* Q4 adj EPS 36 cents tops Wall Street view by 2 cents
* Q4 sales down 4.9 pct to $364.1 mln
* Shares up 11 pct
(Adds CEO comments, stock move, byline; changes headline)
By Martinne Geller
NEW YORK, March 27 Finish Line Inc (FINL.O)
reported a better-than-expected quarterly profit before special
items on Friday, helped by lighter inventories and cost cuts,
sending the retailer's shares up 11 percent.
The seller of athletic shoes and clothing also said sales
for most of March were better than expected, fueling hope that
consumer spending may be on the way to a rebound.
"We are cautiously optimistic about the trends that we have
been seeing since the beginning of February," Chief Executive
Glenn Lyon said on a conference call, saying the 3.7 percent
decline in March sales so far was ahead of the company's plan.
"Some industry experts are speculating that consumers are
starting to adjust to the economic downturn," he said. "That
said, the consumer remains fickle from month to month, and we
can't predict when this economy will turn positive."
On a net basis, the company's loss narrowed to $1.4
million, or 3 cents per share, in the fourth quarter ended Feb.
28, from $39.2 million, or 83 cents per share, a year earlier,
when costs from a failed merger with Genesco Inc (GCO.N) hurt
Excluding such one-time items as $32.6 million in
impairment charges, Finish Line earned 36 cents per share. That
topped the analysts' average expectation of 34 cents, according
to Reuters Estimates.
Net sales fell 4.9 percent to $364.1 million as same-store
sales, a key measure of retail performance, dropped 3.9
Consolidated merchandise inventories per square foot were 8
percent lower at the end of the quarter compared with a year
ago. Indianapolis-based Finish Line has been paring back
inventory and cutting costs to offset a slump in consumer
spending that has hurt mall-based chain stores.
Lyon said he expects mall traffic to be down at a
mid-single-digit percentage rate this year.
The company operates 689 Finish Line stores in the United
States that sells such footwear as Nike (NKE.N) and Adidas
ADSG.DE as well as clothing and accessories. It also has a
smaller chain called Man Alive, which sells hip-hop-inspired
fashion, that has been struggling for some time.
Lyon said the company plans to close unprofitable Man Alive
stores as leases expire, and change three of them to a new
concept it calls Decibel, aimed at a wider audience.
Earlier this week, Finish Line named Ed Wilhelm as chief
financial officer. He was previously CFO at bookseller Borders
Group Inc BGP.N.
Finish Line shares were up 71 cents at $7.07 on the New
York Stock Exchange.