Genesco (GCO), a Nashville-based specialty retailer, has recorded a 43.72 percent plunge in profit for the quarter ended Aug. 02, 2014. The company earned $4.69 million or $0.20 a share in the second-quarter compared with $8.34 million or $0.35 a share a year ago.
Adjusted earnings per share came in at $0.34, when analysts expected $0.55.
Revenue during the second-quarter grew 7.09 percent to $615.47 million from $574.75 million in the last year period.
Gross margin contracted by 18 basis points over the previous year period to 49.03 percent. Total expenses as a percentage of revenues increased to 98.36 percent from 97.30 percent in the same period last year. That has resulted in contraction of 106 basis points in operating margins to 1.64 percent.
The company disclosed operating income of $10.08 million, compared with operating income of $15.53 million in the last year period.
Robert J. Dennis, chairman, president and chief executive officer of Genesco, said, "We are disappointed with our second quarter earnings performance.The third quarter is off to a solid start, with consolidated comparable sales for the Company up 4% through August 23, 2014."
Cash Flow
As on Aug. 02, 2014, the company's cash balance stood at $59.30 million, up 28.84 percent or $13.28 million from Aug. 03, 2013.
Working Capital
Genesco has witnessed an increase in the working capital over the last one year. The company's working capital stood at $439.20 million as at Aug. 02, 2014, up $14.75 million or 3.47 percent from $424.45 million on Aug. 03, 2013. It registered a decrease in current ratio to 2.00 as at Aug. 02, 2014 from 2.10 on Aug. 03, 2013.
Debt Position
Genesco has witnessed an increase in the total debt over the last one year. As on Aug. 02, 2014, total debt stood at $76.37 million, up 4.43 percent or $3.24 million, from Aug. 03, 2013. The company total debt was 4.83 percent of total assets as on Aug. 02, 2014, compared with 5.02 percent on Aug. 03, 2013.
Interest coverage ratio, which determines how easily a company can pay interest expenses on outstanding debt, has declined to 12.90 from 13.62 in the same period last year.
Shares of the company declined $6.73 or 7.59 percent to settle at $81.94 on Thursday.
