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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowShares of The Finish Line Inc. tumbled by about 20 percent in trading Friday morning, after the Indianapolis-based company lowered its earning outlook.
For fiscal 2015, the company now anticipates adjusted earnings to be about the same as fiscal 2014's adjusted earnings of $1.67 per share. Its prior guidance was for earnings per share to rise in the high single to low double-digit range over fiscal 2014's results.
The company blamed margin pressure and vowed to cut spending to maintain profitability.
Finish Line saw both profit and same-store sales grow in its fiscal third quarter, but one-time costs took a toll. For the quarter ended Nov. 29, the Indianapolis-based athletic apparel retailer reported a profit of $2.6 million, an increase of 11 percent from the same quarter of 2013.
Company shares were down more than 20 percent, to $22.90 each, in recent trading.
On a per-share basis, Finish Line earnings of 5 cents were flat compared with the year-ago period. Adjusted for impairment charges, store-closing costs, employee-resignation costs and a one-time tax benefit, the company lost 2 cents per share. The results fell short of the 1-cent profit analysts were expecting.
Same-store sales, a key figure that considers stores open at least a year, rose 4.5 percent.
“Third quarter comparable sales rebounded from second quarter trends, however, merchandise margin pressure kept us from achieving our profitability plan,” Finish Line CEO Glenn Lyon said in a prepared statement.
Revenue grew 8.6 percent, to $395.8 million in the quarter, topping analyst predictions of $387.6 million.
Inventory increased 10.6 percent, to $398.6 million.
Finish Line operates 1,040 stores in malls and Macy’s department stores and 66 Running Specialty shops.
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