Genesco (GCO) has reported 3.29 percent rise in profit for the quarter ended Nov. 01, 2014. The company has earned $28.66 million, or $1.21 a share in the quarter, compared with $27.75 million, or $1.18 a share for the same period last year.
Revenue during the quarter grew 8.49 percent to $722.92 million from $666.33 million in the previous year period. Gross margin for the quarter contracted 26 basis points over the previous year period to 49.59 percent. Total expenses were 93.56 percent of quarterly revenues, up from 92.95 percent for the same period last year. That has resulted in a contraction of 61 basis points in operating margin to 6.44 percent.
Operating income for the quarter was $46.56 million, compared with $46.98 million in the previous year period.
Robert J. Dennis, chairman, president and chief executive officer of Genesco, said, “Based on our third quarter performance and expectations for additional margin pressure in the Lids Sports Group in the fourth quarter, we are revising our full year outlook. We now expect adjusted diluted earnings per share to be in the range of $4.75 to $4.85."
Working capital decreases marginally
Genesco has witnessed a decline in the working capital over the last year. It stood at $446.33 million as at Nov. 01, 2014, down 2.88 percent or $13.24 million from $459.57 million on Nov. 02, 2013. Current ratio was at 1.92 as on Nov. 01, 2014, down from 2.12 on Nov. 02, 2013.
Cash conversion cycle (CCC) has decreased to 38 days for the quarter from 118 days for the last year period. Days sales outstanding were almost stable at 8 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 92 days for the quarter compared with 180 days for the previous year period. At the same time, days payable outstanding went down to 62 days for the quarter from 69 for the same period last year.
Debt moves up Genesco has witnessed an increase in total debt over the last one year. It stood at $115.04 million as on Nov. 01, 2014, up 17.43 percent or $17.08 million from $97.96 million on Nov. 02, 2013. Total debt was 6.89 percent of total assets as on Nov. 01, 2014, compared with 6.34 percent on Nov. 02, 2013. Debt to equity ratio was almost stable at 0.12 as on Nov. 01, 2014, when compared with the last year. Interest coverage ratio decreased to 5.86 for the quarter from 39.48 for the same period last year.
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