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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowThe Finish Line narrowed its losses in its fiscal first quarter, the Indianapolis-based athletic shoe and clothing retailer reported today. But the results fell short of analyst expectations.
Finish Line lost $600,000 in the period ended May 30 compared to a
profit of $868,000 a year earlier. Analysts surveyed by Thomson
Financial anticipated Finish Line to turn a profit of 1 cent per share
rather than its 1-cent loss.
Revenue slipped 7.2 percent to $267.2 million.
Finish Line’s comparable-store sales decreased 3.9 percent, while same-store sales at its Man Alive chain plunged 39.1 percent. Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than newly opened ones.
“Our core Finish Line business has performed as expected against the backdrop of a challenging economy and a difficult comparison to the same quarter of last year,” CEO Glenn S. Lyon said in a prepared statement.
The results were announced after markets closed. Finish Line shares closed at $7.68, up 4.4 percent on a day of broad gains for stocks.
On Monday, Finish Line announced that it had ended an unsuccessful attempt to rebrand and revitalize its struggling Man Alive stores by agreeing to part with the 75-store clothing chain.
The company said it would pay $7 million to Man Alive Acquisition LLC, which is controlled by Brooklyn-based Jimmy Jazz, to take Man Alive assets and liabilities off its hands. The sale is expected to close in early July.
Finish Line paid $12 million to acquire Man Alive four years ago.
Jimmy Jazz, a retailer of urban clothing, has more than 80 stores on the East Coast.
In April, Finish Line converted four Man Alive stores, including one at Castleton Square Mall, into stores called Decibel. Decibel offers “street fashion” aimed at a broader audience than that of Man Alive. Finish Line spent about a year developing the Decibel concept.
It also converted stores in Dallas, suburban Pittsburgh and Tallahassee, Fla.
The test, which was scheduled to run at least six months, was aimed at making the chain profitable. The revamped stores received new fixtures and a fresh product mix anchored by brand-name jeans and rocker T-shirts designed to attract young men and women – a highly coveted demographic.
Finish Line will pay $5 million at closing and the remaining $2 million in 12 monthly installments.
Finish Line bought the locally based Hip Hop-themed Man Alive chain in 2005 and quickly tripled its store count. But same-store sales and margins have been falling.
Finish Line has 685 of its namesake stores in 47 states and online.
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