Genesco Inc GCO
Q4 2012 Earnings Call Transcript

Transcript Call Date 03/08/2013

Operator: Good day, everyone and welcome to the Genesco Fourth Quarter Fiscal Year 2013 Conference Call. Just a reminder, today's call is being recorded.

Participants on the call expect to make forward-looking statements. These statements reflect the participants' expectations as of today, but actual results could be different. Genesco refers you to this morning's earning release and to the Company's SEC filings including the most recent 10-Q filings for some of the factors that could cause differences from the expectations reflected in the forward-looking statements made during the call today.

Participants also expect to refer to certain adjusted financial measures during the call. All non-GAAP financial measures referred to in the prepared remarks are reconciled to their GAAP counterparts in the attachments to this morning's press release and in schedules available on the Company's home page under Investor Relations.

I will now turn the conference over to Mr. Bob Dennis, Genesco's Chairman, President, and Chief Executive Officer. Please go ahead, sir.

Robert J. Dennis - Chairman, President and CEO: Good morning, and thank you for being with us. Joining me today is Jim Gulmi, our Chief Financial Officer. As usual, Jim's detailed review of the results has been posted to our website along with the press release from earlier this morning.

I'll begin today's call with remarks about our full year and fourth quarter results, our start to fiscal 2014 and our outlook for the year. Then I will turn the call over to Jim for a review of the numbers and guidance. I will then return to provide some color on our operating segments before we open up the call to your questions.

As you saw from our press release this morning our fiscal 2013 performance was solid with adjusted earnings per share up 24% to $5.06. This was achieved by a top line gain of 14% and meaningful expense leverage. As a reminder, we are now reporting a combined comparable sales number that includes stores and e-commerce, and that is the number we will be citing throughout our remarks today. For a more detailed breakdown of our comp performance please see Jim's online review.

For fiscal 2013, comps were up 3%. From a strategic standpoint we are very pleased with where the Company is heading. During fiscal 2013 we executed well on the growth drivers we identified at this point last year. First, we accelerated Schuh's store opening schedule to take advantage of the business' momentum over the past year and the attractive real estate opportunities afforded by the weak economic environment in the U.K. Schuh's freestanding store count at year end was 79 up 23% over last year including the third quarter addition of three Schuh Kids stores.

Schuh's success comes despite challenging market conditions in the U.K. and gives us confidence that accelerating Schuh's store growth now will position us for additional gains when the economy eventually recovers. Second, we continued expanding our Lids Locker Room and Clubhouse concepts through acquisitions and organic growth. We added 12 net new Locker Room stores to a base of 78 in fiscal 2013 and 13 net new Clubhouse stores to a base of 41. We continue to believe the economics of this business benefit from scale and we see continuing potential to grow these concepts by both acquiring and opening stores.

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