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Genesco Q2 estimate disappoints; slashes full-year profit outlook

BY Marianne Wilson

Nashville, Tenn. — Footwear retailer Genesco estimated second-quarter results below analysts’ forecast. The company also slashed its adjusted profit outlook for the current year.

“We are disappointed that our second quarter performance fell short of expectations,” said Robert J. Dennis, chairman, president and CEO of Genesco. “Sales trends proved to be more challenging as the quarter progressed and results came in below our plan. The third quarter has gotten off to a difficult start with comparable sales down 3% through Aug. 24.

Genesco said it expects net income to rise to $12.1 million, from $10.6 million a year earlier.

The company said sales increased 5.7% to $574.7 million in the quarter, missing market estimates of $596.2 million.

Same-store sales fell 2%. By division, same-store sales fell 3% at The Lids Sports Group’s, 1% at the Journeys Group, 7% at Schuh Group and 7% at Johnston & Murphy Retail.

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Signet Q2 profit drops with Mother’s Day shift

BY Marianne Wilson

Hamilton, Bermuda — Signet Jewelers Ltd.’s net income fell to $67.4 million for the quarter ended Aug. 3, down from $70.7 million a year earlier, impacted by the Mother’s Day calendar shift.

Total sales increased 3.1% to $880.2 million, fueled by strong sales at the company’s Kay Jewelers and Jared stores in the United States. Sales were soft at its British chains.

Same-store sales were up 3.6%. At Kay, same-store sales rose 5.8%.

Signet CEO Mike Barnes commented: “We delivered solid second quarter results as expected, driven by same-store sales increases of 3.6% overall and 4.9% in the U.S. led by Kay up 5.8% and Jared up 5.5%. All results were, as previously explained, impacted by the Mother’s Day calendar shift.”

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Q2 comp-store sales dip at Michaels

BY CSA STAFF

IRVING, Texas — Same-store sales at Michaels Stores decreased 1.3% for the second quarter ended August 3. The dip was due, in part, to a 3.6% decrease in transactions and a 0.4% decrease in deferred custom framing revenue, partially offset by a 2.7% increase in the company’s average ticket.

The company experienced its strongest sales performance during the quarter in home accents and yarn.

Net sales increased 1.3% to $904 million from $892 million during the prior-year quarter. Gross profit for the quarter decreased 0.6% to $337 million from $339 million during the prior-year quarter. Gross profit decreased approximately 70 basis points to 37.3% as a percent of net sales; however, merchandise margin improved by 80 basis points.

Net income for the quarter increased 53.8% to $20 million and as a percent of net sales increased 90 basis points to 2.3%.

During the quarter, the company opened six Michaels stores and relocated four. In addition, Aaron Brothers relocated one store and closed one. The company operated 45 net new Michaels stores at the end of the second quarter compared to the same period last year. The company now operates 1,241 stores, including 1,119 Michaels stores and 122 Aaron Brothers stores.

The specialty retailer of arts, crafts, framing, floral, wall décor and seasonal merchandise for the hobbyist and do-it-yourself home decorator produces 11 exclusive private brands, including Recollections, Studio Decor, Bead Landing, Creatology, Ashland, Celebrate It, Art Minds, Artist’s Loft, Craft Smart, Loops & Threads and Imagin8.

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