Genesco Inc. (GCO) has reported 4.22 percent rise in profit for the quarter ended Jan. 28, 2017. The company has earned $46.55 million, or $2.39 a share in the quarter, compared with $44.66 million, or $2.06 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $41.83 million, or $2.15 a share compared with $45.79 million or $2.11 a share, a year ago. Revenue during the quarter dropped 5.26 percent to $883.17 million from $932.21 million in the previous year period. Gross margin for the quarter expanded 188 basis points over the previous year period to 47.27 percent. Total expenses were 92.79 percent of quarterly revenues, up from 92.44 percent for the same period last year. That has resulted in a contraction of 35 basis points in operating margin to 7.21 percent.
Operating income for the quarter was $63.70 million, compared with $70.45 million in the previous year period.
However, the adjusted operating income for the quarter stood at $66.69 million compared to $74.37 million in the prior year period. At the same time, adjusted operating margin contracted 43 basis points in the quarter to 7.55 percent from 7.98 percent in the last year period.
Robert J. Dennis, chairman, president and chief executive officer of Genesco, said, "Fourth quarter EPS came in above last year's levels and above expectations fueled in large part by better holiday selling than anticipated for most of our businesses. The strong gross margin and operating income recovery experienced at Lids and Schuh offset some impact of the significant fashion rotation at Journeys. January markdown and other assumptions proved to be conservative and we benefitted from a number of year-end items that contributed to the EPS beat as well. Year-over-year operating income was down, but EPS improved due to share buybacks and a lower tax rate.
For financial year 2018, Genesco projects net income to be in the range of $80.51 million to $84.15 million. For the financial year 2018, Genesco expects adjusted net income to be in the range of $85.48 million to $88.47 million. For fiscal year 2018, the company expects diluted earnings per share to be in the range of $4.14 to $4.33. For fiscal year 2018, the company expects diluted earnings per share to be in the range of $4.40 to $4.55 on adjusted basis.
Working capital declinesGenesco Inc. has witnessed a decline in the working capital over the last year. It stood at $428.78 million as at Jan. 28, 2017, down 10.01 percent or $47.69 million from $476.47 million on Jan. 30, 2016. Current ratio was at 2.39 as on Jan. 28, 2017, down from 2.47 on Jan. 30, 2016. Cash conversion cycle (CCC) has increased to 41 days for the quarter from 36 days for the last year period. Days sales outstanding were almost stable at 2 days for the quarter, when compared with the last year period.
Days inventory outstanding has increased to 55 days for the quarter compared with 47 days for the previous year period. At the same time, days payable outstanding went up to 17 days for the quarter from 14 for the same period last year.
Debt comes down significantly
Genesco Inc. has recorded a decline in total debt over the last one year. It stood at $82.90 million as on Jan. 28, 2017, down 25.82 percent or $28.86 million from $111.76 million on Jan. 30, 2016. Total debt was 5.72 percent of total assets as on Jan. 28, 2017, compared with 7.25 percent on Jan. 30, 2016. Debt to equity ratio was at 0.09 as on Jan. 28, 2017, down from 0.12 as on Jan. 30, 2016. Interest coverage ratio improved to 48.40 for the quarter from 46.97 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
