 

5.5

%

 

 

7,476

 

 

 

1.6

%

Loss from discontinued operations, net of tax

 

 

(86

)

 

 

0.0

%

 

 

(10

)

 

 

0.0

%

Net Earnings

 

$

32,895

 

 

 

5.5

%

 

$

7,466

 

 

 

1.6

%

 

 

(1)

Includes a $0.3 million charge in the third quarter of Fiscal 2022 which includes $0.2 million for retail store asset impairments and $0.1 million for professional fees related to the actions of a shareholder activist.  Includes a $6.4 million charge in the third quarter of Fiscal 2021 for retail store asset impairments.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

 

GENESCO INC.

Sales/Earnings Summary by Segment

(in thousands)

(Unaudited)

 

 

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

Oct. 30,

2021

 

 

% of

Net Sales

 

 

Oct. 31,

2020

 

 

% of

Net Sales

 

Sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Journeys Group

 

$

1,102,750

 

 

 

65.1

%

 

$

763,238

 

 

 

66.4

%

Schuh Group

 

 

294,581

 

 

 

17.4

%

 

 

208,918

 

 

 

18.2

%

Johnston & Murphy Group

 

 

176,756

 

 

 

10.4

%

 

 

102,601

 

 

 

8.9

%

Licensed Brands

 

 

120,337

 

 

 

7.1

%

 

 

74,972

 

 

 

6.5

%

Net Sales

 

$

1,694,424

 

 

 

100.0

%

 

$

1,149,729

 

 

 

100.0

%

Operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Journeys Group

 

$

106,895

 

 

 

9.7

%

 

$

(2,888

)

 

 

-0.4

%

Schuh Group

 

 

9,477

 

 

 

3.2

%

 

 

(15,158

)

 

 

-7.3

%

Johnston & Murphy Group

 

 

2,412

 

 

 

1.4

%

 

 

(38,964

)

 

 

-38.0

%

Licensed Brands

 

 

3,420

 

 

 

2.8

%

 

 

(2,931

)

 

 

-3.9

%

Corporate and Other(1)

 

 

(50,020

)

 

 

-3.0

%

 

 

(30,628

)

 

 

-2.7

%

Goodwill Impairment

 

 

 

 

 

0.0

%

 

 

(79,259

)

 

 

-6.9

%

Operating income (loss)

 

 

72,184

 

 

 

4.3

%

 

 

(169,828

)

 

 

-14.8

%

Other components of net periodic benefit cost (income)

 

 

72

 

 

 

0.0

%

 

 

(488

)

 

 

0.0

%

Interest, net

 

 

1,931

 

 

 

0.1

%

 

 

4,178

 

 

 

0.4

%

Earnings (loss) from continuing operations before income taxes

 

 

70,181

 

 

 

4.1

%

 

 

(173,518

)

 

 

-15.1

%

Income tax expense (benefit)

 

 

17,432

 

 

 

1.0

%

 

 

(27,446

)

 

 

-2.4

%

Earnings (loss) from continuing operations

 

 

52,749

 

 

 

3.1

%

 

 

(146,072

)

 

 

-12.7

%

Loss from discontinued operations, net of tax

 

 

(39

)

 

 

0.0

%

 

 

(275

)

 

 

0.0

%

Net Earnings (Loss)

 

$

52,710

 

 

 

3.1

%

 

$

(146,347

)

 

 

-12.7

%

 

 

(1)

Includes a $10.0 million charge in the first nine months of Fiscal 2022 which includes $8.6 million for professional fees related to the actions of a shareholder activist and $2.0 million for retail store asset impairments, partially offset by a $0.6 million insurance gain.   Includes a $16.0 million charge in the first nine months of Fiscal 2021 which includes a $5.3 million charge for trademark impairment and an $11.1 million charge for retail store asset impairments, partially offset by a $0.4 million gain for the release of an earnout related to the Togast acquisition.

 


 

GENESCO INC.

Condensed Consolidated Balance Sheets

(in thousands)

(Unaudited)

 

 

 

 

Oct. 30,

2021

 

 

Oct. 31,

2020

 

Assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

282,764

 

 

$

115,061

 

Accounts receivable

 

 

36,991

 

 

 

35,592

 

Inventories

 

 

339,198

 

 

 

370,699

 

Other current assets(1)

 

 

85,476

 

 

 

62,606

 

Total current assets

 

 

744,429

 

 

 

583,958

 

Property and equipment

 

 

207,489

 

 

 

210,834

 

Operating lease right of use assets

 

 

573,842

 

 

 

640,078

 

Goodwill and other intangibles

 

 

69,456

 

 

 

67,793

 

Other non-current assets

 

 

21,593

 

 

 

33,837

 

Total Assets

 

$

1,616,809

 

 

$

1,536,500

 

 

 

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

 

 

Accounts payable

 

$

196,024

 

 

$

151,978

 

Current portion operating lease liabilities

 

 

144,453

 

 

 

196,603

 

Other current liabilities

 

 

133,569

 

 

 

84,061

 

Total current liabilities

 

 

474,046

 

 

 

432,642

 

Long-term debt

 

 

15,610

 

 

 

32,850

 

Long-term operating lease liabilities

 

 

490,330

 

 

 

560,082

 

Other long-term liabilities

 

 

44,399

 

 

 

40,954

 

Equity

 

 

592,424

 

 

 

469,972

 

Total Liabilities and Equity

 

$

1,616,809

 

 

$

1,536,500

 

 

(1) Includes prepaid income taxes of $58.5 million at October 30, 2021.

 

 


 

 

GENESCO INC.

Store Count Activity

 

 

 

 

 

Balance

02/01/20

 

 

Open

 

 

Close

 

 

Balance

01/30/21

 

 

Open

 

 

Close

 

 

Balance

10/30/21

 

Journeys Group

 

 

1,171

 

 

 

8

 

 

 

20

 

 

 

1,159

 

 

 

3

 

 

 

25

 

 

 

1,137

 

Schuh Group

 

 

129

 

 

 

1

 

 

 

7

 

 

 

123

 

 

 

0

 

 

 

0

 

 

 

123

 

Johnston & Murphy Group

 

 

180

 

 

 

4

 

 

 

6

 

 

 

178

 

 

 

1

 

 

 

5

 

 

 

174

 

Total Retail Units

 

 

1,480

 

 

 

13

 

 

 

33

 

 

 

1,460

 

 

 

4

 

 

 

30

 

 

 

1,434

 

 

 

 

 

GENESCO INC.

Store Count Activity

 

 

 

 

Balance

07/31/21

 

 

Open

 

 

Close

 

 

Balance

10/30/21

 

Journeys Group

 

 

1,142

 

 

 

0

 

 

 

5

 

 

 

1,137

 

Schuh Group

 

 

123

 

 

0

 

 

0

 

 

 

123

 

Johnston & Murphy Group

 

 

174

 

 

 

0

 

 

 

0

 

 

 

174

 

Total Retail Units

 

 

1,439

 

 

 

0

 

 

 

5

 

 

 

1,434

 

 

 

 

 

 

 

GENESCO INC.

Comparable Sales(1)

 

 

 

Quarter 3

 

 

Nine Months

 

 

 

Oct. 30,

2021

 

 

Oct. 31,

2020

 

 

Oct. 30,

2021

 

 

Oct. 31,

2020

 

Journeys Group

 

 

15

%

 

 

-6

%

 

NA

 

 

NA

 

Schuh Group

 

 

23

%

 

 

1

%

 

NA

 

 

NA

 

Johnston & Murphy Group

 

 

77

%

 

 

-43

%

 

NA

 

 

NA

 

Total Comparable Sales

 

 

21

%

 

 

-9

%

 

NA

 

 

NA

 

Same Store Sales

 

 

25

%

 

 

-18

%

 

NA

 

 

NA

 

Comparable Direct Sales

 

 

7

%

 

 

62

%

 

 

4

%

 

 

88

%

 

 

 

(1)

As a result of store closures in response to the COVID-19 pandemic and the Company's policy of removing any store closed for seven consecutive days from comparable sales, the Company has not included comparable sales for the nine months this year and last year, except for comparable direct sales, as it felt that overall sales was a more meaningful metric during these periods.

 

 

 

 

 

 

 

 

 

 

 


 

 

GENESCO INC.

COVID-19 Related Items

Decrease (Increase) to Pretax Earnings

(in thousands)

(Unaudited)

 

 

 

 

Quarter 3

 

 

Nine Months Ended

 

 

 

Oct. 30, 2021

 

Oct. 31, 2020

 

 

Oct. 30, 2021

 

Oct. 31, 2020

 

Goodwill impairment

 

$

 

$

 

 

$

 

$

79,259

 

Incremental retail store asset impairment(1)

 

 

 

 

5,828

 

 

$

 

$

9,564

 

Trademark impairment(1)

 

 

 

 

 

 

$

 

$

5,260

 

Release of Togast earnout(1)

 

 

 

 

 

 

 

 

 

(441

)

Excess inventory(2) and (3)

 

 

(1,610

)

 

1,051

 

 

 

(3,436

)

 

5,328

 

Excess freight & logistics costs(3)

 

 

4,050

 

 

 

 

 

4,050

 

 

 

Non-productive compensation(4) and (5)

 

 

(134

)

 

2,574

 

 

 

(334

)

 

7,262

 

UK property tax relief(4)

 

 

(1,348

)

 

(3,922

)

 

 

(8,476

)

 

(9,412

)

Other governmental relief(4) and (6)

 

 

(804

)

 

 

 

 

(5,191

)

 

 

Rent abatements and temporary rent concessions(4) and (7)

 

 

(4,847

)

 

(8,224

)

 

 

(13,421

)

 

(11,153

)

Incremental bad debt reserve(4)

 

 

 

 

(67

)

 

 

 

 

2,998

 

Other(4) and (8)

 

 

 

 

275