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Genesco Inc. Reports Fiscal 2024 Third Quarter Results

Genesco Inc. (NYSE: GCO) today reported third quarter results for the three months ended October 28, 2023.

Third Quarter Fiscal 2024 Financial Summary

  • Net sales of $579 million decreased 4% compared to Q3FY23
  • Comps down 4%, with stores down 7% and direct up 8%
  • E-commerce sales represented 21% of retail sales compared to 18% last year
  • GAAP EPS from continuing operations was $0.60 vs. $1.66 last year
  • Non-GAAP EPS from continuing operations was $0.571 vs. $1.65 last year

Mimi E. Vaughn, Genesco’s Board Chair, President and Chief Executive Officer, said, “Following a good Back-to-School season, demand in October softened in an ongoing challenging operating environment, along with a delayed start to the fall selling season. Disruptions related to implementation of a new ERP system for our branded businesses added to the pressure, all leading to results that were below our expectations. Despite these headwinds, we were pleased to see sales trends within our Journeys business continue to sequentially improve, and Schuh and Johnston & Murphy deliver record third-quarter sales. In the meantime, we continued to inject Journeys’ product assortment with more of the newness and must-have items our customer desires, while also executing on our cost reduction and store closure plans.”

Vaughn continued, “Fourth quarter-to-date, I’m pleased to say our total comps are currently running positive and we experienced a strong start to the holiday season. However, as consumer shopping behavior remains choppy, we plan to increase our promotional activity, especially at Journeys, for the remainder of the holiday season to be more competitive and drive sales in this environment. Our revised Fiscal 2024 outlook reflects this, partially offset by a somewhat more conservative view for our other businesses. Looking ahead, I have confidence that our strategic initiatives and specific efforts to elevate Journeys in the marketplace will help us continue to drive progress in the near term while positioning us even more strongly to create value for the longer term.”

__________________________

1Excludes a charge for asset impairments, net of tax effect in the third quarter of Fiscal 2024 (“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.

Third Quarter Review

Net sales for the third quarter of Fiscal 2024 of $579 million decreased 4% compared to $604 million in the third quarter of Fiscal 2023. The sales decrease compared to last year was driven by decreased store sales in Journeys Group and decreased wholesale sales in Genesco Brands Group, partially offset by an 8% increase in e-commerce comparable sales and a favorable foreign exchange impact.

Comparable Sales

 

 

 

 

 

Comparable Same Store and Direct Sales:

 

3QFY24

 

3QFY23

Journeys Group

 

(8)%

 

1%

Schuh Group

 

5%

 

3%

Johnston & Murphy Group

 

1%

 

20%

Total Genesco Comparable Sales

 

(4)%

 

3%

 

Same Store Sales

 

(7)%

 

2%

Comparable Direct Sales

 

8%

 

6%

The overall sales decrease of 4% for the third quarter of Fiscal 2024 compared to the third quarter of Fiscal 2023 was driven by a decrease of 8% at Journeys and a 22% or $8 million decrease at Genesco Brands, partially offset by an increase of 13% at Schuh and an increase of 2% at Johnston & Murphy. On a constant currency basis, Schuh had record third quarter sales, which were up 5%.

Third quarter gross margin this year was 48.1%, down 60 basis points compared with 48.7% last year. The decrease as a percentage of sales compared to Fiscal 2023 is due primarily to increased promotional activity at Journeys, including introductory coupons for their new loyalty program, more normalized markdowns and closeouts at Johnston & Murphy and increased shipping and warehouse expense in all retail businesses, reflecting increased warehouse costs and higher e-commerce penetration, partially offset by improved margins at Schuh and Genesco Brands.

Selling and administrative expense for the third quarter this year increased 190 basis points as a percentage of sales compared with last year. Adjusted selling and administrative expense for the third quarter this year also increased 190 basis points as a percentage of sales compared with last year. The increase as a percentage of sales compared to Fiscal 2023 reflects the deleverage of expenses, especially compensation, marketing and depreciation expenses, as a result of decreased revenue in the third quarter of Fiscal 2024. In absolute dollars, selling and administrative expenses were flat for the third quarter this year compared to last year.

Genesco’s GAAP operating income for the third quarter was $10.9 million, or 1.9% of sales this year, compared with $26.1 million, or 4.3% of sales in the third quarter last year. Adjusted for the Excluded Items in all periods, operating income for the third quarter was $11.0 million this year compared to $26.3 million last year. Adjusted operating margin was 1.9% of sales in the third quarter of Fiscal 2024 and 4.4% in the third quarter last year.

The effective tax rate for the quarter was 22.5% in Fiscal 2024 compared to 18.7% in the third quarter last year. The adjusted tax rate, reflecting Excluded Items, was 27.8% in Fiscal 2024 compared to 19.6% in the third quarter last year. The higher adjusted tax rate for the third quarter this year compared to the third quarter last year primarily reflects that we are no longer subject to a valuation allowance in certain jurisdictions.

GAAP earnings from continuing operations were $6.6 million in the third quarter of Fiscal 2024 compared to $20.4 million in the third quarter last year. Adjusted for the Excluded Items in all periods, third quarter earnings from continuing operations were $6.2 million, or $0.57 per share, in Fiscal 2024, compared to $20.4 million, or $1.65 per share, in the third quarter last year.

Cash, Borrowings and Inventory

Cash as of October 28, 2023 was $21.7 million, compared with $32.1 million as of October 29, 2022. Total debt at the end of the third quarter of Fiscal 2024 was $128.2 million compared with $89.4 million at the end of last year’s third quarter. Inventories decreased 8% on a year over year basis reflecting decreased inventory for Journeys and Johnston & Murphy, partially offset by an increase at Schuh.

Capital Expenditures and Store Activity

For the third quarter this year, capital expenditures were $15 million, related primarily to retail stores and digital and omnichannel initiatives. Depreciation and amortization was $12 million. During the quarter, the Company opened five stores and closed 20 stores. The Company ended the quarter with 1,360 stores compared with 1,404 stores at the end of the third quarter last year, or a decrease of 3%. Square footage was down 1% on a year-over-year basis.

Share Repurchases

The Company did not repurchase any shares during the third quarter of Fiscal 2024. The Company currently has $52.1 million remaining on its expanded share repurchase authorization announced in June 2023.

Store Closing and Cost Savings Update

  • The Company remains on track to close approximately 100 Journeys stores in Fiscal 2024
  • The Company continues to anticipate up to $40 million in cost reductions by the end of Fiscal 2025

Revised Fiscal 2024 EPS Outlook

For Fiscal 2024, the Company:

  • Now expects sales to be down 1% to 2%, or down 2% to 3% excluding the 53rd week this year, compared to Fiscal 2023
  • Now expects adjusted diluted earnings per share from continuing operations in the range of $1.50 to $2.00, with an expectation that EPS will be near the mid-point of the range 2
  • Guidance assumes no further share repurchases and a tax rate of 24%

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 1, 2023, 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.

__________________________

2A reconciliation of the adjusted financial measures cited in the guidance to their corresponding measures as reported pursuant to GAAP is included in Schedule B to this press release.

Safe Harbor Statement

This release contains forward-looking statements, including those regarding future sales, earnings, operating income, gross margins, expenses, capital expenditures, depreciation and amortization, tax rates, store openings and closures, cost reductions, ESG progress 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,” “feel,” “believe,” “anticipate,” “optimistic,” “confident” 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 weakness in store and shopping mall traffic, 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; our ability to pass on price increases to our customers; 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 pandemics or geopolitical events; unfavorable trends in fuel costs, foreign exchange rates, foreign labor and material costs, and other factors affecting the cost of products; our ability to renew our license agreements; impacts of the Russia-Ukraine war, 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 secure allocations to refine product assortments to address consumer demand; the ability to renew leases in existing stores and control or lower occupancy costs, to open or close stores in the number and on the planned schedule, and to conduct required remodeling or refurbishment on schedule and at expected expense levels; the Company’s ability to realize anticipated cost savings, including rent savings; the amount and timing of share repurchases; 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; our ability to meet our sustainability, stewardship, emission and diversity, equity and inclusion related ESG projections, goals and commitments; 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 in both the amount and timeframe anticipated; and the cost and outcome of litigation, investigations, environmental matters and other disputes 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. (NYSE: GCO) is a footwear focused company with distinctively positioned retail and lifestyle brands and proven omnichannel capabilities offering customers the footwear they desire in engaging shopping environments, including approximately 1,350 retail stores and branded e-commerce websites. Its Journeys, Little Burgundy and Schuh brands serve teens, kids and young adults with on-trend fashion footwear that inspires youth culture in the U.S., Canada and the U.K. Johnston & Murphy serves the successful, affluent man and woman with premium footwear, apparel and accessories in the U.S. and Canada, and Genesco Brands Group sells branded lifestyle footwear to leading retailers under licensed brands including Levi’s, Dockers and G.H. Bass. Founded in 1924, Genesco is based in Nashville, Tennessee. For more information on Genesco and its operating divisions, please visit www.genesco.com.

  GENESCO INC.  
  Condensed Consolidated Statements of Operations  
  (in thousands, except per share data)  
  (Unaudited)  
           
   

Quarter 3

 

Quarter 3

 
   

October 28,

 

% of

 

October 29,

 

% of

 
   

2023

 

Net Sales

 

2022

 

Net Sales

 
  Net sales  

 $

  579,315

 

 

100.0

%

 $

603,788

 

 

100.0

%

 
  Cost of sales  

 

     300,890

 

 

51.9

%

 

 

    309,981

 

 

51.3

%

 
  Gross margin  

 

     278,425

 

 

48.1

%

 

    293,807

 

 

48.7

%

 
  Selling and administrative expenses  

 

     267,474

 

 

46.2

%

 

    267,734

 

 

44.3

%

 
  Asset impairments and other, net  

 

               99

 

 

0.0

%

 

 

                 -

 

 

0.0

%

 
  Operating income  

 

       10,852

 

 

1.9

%

 

      26,073

 

 

4.3

%

 
  Other components of net periodic benefit cost  

 

             148

 

 

0.0

%

 

              50

 

 

0.0

%

 
  Interest expense, net  

 

         2,207

 

 

0.4

%

 

 

           906

 

 

0.2

%

 
  Earnings from continuing operations before income taxes  

 

         8,497

 

 

1.5

%

 

      25,117

 

 

4.2

%

 
  Income tax expense  

 

         1,908

 

 

0.3

%

 

 

        4,693

 

 

0.8

%

 
  Earnings from continuing operations  

 

         6,589

 

 

1.1

%

 

      20,424

 

 

3.4

%

 
  Loss from discontinued operations, net of tax  

 

             (50

)

 

0.0

%

 

 

            (48

)

 

0.0

%

 
  Net Earnings  

 $

      6,539

 

 

1.1

%

 

 $

   20,376

 

 

3.4

%

 
         
  Basic earnings per share:        
  Before discontinued operations  

 $

        0.60

 

 

 $

       1.68

 

   
  Net earnings  

 $

        0.60

 

 

 $

       1.68

 

   
         
  Diluted earnings per share:        
  Before discontinued operations  

 $

        0.60

 

 

 $

       1.66

 

   
  Net earnings  

 $

        0.60

 

 

 $

       1.65

 

   
         
  Weighted-average shares outstanding:        
  Basic  

 

       10,898

 

 

 

      12,138

 

   
  Diluted  

 

       10,972

 

 

 

      12,326

 

   
GENESCO INC.  
Condensed Consolidated Statements of Operations  
(in thousands, except per share data)  
(Unaudited)  
         
   

Nine Months Ended

 

Nine Months Ended

 
   

October 28,

 

% of

 

October 29,

 

% of

 
   

2023

 

Net Sales

 

2022

 

Net Sales

 
  Net sales  

 $

1,585,674

 

 

100.0

%

 $

1,659,868

 

 

100.0

%

 
  Cost of sales  

 

       828,921

 

 

52.3

%

 

 

       860,303

 

 

51.8

%

 
  Gross margin  

 

       756,753

 

 

47.7

%

 

       799,565

 

 

48.2

%

 
  Selling and administrative expenses  

 

       778,491

 

 

49.1

%

 

       756,318

 

 

45.6

%

 
  Goodwill impairment  

 

         28,453

 

 

1.8

%

 

                    -

 

 

0.0

%

 
  Asset impairments and other, net  

 

               581

 

 

0.0

%

 

 

             (154

)

 

0.0

%

 
  Operating income (loss)  

 

        (50,772

)

 

-3.2

%

 

         43,401

 

 

2.6

%

 
  Other components of net periodic benefit cost  

 

               388

 

 

0.0

%

 

               198

 

 

0.0

%

 
  Interest expense, net  

 

           6,241

 

 

0.4

%

 

 

           1,608

 

 

0.1

%

 
  Earnings (loss) from continuing operations before income taxes  

 

        (57,401

)

 

-3.6

%

 

         41,595

 

 

2.5

%

 
  Income tax expense (benefit)  

 

        (13,483

)

 

-0.9

%

 

 

           8,551

 

 

0.5

%

 
  Earnings (loss) from continuing operations  

 

        (43,918

)

 

-2.8

%

 

         33,044

 

 

2.0

%

 
  Loss from discontinued operations, net of tax  

 

               (98

)

 

0.0

%

 

 

               (78

)

 

0.0

%

 
  Net Earnings (Loss)  

 $

     (44,016

)

 

-2.8

%

 

 $

      32,966

 

 

2.0

%

 
         
  Basic earnings (loss) per share:        
  Before discontinued operations  

 $

         (3.87

)

 

 $

          2.61

 

   
  Net earnings (loss)  

 $

         (3.88

)

 

 $

          2.61

 

   
         
  Diluted earnings (loss) per share:        
  Before discontinued operations  

 $

         (3.87

)

 

 $

          2.56

 

   
  Net earnings (loss)  

 $

         (3.88

)

 

 $

          2.56

 

   
         
  Weighted-average shares outstanding:        
  Basic  

 

         11,353

 

 

 

         12,637

 

   
  Diluted  

 

         11,353

 

 

 

         12,901

 

   
                   
GENESCO INC.  
Sales/Earnings Summary by Segment  
(in thousands)  
(Unaudited)  
         
   

Quarter 3

 

Quarter 3

 
   

October 28,

 

% of

 

October 29,

 

% of

 
   

2023

 

Net Sales

 

2022

 

Net Sales

 
  Sales:        
  Journeys Group  

 $

  349,367

 

 

60.3

%

 $

380,619

 

 

63.0

%

 
  Schuh Group  

 

118,129

 

 

20.4

%

 

104,809

 

 

17.4

%

 
  Johnston & Murphy Group  

 

       81,411

 

 

14.1

%

 

      79,614

 

 

13.2

%

 
  Genesco Brands Group  

 

       30,408

 

 

5.2

%

 

      38,746

 

 

6.4

%

 
  Net Sales  

 $

  579,315

 

 

100.0

%

 

 $

603,788

 

 

100.0

%

 
  Operating Income (Loss):        
  Journeys Group  

 $

    11,975

 

 

3.4

%

 $

   27,083

 

 

7.1

%

 
  Schuh Group  

 

5,484

 

 

4.6

%

 

5,912

 

 

5.6

%

 
  Johnston & Murphy Group  

 

         2,706

 

 

3.3

%

 

        3,494

 

 

4.4

%

 
  Genesco Brands Group  

 

        (1,560

)

 

-5.1

%

 

       (1,927

)

 

-5.0

%

 
  Corporate and Other(1)  

 

        (7,753

)

 

-1.3

%

 

 

       (8,489

)

 

-1.4

%

 
  Operating income  

 

       10,852

 

 

1.9

%

 

      26,073

 

 

4.3

%

 
  Other components of net periodic benefit cost  

 

             148

 

 

0.0

%

 

              50

 

 

0.0

%

 
  Interest, net  

 

         2,207

 

 

0.4

%

 

 

           906

 

 

0.2

%

 
         
  Earnings from continuing operations before income taxes  

 

         8,497

 

 

1.5

%

 

      25,117

 

 

4.2

%

 
  Income tax expense  

 

         1,908

 

 

0.3

%

 

 

        4,693

 

 

0.8

%

 
  Earnings from continuing operations  

 

         6,589

 

 

1.1

%

 

      20,424

 

 

3.4

%

 
  Loss from discontinued operations, net of tax  

 

             (50

)

 

0.0

%

 

 

            (48

)

 

0.0

%

 
  Net Earnings  

 $

      6,539

 

 

1.1

%

 

 $

   20,376

 

 

3.4

%

 
         
         
  (1) Includes a $0.1 million charge in the third quarter of Fiscal 2024 for asset impairments.  
         
                   

 

GENESCO INC.  
Sales/Earnings Summary by Segment  
(in thousands)  
(Unaudited)  
         
   

Nine Months Ended

 

Nine Months Ended

 
   

October 28,

 

% of

 

October 29,

 

% of

 
   

2023

 

Net Sales

 

2022

 

Net Sales

 
  Sales:        
  Journeys Group  

 $

    908,832

 

 

57.3

%

 $

1,016,396

 

 

61.2

%

 
  Schuh Group  

 

334,033

 

 

21.1

%

 

294,486

 

 

17.7

%

 
  Johnston & Murphy Group  

 

       241,823

 

 

15.3

%

 

       225,448

 

 

13.6

%

 
  Genesco Brands Group  

 

       100,986

 

 

6.4

%

 

       123,538

 

 

7.4

%

 
  Net Sales  

 $

1,585,674

 

 

100.0

%

 

 $

1,659,868

 

 

100.0

%

 
  Operating Income (Loss):        
  Journeys Group  

 $

     (21,265

)

 

-2.3

%

 $

      51,235

 

 

5.0

%

 
  Schuh Group  

 

12,110

 

 

3.6

%

 

5,260

 

 

1.8

%

 
  Johnston & Murphy Group  

 

         10,178

 

 

4.2

%

 

           7,256

 

 

3.2

%

 
  Genesco Brands Group  

 

               259

 

 

0.3

%

 

           2,551

 

 

2.1

%

 
  Corporate and Other(1)  

 

        (23,601

)

 

-1.5

%

 

        (22,901

)

 

-1.4

%

 
  Goodwill Impairment  

 

        (28,453

)

 

-1.8

%

 

 

                    -

 

 

0.0

%

 
  Operating income (loss)  

 

        (50,772

)

 

-3.2

%

 

         43,401

 

 

2.6

%

 
  Other components of net periodic benefit cost   

 

               388

 

 

0.0

%

 

               198

 

 

0.0

%

 
  Interest, net  

 

           6,241

 

 

0.4

%

 

 

           1,608

 

 

0.1

%

 
         
  Earnings (loss) from continuing operations before income taxes  

 

        (57,401

)

 

-3.6

%

 

         41,595

 

 

2.5

%

 
  Income tax expense (benefit)  

 

        (13,483

)

 

-0.9

%

 

 

           8,551

 

 

0.5

%

 
  Earnings (loss) from continuing operations  

 

        (43,918

)

 

-2.8

%

 

         33,044

 

 

2.0

%

 
  Loss from discontinued operations, net of tax  

 

               (98

)

 

0.0

%

 

 

               (78

)

 

0.0

%

 
  Net Earnings (Loss)  

 $

     (44,016

)

 

-2.8

%

 

 $

      32,966

 

 

2.0

%

 
         
  (1) Includes a $0.6 million charge in the first nine months of Fiscal 2024 for asset impairments.  
  Includes a $0.2 million gain in the first nine months of Fiscal 2023 which includes a $0.7 million gain on the termination of the pension plan, partially offset by $0.5 million for asset impairments.  
         
                   

 

  GENESCO INC.  
  Condensed Consolidated Balance Sheets  
  (in thousands)  
  (Unaudited)  
     
     
    October 28, 2023   October 29, 2022  
  Assets    
  Cash  

 $

             21,691

 $

           32,113

 
  Accounts receivable  

 

                 56,934

 

               48,670

 
  Inventories  

 

              516,735

 

            563,490

 
  Other current assets(1)  

 

                 43,350

 

 

               37,575

 
  Total current assets  

 

              638,710

 

 

            681,848

 
  Property and equipment  

 

              245,009

 

            221,207

 
  Operating lease right of use assets  

 

              459,524

 

            483,403

 
  Goodwill and other intangibles  

 

                 35,725

 

               64,111

 
  Non-current prepaid income taxes  

 

                 55,632

 

               52,319

 
  Other non-current assets  

 

                 58,331

 

               34,105

 
  Total Assets  

 $

        1,492,931

 

 $

      1,536,993

 
   

 

 
  Liabilities and Equity  

 

 
  Accounts payable  

 $

           186,683

 $

         223,404

 
  Current portion long-term debt  

 

                            -

 

                 3,484

 
  Current portion operating lease liabilities  

 

              134,850

 

            136,294

 
  Other current liabilities  

 

                 75,631

 

 

               82,193

 
  Total current liabilities  

 

              397,164

 

 

            445,375

 
  Long-term debt  

 

              128,163

 

               85,904

 
  Long-term operating lease liabilities  

 

              387,347

 

            413,096

 
  Other long-term liabilities  

 

                 43,299

 

               33,275

 
  Equity  

 

              536,958

 

 

            559,343

 
  Total Liabilities and Equity  

 $

        1,492,931

 

 $

      1,536,993

 
     
  (1) Includes prepaid income taxes of $18.0 million and $13.3 million at October 28, 2023 and October 29, 2022, respectively.  
           
GENESCO INC.
Store Count Activity
           
           
   

Balance

 

 

 

 

 

Balance

 

 

 

 

 

Balance

   

01/29/22

 

Open

 

Close

 

01/28/23

 

Open

 

Close

 

10/28/23

Journeys Group  

1,135

 

22

 

27

    1,130

24

 

74

        1,080

Schuh Group  

123

 

4

 

5

        122

2

 

0

           124

Johnston & Murphy Group  

167

 

2

 

11

 

        158

 

1

 

3

 

           156

Total Retail Stores  

1,425

 

28

 

43

 

1,410

 

27

 

77

 

        1,360

           
                             
GENESCO INC.
Store Count Activity
         
         
   

Balance

 

 

 

 

 

Balance

 
   

07/29/23

 

Open

 

Close

 

10/28/23

 
Journeys Group  

1,095

 

5

 

20

    1,080

 
Schuh Group  

124

 

0

 

0

        124

 
Johnston & Murphy Group  

156

 

0

 

0

 

        156

 
Total Retail Stores  

1,375

 

5

 

20

 

    1,360

 
                   
GENESCO INC.
Comparable Sales(1)
   
 

Quarter 3

 

 

Nine Months

 

Oct. 28,

 

Oct. 29,

 

 

Oct. 28,

 

Oct. 29,

     

2023

 

2022

 

 

2023

 

2022

Journeys Group

-8

%

1

%

-10

%

NA
Schuh Group

5

%

3

%

11

%

NA
Johnston & Murphy Group    

1

%

 

20

%

   

10

%

  NA
Total Comparable Sales    

-4

%

 

3

%

   

-4

%

  NA
   
Same Store Sales

-7

%

2

%

-7

%

NA
Comparable Direct Sales    

8

%

 

6

%

   

10

%

 

-9

%

 
(1) As a result of store closures in response to the COVID-19 pandemic during the first quarter of Fiscal 2022, and the Company's policy of removing any store closed for seven consecutive days from comparable sales, the Company did not include comparable sales for the first nine months of Fiscal 2023, except for comparable direct sales, as it felt that overall sales was a more meaningful metric last year.
Schedule B
 
Genesco Inc.
Adjustments to Reported Earnings from Continuing Operations
Three Months Ended October 28, 2023 and October 29, 2022
 
The Company believes that disclosure of earnings and earnings per share from continuing operations and operating income 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.
 
 
Quarter 3  Quarter 3 
October 28, 2023  October 29, 2022 
Net of  Per Share  Net of  Per Share 
In Thousands (except per share amounts) Pretax  Tax  Amounts  Pretax  Tax  Amounts 
Earnings from continuing operations, as reported  

 $

          6,589

 

$0.60

 

 

 $

      20,424

 

$1.66

 

           
Asset impairments and other adjustments:            
Asset impairment charges

 $

              99

 

                 79

 

                0.01

 

 $

              -  

 

               (3

)

0.00

 

Fees related to shareholder activist

 

                  -  

 

                 -

 

0.00

 

 

                -  

 

               (2

)

0.00

 

Expenses related to new HQ building  

 

                  -  

 

                 -

 

0.00

 

 

              257

 

             200

 

0.01

 

Total asset impairments and other adjustments  

 $

              99

 

                 79

 

                0.01

 

 

 $

           257

 

             195

 

0.01

 

           
Income tax expense adjustments:            
Tax impact share based awards  

 

                 48

 

0.00

 

 

 

               28

 

0.00

 

Other tax items    

 

              (509

)

(0.04

)

   

 

            (251

)

(0.02

)

Total income tax expense adjustments    

 

              (461

)

(0.04

)

   

 

            (223

)

(0.02

)

           
Adjusted earnings from continuing operations (1) and (2)    

 $

          6,207

 

$0.57

 

   

 $

      20,396

 

$1.65

 

 
 
(1) The adjusted tax rate for the third quarter of Fiscal 2024 and 2023 is 27.8% and 19.6%, respectively.
  
(2) EPS reflects 11.0 million and 12.3 million share count for the third quarter of Fiscal 2024 and 2023, respectively, which includes common stock equivalents in both periods.
 
Genesco Inc.
Adjustments to Reported Operating Income and Selling and Administrative Expenses
Three Months Ended October 28, 2023 and October 29, 2022
 
  Quarter 3 - October 28, 2023  
 Operating   Asset Impair  Adj Operating
In Thousands   Income (Loss)  & Other Adj  Income (Loss) 
Journeys Group

 $

        11,975

 

 $

               -

 

 $

          11,975

 

Schuh Group

 

             5,484

 

 

                 -

 

 

              5,484

 

Johnston & Murphy Group

 

             2,706

 

 

                 -

 

 

              2,706

 

Genesco Brands Group

 

            (1,560

)

 

                 -

 

 

             (1,560

)

Goodwill Impairment

 

                  -

 

 

                 -

 

 

                   -

 

Corporate and Other

 

            (7,753

)

 

                 99

 

 

             (7,654

)

Total Operating Income

 $

        10,852

 

 $

              99

 

 $

          10,951

 

% of sales

 

1.9

%

 

 

1.9

%

 
 Quarter 3 - October 29, 2022  
 Operating   Asset Impair  Adj Operating
In Thousands   Income (Loss)  & Other Adj  Income (Loss) 
Journeys Group

 $

        27,083

 

 $

               -

 

 $

          27,083

 

Schuh Group

 

             5,912

 

 

                 -

 

 

              5,912

 

Johnston & Murphy Group

 

             3,494

 

 

                 -

 

 

              3,494

 

Genesco Brands Group

 

            (1,927

)

 

                 -

 

 

             (1,927

)

Corporate and Other

 

            (8,489

)

 

               257

 

 

             (8,232

)

Total Operating Income

 $

        26,073

 

 $

            257

 

 $

          26,330

 

% of sales

 

4.3

%

 

 

4.4

%

 
 Quarter 3 
In Thousands  Oct. 28, 2023   Oct. 29, 2022 
Selling and administrative expenses, as reported

 $

      267,474

 

 $

      267,734

 

   
Expenses related to new HQ building

 

                  -

 

 

              (257

)

Total adjustments

 

                  -

 

 

              (257

)

Adjusted selling and administrative expenses

 $

      267,474

 

 $

      267,477

 

% of sales

 

46.2

%

 

44.3

%

  Schedule B
Genesco Inc.
Adjustments to Reported Earnings (Loss) from Continuing Operations
Nine Months Ended October 28, 2023 and October 29, 2022
   
The Company believes that disclosure of earnings (loss) and earnings (loss) per share from continuing operations and operating income (loss) 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.
   
   
  Nine Months Nine Months
  October 28, 2023 October 29, 2022
  Net of Per Share Net of Per Share
In Thousands (except per share amounts)    Pretax Tax Amounts Pretax Tax Amounts
Earnings (loss) from continuing operations, as reported    

 $

       (43,918

)

($3.87

)

 

 $

      33,044

 

$2.56

 

             
Asset impairments and other adjustments:              
Asset impairment charges  

 $

             581

 

               446

 

                0.04

 

 $

           541

 

 

             454

 

0.04

 

Goodwill impairment charge  

 

           28,453

 

           21,858

 

                1.93

 

 

                -

 

 

               -

 

0.00

 

Gain on pension termination  

 

                  -  

 

                 -

 

0.00

 

 

             (695

)

 

            (520

)

(0.04

)

Expenses related to new HQ building  

 

                  -  

 

                 -

 

0.00

 

 

           2,545

 

 

          1,905

 

0.15

 

Total asset impairments and other adjustments  

 $

        29,034

 

           22,304

 

                1.97

 

 

 $

         2,391

 

 

          1,839

 

0.15

 

             
Income tax expense adjustments:              
Tax impact share based awards    

 

            1,059

 

                0.09

 

 

 

            (635

)

(0.05

)

Other tax items    

 

           (1,578

)

(0.14

)

   

 

            (250

)

(0.02

)

Total income tax expense adjustments    

 

              (519

)

(0.05

)

   

 

            (885

)

(0.07

)

             
Adjusted earnings (loss) from continuing operations (1) and (2)    

 $

       (22,133

)

($1.95

)

   

 $

      33,998

 

$2.64

 

   
   
(1) The adjusted tax rate for the first nine months of Fiscal 2024 and 2023 is 22.0% and 22.7%, respectively.
 
(2) EPS reflects 11.4 million and 12.9 million share count for the first nine months of Fiscal 2024 and 2023, respectively, which includes common stock equivalents in the first nine months last year but not in this year due to the loss from continuing operations.
 
Genesco Inc.
Adjustments to Reported Operating Income (Loss) and Selling and Administrative Expenses
Nine Months Ended October 28, 2023 and October 29, 2022
 
 Nine Months October 28, 2023 
 Operating   Asset Impair  Adj Operating
In Thousands   Income (Loss)  & Other Adj  Income (Loss) 
Journeys Group

 $

       (21,265

)

 $

               -

 

 $

         (21,265

)

Schuh Group

 

           12,110

 

 

                 -

 

 

             12,110

 

Johnston & Murphy Group

 

           10,178

 

 

                 -

 

 

             10,178

 

Genesco Brands Group

 

               259

 

 

                 -

 

 

                 259

 

Goodwill Impairment

 

          (28,453

)

 

           28,453

 

 

                   -

 

Corporate and Other

 

          (23,601

)

 

               581

 

 

            (23,020

)

Total Operating Loss

 $

       (50,772

)

 $

        29,034

 

 $

         (21,738

)

% of sales

 

-3.2

%

 

 

-1.4

%

 
 Nine Months October 29, 2022 
 Operating   Asset Impair  Adj Operating
In Thousands   Income (Loss)  & Other Adj  Income (Loss) 
Journeys Group

 $

        51,235

 

 $

               -

 

 $

          51,235

 

Schuh Group

 

             5,260

 

 

                 -

 

 

              5,260

 

Johnston & Murphy Group

 

             7,256

 

 

                 -

 

 

              7,256

 

Genesco Brands Group

 

             2,551

 

 

                 -

 

 

              2,551

 

Corporate and Other

 

          (22,901

)

 

            2,391

 

 

            (20,510

)

Total Operating Income 

 $

        43,401

 

 $

          2,391

 

 $

          45,792

 

% of sales

 

2.6

%

 

 

2.8

%

 
 Nine Months 
In Thousands  Oct. 28, 2023   Oct. 29, 2022 
Selling and administrative expenses, as reported

 $

      778,491

 

 $

      756,318

 

   
Expenses related to new HQ building

 

                  -

 

 

           (2,545

)

Total adjustments

 

                  -

 

 

           (2,545

)

Adjusted selling and administrative expenses

 $

      778,491

 

 $

      753,773

 

% of sales

 

49.1

%

 

45.4

%

Schedule B
         
Genesco Inc.
Adjustments to Forecasted Earnings (Loss) from Continuing Operations
Fiscal Year Ending February 3, 2024
         
In millions (except per share amounts)   High Guidance   Low Guidance
  Fiscal 2024   Fiscal 2024
  Net of Tax   Per Share   Net of Tax   Per Share
Forecasted earnings (loss) from continuing operations  

 $

          (0.7

)

 

 $

      (0.06

)

 

 $

       (6.8

)

 

 $

      (0.60

)

             
Asset impairments and other adjustments:              
Asset impairments and other matters  

 

             1.5

 

 

 

         0.13

 

 

 

           1.9

 

 

 

         0.17

 

Goodwill impairment  

 

            21.9

 

 

 

         1.93

 

 

 

         21.9

 

 

 

         1.93

 

Total asset impairments and other adjustments (1)  

 

            23.4

 

 

 

         2.06

 

 

 

         23.8

 

 

 

         2.10

 

             
Adjusted forecasted earnings from continuing operations (2)  

 $

         22.7

 

 

 $

       2.00

 

 

 $

       17.0

 

 

 $

       1.50

 

         
         
(1) All adjustments are net of tax where applicable.  The forecasted tax rate for Fiscal 2024 is approximately 24%.  
         
(2) EPS reflects 11.4 million share count for Fiscal 2024 which includes common stock equivalents.  
         
         
This reconciliation reflects estimates and current expectations of future results. Actual results may vary materially from these expectations and estimates, for reasons including those included in the discussion of forward-looking statements elsewhere in this release. The Company disclaims any obligation to update such expectations and estimates.

 

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