Foot Locker Inc. (NYSE: FL) released its fourth-quarter financial results before the markets opened on Friday. Although the company reported a beat on the bottom line, this wasn’t enough to offset revenues and declining comparable sales. As a result, investors voted with their shares and sent the stock lower in early trading on Friday.
The footwear retailer posted $1.26 in earnings per share (EPS) and $2.21 billion in revenues, compared with consensus estimates from Thomson Reuters of $1.25 in EPS on revenue of $2.22 billion. The same period of last year reportedly had EPS of $1.37 and $2.11 billion in revenue.
During the fourth quarter, comparable-store sales decreased 3.7%.
In terms of guidance for the 2018 full year, the company currently expects a flat to up by low single-digit comparable-store sales performance and gross margins to begin recovering from 2017’s 31.6% rate. The consensus estimates are $4.51 in EPS on $7.79 billion in revenue for the year.
On the books, Foot Locker’s cash and cash equivalents totaled $849 million at the end of the quarter, down from $1.05 billion in the same period of last year.
Richard Johnson, board chair and chief executive, commented:
The dramatic shifts influencing the expectations and behaviors of our customers continued to affect our business in the fourth quarter, just as they have throughout 2017. That said, we remained a highly profitable company in 2017, even though our sales and profit results were not what we planned for going into the year. Looking ahead, with the product and other strategic initiatives we have underway, we believe we are positioned well, both organizationally and financially, to successfully transform our business to continue inspiring and serving an exceptionally dynamic youth culture, for generations to come.
Shares of Foot Locker traded down more than 13% early Friday at $39.79, with a consensus analyst price target of $54.95 and a 52-week range of $28.42 to $77.86.
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