Genesco expects comparable store sales to decline by 1 to 4 percent in the fourth quarter. For the third quarter ended Nov. 1, sales grew by 4.6 percent to $389.8 million at Genesco, compared with the same quarter last year, with sales from continuing operations up by 2 percent. Without adjusting for various merger-related items and other expenses, earnings from continuing operations jumped by 69.6 percent to $9.5 million for the quarter. However, when $6.2 million in merger-related and restructuring expenses from the third quarter last year are figured in, Genesco’s operating earnings fell by 5.0 percent. Overall, the company had a slight uptick in the gross profit margin at 50.8 percent compared with 50.5 percent last year.
Sales at the Journeys Group of stores increased by 9.9 percent to $200.7 million during the quarter, helped by the addition of five new stores, with same-store sales increases of 5 percent for the group and 4 percent for Journeys stores, recovering from a decline suffered a year ago. In terms of volume, comparable store sales were up by 2 percent at Journeys and average prices grew by 4 percent. The division got a boost from sales of skate shoes and women’s boots. Its operating margin was flat at 8.4 percent.
At Journeys Kidz, which opened nine stores in the period, average unit prices grew by 8 percent with sales by unit up by 1 percent. Shi by Journeys had a comparable store sales increase of 6 percent, but higher sales of athletic shoes and higher-priced products led to an average price that jumped by 29 percent. The company plans to open two more Shi stores by the end of the year, but will hold off on more in the future until the division shows meaningful improvement. Sales at Journeys Direct, which comprises catalog and internet, were up by 33 percent.
Underground Station had a 1 percent climb in comparable store sales, though total sales fell by 9.4 percent to $24.3 million. The number of pairs sold was up by 10 percent on a same-store basis.
Johnston & Murphy did not fare as well, with wholesale revenues down by 2 percent and same-store sales dropping by 16 percent. Sales for the quarter were $41.8 million, a drop of 10.0 percent. Genesco’s licensed brands division had sales that were up by 3.1 percent to $29.6 million, with an 11 percent growth for Dockers Footwear.
At the end of the quarter, Genesco had 1,008 Journeys Group stores, up from 993 at the end of the second quarter; 184 Underground Station Group stores, one less than as of Aug.2; and 157 Johnston & Murphy stores, two more than from the previous quarter.