2023-05-25 09:33:54 ET
Genesco ( NYSE: GCO ) shares were jolted over 20% downward on Thursday after reporting deepening losses in Q1 and cutting full-year forecasts
For the first quarter, an adjusted $1.59 per share loss came in wider than the $1.10 expectation on the Street. Meanwhile, a 7.2% drop in revenue year over year to $483.33M narrowly edged out the $478M analyst consensus. Comparable sales were down 5% in the quarter as well.
“Following a positive end to the holiday season, the first quarter proved considerably more challenging than we anticipated. Consumer demand at Journeys dropped off significantly early in the quarter and did not improve as we changed seasons in the latter part of March and into April, offsetting another quarter of record sales at Schuh and Johnston & Murphy,” CEO Mimi E. Vaughn commented. “In response, we are taking swift actions to mitigate the consumer shift in the marketplace, including closing more underperforming Journeys stores, reducing our cost base further, and working to quickly refine our product assortment. However, given the ongoing uncertainty around near-term consumer behavior, we are taking a much more conservative view and revising our outlook for the remainder of Fiscal 2024.”
The new outlook projects sales to be down 4% to 5% and sets a forecast for earnings per share from continuing operations in the range of $2.00 to $2.50. The new outlook diverges significantly from the guidance offered in March, which slated sales to be flat to up 2% and projected between $5.10 and $5.90 in earnings per share.
Analysts had projected about a 1% rise in sales $2.41B in revenue for fiscal 2024. Further, even the high end of the new guidance for EPS suggests less than half the $5.39 Street consensus.
Genesco ( GCO ) stock slumped 22.34% shortly after Thursday's market open.
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Genesco stock plunges over 20% on widening losses, slashed guidance