An employee organizes a shoe show at a Foot Locker Inc. store. at the South Park Mall in Strongsville, Ohio.
Luke Sharrett | Bloomberg | Getty Images
Shares of Foot Locker rose more than 10% in early trading on Friday after the company shattered second-quarter fiscal earnings estimates and showed optimism about the middle of the year.
Consumers continued to spend on athletic shoes and training clothes during the Covid pandemic, with these segments surpassing others such as dress shirts and high heels. Now, parents are budgeting their salaries to buy new Nike and Adidas sneakers for their kids as they prepare to return to school.
Foot Locker reported net income for the quarter ended July 31 of $ 430 million, or $ 4.09 per share, compared to $ 45 million, or 43 cents per share, a year earlier. Excluding earnings once, the company earned $ 2.21 per share. Analysts surveyed by Refinitiv have been looking for adjusted earnings per share of $ 1.01.
Revenues increased 9.5% to $ 2.28 billion from $ 2.08 billion the year before. That exceeded expectations by $ 2.09 billion.
Comparable sales of Foot Locker increased by 6.9%. Analysts surveyed by StreetAccount have seen a 0.2% drop.
Executive director Richard Johnson said the company has seen strong demand in the women’s and children’s footwear business, in addition to its clothing and accessories segments. Foot Locker has also kept promotions in check, fueling profits, he said.
Andrew Page, Chief Financial Officer, Andrew Page said the retailer remains “cautiously optimistic” about its prospects for the second half of the year.
“Recognizing that we are still operating in an uncertain environment due to Covid-19, we continue to keep a close eye on business, including temporary store closures and supply chain challenges,” he said in the statement. printing.
Earlier this month, Foot Locker announced plans to buy two smaller shoe store chains for about $ 1.1 billion in cash to expand its reach outside of malls and into Asia.
Foot Locker shares are up about 35% year to date. The company’s market capitalization is $ 5.63 billion.