FINANCE

Michaels’ profit jumps 54%

BY Marianne Wilson

Irving, Texas — Michaels Stores Inc.’s second-quarter profit soared 53.8% amid higher sales and lower interest expenses.

The retailer reported a profit of $20 million for the quarter ended Aug. 3, compared with $13 million a year earlier.
Sales inched up 1.3% to $904 million. Same-store sales fell 1.3%, due to a 3.6% decrease in transactions and a 0.4% decrease in deferred custom framing revenue, which was partially offset by a 2.7% increase in the company’s average ticket.

Michaels operates 1,241 locations, including 1,119 Michaels stores and 122 Aaron Brothers stores.

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FINANCE

Guess Q2 income tops estimates

BY Marianne Wilson

Los Angeles — Guess Inc. reported net income for the second quarter above expectations due to improving sales in North America.

Net income fell 7% to $39.8 million, down from $42.9 million a year ago.

Overall sales rose 0.6% to $639 million. In North America, which accounts for about 40% of the chain’s revenue, retail sales were up 1%.

Same-store sales fell 2%, compared to a 10% drop in the first quarter.

“We are very encouraged by the improvements in the trends of our North American Retail business in the second quarter, reflecting the enhancements in our product assortments,” said CEO Paul Marciano. “However, the economic climate in Southern Europe continues to be challenging and we are beginning to see a slowdown in China. Therefore, although we are encouraged by our overall results in the first half of fiscal 2014, the outlook for consumer spending in Southern Europe and China remains uncertain and we are planning our business accordingly.”

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FINANCE

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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