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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 21, 2003
(August 21, 2003)
GENESCO INC.
(Exact name of registrant as specified in its charter)
| Tennessee (State of Incorporation) |
1-3083 (Commission File No.) |
62-0211340 (IRS Employer I.D. No.) |
| 1415 Murfreesboro Road Nashville, Tennessee (Address of Principal Executive Office) |
37217-2895 (Zip code) |
Registrant’s telephone number, including area code: (615) 367-7000
| SIGNATURES | ||||||||
| EXHIBIT INDEX | ||||||||
| EX-99.1 PRESS RELEASE | ||||||||
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Item 7. Financial Statements and Exhibits.
c) Exhibits
| Exhibit | ||
| No. | Description of Exhibit | |
| 99.1 | Genesco Inc.’s press release dated August 21, 2003 containing financial results for the quarter ended August 2, 2003 (furnished pursuant to filing guidance contained in SEC Release 33-8176). |
Item 12. Regulation FD Disclosure.
On August 21, 2003, Genesco Inc. issued a press release regarding its results of operations for the quarter ended August 2, 2003 and its financial condition as of that date. Included in the press release is a calculation of earnings excluding loss on early retirement and other expenses associated with the Company’s issuance of Convertible Subordinated Debentures and its redemption of Convertible Subordinated Notes during the quarter. The Company believes this calculation is useful to investors because it allows them to consider the Company’s performance for the period on a basis they may consider more comparable to the same period last year, which did not reflect similar items. A copy of the press release is furnished herewith as Exhibit 99.1 and is not deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934 or incorporated by reference in the Company’s filings under the Securities Act of 1933.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| GENESCO INC. | ||
| Date: August 21, 2003 |
By: /s/ Roger G. Sisson Name: Roger G. Sisson Title: Secretary and General Counsel |
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EXHIBIT INDEX
| Exhibit | ||
| No. | Description of Exhibit | |
| 99.1 | Genesco Inc.’s press release dated August 21, 2003 containing financial results for the quarter ended August 2, 2003 (furnished pursuant to filing guidance contained in SEC Release 33-8176). |
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EXHIBIT 99.1 FINANCIAL CONTACT: JAMES S. GULMI (615) 367-8325 MEDIA CONTACT: CLAIRE S. MCCALL (615) 367-8283 GENESCO REPORTS SECOND QUARTER SALES AND EARNINGS NASHVILLE, Tenn., Aug. 21, 2003 - Genesco Inc. (NYSE: GCO) today reported a net loss of $891,000, or ($0.04) per share, for the second quarter ended August 2, 2003, compared with net earnings of $4.0 million, or $0.17 per diluted share, for the second quarter last year. These results, which were better than expectations, include a net loss of $0.08 per diluted share related to the redemption of $103 million of Convertible Subordinated Notes during the quarter. Excluding the refinancing-related expenses, the Company reported earnings per diluted share of $0.03 (see Table 3). Net sales for the quarter were $179 million compared to $175 million for the second quarter of fiscal 2003. The notes were called for redemption on June 24, 2003, upon completion of the sale by the Company of $86 million of Convertible Subordinated Debentures due 2023. The Company previously announced that the incremental net interest expense while both issues were outstanding during the 30-day call period for the Notes, and the loss on early retirement of the Notes (consisting of unamortized deferred note expense and redemption premium) would reduce diluted earnings per share for the quarter by $0.08. Genesco President and Chief Executive Officer Hal N. Pennington, said, "Our better than expected results for the quarter were primarily driven by stronger comps at Journeys and a continued robust performance at Underground Station. Both of these chains had a solid start on back-to-school, and their positive momentum late in the quarter has continued into August. Journeys' same store sales declined 1% for the quarter, which was better than the 3% decline we had expected. Underground Station posted a 9% same store sales increase, on top of 19% in the second quarter last year. We believe that both these businesses are well positioned for the second half. -more- "Although Johnston & Murphy faces continuing short-term challenges, we saw in the second quarter some encouraging indications that the turnaround there is working. Same store sales in Johnston & Murphy retail increased 2% for the quarter. "Both the Jarman retail stores and Dockers Footwear performed below expectations. Jarman's same store sales declined 14%, reflecting its inability to participate in the women's and fashion athletic trends that are leading both Journeys' and Underground Station's strong early season performance. Dockers' performance continues to reflect conditions in its market segment as well as lower than expected sell-throughs in one of its product lines. Primarily because of these businesses and the continuing challenges at Johnston & Murphy, we believe it is prudent to adopt a more conservative outlook for the second half of the year." The Company now expects third quarter sales to range from $222 million to $226 million and earnings per share to range from $0.40 to $0.43. For the fourth quarter, the Company expects sales to range from $265 million to $269 million and earnings per share to range from $0.83 to $0.89. For fiscal 2004, it expects sales to range from $859 million to $867 million and earnings per share to range from $1.42 to $1.50, excluding the loss on early retirement of debt associated with the second quarter refinancing, or from $1.34 to $1.42 per share, including the loss on early retirement. The Company's earnings per share expectations for both quarters and for the year reflect changes in the number of shares deemed to be outstanding due to the issuance of the Convertible Subordinated Debentures. Pennington concluded, "We move into the second half of the year with a strong balance sheet and positive momentum at Journeys and Underground Station, and while we still have work to do at Johnston & Murphy, we believe our strategies are sound and we continue to see progress. At the same time, we are responding to the current challenges we are facing in our Jarman stores and at Dockers and we are committed to improving those businesses. We remain focused on long-term growth and profitability in all of these divisions." This release contains forward-looking statements, including those regarding the Company's sales and earnings outlook and all other statements not addressing solely historical facts or present conditions. Actual results could turn out materially different from the expectations reflected in these statements. A number of factors could cause differences. These include weakness in consumer demand for products sold by the Company, fashion trends that affect the sales or product margins of the Company's retail product offerings, changes in buying patterns by significant wholesale customers, disruptions in product supply or distribution, further unfavorable trends in foreign exchange rates and other factors affecting the cost of products, changes in business strategies by the Company's competitors, the Company's ability to open, staff and support additional retail stores on schedule and at acceptable expense levels and to renew leases in existing stores on schedule and at acceptable expense levels, variations from expected pension-related charges caused by conditions in the financial markets, and the outcome of litigation and environmental matters involving the Company. Forward-looking statements reflect the expectations of the Company at the time they are made. The Company disclaims any obligation to update such statements. The Company's live conference call on August 21, 2003, at 10:00 a.m. (Central time) may be accessed through the Company's internet website, www.genesco.com. The Company expects to discuss results from the second quarter, and its current expectations for the third quarter and fiscal year ending January 31, 2004, during the call. To listen live, please go to the website at least 15 minutes early to register, download and install any necessary software. Genesco, based in Nashville, sells footwear and accessories in more than 1,000 retail stores in the U.S., principally under the names Journeys, Journeys Kidz, Johnston & Murphy, Jarman and Underground Station, and on internet websites www.journeys.com and www.johnstonmurphy.com. The Company also sells footwear at wholesale under its Johnston & Murphy brand and under the licensed Dockers brand. Additional information on Genesco and its operating divisions may be accessed at its website www.genesco.com. TABLE 1 GENESCO INC. CONSOLIDATED EARNINGS SUMMARY EARNINGS PER SHARE INFORMATION
Three Months Ended Six Months Ended ----------------------------- ----------------------------- AUGUST 2, August 3, AUGUST 2, August 3, In Thousands 2003 2002 2003 2002 ------------ ------------ ------------ ------------ Net sales $ 179,478 $ 174,842 $ 372,224 $ 365,435 Cost of sales 95,989 91,991 200,643 192,436 Selling and administrative expenses 80,271 74,666 160,924 149,892 Restructuring adjustment (gain) (139) -- (139) -- ------------ ------------ ------------ ------------ Earnings from operations before interest and other 3,357 8,185 10,796 23,107 Loss on early retirement of debt 2,581 -- 2,581 -- Interest expense, net* 2,149 1,922 4,181 3,594 ------------ ------------ ------------ ------------ PRETAX EARNINGS (LOSS) (1,373) 6,263 4,034 19,513 Income tax expense (benefit) (482) 2,300 1,588 7,348 ------------ ------------ ------------ ------------ NET EARNINGS (LOSS) $ (891) $ 3,963 $ 2,446 $ 12,165 ============ ============ ============ ============ * Includes $0.2 million additional net interest expense due to early retirement of debt.
Three Months Ended Six Months Ended ----------------------------- ---------------------------- AUGUST 2, August 3, AUGUST 2, August 3, In Thousands (except per share amounts) 2003 2002 2003 2002 ------------ ------------ ------------ ------------ Preferred dividend requirements $ 73 $ 74 $ 147 $ 148 Average common shares - Basic EPS 21,754 21,914 21,748 21,895 Basic net earnings (loss) per share $ (0.04) $ 0.18 $ 0.11 $ 0.55 Average common and common equivalent shares - Diluted EPS 21,754 22,416 22,041 27,318 Diluted net earnings (loss) per share $ (0.04) $ 0.17 $ 0.10 $ 0.51 GENESCO INC. CONSOLIDATED EARNINGS SUMMARY * Includes a $0.1 million restructuring adjustment in the second quarter and six months of Fiscal 2004 and $0.5 million of professional fees and severance charges in the second quarter and six months of Fiscal 2003.
Three Months Ended Six Months Ended ----------------------------- ----------------------------- AUGUST 2, August 3, AUGUST 2, August 3, In Thousands 2003 2002 2003 2002 ------------ ------------ ------------ ------------ Sales: Journeys $ 97,474 $ 91,681 $ 196,189 $ 183,155 Underground Station/Jarman Group 30,722 30,183 65,295 63,382 Johnston & Murphy 39,392 39,541 79,608 81,906 Dockers 11,821 13,437 31,010 36,992 Corporate and Other 69 -- 122 -- ------------ ------------ ------------ ------------ NET SALES $ 179,478 $ 174,842 $ 372,224 $ 365,435 ============ ============ ============ ============ Pretax Earnings (Loss): Journeys $ 6,711 $ 7,497 $ 12,274 $ 15,700 Underground Station/Jarman Group 231 1,153 1,791 3,803 Johnston & Murphy 174 1,365 1,974 5,472 Dockers (263) 1,325 2,290 4,112 Corporate and Other* (3,496) (3,155) (7,533) (5,980) ------------ ------------ ------------ ------------ Operating income 3,357 8,185 10,796 23,107 Loss on early retirement of debt 2,581 -- 2,581 -- Interest, net 2,149 1,922 4,181 3,594 ------------ ------------ ------------ ------------ TOTAL PRETAX EARNINGS (LOSS) (1,373) 6,263 4,034 19,513 Income tax expense (benefit) (482) 2,300 1,588 7,348 ------------ ------------ ------------ ------------ NET EARNINGS (LOSS) $ (891) $ 3,963 $ 2,446 $ 12,165 ============ ============ ============ ============ GENESCO INC. CONSOLIDATED BALANCE SHEET * Non-current assets of discontinued operations include Volunteer Leather.
AUGUST 2, August 3, In Thousands 2003 2002 ------------ ------------ ASSETS Cash and short-term investments $ 32,968 $ 32,214 Accounts receivable 14,579 16,785 Inventories 213,440 202,062 Other current assets 24,910 26,670 ------------ ------------ Total current assets 285,897 277,731 ------------ ------------ Plant, equipment and capital leases 125,865 128,617 Other non-current assets 24,507 13,314 Non-current assets of discontinued operations* -- 1,085 ------------ ------------ TOTAL ASSETS $ 436,269 $ 420,747 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable $ 80,074 $ 82,305 Other current liabilities 36,750 35,899 ------------ ------------ Total current liabilities 116,824 118,204 ------------ ------------ Long-term debt 86,275 103,271 Other long-term liabilities 47,317 24,565 Shareholders' equity 185,853 174,707 ------------ ------------ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 436,269 $ 420,747 ============ ============ TABLE 2 GENESCO INC. RETAIL UNITS OPERATED - SIX MONTHS ENDED AUGUST 2, 2003 RETAIL UNITS OPERATED - THREE MONTHS ENDED AUGUST 2, 2003
BALANCE BALANCE 02/01/03 OPEN CONVERSIONS CLOSE 08/02/03 ------------ ------------ ------------ ------------ ------------ Journeys 614 28 0 1 641 Journeys 579 25 0 1 603 Journeys Kidz 35 3 0 0 38 Underground Station/Jarman Group 229 10 0 4 235 Underground Station 114 10 3 2 125 Jarman Retail 115 0 (3) 2 110 Johnston & Murphy 148 4 0 0 152 Shops 115 2 0 0 117 Factory Outlets 33 2 0 0 35 ------------ ------------ ------------ ------------ ------------ Total Retail Units 991 42 0 5 1,028 ============ ============ ============ ============ ============ CONSTANT STORE SALES
BALANCE BALANCE 05/03/03 OPEN CONVERSIONS CLOSE 08/02/03 ------------ ------------ ------------ ------------ ------------ Journeys 631 10 0 0 641 Journeys 594 9 0 0 603 Journeys Kidz 37 1 0 0 38 Underground Station/Jarman Group 236 2 0 3 235 Underground Station 122 2 3 2 125 Jarman Retail 114 0 (3) 1 110 Johnston & Murphy 150 2 0 0 152 Shops 116 1 0 0 117 Factory Outlets 34 1 0 0 35 ------------ ------------ ------------ ------------ ------------ Total Retail Units 1,017 14 0 3 1,028 ============ ============ ============ ============ ============
Three Months Ended Six Months Ended ---------------------------- ---------------------------- AUGUST 2, August 3, AUGUST 2, August 3, 2003 2002 2003 2002 ------------ ------------ ------------ ------------ Journeys -1% -3% -2% -3% Underground Station/Jarman Group -3% 20% -2% 19% Underground Station 9% 19% 8% 17% Jarman Retail -14% 20% -12% 20% Johnston & Murphy 2% -2% -3% 0% Shops 1% -1% -3% -1% Factory Outlets 8% -4% 0% 2% ------------ ------------ ------------ ------------ Total Constant Store Sales -1% 1% -2% 2% ============ ============ ============ ============ TABLE 3 GENESCO INC. RECONCILIATION OF ACTUAL EPS TO EPS EXCLUDING REDEMPTION RELATED EXPENSES SECOND QUARTER ENDED AUGUST 2, 2003 (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) * Shares include options of 320 that were excluded from the loss per share calculation.
Earnings Shares EPS ------------- ----------- ----------- Net loss as reported $ (891) Dividends (73) ------------- Loss available to common shareholders $ (964) ------------- Shares as reported 21,754 Diluted EPS as reported $ (0.04) Adjustments: (net of tax) Loss on early retirement of debt $ 1,600 $ 0.07 Additional net interest during 30-day call period 128 $ 0.01 ------------- ----------- Total adjustments, net of tax $ 1,728 $ 0.08 ------------- ----------- Adjusted earnings available to common shareholders $ 764 ============= Adjusted shares for earnings* 22,074 Adjusted diluted EPS $ 0.03 ===========