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Strong holiday sales give Finish Line a boost

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Indianapolis-based The Finish Line Inc. is getting an early Christmas present: strong holiday shopping sales.

The athletic shoe and apparel retailer said on Tuesday that sales at stores open more than a year rose 4.5 percent from Nov. 28 through Dec. 19 compared to the same period a year ago. Same-store sales is a key indicator for retailers because it excludes results from stores that open or close during the year.

Finish Line Chief Financial Officer Ed Wilhelm told IBJ the company is “pleased” and “encouraged” by its performance so far in December, but he declined to speculate on overall holiday shopping sales.

Profit in the third quarter, which ended Nov. 27, exceeded analysts’ expectations, hitting $4.1 million, or 8 cents per share, compared with $6.6 million, or 12 cents per share, a year ago. A tax benefit boosted the prior year's earnings by $6.4 million; without it, earnings per share would have been nearly flat.

Still, the drop in profit reflected on the company’s stock price, which quickly fell 5 percent to $17.85 in Wednesday morning trading.  

Revenue in the quarter rose 9 percent to $260.9 million from $240.1 million a year ago.

Analysts polled by Thomson Reuters had expected 5 cents per share on revenue of $249.1 million.

Wilhelm attributed the rise in quarterly revenue to several factors, including a 25-percent increase in online sales, more foot traffic in stores and a rise in the overall dollar amount per transaction.

“We continue to sell more product at full retail [price] with fewer markdowns,” he said.

Running shoes continue to drive revenue, though sales of basketball shoes provided a boost.

The launch of Reebok’s ZigTech Slash shoe, endorsed by Washington Wizards rookie John Wall, and another shoe by Under Armour, supported by Milwaukee Bucks point guard Brandon Jennings, helped lift sales of an otherwise challenging category.

Same-store sales for the entire quarter jumped 10.1 percent compared with an increase of 1.7 percent the same time a year ago.

Finish Line also reported having $222 million in cash at the end of the quarter, up from $149.2 million the same period last year, and no interest-bearing debt.

The chain is working on a three-part strategy for spending its accumulated cash: reinvesting in the core Finish Line business, returning funds to shareholders through higher dividends and share repurchases, and diversifying its business either with a new retail concept developed in-house or through acquisitions.

Through three quarters of its fiscal year, Finish Line reported profit of $34.6 million, or 63 cents per share, compared with profit of $20 million, or 36 cents per share, including the tax benefit, in the year-ago period.

The retailer operates 669 stores in 47 states.

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  1. to mention the rest of Molly's experience- she served as Communications Director for the Indianapolis Department of Public Works and also did communications for the state. She's incredibly qualified for this role and has a real love for Indianapolis and Indiana. Best of luck to her!

  2. Shall we not demand the same scrutiny for law schools, med schools, heaven forbid, business schools, etc.? How many law school grads are servers? How many business start ups fail and how many business grads get low paying jobs because there are so few high paying positions available? Why does our legislature continue to demean public schools and give taxpayer dollars to charters and private schools, ($171 million last year), rather than investing in our community schools? We are on a course of disaster regarding our public school attitudes unless we change our thinking in a short time.

  3. I agree with the other reader's comment about the chunky tomato soup. I found myself wanting a breadstick to dip into it. It tasted more like a marinara sauce; I couldn't eat it as a soup. In general, I liked the place... but doubt that I'll frequent it once the novelty wears off.

  4. The Indiana toll road used to have some of the cleanest bathrooms you could find on the road. After the lease they went downhill quickly. While not the grossest you'll see, they hover a bit below average. Am not sure if this is indicative of the entire deal or merely a portion of it. But the goals of anyone taking over the lease will always be at odds. The fewer repairs they make, the more money they earn since they have a virtual monopoly on travel from Cleveland to Chicago. So they only comply to satisfy the rules. It's hard to hand public works over to private enterprise. The incentives are misaligned. In true competition, you'd have multiple roads, each build by different companies motivated to make theirs more attractive. Working to attract customers is very different than working to maximize profit on people who have no choice but to choose your road. Of course, we all know two roads would be even more ridiculous.

  5. The State is in a perfect position. The consortium overpaid for leasing the toll road. Good for the State. The money they paid is being used across the State to upgrade roads and bridges and employ people at at time most of the country is scrambling to fund basic repairs. Good for the State. Indiana taxpayers are no longer subsidizing the toll roads to the tune of millions a year as we had for the last 20 years because the legislature did not have the guts to raise tolls. Good for the State. If the consortium fails, they either find another operator, acceptable to the State, to buy them out or the road gets turned back over to the State and we keep the Billions. Good for the State. Pat Bauer is no longer the Majority or Minority Leader of the House. Good for the State. Anyway you look at this, the State received billions of dollars for an assett the taxpayers were subsidizing, the State does not have to pay to maintain the road for 70 years. I am having trouble seeing the downside.

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