World Footwear


Foot Locker remains a highly profitable company

Apr 11, 2018 United States
Foot Locker remains a highly profitable company
Richard Johnson, Chairman of the Board and CEO of the New York-based specialty athletic retailer commented the financial results for Foot Locker's fourth quarter and full year
“The dramatic shifts influencing the expectations and behaviors of our customers continued to affect our business in the fourth quarter, just as they have throughout 2017”, stated Richard Johnson, Chairman of the Board and Chief Executive Officer, adding: “That said, we remained a highly profitable company in 2017, even though our sales and profit results were not what we planned for going into the year. Looking ahead, with the product and other strategic initiatives we have underway, we believe we are positioned well, both organizationally and financially, to successfully transform our business to continue inspiring and serving an exceptionally dynamic youth culture, for generations to come.”

Fourth quarter

Foot Locker reported a net loss of 49 million US dollars, or 0.40 US dollars per share, for the 14 weeks ended on the 3rd of February compared to net income of 189 million US dollars, or 1.42 US dollars per share in the same period of fiscal 2016. With the benefit of the extra week, total fourth quarter sales increased by 4.6%, to 2 210 million US dollars this year, compared to sales of 2 113 million US dollars in the prior-year fourth quarter. Excluding the effect of foreign exchange rate fluctuations, total sales for the quarter increased by 2.0%. Fourth quarter comparable-store sales decreased 3.7%.

Fiscal year

Foot Locker sales in 2017 totaled 7 782 million US dollars, an increase of 0.2% compared to sales of 7 766 million US dollars in fiscal 2016 and the most in the company’s history as an athletic business. Full-year comparable-store sales decreased by 3.1%. Excluding the effect of foreign currency fluctuations, total sales decreased by 0.5%. Foot Locker net income decreased to 284 million US dollars in 2017, or 2.22 US dollars per share, compared to net income of 664 million US dollars, or 4.91 US dollars per share in 2016.

2018 Outlook

Foot Locker currently expects a flat to up low single-digit comparable-store sales performance for fiscal 2018: “The first quarter of 2018 will likely see the continuation of sales and margins in line with trends in the second half of 2017”, commented Lauren Peters, Executive Vice President and Chief Financial Officer, concluding: “However, we are confident that we will inflect back to positive comparable - store sales by the middle of 2018, with the pace of sales continuing to gradually strengthen in the second half of the year based on the improving depth and variety of premium products we see coming from our key vendors. We also expect a double-digit percentage increase in annual earnings per share, with an effective tax rate in the 27% to 28% range and a lower share count both contributing to this performance.

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