Genesco Inc. reported earnings from continuing operations for the 14-week period ended February 2, 2013, of $38.7 million, or $1.63 per diluted share, compared to earnings from continuing operations of $41.5 million, or $1.72 per diluted share, for the 13-week period ended January 28, 2012.
Fiscal 2013 fourth quarter results reflect expenses of $19.3 million, or $0.53 per share after tax, including $15.4 million of expenses related to the 2010 network intrusion; $3.2 million of expenses related to deferred purchase price payments in connection with the acquisition of Schuh Group Limited, which are required to be expensed as compensation because the payment is contingent upon the payees' continued employment; and $0.7 million in asset impairment charges; and a higher effective tax rate related to the nondeductibility of the Schuh deferred purchase price expenses.
Fiscal 2012 fourth quarter results reflect expenses of $3.7 million, or $0.25 per share after tax, primarily including deferred purchase price expenses and asset impairments, other legal matters and acquisition expenses.
Adjusted for the items described above in both periods, earnings from continuing operations were $51.4 million, or $2.16 per diluted share, for the fourth quarter of Fiscal 2013, compared to earnings from continuing operations of $47.5 million, or $1.97 per diluted share, for the fourth quarter of Fiscal 2012.
For consistency with Fiscal 2013's previously announced earnings expectations and with previously reported adjusted results for the prior year period, the Company believes that the disclosure of the results from continuing operations adjusted for these items will be useful to investors.
Additionally, the Company believes that the presentation of earnings from continuing operations before the compensation expense associated with the Schuh deferred purchase price will enable investors to understand the effect attributable to incorporating a continuing employment condition into the obligation to pay deferred purchase price.
A reconciliation of earnings and earnings per share from continuing operations in accordance with U.S. Generally Accepted Accounting Principles with the adjusted earnings and earnings per share numbers presented in this paragraph is set forth on Schedule B to this press release.
Net sales for the 14-week fourth quarter of Fiscal 2013 increased 10% to $797 million from $723 million in the 13-week fourth quarter of Fiscal 2012, with the extra week accounting for approximately half the increase.
Consolidated fourth quarter 2013 comparable sales, including same store sales and comparable e-commerce and catalog sales, decreased 2% on a 14-week basis, with a 1% decrease in the Journeys Group, a 10% decrease in the Lids Sports Group, a 7% increase in the Schuh Group, and a 2% increase in the Johnston & Murphy Group.
The Company also reported earnings from continuing operations for the 53-week period ended February 2, 2013, of $111.0 million, or $4.62 per diluted share, compared to earnings from continuing operations of $83.0 million, or $3.48 per diluted share, for the 52-week period ended January 28, 2012.
Fiscal 2013 earnings reflect after-tax charges of $0.44 per diluted share, including network intrusion-related expenses, compensation expense associated with the Schuh deferred purchase price, asset impairments, and other legal matters, and a higher effective tax rate. Fiscal 2012 earnings reflected after-tax charges of $0.61 per diluted share, including compensation expense associated with the Schuh deferred purchase price, acquisition expenses, asset impairments, other legal matters, and network intrusion-related expenses.
Adjusted for the listed items in both years, earnings from continuing operations were $121.8 million, or $5.06 per diluted share, for Fiscal 2013, compared to earnings from continuing operations of $97.5 million, or $4.09 per diluted share, for Fiscal 2012.
For consistency with previously announced earnings expectations, which did not reflect the listed items, the Company believes that disclosure of earnings from continuing operations adjusted for those items will be useful to investors.
A reconciliation of the adjusted financial measures to their corresponding measures as reported pursuant to U.S. Generally Accepted Accounting Principles is included in Schedule B to this press release. Net sales for Fiscal 2013 increased 14% to $2.60 billion from $2.29 billion in Fiscal 2012.
Robert J. Dennis, chairman, president and chief executive officer of Genesco, said, "Fiscal 2013 was another solid year for Genesco, highlighted by annual sales and adjusted earnings per share increases of 14% and 24%, respectively. We believe that the strong earnings performance in a year characterized by challenges in our markets and in the broader economy demonstrates the resiliency of our business model."
About Genesco Inc.
Genesco Inc., a Nashville-based specialty retailer, sells footwear, headwear, sports apparel and accessories in more than 2,455 retail stores.
