Foot Locker slides into the red in the second quarter

The US retail group Foot Locker Inc. presented disappointing figures for the second quarter of the 2023/24 financial year and once again lowered its forecasts. The unexpectedly weak results and prospects immediately weighed on the share prices of numerous companies in the sporting goods industry.

For the second quarter ended July 29, Foot Locker generated revenue of 1.86 million dollars (1.72 billion dollars). Revenue slipped by 9.9 percent compared to the same period last year. Adjusted for currency effects also fell by 10.2 percent. The company justified the losses, among other things, with the weak consumer sentiment and reforms at the Champs Sport chain.

The share price collapses by more than 34 percent

As a result of the negative sales development, operating profit shrank to one million dollars from 142 million dollars in the same period last year. The bottom line was a net loss attributable to shareholders of five million dollars, down from a surplus of 94 million dollars in the second quarter of last year.

The group then announced that it would suspend its dividend payments for the time being and lowered its forecasts for the full fiscal year. For 2023/24, the management is now expecting a drop in sales of 8.0 to 9.0 percent after previously expecting a minus of 6.5 to 8.0 percent. The target for adjusted earnings per share was lowered to 1.30-1.50 dollars from 2.00-2.25 dollars. Faced with this disappointing outlook, the company's share price immediately plummeted more than 34 percent.