Foot Locker to up investments in 2021, raises dividend

Foot Locker has said it plans to invest 275 million dollars in 2021 as it looks to post-Covid growth.

The New York-based footwear retailer said Thursday its board of directors had approved plans for the capital expenditure programme, which is around 77 percent larger than its 2020 programme.

The company said the larger investment this year “signals a return to a pre-Covid level of investment necessary to achieve its long-term strategic imperatives”.

A large portion of the funds will be invested in Foot Locker’s digital capabilities and infrastructure, the enhancement of its digital customer experience, as well as initiatives to further streamline its global supply chain.

The plan also includes investments to accelerate the company’s community-based off-mall store rollout in markets across the world, and “to elevate the customer experience in core stores”.

Foot Locker also declared a quarterly cash dividend on the company’s common stock of 0.20 dollars per share, a 33 percent increase from the prior 0.15 dollars per share.

“These actions demonstrate our Board of Directors’ confidence in resuming higher levels of investment into the business as we continue to build our strategic omni-channel position at the center of youth culture, while also returning more cash to shareholders through a significant dividend increase,” said Foot Locker’s CEO and chairman, Richard Johnson, in a statement.

“The strength of our financial position enables us to pursue these initiatives, while at the same time remaining engaged in our opportunistic share repurchase program and focused on canvassing the global marketplace for new growth prospects. Of course, given the lingering unknowns of the ongoing pandemic, we will retain flexibility and discipline with respect to our capital deployment.”

Photo: courtesy of Foot Locker