Exhibit 99.1
GENESCO INC. REPORTS FISCAL 2026 FIRST QUARTER RESULTS
--Top and bottom-line results exceed expectations--
--Comparable sales increased 5%, led by Journeys with an 8% increase--
--Sales growth and meaningful expense leverage drives bottom line improvement
compared to Q1 last year--
--Company reiterates full year EPS outlook including impact of current tariffs --
NASHVILLE, Tenn., June 4, 2025 --- Genesco Inc. (NYSE: GCO) today reported first quarter results for the three months ended May 3, 2025.
First Quarter Fiscal 2026 Financial Summary
•Net sales of $474 million increased 4% compared to Q1FY25
•Comparable sales increased 5%, with stores up 5% and e-commerce up 7%
•E-commerce sales represented 23% of retail sales
•Selling and administrative expenses leveraged 170 basis points compared to last year
•GAAP EPS was ($2.02) and Non-GAAP EPS was ($2.05)1 versus GAAP EPS of ($2.22) and Non-GAAP EPS of ($2.10) last year
Mimi E. Vaughn, Genesco’s Board Chair, President and Chief Executive Officer, said, “Following the significant momentum in last year’s back half, we are pleased with our start to fiscal 2026 with both sales and profitability coming in above our expectations. Our first quarter performance was highlighted by our third consecutive quarter of positive comparable sales increases, with results once again driven by Journeys, as our strategic plan to accelerate growth and increase market share continues to gain traction. At the same time, the work we’ve done realigning our cost structure including our ongoing store optimization initiatives, helped drive a nice year-over-year improvement in operating income.”
Vaughn continued, “While an already choppy consumer environment has become more pronounced recently from the increased uncertainty due to tariffs, our diversified sourcing and mitigation actions position us well to manage the current tariff impact. In addition, our strong strategic positioning and track record of evolving our businesses in the face of market disruptions are giving us confidence in successfully navigating the current environment.”
_____________________
1Excludes charges for severance and asset impairments, net of tax effect in the first quarter of Fiscal 2026 (“Excluded Items”). A reconciliation of loss and loss per share from continuing operations in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) with the adjusted loss and loss per share numbers is set forth on Schedule B to this press release. The Company believes that disclosure of loss and 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.
Sandra Harris, Genesco’s Senior Vice President Finance and Chief Financial Officer, added, “Our first quarter performance exceeded our expectations, and our adjusted EPS would have been $0.05 better had we not opportunistically bought back shares during the quarter. Today we are reiterating our full-year adjusted EPS guidance of $1.30 to $1.70, incorporating the impact of current tariffs. Although there is ongoing external market uncertainty, we know our businesses are strong, and we are making investments in product, stores, and marketing across all brands to drive growth.”
First Quarter Review
Net sales for the first quarter of Fiscal 2026 increased 4% to $474 million compared to $458 million in the first quarter of Fiscal 2025. The net sales increase reflects a 5% increase in comparable sales, including a 7% increase in e-commerce comparable sales and a 5% increase in same store sales, and increased wholesale sales, partially offset by the impact of net store closings.
|
|
|
Comparable Sales |
|
|
|
Comparable Same Store and E-commerce Sales: |
1QFY26 |
1QFY25 |
Journeys Group |
8% |
(5)% |
Schuh Group |
1% |
(7)% |
Johnston & Murphy Group |
(2)% |
(3)% |
Total Genesco Comparable Sales |
5% |
(5)% |
Same Store Sales |
5% |
(7)% |
Comparable E-commerce Sales |
7% |
3% |
The overall sales increase of 4% for the first quarter of Fiscal 2026 compared to the first quarter of Fiscal 2025 was driven by an increase of 5% at Journeys, an increase of 4% at Schuh and a 7% increase at Genesco Brands, partially offset by a decrease of 3% at Johnston & Murphy. On a constant currency basis, Schuh sales were up 1% for the first quarter this year.
Gross margin for the first quarter this year was 46.7% compared to 47.3% last year. Adjusted gross margin for the first quarter this year of 46.7% decreased 90 basis points as a percentage of sales compared to 47.6% last year. The decrease as a percentage of sales compared to Fiscal 2025 is due primarily to changes in brand mix at Journeys and Schuh, promotional activity at Schuh and lower margins at Genesco Brands related to liquidation of product for sunsetting licenses.
Selling and administrative expenses for the first quarter this year of 52.5% decreased 170 basis points as a percentage of sales compared with last year primarily reflecting decreased occupancy and performance-based compensation expenses as well as other cost savings initiatives.
Genesco’s GAAP operating loss for the first quarter was $28.1 million, or 5.9% of sales this year, compared with a loss of $32.1 million, or 7.0% of sales in the first quarter last year. Adjusted for the Excluded Items in the first quarters of both Fiscal 2026 and 2025, the operating loss for the first quarter was $27.9 million this year compared to a loss of $30.0 million last year. Adjusted operating margin was a loss of 5.9% of sales in the first quarter of Fiscal 2026 compared to a loss of 6.5% in the first quarter last year.
The effective tax rate for the quarter was 28.5% in Fiscal 2026 compared to 26.7% in the first quarter last year. The adjusted tax rate, reflecting Excluded Items, was 26.7% in Fiscal 2026 compared to 26.0% in the first quarter last year.
GAAP loss from continuing operations was $21.2 million in the first quarter of Fiscal 2026 compared to a loss of $24.3 million in the first quarter last year. Adjusted for the Excluded Items, the first quarter loss from continuing operations was $21.5 million, or $2.05 per share, in Fiscal 2026, compared to a loss of $22.9 million, or $2.10 per share, in the first quarter last year.
Cash, Borrowings and Inventory
Cash as of May 3, 2025, was $21.7 million, compared with $19.2 million as of May 4, 2024. Total debt at the end of the first quarter of Fiscal 2026 was $121.0 million compared with $59.4 million at the end of last year’s first quarter, primarily reflecting increased inventories which were up 15% on a year-over-year basis to meet increased demand at Journeys.
Capital Expenditures and Store Activity
For the first quarter this year, capital expenditures were $19 million, related primarily to retail stores and other initiatives. Depreciation and amortization was $13 million. During the quarter, the Company opened four stores and closed 26 stores. The Company ended the quarter with 1,256 stores compared with 1,321 stores at the end of the first quarter last year, or a decrease of 5%. Square footage was down 3% on a year-over-year basis.
Share Repurchases
The Company repurchased 604,531 shares for $12.6 million, or $20.79 per share, during the first quarter of Fiscal 2026. The Company currently has $29.8 million remaining on its expanded share repurchase authorization announced in June 2023.
Fiscal 2026 Outlook
For Fiscal 2026, the Company:
•Continues to expect adjusted diluted earnings per share from continuing operations in the range of $1.30 to $1.70 2 , including the impact of tariffs currently in place
•Expects total sales to be up 1% to 2% compared to Fiscal 2025 versus prior expectation of flat to up 1% due to the impact of favorable foreign exchange, with comparable sales range narrowed to up 2% to 3% versus prior range of up 2% to 4%
•Guidance assumes no further share repurchases and a tax rate of 29%
__________________________
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.
Conference Call, Management Commentary and Investor Presentation
The Company has posted detailed financial commentary and a supplemental financial presentation of first quarter results on its website, www.genesco.com, in the investor relations section. The Company's live conference call on June 4, 2025, 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.
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, 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,” “should,” “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, 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; our ability to pass on price increases to our customers; 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 the level and timing of promotional activity necessary to maintain inventories at appropriate levels; 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, including shipping disruptions in the Red Sea; unfavorable trends in fuel costs, foreign exchange rates, foreign labor and material costs, and other factors affecting the cost of products;
civil disturbances; 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; 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 more than 1,250 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, Starter and PONY. Founded in 1924, Genesco is based in Nashville, Tennessee. For more information on Genesco and its operating divisions, please visit www.genesco.com.
Genesco Financial Contact Genesco Media Contact
Sandra Harris, SVP Finance, Chief Financial Officer Claire S. McCall
(615) 367-7578 (615) 367-8283
[email protected] [email protected]
GENESCO INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter 1 |
|
|
Quarter 1 |
|
|
|
May 3,
2025 |
|
|
% of
Net Sales |
|
|
May 4,
2024 |
|
|
% of
Net Sales |
|
Net sales |
|
$ |
473,973 |
|
|
|
100.0 |
% |
|
$ |
457,597 |
|
|
|
100.0 |
% |
Cost of sales |
|
|
252,792 |
|
|
|
53.3 |
% |
|
|
241,316 |
|
|
|
52.7 |
% |
Gross margin(1) |
|
|
221,181 |
|
|
|
46.7 |
% |
|
|
216,281 |
|
|
|
47.3 |
% |
Selling and administrative expenses |
|
|
249,035 |
|
|
|
52.5 |
% |
|
|
247,831 |
|
|
|
54.2 |
% |
Asset impairments and other, net(2) |
|
|
291 |
|
|
|
0.1 |
% |
|
|
578 |
|
|
|
0.1 |
% |
Operating loss |
|
|
(28,145 |
) |
|
|
-5.9 |
% |
|
|
(32,128 |
) |
|
|
-7.0 |
% |
Other components of net periodic benefit cost |
|
|
180 |
|
|
|
0.0 |
% |
|
|
109 |
|
|
|
0.0 |
% |
Interest expense, net |
|
|
1,339 |
|
|
|
0.3 |
% |
|
|
890 |
|
|
|
0.2 |
% |
Loss from continuing operations before income taxes |
|
|
(29,664 |
) |
|
|
-6.3 |
% |
|
|
(33,127 |
) |
|
|
-7.2 |
% |
Income tax benefit |
|
|
(8,452 |
) |
|
|
-1.8 |
% |
|
|
(8,839 |
) |
|
|
-1.9 |
% |
Loss from continuing operations |
|
|
(21,212 |
) |
|
|
-4.5 |
% |
|
|
(24,288 |
) |
|
|
-5.3 |
% |
Loss from discontinued operations, net of tax |
|
|
(15 |
) |
|
|
0.0 |
% |
|
|
(59 |
) |
|
|
0.0 |
% |
Net Loss |
|
$ |
(21,227 |
) |
|
|
-4.5 |
% |
|
$ |
(24,347 |
) |
|
|
-5.3 |
% |
Basic loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Before discontinued operations |
|
$ |
(2.02 |
) |
|
|
|
|
$ |
(2.22 |
) |
|
|
|
Net loss |
|
$ |
(2.02 |
) |
|
|
|
|
$ |
(2.23 |
) |
|
|
|
Diluted loss per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Before discontinued operations |
|
$ |
(2.02 |
) |
|
|
|
|
$ |
(2.22 |
) |
|
|
|
Net loss |
|
$ |
(2.02 |
) |
|
|
|
|
$ |
(2.23 |
) |
|
|
|
Weighted-average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
10,495 |
|
|
|
|
|
|
10,930 |
|
|
|
|
Diluted |
|
|
10,495 |
|
|
|
|
|
|
10,930 |
|
|
|
|
(1)Includes a $1.6 million gross margin charge related to a distribution model transition in Genesco Brands Group in the first quarter of Fiscal 2025.
(2)Includes a $0.3 million charge in the first quarter of Fiscal 2026 for severance. Includes a $0.6 million charge in the first quarter of Fiscal 2025 which includes $0.3 million for severance and $0.3 million for asset impairments.
GENESCO INC.
Sales/Earnings Summary by Segment
(in thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter 1 |
|
|
Quarter 1 |
|
|
|
May 3,
2025 |
|
|
% of
Net Sales |
|
|
May 4,
2024 |
|
|
% of
Net Sales |
|
Sales: |
|
|
|
|
|
|
|
|
|
|
|
|
Journeys Group |
|
$ |
272,634 |
|
|
|
57.5 |
% |
|
$ |
259,445 |
|
|
|
56.7 |
% |
Schuh Group |
|
|
95,915 |
|
|
|
20.2 |
% |
|
|
92,349 |
|
|
|
20.2 |
% |
Johnston & Murphy Group |
|
|
76,839 |
|
|
|
16.2 |
% |
|
|
79,207 |
|
|
|
17.3 |
% |
Genesco Brands Group |
|
|
28,585 |
|
|
|
6.0 |
% |
|
|
26,596 |
|
|
|
5.8 |
% |
Net Sales |
|
$ |
473,973 |
|
|
|
100.0 |
% |
|
$ |
457,597 |
|
|
|
100.0 |
% |
Operating income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
Journeys Group |
|
$ |
(15,283 |
) |
|
|
-5.6 |
% |
|
$ |
(18,822 |
) |
|
|
-7.3 |
% |
Schuh Group |
|
|
(6,131 |
) |
|
|
-6.4 |
% |
|
|
(5,896 |
) |
|
|
-6.4 |
% |
Johnston & Murphy Group |
|
|
500 |
|
|
|
0.7 |
% |
|
|
2,355 |
|
|
|
3.0 |
% |
Genesco Brands Group(1) |
|
|
698 |
|
|
|
2.4 |
% |
|
|
(986 |
) |
|
|
-3.7 |
% |
Corporate and Other(2) |
|
|
(7,929 |
) |
|
|
-1.7 |
% |
|
|
(8,779 |
) |
|
|
-1.9 |
% |
Operating loss |
|
|
(28,145 |
) |
|
|
-5.9 |
% |
|
|
(32,128 |
) |
|
|
-7.0 |
% |
Other components of net periodic benefit cost |
|
|
180 |
|
|
|
0.0 |
% |
|
|
109 |
|
|
|
0.0 |
% |
Interest expense, net |
|
|
1,339 |
|
|
|
0.3 |
% |
|
|
890 |
|
|
|
0.2 |
% |
Loss from continuing operations before income taxes |
|
|
(29,664 |
) |
|
|
-6.3 |
% |
|
|
(33,127 |
) |
|
|
-7.2 |
% |
Income tax benefit |
|
|
(8,452 |
) |
|
|
-1.8 |
% |
|
|
(8,839 |
) |
|
|
-1.9 |
% |
Loss from continuing operations |
|
|
(21,212 |
) |
|
|
-4.5 |
% |
|
|
(24,288 |
) |
|
|
-5.3 |
% |
Loss from discontinued operations, net of tax |
|
|
(15 |
) |
|
|
0.0 |
% |
|
|
(59 |
) |
|
|
0.0 |
% |
Net Loss |
|
$ |
(21,227 |
) |
|
|
-4.5 |
% |
|
$ |
(24,347 |
) |
|
|
-5.3 |
% |
(1)Includes a $1.6 million gross margin charge related to a distribution model transition in Genesco Brands Group in the first quarter of Fiscal 2025.
(2)Includes a $0.3 million charge in the first quarter of Fiscal 2026 for severance. Includes a $0.6 million charge in the first quarter of Fiscal 2025 which includes $0.3 million for severance and $0.3 million for asset impairments.
GENESCO INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
May 3, 2025 |
|
|
May 4, 2024 |
|
Assets |
|
|
|
|
|
Cash |
$ |
21,748 |
|
|
$ |
19,247 |
|
Accounts receivable |
|
52,815 |
|
|
|
50,119 |
|
Inventories |
|
450,829 |
|
|
|
392,671 |
|
Other current assets(1) |
|
107,922 |
|
|
|
46,003 |
|
Total current assets |
|
633,314 |
|
|
|
508,040 |
|
Property and equipment |
|
236,909 |
|
|
|
233,601 |
|
Operating lease right of use assets |
|
472,091 |
|
|
|
420,133 |
|
Goodwill and other intangibles |
|
36,857 |
|
|
|
36,331 |
|
Non-current prepaid income taxes |
|
— |
|
|
|
57,441 |
|
Other non-current assets |
|
25,420 |
|
|
|
51,871 |
|
Total Assets |
$ |
1,404,591 |
|
|
$ |
1,307,417 |
|
|
|
|
|
|
|
Liabilities and Equity |
|
|
|
|
|
Accounts payable |
$ |
122,166 |
|
|
$ |
108,847 |
|
Current portion long-term debt |
|
7,299 |
|
|
|
— |
|
Current portion operating lease liabilities |
|
126,954 |
|
|
|
125,450 |
|
Other current liabilities |
|
74,504 |
|
|
|
73,888 |
|
Total current liabilities |
|
330,923 |
|
|
|
308,185 |
|
Long-term debt |
|
113,733 |
|
|
|
59,444 |
|
Long-term operating lease liabilities |
|
389,384 |
|
|
|
345,670 |
|
Other long-term liabilities |
|
48,319 |
|
|
|
45,665 |
|
Equity |
|
522,232 |
|
|
|
548,453 |
|
Total Liabilities and Equity |
$ |
1,404,591 |
|
|
$ |
1,307,417 |
|
(1)Includes prepaid income taxes of $74.8 million at May 3, 2025 and $17.3 million at May 4, 2024.
GENESCO INC.
Store Count Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
02/03/24 |
|
Open |
|
Close |
|
Balance
02/01/25 |
|
Open |
|
Close |
|
Balance
05/03/25 |
|
Journeys Group |
|
1,063 |
|
|
7 |
|
|
64 |
|
|
1,006 |
|
|
2 |
|
|
19 |
|
|
989 |
|
Schuh Group |
|
122 |
|
|
4 |
|
|
2 |
|
|
124 |
|
|
0 |
|
|
3 |
|
|
121 |
|
Johnston & Murphy Group |
|
156 |
|
|
1 |
|
|
9 |
|
|
148 |
|
|
2 |
|
|
4 |
|
|
146 |
|
Total Retail Stores |
|
1,341 |
|
|
12 |
|
|
75 |
|
|
1,278 |
|
|
4 |
|
|
26 |
|
|
1,256 |
|
GENESCO INC.
Comparable Sales
|
|
|
|
|
|
|
|
Quarter 1 |
|
|
May 3,
2025 |
|
May 4,
2024 |
|
Journeys Group |
|
8 |
% |
|
-5 |
% |
Schuh Group |
|
1 |
% |
|
-7 |
% |
Johnston & Murphy Group |
|
-2 |
% |
|
-3 |
% |
Total Comparable Sales |
|
5 |
% |
|
-5 |
% |
Same Store Sales |
|
5 |
% |
|
-7 |
% |
Comparable E-commerce Sales |
|
7 |
% |
|
3 |
% |
Genesco Inc.
Adjustments to Reported Loss from Continuing Operations
Three Months Ended May 3, 2025 and May 4, 2024
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.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter 1 |
|
|
Quarter 1 |
|
|
May 3, 2025 |
|
|
May 4, 2024 |
|
In Thousands (except per share amounts) |
Pretax |
|
Net of
Tax |
|
Per Share
Amounts |
|
|
Pretax |
|
Net of
Tax |
|
Per Share
Amounts |
|
Loss from continuing operations, as reported |
|
|
$ |
(21,212 |
) |
$ |
(2.02 |
) |
|
|
|
$ |
(24,288 |
) |
$ |
(2.22 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Charges related to distribution model transition |
$ |
— |
|
|
— |
|
|
0.00 |
|
|
$ |
1,581 |
|
|
1,151 |
|
|
0.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset impairments and other adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset impairment charges |
$ |
34 |
|
|
24 |
|
|
0.00 |
|
|
$ |
244 |
|
|
178 |
|
|
0.02 |
|
Severance |
|
257 |
|
|
185 |
|
|
0.02 |
|
|
|
334 |
|
|
243 |
|
|
0.02 |
|
Total asset impairments and other adjustments |
$ |
291 |
|
|
209 |
|
|
0.02 |
|
|
$ |
578 |
|
|
421 |
|
|
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax impact share based awards |
|
|
|
139 |
|
|
0.01 |
|
|
|
|
|
130 |
|
|
0.01 |
|
Other tax items |
|
|
|
(666 |
) |
|
(0.06 |
) |
|
|
|
|
(345 |
) |
|
(0.03 |
) |
Total income tax expense adjustments |
|
|
|
(527 |
) |
|
(0.05 |
) |
|
|
|
|
(215 |
) |
|
(0.02 |
) |
Adjusted loss from continuing operations (1) and (2) |
|
|
$ |
(21,530 |
) |
|
(2.05 |
) |
|
|
|
$ |
(22,931 |
) |
|
(2.10 |
) |
(1)The adjusted tax rate for the first quarter of Fiscal 2026 and 2025 is 26.7% and 26.0%, respectively.
(2)EPS reflects 10.5 million and 10.9 million share count for the first quarter of Fiscal 2026 and 2025, respectively, which excludes common stock equivalents in both periods due to the loss from continuing operations.
Genesco Inc.
Adjustments to Reported Operating Income (Loss) and Gross Margin
Three Months Ended May 3, 2025 and May 4, 2024
|
|
|
|
|
|
|
|
|
|
|
Quarter 1 - May 3, 2025 |
|
In Thousands |
Operating
Income (Loss) |
|
Asset Impair
& Other Adj |
|
Adj Operating
Income (Loss) |
|
Journeys Group |
$ |
(15,283 |
) |
$ |
— |
|
$ |
(15,283 |
) |
Schuh Group |
|
(6,131 |
) |
|
— |
|
|
(6,131 |
) |
Johnston & Murphy Group |
|
500 |
|
|
— |
|
|
500 |
|
Genesco Brands Group |
|
698 |
|
|
— |
|
|
698 |
|
Corporate and Other |
|
(7,929 |
) |
|
291 |
|
|
(7,638 |
) |
Total Operating Loss |
$ |
(28,145 |
) |
$ |
291 |
|
$ |
(27,854 |
) |
% of sales |
|
-5.9 |
% |
|
|
|
-5.9 |
% |
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
|
13,393 |
|
Adjusted loss before interest, taxes, depreciation and amortization ("EBITDA")(1) |
|
$ |
(14,461 |
) |
% of sales |
|
|
|
|
|
-3.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
Quarter 1 - May 4, 2024 |
|
In Thousands |
Operating
Income (Loss) |
|
Asset Impair
& Other Adj |
|
Adj Operating
Income (Loss) |
|
Journeys Group |
$ |
(18,822 |
) |
$ |
— |
|
$ |
(18,822 |
) |
Schuh Group |
|
(5,896 |
) |
|
— |
|
|
(5,896 |
) |
Johnston & Murphy Group |
|
2,355 |
|
|
— |
|
|
2,355 |
|
Genesco Brands Group |
|
(986 |
) |
|
1,581 |
|
|
595 |
|
Corporate and Other |
|
(8,779 |
) |
|
578 |
|
|
(8,201 |
) |
Total Operating Loss |
$ |
(32,128 |
) |
$ |
2,159 |
|
$ |
(29,969 |
) |
% of sales |
|
-7.0 |
% |
|
|
|
-6.5 |
% |
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
|
13,237 |
|
Adjusted loss before interest, taxes, depreciation and amortization ("EBITDA")(1) |
|
$ |
(16,732 |
) |
% of sales |
|
|
|
|
|
-3.7 |
% |
(1)Excludes "Other components of net periodic benefit cost" line item on the Consolidated Statements of Operations.
|
|
|
|
|
|
|
|
Quarter 1 |
|
In Thousands |
May 3, 2025 |
|
May 4, 2024 |
|
Gross margin, as reported |
$ |
221,181 |
|
$ |
216,281 |
|
% of sales |
|
46.7 |
% |
|
47.3 |
% |
|
|
|
|
|
Charges related to distribution model transition |
|
— |
|
|
1,581 |
|
Total adjustments |
|
— |
|
|
1,581 |
|
|
|
|
|
|
Adjusted gross margin |
$ |
221,181 |
|
$ |
217,862 |
|
% of sales |
|
46.7 |
% |
|
47.6 |
% |
Genesco Inc.
Adjustments to Forecasted Earnings from Continuing Operations
Fiscal Year Ending January 31, 2026
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions (except per share amounts) |
High Guidance Fiscal 2026 |
|
Low Guidance Fiscal 2026 |
|
|
Net of Tax |
|
Per Share |
|
Net of Tax |
|
Per Share |
|
Forecasted earnings from continuing operations |
$ |
17.0 |
|
$ |
1.61 |
|
$ |
12.5 |
|
$ |
1.17 |
|
|
|
|
|
|
|
|
|
|
Asset impairments and other adjustments: |
|
|
|
|
|
|
|
|
Asset impairments and other matters |
|
1.0 |
|
|
0.09 |
|
|
1.3 |
|
|
0.13 |
|
Total asset impairments and other adjustments (1) |
|
1.0 |
|
|
0.09 |
|
|
1.3 |
|
|
0.13 |
|
Adjusted forecasted earnings from continuing operations (2) |
$ |
18.0 |
|
$ |
1.70 |
|
$ |
13.8 |
|
$ |
1.30 |
|
(1)All adjustments are net of tax where applicable. The forecasted tax rate for Fiscal 2026 is approximately 29%.
(2)EPS reflects 10.6 million share count for Fiscal 2026 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.
FY26 Q1 GENESCO Summary Results • June 4, 2025 Exhibit 99.2
This presentation 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, 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,” “should,” “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, 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; our ability to pass on price increases to our customers; 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 the level and timing of promotional activity necessary to maintain inventories at appropriate levels; 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, including shipping disruptions in the Red Sea; unfavorable trends in fuel costs, foreign exchange rates, foreign labor and material costs, and other factors affecting the cost of products; civil disturbances; 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; 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. Safe Harbor Statement
We report consolidated financial results in accordance with generally accepted accounting principles (“GAAP”). However, to supplement these consolidated financial results our presentation includes certain non-GAAP financial measures such as earnings (loss) and earnings (loss) per share and operating income (loss). This supplemental information should not be considered in isolation as a substitute for related GAAP measures. We believe 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. Reconciliations of the non-GAAP supplemental information to the comparable GAAP measures can be found in the Appendix. Non-GAAP • Financial Measures
Q1 FY26 Financial Snapshot SALES $474M Up 4% vs Q1 FY2025 with e-commerce 23% of retail sales GROSS MARGIN 46.7% Down 60 bps vs Q1 FY2025 Non-GAAP gross margin down 90 bps vs Q1 FY2025 SG&A $249M 52.5% of sales and 170 bps leverage vs Q1 FY2025 COMPS +5% Stores E-commerce Journeys +5% +7% +8% GAAP EPS ($2.02) Non-GAAP EPS ($2.05) GAAP EPS $0.20 improved vs Q1 FY2025 Non-GAAP EPS $0.05 improved vs Q1 FY2025 GAAP OI ($28.1M) Non-GAAP OI ($27.9M)
Top and bottom-line results exceed expectations All channels posting positive growth Comparable sales increased 5%, our third consecutive positive increase, with both stores up mid-single digits and online up high single digits Wholesale channel growth of 5% Journeys comps were strongly positive for the third consecutive quarter as well, up 8%, and Schuh continued its positive comp run from Q4 Operating expense leveraged 170 basis points benefitting from our ongoing cost reduction efforts Operating income and EPS improved year over year driven by higher sales and better expense leverage; EPS would have been $0.05 better, excluding opportunistic share repurchases in Q1 Company reiterates full year EPS outlook, inclusive of current tariffs Q1 FY26 • Highlights
Our Footwear Focused Vision & Strategy OUR ASPIRATION Create and curate leading footwear brands that represent style, innovation and self-expression; be the destination for our consumers’ favorite fashion footwear HOW WE WILL ACHIEVE IT Build enduring relationships with our target customers, grounded in unparalleled consumer and market insights Deliver exciting, distinctive products and experiences across physical and digital
OUR PLATFORMS ENABLE THE STRATEGY UNITED BY DTC CAPABILITIES Our Footwear Focused Vision & Strategy Strategic Initiatives/Pillars RETAIL PLATFORM The destination for young adult and teen fashion footwear and partner of choice for leading global brands 6 2 3 5 ACCELERATE DIGITAL 1 MAXIMIZE PHYSICAL & DIGITAL DEEPEN CONSUMER INSIGHTS RESHAPE & REINVEST COST BASE PURSUE GROWTH & ACQUISITIONS Portfolio of leading owned and licensed brands BRANDED PLATFORM 4 INTENSIFY PRODUCT INNOVATION
What is Journeys Strategic Growth Plan? Multi-Brand, multi-category offering to inspire the journey from one you to the next
Unique Consumer Positioning There is white space in the market for Journeys to expand its reach amongst teens with a sharp focus on females STYLE-LED FOOTWEAR DESTINATION
Expand Consumer Segmentation We have sharpened our consumer focus, targeting three consumer segments reaching a wider teen audience. @ANTI-HERO Independent Heritage Journeys consumer Self-expression @STYLECHASER What’s cool & fashionable More mainstream Later trend adopters @DYNAMICEXPLORER Many different styles What’s new & next Seeks latest trend Journeys Today Journeys Future Hold Accelerate Validate 6 to 7 TIMES BIGGER TOTAL ADDRESSABLE MARKET (TAM)
Key Strategies Elevate Our Customer Experience Invest In Our Journeys Brand Diversify Our Footwear Leadership
Strengthen strategic partnership with lead brands Build athletic as third pillar of assortment with casual & canvas Sharp focus on the teen girl as a differentiator Drive ASP growth through outpaced premium product growth Establish incubation strategy for new brand and new model launches Evolve the assortment to become a leading footwear destination and create sustainable growth. Unique Consumer Positioning Elevate our product to lead across multi-categories
House of brands Singular focus on Anti-Hero Over reliance on tactical marketing Product only campaigns Minimal use of social media FROM Branded house Expanded segmentation More balanced, full funnel and brand approach Product AND brand Double down on social Reenergize the Journeys brand, making it the ultimate destination for discovery to reach and excite the next generation of fans TO Invest In The Journeys Brand Evolve the marketing strategy to engage teen consumer target
All serving our consumer segments and new consumers All delivering on our premium style led footwear destination 4.0 stores: Modular and flexible designs, enhanced visuals and storytelling, footwear focused, digital integration, connected with our heritage. Elevate Our Customer Experience Refresh our consumer touch points to fuel discovery 4.0 – Next generation store concept to support our strategy Store Website Social
FINANCIALS
Our retail business, comprised of Journeys and Schuh, represents approximately 80% of Genesco’s business where we sell a mix of mostly larger, premium, global brands with diversified sourcing. Our branded business, comprised of Johnston & Murphy and Genesco Brands Group, represents approximately 20% of Genesco’s business and we have been working diligently over the past several years to diversify countries of production and lower our China exposure. Along with our retail business, we estimated our exposure at the beginning of Fiscal 2026 to China tariffs to be a little more than 10% for Genesco overall Unmitigated cost increases within our branded business would be roughly $15M for this fiscal year reflecting the current higher tariffs and assuming no changes in sourcing We are taking the following actions to mitigate this cost pressure: Accelerating, increasing or cancelling inventory Further diversifying suppliers and re-sourcing to countries with lower tariffs Working with longstanding factory partners to reduce costs Identifying further cost reductions across our business Planning for strategic price increases targeted more toward the back half of the year Tariff Exposure Based on what we know today, we expect our mitigation actions will mostly offset the tariff impact for the year
2% J&M 3% GBG 6% Journeys Tariff Exposure – Continued diversification out of China expected throughout FY26 11% China1 1 We expect China exposure to be half this percentage or less by the end of FY26 Reciprocal Tariff Affected Countries (estimated at beginning of FY26) Genesco Estimated FY26 Revenue 81% Retail 19% Branded schuh Central & Latin America 6% Rest of World ~80% Impacted by Reciprocal Tariffs 52% Vietnam, India, Cambodia 11% China1 5% EU 5%
Q1 FY26 • Key Earnings Highlights Quarter 4(1) Feb 3, 2025 Quarter 4(1) Jan 28, 2024
Q1 FY26 Capital Allocation Snapshot TOTAL LIQUIDITY ~$230M Liquidity is comprised of cash and borrowing available under bank facilities INVENTORY $451M +15% vs Q1 FY2025 to meet Journeys growth CAPITAL EXPENDITURES $19M ~85% allocated to stores ~15% to other STORE COUNT 1,256 4 26 Opened Closed SHARE REPURCHASES $13M $30M remaining under current authorization JOURNEYS 4.0 29 remodels 39 total remodels to date 75+ by end of year
% of Retail Sales (2) 31% 25% 23% 23% 23% 25% 5% 12% FY26 • Strong Digital Growth (1) 52-week period for trailing twelve months ended May 3, 2025 and 53-week period for trailing twelve months ended May 4, 2024. (2) Retail sales represent combined store sales and e-commerce sales
Q1 FY26 Net Sales $474.0 Million Journeys Schuh Johnston & Murphy Group Genesco Brands Group Q1 FY26 Sales by Segment
Q1 & Proj 12 mos FY26 • Retail Store Summary
FY26 • Outlook (1) Reiterates FY26 EPS Outlook: Additional color on anticipated sales growth by business: Journeys: Low-single digit percentage increase schuh: Low-single digit percentage increase (vs. previous low-single digit decrease) Johnston & Murphy: Low-single digit percentage increase Genesco Brands Group: High-single digit percentage decrease (vs. previous low-single digit decrease)
APPENDIX
Q1 FY26 • Adjusted Operating Income Statement (1)
Q1 FY26 • Non-GAAP Reconciliation
Q1 FY26 • Adjusted Gross Margin
FY26 Q1 GENESCO Summary Results • June 4, 2025