Foot Locker Inc (NYSE: FL) is up 25% on Friday after the footwear and apparel retailer reported better-than-expected profit for its fiscal second quarter.
Foot Locker Q2 financial highlights
Earned $94 million versus the year-ago $430 million
Per-share earnings tanked to 99 cents from $4.09
On an adjusted basis, EPS came in at $1.10
Sales went down 9.0% year-on-year to $2.07 billion
Merchandise inventories were up 52.1% from last year
FactSet consensus was 80 cents of adjusted earnings per share on $2.07 billion in sales. Comparable sales declined 10.3%, beating estimates by significant margin. In the earnings press release, CEO Richard Johnson said:
Our strategy of diversifying our brand portfolio and offering more choice continues to resonate with consumers and is enabling us to expand our customer base.
Foot Locker stock up despite lowered guidance
For the full financial year, Foot Locker lowered its guidance for adjusted EPS to $4.25 – $4.45. Previously, it was looking at up to $4.60.
In comparison, experts had called for $4.42 a share this year. The retailer now forecasts an 8.0% to 9.0% increase in same-store sales versus up to 10% it had guided for earlier. Johnson added:
Our operational excellence, improving ability to fuel customer’s desire for self-expression, and secular trends driving our categories, put us in a strong position to navigate the expected ongoing macro headwinds in the back half of 2022.
Foot Locker stock is now down 10% for the year.
Foot Locker names a new CEO
In related retail news, Foot Locker says Mary Dillon will replace Richard Johnson as the Chief Executive on September 1st. Dillon has previously served in a similar capacity at Ulta Beauty.
Johnson will remain an executive chairman of the company until January 31st, 2023. Wall Street currently rates the Foot Locker stock at “hold”.
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