• Home
  • News
  • Business
  • Foot Locker, a foot ahead market expectations

Foot Locker, a foot ahead market expectations

By Angela Gonzalez-Rodriguez

9 Mar 2015

Business |ANALYSIS

The footwear and athletic clothing chain has stomped into 2015 steadily: net profit soared to 520 million dollars in the last financial year (+ 21.2 percent annually).

President and CEO of Foot Locker, Richard Johnson, stressed that the company remains focused on executing its key strategies and stressed that increased investment and its staff have enabled it to achieve success records in financial and operational terms.

"In fact, we have either surpassed or have closely approached many of the long-term goals we recently established," said Johnson, adding that in the future, the company will continue to focus on its strategic priorities and on taking advantage of any opportunity that arise to meet its objectives.

Richard Johnson emerges stronger after his first quarter as CEO

This strategy seems to be working for the company, which has recorded a turnover that reached a record high of 7.151 million dollars over its last fiscal year - ended on January 31- that’s a 9.9 percent more than the 6.505 million dollars it gained a year ago. On a comparable basis, sales were up 8 percent, highlights Europa Press.

Moreover, in the last quarter, net profit of Foot Locker was 146 million, 20.7 percent more than the same period last year; while sales rose 6.7 percent, up to 1,911 million.

Following the news, shares of Foot Locker added up to 5 percent in the futures market on Wall Street. Analysts covering the stock point out that the market has not only rewarded figures that have exceeded the most enthusiastic market forecasts, but also the retailer’s robust business figures.

During these three months, which marked the first full quarter with Richard Johnson as CEO, earnings per share were 1.00 dollar, comfortably beating the forecast of 91 cents consensus estimate.

In short, Foot Locker Inc reported better-than-expected sales in comparable stores – those open at least over a year - prompting the stock to increase annual earnings by 20 percent, according to Barron's.

The popularity of basketball shoes, its exclusivity agreement with Nike to protect their competitive designs and new software to help manage the goods, especially in Europe, are the reasons argued by Barron’s to predict the stock could continue to grow in the short run.

The retailer plans to present a new financial plan and objectives for the coming months on March 16. On Friday, shares closed at 59.37.

Last month, the company based in New York announced a billion dollar share buyback plan and dividend increase of 14 percent. It also approved an investment program of 220 million dollars for 2015, as it continues to invest in its core initiatives.

Gross margin for the quarter rose to 33.2 percent.

Foot Locker