Genesco Inc. is feeling pressure from Wall Street. The Nashville-based company, which owns Journeys and the sells wholesale footwear for Johnston & Murphy, Trask and G.H. Bass, reported Thursday that its first quarter profit totaled $1 million, $0.06 earnings per share (EPS), down 92 percent from $12.95 million in the same period one year prior.
Nasdaq.com reported that Genesco’s stock has been declining for the past two weeks and has dipped to a new low for the year.
Revenues for Q1 was $643 million, compared to estimates of $644 million. Consolidated first quarter 2018 comparable sales, including same store sales and comparable e-commerce and catalog sales, decreased 1 percent, with a 5 percent decrease in the Journeys Group. Sales for the Johnston & Murphy group decreased 3 percent.
Genesco Chairman, President and CEO Robert Dennis said the company’s first quarter performance reflects a number of challenges which were expected, including weak store traffic in the U.S. and “significant fashion rotation at Journeys.” He added that the combination of a 1 percent comp decline, expense deleverage on lower sales, gross margin headwinds at Journeys and Lids, that were especially pronounced in the first quarter.
The company said it now expects adjusted diluted earnings per share for the year in the range of $3.90 to $4.05, compared to the previously issued guidance range of $4.40 to $4.55.
“While Journeys continues to make good progress adjusting its product offering to better reflect current consumer demand, we now believe Journeys’ comp recovery will take longer to materialize than previously expected due to a more significant slowdown in the declining part of its merchandise assortment,” Dennis stated. “In addition, we have adopted a more conservative outlook for store-based sales given the anemic level of mall traffic year-to-date and the more pronounced shift in consumer spending away from stores to online.”