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UPDATE: Finish Line stock slumps after reporting loss

June 29, 2007
Shares of The Finish Line Inc. fell 6 percent, to $9.03, this morning after the company announced that it lost $3.9 million in its first fiscal quarter ended June 2.

The loss of 8 cents per share is less than the 9 to 11 cents the Indianapolis company expected. Finish Line reported a $4.4 million profit a year earlier.

Finish Line, which announced June 18 that it would buy Genesco Inc., the Nashville, Tenn., parent of Indianapolis-based Hat World, also said same-store sales slumped 3.9 percent, an improvement from the 7.2-percent decline it experienced in the same period last year.

Sales were virtually stagnant at $288.3 million, but profit was dragged down by higher expenses.

Analysts are wondering how the conservatively managed company, which plans to borrow nearly the entire $1.5 billion purchase price, will fund the deal.

In a conference call this morning, one analyst asked how he could expect to follow Finish Line if the company didn't disclose whether its financiers had limited its borrowing capacity.

A company official said the information would be forthcoming.
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