Form 8-K FINISH LINE INC /IN/ For: Dec 19
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E-mailUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): December 19, 2014
The Finish Line, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)
Indiana | 0-20184 | 35-1537210 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
3308 North Mitthoeffer Road Indianapolis, Indiana | 46235 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrants telephone number, including area code: 317-899-1022
Not Applicable
______________________________________________
Former name or former address, if changed since last report
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On December 19, 2014, The Finish Line, Inc. issued a press release discussing its results of operations for the thirteen and thirty-nine weeks ended November 29, 2014, and its financial condition as of November 29, 2014.
A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information in this Current Report, including Exhibit 99.1 hereto, shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit Number | Description |
99.1 | Press release issued December 19, 2014, regarding results of operations |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
The Finish Line, Inc. | |||
Date: December 19, 2014 | By: | /s/ Edward W. Wilhelm���������������� | |
Name: | Edward W. Wilhelm | ||
Title: | Executive Vice President, Chief Financial Officer | ||
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Exhibit 99.1
Finish Line Reports Third Quarter Fiscal Year 2015 Results
INDIANAPOLIS, December 19, 2014 The Finish Line, Inc. (NASDAQ: FINL) today reported results for the thirteen weeks ended November 29, 2014.
For the thirteen weeks ended November 29, 2014:
� | Consolidated net sales were $395.8 million, an increase of 8.6% over the prior year period. |
� | Finish Line comparable store sales increased 4.5%. |
� | On a GAAP basis, diluted earnings per share were $0.05. |
� | Non-GAAP diluted earnings per share, which excludes the impact of impairment charges and store closing costs, employee resignation costs and the recognition of a one-time tax benefit were $(0.02). |
Third quarter comparable sales rebounded from second quarter trends, however merchandise margin pressure kept us from achieving our profitability plan, said Glenn Lyon, Chairman and Chief Executive Officer of Finish Line. We remain confident in the strategic course we have set for the company and well continue to invest in the omnichannel initiatives focused on delivering the long-term financial goals we have previously outlined. That said, we are adjusting our near-term capital spending plans and creating a more flexible expense structure to protect profitability until stronger full price selling trends reemerge.
Balance Sheet
As of November 29, 2014, consolidated merchandise inventories increased 10.6% to $398.6 million compared to $360.5 million as of November 30, 2013.
The company repurchased 1.2 million shares of common stock during the thirteen weeks ended November 29, 2014, totaling $29.9 million. The company has 1.9 million shares remaining on its current Board authorized repurchase plan.
As of November 29, 2014, the company had no interest-bearing debt and $85.4 million in cash and cash equivalents, compared to $111.9 million as of November 30, 2013.
Outlook
For the fiscal year ending February 28, 2015, Finish Line now expects non-GAAP diluted earnings per share to be flat to fiscal year 2014 non-GAAP diluted earnings per share of $1.67. The company expects Finish Line comparable store sales to increase low to mid-single digits.
Q3 Fiscal 2015 Conference Call Today, December 19, 2014 at 8:30 a.m.
The company will host a conference call for investors today, December 19, 2014, at 8:30 a.m. Eastern. To participate in the live conference call, dial 866-923-8645 (U.S. and Canada) or 660-422-4970 (International), conference ID #45036075. The live conference call will also be accessible online at www.finishline.com. A replay of the conference call can be accessed approximately two hours following the completion of the call by dialing 855-859-2056, conference ID #45036075. This recording will be made available through Monday, January 19, 2015. The replay will also be accessible online at www.finishline.com.
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Disclosure Regarding Non-GAAP Measures
This report refers to certain financial measures that are identified as non-GAAP. The company believes that these non-GAAP measures, including gross profit, selling, general and administrative expenses, operating income, income tax expense, net income attributable to The Finish Line, Inc. and diluted earnings per share attributable to The Finish Line, Inc. shareholders, are helpful to investors because they allow for a more direct comparison of the companys year-over-year performance and are useful in assessing the companys progress in achieving its long-term financial objectives. This supplemental information should not be considered in isolation or as a substitute for the related GAAP measures. A reconciliation of the non-GAAP measures to the comparable GAAP measures can be found in the companys Form 8-K filed with the Securities and Exchange Commission with this release.
About The Finish Line, Inc.
The Finish Line, Inc. is a premium retailer of athletic shoes, apparel and accessories. Headquartered in Indianapolis, Finish Line has approximately 1,040 Finish Line branded locations primarily in U.S. malls and shops inside Macys department stores and employs more than 14,000 sneakerologists who help customers every day connect with their sport, their life and their style. Online shopping is available at�www.finishline.com�and�www.macys.com. Mobile shopping is available at�m.finishline.com. Follow Finish Line on Twitter at�Twitter.com/FinishLine�and like Finish Line on Facebook at�Facebook.com/FinishLine. Track loyalty points and find store and product information with the free Finish Line app downloadable for iOS and Android customers.
Finish Line also operates the Running Specialty Group. This includes 66 specialty running stores in 15 states and the District of Columbia under The Running Company, Run On!, Blue Mile, Boulder Running Company, Ronckers Running Spot, Running Fit, VA Runner, Capital RunWalk, Richmond �RoadRunner, Garry Gribbles Running Sports and Run Colorado banners. More information is available at�www.run.com or www.boulderrunningcompany.com.
Forward-Looking Statements
This news release includes statements that are or may be considered forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally can be identified by the use of words or phrases such as believe, expect, future, anticipate, intend, plan, foresee, may, should, will, estimates, outlook, potential, optimistic, confidence, continue, evolve, expand, growth or words and phrases of similar meaning. Statements that describe objectives, plans or goals also are forward-looking statements.
All of these forward-looking statements are subject to risks, management assumptions and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements. The principal risk factors that could cause actual performance and future actions to differ materially from the forward-looking statements include, but are not limited to, the companys reliance on a few key vendors for a majority of its merchandise purchases (including a significant portion from one key vendor); the availability and timely receipt of products; the ability to timely fulfill and ship products to customers; fluctuations in oil prices causing changes in gasoline and energy prices, resulting in changes in consumer spending as well as increases in utility, freight and product costs; product demand and market acceptance risks; deterioration of macro-economic and business conditions; the inability to locate and obtain or retain acceptable lease terms for the companys stores; the effect of competitive products and pricing; loss of key employees; execution of strategic growth initiatives (including actual and potential mergers and acquisitions and other components of the companys capital allocation strategy); cybersecurity risks, including breach of customer data; and the other risks detailed in the companys Securities and Exchange Commission filings. Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements included herein are made only as of the date of this report and Finish Line undertakes no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances.
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The Finish Line, Inc. Consolidated Statements of Income (Unaudited) (In thousands, except per share and store/shop data) | ||||||||||||||||
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||
November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | |||||||||||||
Net sales | $ | 395,828 | $ | 364,455 | $ | 1,269,239 | $ | 1,151,538 | ||||||||
Cost of sales (including occupancy costs) | 284,074 | 256,607 | 873,485 | 790,358 | ||||||||||||
Gross profit | 111,754 | 107,848 | 395,754 | 361,180 | ||||||||||||
Selling, general and administrative expenses | 114,923 | 104,092 | 335,701 | 306,903 | ||||||||||||
Impairment charges and store closing costs | 462 | 1,007 | 3,155 | 1,210 | ||||||||||||
Operating (loss) income | (3,631 | ) | 2,749 | 56,898 | 53,067 | |||||||||||
Interest income, net | 3 | 6 | 27 | |||||||||||||
(Loss) income before income taxes | (3,631 | ) | 2,752 | 56,904 | 53,094 | |||||||||||
Income tax (benefit) expense | (6,126 | ) | 1,161 | 17,595 | 20,796 | |||||||||||
Net income | 2,495 | 1,591 | 39,309 | 32,298 | ||||||||||||
Net loss attributable to redeemable noncontrolling interest | 83 | 727 | 1,861 | 1,602 | ||||||||||||
Net income attributable to The Finish Line, Inc. | $ | 2,578 | $ | 2,318 | $ | 41,170 | $ | 33,900 | ||||||||
Diluted earnings per share attributable to The Finish Line, Inc. shareholders | $ | 0.05 | $ | 0.05 | $ | 0.85 | $ | 0.69 | ||||||||
Diluted weighted average shares | 47,478 | 48,709 | 48,013 | 48,733 | ||||||||||||
Dividends declared per share | $ | 0.08 | $ | 0.07 | $ | 0.24 | $ | 0.21 | ||||||||
Finish Line store activity for the period: | ||||||||||||||||
�����Beginning of period | 647 | 659 | 645 | 645 | ||||||||||||
�������Opened | 2 | 3 | 9 | 22 | ||||||||||||
�������Closed | (7 | ) | (4 | ) | (12 | ) | (9 | ) | ||||||||
�����End of period | 642 | 658 | 642 | 658 | ||||||||||||
�����Square feet at end of period | 3,492,050 | 3,566,404 | ||||||||||||||
�����Average square feet per store | 5,439 | 5,420 | ||||||||||||||
Branded shops within department stores activity for the period: | ||||||||||||||||
�����Beginning of period | 370 | 133 | 185 | 3 | ||||||||||||
�������Opened | 27 | 48 | 213 | 178 | ||||||||||||
�������Closed | (1 | ) | ||||||||||||||
�����End of period | 397 | 181 | 397 | 181 | ||||||||||||
�����Square feet at end of period | 406,063 | 224,515 | ||||||||||||||
�����Average square feet per shop | 1,023 | 1,240 | ||||||||||||||
Running Specialty store activity for the period: | ||||||||||||||||
�����Beginning of period | 58 | 39 | 48 | 27 | ||||||||||||
�������Acquired | 7 | 4 | 15 | 13 | ||||||||||||
�������Opened | 1 | 4 | 3 | 7 | ||||||||||||
�������Closed | ||||||||||||||||
�����End of period | 66 | 47 | 66 | 47 | ||||||||||||
�����Square feet at end of period | 234,162 | 154,348 | ||||||||||||||
�����Average square feet per store | 3,548 | 3,284 | ||||||||||||||
��
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� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||
November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | |||||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||
Cost of sales (including occupancy costs) | 71.8 | 70.4 | 68.8 | 68.6 | ||||||||
Gross profit | 28.2 | 29.6 | 31.2 | 31.4 | ||||||||
Selling, general and administrative expenses | 29.0 | 28.6 | 26.5 | 26.7 | ||||||||
Impairment charges and store closing costs | 0.1 | 0.2 | 0.2 | 0.1 | ||||||||
Operating (loss) income | (0.9 | ) | 0.8 | 4.5 | 4.6 | |||||||
Interest income, net | ||||||||||||
(Loss) income before income taxes | (0.9 | ) | 0.8 | 4.5 | 4.6 | |||||||
Income tax (benefit) expense | (1.5 | ) | 0.4 | 1.4 | 1.8 | |||||||
Net income | 0.6 | 0.4 | 3.1 | 2.8 | ||||||||
Net loss attributable to redeemable noncontrolling interest | 0.1 | 0.2 | 0.1 | 0.1 | ||||||||
Net income attributable to The Finish Line, Inc. | 0.7 | % | 0.6 | % | 3.2 | % | 2.9 | % | ||||
� | Condensed Consolidated Balance Sheets | |||||||||||
November 29, 2014 | November 30, 2013 | March 1, 2014 | ||||||||||
� | (Unaudited) | (Unaudited) | � | |||||||||
ASSETS | ||||||||||||
Cash and cash equivalents | $ | 85,426 | $ | 111,916 | $ | 229,079 | ||||||
Merchandise inventories, net | 398,615 | 360,463 | 304,209 | |||||||||
Other current assets | 44,384 | 49,783 | 33,675 | |||||||||
Property and equipment, net | 256,262 | 213,188 | 223,182 | |||||||||
Goodwill | 32,902 | 24,035 | 25,608 | |||||||||
Other assets, net | 9,017 | 14,185 | 9,192 | |||||||||
�����Total assets | $ | 826,606 | $ | 773,570 | $ | 824,945 | ||||||
LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||||||
Current liabilities | $ | 209,049 | $ | 180,756 | $ | 193,670 | ||||||
Deferred credits from landlords | 29,507 | 28,639 | 27,658 | |||||||||
Other long-term liabilities | 20,625 | 17,465 | 19,659 | |||||||||
Redeemable noncontrolling interest, net | 480 | 2,034 | 1,774 | |||||||||
Shareholders equity | 566,945 | 544,676 | 582,184 | |||||||||
�����Total liabilities and shareholders equity | $ | 826,606 | $ | 773,570 | $ | 824,945 | ||||||
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The Finish Line, Inc.
Reconciliation of Gross Profit, GAAP to Gross Profit, Non-GAAP (Unaudited)
(In thousands)
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||||||||||||||
� | November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | ||||||||||||||||||||||||
Gross profit, GAAP | $ | 111,754 | 28.2 | % | $ | 107,848 | 29.6 | % | $ | 395,754 | 31.2 | % | $ | 361,180 | 31.4 | % | ||||||||||||
���Start-up costs | 5,758 | 0.5 | ||||||||||||||||||||||||||
Gross profit, Non-GAAP | $ | 111,754 | 28.2 | % | $ | 107,848 | 29.6 | % | $ | 395,754 | 31.2 | % | $ | 366,938 | 31.9 | % | ||||||||||||
�
Reconciliation of Selling, General and Administrative Expenses, GAAP to
Selling, General and Administrative Expenses, Non-GAAP (Unaudited)
(In thousands)
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||||||||||||||
� | November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | ||||||||||||||||||||||||
Selling, general and administrative expenses, GAAP | $ | 114,923 | 29.0 | �% | $ | 104,092 | 28.6 | % | $ | 335,701 | 26.5 | �% | $ | 306,903 | 26.7 | �% | ||||||||||||
Employee resignation costs | (842 | ) | (0.2 | ) | (842 | ) | (0.1 | ) | ||||||||||||||||||||
Start-up costs | (2,202 | ) | (0.2 | ) | ||||||||||||||||||||||||
Selling, general and administrative expenses, Non-GAAP | $ | 114,081 | 28.8 | �% | $ | 104,092 | 28.6 | % | $ | 334,859 | 26.4 | �% | $ | 304,701 | 26.5 | �% | ||||||||||||
�
�
Reconciliation of Operating (Loss) Income, GAAP to Operating (Loss) Income, Non-GAAP (Unaudited)
(In thousands)
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||||||||||||||
� | November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | ||||||||||||||||||||||||
Operating (loss) income, GAAP | $ | (3,631 | ) | (0.9 | )% | $ | 2,749 | 0.8 | % | $ | 56,898 | 4.5 | % | $ | 53,067 | 4.6 | % | |||||||||||
Impairment charges and store closing costs | 462 | 0.1 | 1,007 | 0.2 | 3,155 | 0.2 | 1,210 | 0.1 | ||||||||||||||||||||
Employee resignation costs | 842 | 0.2 | 842 | 0.1 | ||||||||||||||||||||||||
Start-up costs | 7,960 | 0.7 | ||||||||||||||||||||||||||
Operating (loss) income, Non-GAAP | $ | (2,327 | ) | (0.6 | )% | $ | 3,756 | 1.0 | % | $ | 60,895 | 4.8 | % | $ | 62,237 | 5.4 | % | |||||||||||
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Reconciliation of Income Tax (Benefit) Expense, GAAP to Income Tax (Benefit) Expense, Non-GAAP (Unaudited)
(In thousands)
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||||||||||||||
� | November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | ||||||||||||||||||||||||
Income tax (benefit) expense, GAAP | $ | (6,126 | ) | (1.5 | )% | $ | 1,161 | 0.4 | % | $ | 17,595 | 1.4 | % | $ | 20,796 | 1.8 | % | |||||||||||
Tax affect of: | ||||||||||||||||||||||||||||
Impairment charges and store closing costs | 178 | 393 | 1,215 | 0.1 | 473 | |||||||||||||||||||||||
Employee resignation costs | 324 | 0.1 | 324 | |||||||||||||||||||||||||
Start-up costs | 3,109 | 0.3 | ||||||||||||||||||||||||||
One-time tax benefit | 4,313 | 1.1 | 4,313 | 0.3 | ||||||||||||||||||||||||
Income tax (benefit) expense, Non-GAAP | $ | (1,311 | ) | (0.3 | )% | $ | 1,554 | 0.4 | % | $ | 23,447 | 1.8 | % | $ | 24,378 | 2.1 | % | |||||||||||
�
Reconciliation of Net Income Attributable to The Finish Line, Inc., GAAP to
Net (Loss) Income Attributable to The Finish Line, Inc., Non-GAAP (Unaudited)
(In thousands)
� | Thirteen Weeks Ended | Thirty-Nine Weeks Ended | ||||||||||||||||||||||||||
� | November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | ||||||||||||||||||||||||
Net income attributable to The Finish Line, Inc., GAAP | $ | 2,578 | 0.7 | �% | $ | 2,318 | 0.6 | % | $ | 41,170 | 3.2 | �% | $ | 33,900 | 2.9 | % | ||||||||||||
Impairment charges and store closing costs, net of income taxes* | 284 | 0.1 | 614 | 0.2 | 1,884 | 0.1 | 737 | 0.1 | ||||||||||||||||||||
Employee resignation costs, net of income taxes | 518 | 0.1 | 518 | 0.1 | ||||||||||||||||||||||||
Start-up costs, net of income taxes | 4,851 | 0.4 | ||||||||||||||||||||||||||
One-time tax benefit | (4,313 | ) | (1.1 | ) | (4,313 | ) | (0.3 | ) | ||||||||||||||||||||
Net (loss) income attributable to The Finish Line, Inc., Non-GAAP | $ | (933 | ) | (0.2 | )% | $ | 2,932 | 0.8 | % | $ | 39,259 | 3.1 | �% | $ | 39,488 | 3.4 | % | |||||||||||
* Net of decrease to net loss attributable to redeemable noncontrolling interest for the thirty-nine weeks ended November 29, 2014 related to impairment charges of $56.
�
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Reconciliation of Diluted Earnings Per Share Attributable to The Finish Line, Inc. Shareholders, GAAP to
Diluted (Loss) Earnings Per Share Attributable to The Finish Line, Inc. Shareholders, Non-GAAP (unaudited)
Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
November 29, 2014 | November 30, 2013 | November 29, 2014 | November 30, 2013 | |||||||||||||
Diluted earnings per share attributable to The Finish Line, Inc. shareholders, GAAP | $ | 0.05 | $ | 0.05 | $ | 0.85 | $ | 0.69 | ||||||||
Impairment charges and store closing costs, net of income taxes and redeemable noncontrolling interest | 0.01 | 0.01 | 0.04 | 0.01 | ||||||||||||
Employee resignation costs, net of income taxes | 0.01 | 0.01 | ||||||||||||||
Start-up costs, net of income taxes | 0.10 | |||||||||||||||
One-time tax benefit | (0.09 | ) | (0.09 | ) | ||||||||||||
Diluted (loss) earnings per share attributable to The Finish Line, Inc. shareholders, Non-GAAP | $ | (0.02 | ) | $ | 0.06 | $ | 0.81 | $ | 0.80 | |||||||
�
Note: See Disclosure Regarding Non-GAAP Measures above.
�
Media Contact: | Investor Contact: |
Dianna Boyce | Ed Wilhelm |
Corporate Communications | Chief Financial Officer |
317-613-6577 | 317-613-6914 |
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