Shares in The Finish Line Inc. jumped more than 10 percent Friday morning after the company's first-quarter performance exceeded analyst expectations.
The Indianapolis-based athletic apparel retailer announced Friday that profit in its fiscal first quarter fell 25 percent compared with the same period a year ago due to lower sales margins and higher expenses.
For the quarter ended June 2, Finish Line reported earnings of $12.3 million, or 24 cents a share, compared with $16.4 million, or 30 cents a share, in the same period a year earlier.
The chain reported revenue of $319 million, a 6.5-percent increase from the same period last year. Analysts expected the company to earn 23 cents a share on sales of $320.7 million, according to Thomson Reuters.
Same-store sales rose 8 percent, the 11th consecutive quarter the company reported a gain in the key metric. Online sales jumped 28.1 percent.
Finish Line shares rose nearly 12 percent, or $2.23 each, to close at $20.91, their highest close since May 30.
Last quarter, Finish Line said it expected first-quarter earnings per share to drop due to lower margins from promotional sales, and investments to update in-store technology and add a social media operation.
Total selling, general and administrative expenses rose to $85 million from $77 million in the year-ago period.
“While we are still in the early stages of a multi-year transformation, I have great confidence in this organization’s ability to successfully deliver on our near-term promises while at the same time remain on a strategic course towards $2 billion in total [annual] company sales and $2.50 in earnings per share by fiscal 2016,” Finish Line CEO Glenn Lyon said in a prepared statement.
The company said it expects fiscal 2013 earnings per share to rise 6 percent to 7 percent, up from its previous guidance of mid-single-digit growth.
Finish Line operated 640 stores as of June 2, down from 657 at the same time a year ago.
Shares of Finish Line opened trading Friday morning at $16.42 each, down from a 52-week high of $26.16 reached in late March.