NASHVILLE, Tenn., Sept. 3, 2020 /PRNewswire/ --

Second Quarter Fiscal 2021 Financial Summary

  • Net sales decreased 20% from last year to $391 million with stores open about 70% of days
  • Robust 144% e-commerce growth
  • Generated $74 million of operating cash flow

Genesco Inc. (NYSE: GCO) today reported a GAAP loss from continuing operations per diluted share of ($1.33) for the three months ended August 1, 2020, compared to earnings from continuing operations per diluted share of $0.05 in the second quarter last year.  Adjusted for the excluded items in both periods, the Company reported a second quarter loss from continuing operations per diluted share of ($1.23), compared to earnings from continuing operations per diluted share of $0.15 last year.

Mimi E. Vaughn, Genesco Board Chair, President and Chief Executive Officer, said, "The second quarter began with consumers enthusiastically returning to our physical locations as we began reopening stores and continuing to actively engage and shop with us online. The speed and executional excellence our teams demonstrated in getting our stores open and operational was a huge advantage as we often opened on the first day permitted by local authorities.  Despite our stores being open for about 70% of the days in the second quarter, total net revenue decreased only 20% as the drop in store volume was partially offset by a notable 144% increase in e-commerce sales as we pivoted to digital. Equally encouraging was our ability to reduce expenses and inventories in line with sales and to generate cash during the quarter.  Journeys generated a positive operating income for the quarter, but gross margin headwinds especially at Johnston & Murphy and Schuh led to a consolidated operating loss.

"Towards the end of the second quarter and to begin the third quarter, our business in North America was significantly impacted by the changes in back-to-school timing brought on by the pandemic. This includes schools in several areas of the country starting later than last year and many others not returning to in-person learning. As such we believe the back-to-school selling season will extend deeper into the third quarter which has limited visibility as we head into the back half. I am incredibly proud of how our teams have responded to the unprecedented challenges we've faced thus far in Fiscal 2021.  This, along with the strong strategic positioning of our businesses and current liquidity, gives me confidence that we will successfully weather this storm and emerge strong to take advantage of the many opportunities on the other side."

Store Re-Opening Update
Currently, the Company is operating in 96% of its locations, including approximately 1,130 Journeys, 160 Johnston & Murphy, and 125 Schuh locations. 

All store locations are operating under enhanced measures to ensure the health and safety of employees and customers.

Genesco will continue its phased approach to reopen stores when:

  • state and local governments have allowed stores to operate,
  • the Company believes it can operate safely under its enhanced health and safety measures, and
  • the Company believes that it can ensure the safety of its employees and customers.

Second Quarter Review
Net sales for the second quarter of Fiscal 2021 decreased 20% to $391 million from $487 million in the second quarter of Fiscal 2020.  This sales decrease was driven by store closures, a later start to back-to-school, lower store comps and lower wholesale sales, partially offset by digital comp growth of 144%.  As a result of the store closures and gradual reopening of stores in response to COVID-19, the Company has not included second quarter Fiscal 2021 comparable sales, except for comparable direct sales, as it believes that overall sales is a more meaningful metric during this period.

 

Comparable Sales




Comparable Same Store and Direct Sales:

2QFY21

2QFY20

Journeys Group

NA

4%

Schuh Group

NA

0%

Johnston & Murphy Group

NA

1%

Total Genesco Comparable Sales

NA

3%

   

Same Store Sales

NA

1%

Comparable Direct Sales

144%

20%

Overall sales were down 12% for Journeys, 22% at Schuh, and 64% at J&M while sales were up 62% at Licensed Brands due to the Togast acquisition.

Second quarter gross margin this year was 42.7%, down 590 basis points, compared with 48.6% last year. The decrease as a percentage of sales is due primarily to higher shipping and warehouse expense in all divisions driven by the increase in penetration of e-commerce, significant inventory reserves taken at Johnston & Murphy, and increased promotional activity at Schuh.

Adjusted selling and administrative expense for the second quarter this year increased 40 basis points as a percentage of net sales due to lower sales as a result of COVID-19. On a dollar basis, expenses decreased 19% compared to the same period last year driven by disciplined expense management, including: reduced selling salaries, occupancy, and compensation expense along with lower travel, advertising and bonus expenses.

Genesco's GAAP operating loss for the second quarter was $(22.0) million, or (5.6)% of sales this year compared with operating income of $3.0 million, or 0.6% of sales last year.  Adjusted for the excluded items in both periods, the operating loss for the second quarter was $(20.9) million this year compared with operating income of $4.7 million last year.  Adjusted operating margin was (5.3)% of sales in the second quarter of Fiscal 2021 and 1.0% last year.

The effective tax rate for the quarter was 20.3% in Fiscal 2021 compared to 70.7% last year.  The adjusted tax rate, reflecting excluded items, was 23.0% in Fiscal 2021 compared to 45.2% last year.  The lower adjusted tax rate for this year primarily reflects the inability to recognize a tax benefit for certain foreign losses.

The GAAP loss from continuing operations was $(18.9) million in the second quarter of Fiscal 2021, compared to earnings from continuing operations of $0.8 million in the second quarter last year.  Adjusted for the excluded items in both periods, the second quarter loss from continuing operations was $(17.4) million, or ($1.23) loss per share in Fiscal 2021, compared to earnings from continuing operations of $2.5 million, or $0.15 earnings per share last year.     

Cash, Borrowings and Inventory
Cash and cash equivalents at August 1, 2020, were $299.1 million, compared with $58.0 million at August 3, 2019.  Cash increased $60.6 million during the second quarter driven primarily by operating activities generating $74.4 million, partially offset by a use of cash in financing activities of $12.0 million, capital expenditures and other activities.  Total debt at the end of the second quarter of Fiscal 2021 was $210.9 million compared with $75.1 million at the end of last year's second quarter. Total unused availability as of August 1, 2020 was $63.4 million.  Inventories decreased 18% in the second quarter of Fiscal 2021 on a year-over-year basis.  

Capital Expenditures and Store Activity
For the second quarter, capital expenditures were $4 million, primarily related to digital and omni-channel initiatives and store projects already in progress.  Depreciation and amortization was $12 million.  During the quarter, the Company opened three new stores and closed six stores.  The Company ended the quarter with 1,476 stores compared with 1,494 stores at the end of the second quarter last year, or a decrease of 1%.  Square footage was down 1% on a year-over-year basis.

Share Repurchases
The Company did not repurchase any shares during the second quarter of Fiscal 2021. 

Fiscal 2021 Outlook
Due to the continued uncertainty in the overall economy driven by COVID-19, the Company is not providing guidance at this time.

Conference Call, Management Commentary and Investor Presentation
The Company has posted detailed financial commentary and a supplemental financial presentation of second quarter results on its website, www.genesco.com, in the investor relations section. The Company's live conference call on September 3, 2020, at 7:30 a.m. (Central time), may be accessed through the Company's website, www.genesco.com. To listen live, please go to the website at least 15 minutes early to register, download and install any necessary software.

Safe Harbor Statement
This release contains forward-looking statements, including those regarding the performance outlook for the Company and its individual businesses (including, without limitation, those regarding back-to-school and holiday selling seasons and its ability to keep stores open, operate the stores safely and ensure the safety of customers and employees) and all other statements not addressing solely historical facts or present conditions. Actual results could vary materially from the expectations reflected in these statements. A number of factors could cause differences.  These include adjustments to estimates and projections reflected in forward-looking statements, including as a result of the effects of COVID-19 on the Company's business including whether there are  periods of increases in the number of COVID-19 cases in locations in which the Company operates, further closures of stores due to COVID-19, weakness in store and shopping mall traffic, restrictions on operations imposed by government entities and landlords, changes in public safety and health requirements, the Company's ability to adequately staff stores, limitations on the Company's ability to provide adequate personal protective equipment to employees, and the Company's ability to maintain social distancing requirements; stores closures and effects on the business as a result of civil disturbances; the level and timing of promotional activity necessary to maintain inventories at appropriate levels; the imposition of tariffs on products imported by the Company or its vendors as well as the ability and costs to move production of products in response to tariffs; the Company's ability to obtain from suppliers products that are in-demand on a timely basis and effectively manage disruptions in product supply or distribution, including disruptions as a result of COVID-19; unfavorable trends in fuel costs, foreign exchange rates, foreign labor and material costs, and other factors affecting the cost of products; the effects of the British decision to exit the European Union and other sources of weakness in the U.K. market; the effectiveness of the Company's omnichannel initiatives; costs associated with changes in minimum wage and overtime requirements; wage pressure in the U.S. and the U.K.; weakness in the consumer economy and retail industry; competition and fashion trends in the Company's markets; risks related to the potential for terrorist events; risks related to public health and safety events, including for example, the COVID-19 coronavirus; changes in buying patterns by significant wholesale customers;  retained liabilities associated with divestitures of businesses including potential liabilities under leases as the prior tenant or as a guarantor of certain leases; and changes in the timing of holidays or in the onset of seasonal weather affecting period-to-period sales comparisons. Additional factors that could cause differences from expectations include the ability to renew leases in existing stores and control or lower occupancy costs, and to conduct required remodeling or refurbishment on schedule and at expected expense levels; the Company's ability to eliminate stranded costs associated with dispositions, including the sale of the Lids Sport Group business; the Company's ability to realize anticipated cost savings, including rent savings; deterioration in the performance of individual businesses or of the Company's market value relative to its book value, resulting in impairments of fixed assets, operating lease right of use assets or intangible assets or other adverse financial consequences and the timing and amount of such impairments or other consequences; unexpected changes to the market for the Company's shares or for the retail sector in general; costs and reputational harm as a result of disruptions in the Company's business or information technology systems either by security breaches and incidents or by potential problems associated with the implementation of new or upgraded systems; and the cost and outcome of litigation, investigations and environmental matters involving the Company. Additional factors are cited in the "Risk Factors," "Legal Proceedings" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of, and elsewhere in, the Company's SEC filings, copies of which may be obtained from the SEC website, www.sec.gov, or by contacting the investor relations department of Genesco via the Company's website, www.genesco.com. Many of the factors that will determine the outcome of the subject matter of this release are beyond Genesco's ability to control or predict. Genesco undertakes no obligation to release publicly the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Forward-looking statements reflect the expectations of the Company at the time they are made. The Company disclaims any obligation to update such statements.

About Genesco Inc.
Genesco Inc., a Nashville-based specialty retailer, sells footwear and accessories in more than 1,475 retail stores throughout the U.S., Canada, the United Kingdom and the Republic of Ireland, principally under the names Journeys, Journeys Kidz, Schuh, Schuh Kids, Little Burgundy, Johnston & Murphy, and on internet websites www.journeys.com, www.journeyskidz.com, www.journeys.ca, www.littleburgundyshoes.com, www.schuh.co.uk, www.johnstonmurphy.com, www.johnstonmurphy.ca,  and www.dockersshoes.com.  In addition, Genesco sells wholesale footwear under its Johnston & Murphy brand, the licensed Dockers brand, the licensed Levi's brand, the licensed Bass brand, and other brands. For more information on Genesco and its operating divisions, please visit www.genesco.com.

 

______________________

1 Excludes retail store asset impairment charges and a change in vacation policy, net of tax effect in the second quarter of Fiscal 2021 ("Excluded Items").  A reconciliation of earnings/loss and earnings/loss per share from continuing operations in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") with the adjusted earnings/loss and earnings/loss per share numbers is set forth on Schedule B to this press release. The Company believes that disclosure of earnings and earnings per share from continuing operations adjusted for the items not reflected in the previously announced expectations will be meaningful to investors, especially in light of the impact of such items on the results.

 

 














GENESCO INC.




Condensed Consolidated Statements of Operations




(in thousands, except per share data)




(Unaudited)




















Quarter 2


Quarter 2








Aug. 1,

% of


Aug. 3,

% of








2020

Net Sales


2019

Net Sales





Net sales



$  391,217

100.0%


$ 486,573

100.0%





Cost of sales


224,217

57.3%


250,040

51.4%





   Gross margin


167,000

42.7%


236,533

48.6%





Selling and administrative expenses

187,261

47.9%


231,796

47.6%





Asset impairments and other, net

1,733

0.4%


1,775

0.4%





   Operating income (loss)

(21,994)

-5.6%


2,962

0.6%





Other components of net periodic benefit cost

(182)

0.0%


(93)

0.0%





Interest expense, net


1,918

0.5%


347

0.1%





   Earnings (loss) from continuing operations before 










     income taxes


(23,730)

-6.1%


2,708

0.6%





Income tax expense (benefit)

(4,806)

-1.2%


1,915

0.4%





   Earnings (loss) from continuing operations

(18,924)

-4.8%


793

0.2%





Loss from discontinued operations, net of tax

(112)

0.0%


(216)

0.0%





   Net Earnings (Loss)


$   (19,036)

-4.9%


$        577

0.1%

















Basic earnings (loss) per share:










    Before discontinued operations

$       (1.33)



$       0.05






    Net earnings (loss)


$       (1.34)



$       0.04


















Diluted earnings (loss) per share:










    Before discontinued operations

$       (1.33)



$       0.05






    Net earnings (loss)


$       (1.34)



$       0.04


















Weighted-average shares outstanding:










    Basic



14,179



15,959






    Diluted



14,179



16,028




















 

 














GENESCO INC.




Condensed Consolidated Statements of Operations




(in thousands, except per share data)




(Unaudited)




















Six Months Ended


Six Months Ended








Aug. 1,

% of


Aug. 3,

% of








2020

Net Sales


2019

Net Sales





Net sales



$    670,449

100.0%


$    982,224

100.0%





Cost of sales


383,305

57.2%


500,783

51.0%





   Gross margin


287,144

42.8%


481,441

49.0%





Selling and administrative expenses

376,303

56.1%


468,351

47.7%





Goodwill impairment


79,259

11.8%


-

0.0%





Asset impairments and other, net

9,594

1.4%


1,044

0.1%





   Operating income (loss)

(178,012)

-26.6%


12,046

1.2%





Other components of net periodic benefit cost

(306)

0.0%


(179)

0.0%





Interest expense, net


2,774

0.4%


181

0.0%





   Earnings (loss) from continuing operations before 










     income taxes


(180,480)

-26.9%


12,044

1.2%





Income tax expense (benefit)

(26,932)

-4.0%


4,781

0.5%





   Earnings (loss) from continuing operations

(153,548)

-22.9%


7,263

0.7%





Loss from discontinued operations, net of tax

(265)

0.0%


(340)

0.0%





   Net Earnings (Loss)


$  (153,813)

-22.9%


$        6,923

0.7%

















Basic earnings (loss) per share:










    Before discontinued operations

$       (10.86)



$          0.43






    Net earnings (loss)


$       (10.87)



$          0.41


















Diluted earnings (loss) per share:










    Before discontinued operations

$       (10.86)



$          0.43






    Net earnings (loss)


$       (10.87)



$          0.41


















Weighted-average shares outstanding:










    Basic



14,145



16,802






    Diluted



14,145



16,939




















 

 














GENESCO INC.




Sales/Earnings Summary by Segment




(in thousands)




(Unaudited)




















Quarter 2


Quarter 2








Aug. 1,

% of


Aug. 3,

% of








2020

Net Sales


2019

Net Sales





Sales:












    Journeys Group


$  276,631

70.7%


$ 315,175

64.8%





    Schuh Group


71,732

18.3%


92,476

19.0%





    Johnston & Murphy Group

24,097

6.2%


67,267

13.8%





    Licensed Brands


18,757

4.8%


11,583

2.4%





    Corporate and Other


-

0.0%


72

0.0%





    Net Sales



$  391,217

100.0%


$ 486,573

100.0%





Operating Income (Loss):











    Journeys Group


$    10,160

3.7%


$   11,329

3.6%





    Schuh Group


(6,838)

-9.5%


39

0.0%





    Johnston & Murphy Group

(18,243)

-75.7%


1,518

2.3%





    Licensed Brands


(1,222)

-6.5%


(251)

-2.2%





    Corporate and Other(1)


(5,851)

-1.5%


(9,673)

-2.0%





Operating income (loss)

(21,994)

-5.6%


2,962

0.6%





Other components of net periodic benefit cost

(182)

0.0%


(93)

0.0%





Interest, net



1,918

0.5%


347

0.1%

















Earnings (loss) from continuing operations before                    









   income taxes


(23,730)

-6.1%


2,708

0.6%





Income tax expense (benefit)

(4,806)

-1.2%


1,915

0.4%





Earnings (loss) from continuing operations

(18,924)

-4.8%


793

0.2%





Loss from discontinued operations, net of tax

(112)

0.0%


(216)

0.0%





Net Earnings (Loss)


$   (19,036)

-4.9%


$        577

0.1%





























(1)Includes a $1.7 million charge in the second quarter of Fiscal 2021 for retail store asset impairments.  Includes a $1.7 million charge in




   the second quarter of Fiscal 2020 which includes $1.0 million for lease terminations and $0.7 million for retail store asset impairments. 






































 

 














GENESCO INC.




Sales/Earnings Summary by Segment




(in thousands)




(Unaudited)




















Six Months Ended


Six Months Ended








Aug. 1,

% of


Aug. 3,

% of








2020

Net Sales


2019

Net Sales





Sales:












    Journeys Group


$    445,556

66.5%


$    639,147

65.1%





    Schuh Group


118,897

17.7%


169,320

17.2%





    Johnston & Murphy Group

62,946

9.4%


142,001

14.5%





    Licensed Brands


43,050

6.4%


31,666

3.2%





    Corporate and Other


-

0.0%


90

0.0%





    Net Sales



$    670,449

100.0%


$    982,224

100.0%





Operating Income (Loss):











    Journeys Group 


$     (26,923)

-6.0%


$      30,305

4.7%





    Schuh Group


(21,924)

-18.4%


(5,389)

-3.2%





    Johnston & Murphy Group

(27,827)

-44.2%


6,624

4.7%





    Licensed Brands


(3,723)

-8.6%


178

0.6%





    Corporate and Other(1)


(18,356)

-2.7%


(19,672)

-2.0%





    Goodwill Impairment


(79,259)

-11.8%


-

0.0%





Operating income (loss)

(178,012)

-26.6%


12,046

1.2%





Other components of net periodic benefit cost

(306)

0.0%


(179)

0.0%





Interest, net



2,774

0.4%


181

0.0%

















Earnings (loss) from continuing operations before                    









   income taxes


(180,480)

-26.9%


12,044

1.2%





Income tax expense (benefit)

(26,932)

-4.0%


4,781

0.5%





Earnings (loss) from continuing operations

(153,548)

-22.9%


7,263

0.7%





Loss from discontinued operations, net of tax

(265)

0.0%


(340)

0.0%





Net Earnings (Loss)


$  (153,813)

-22.9%


$        6,923

0.7%

















(1)Includes a $9.6 million charge in the first six months of Fiscal 2021 which includes a $5.3 million charge for trademark impairment and a $4.7





   million charge for retail store asset impairments, partially offset by a $(0.4) million gain for the release of an earnout related to the Togast 





   acquisition. Includes a $1.0 million charge in the first six months of Fiscal 2020 for retail store asset impairments. 








































 

 













GENESCO INC.





Condensed Consolidated Balance Sheets





(in thousands)





(Unaudited)




























Aug. 1, 2020


Aug. 3, 2019





Assets










Cash and cash equivalents



$           299,144


$           57,965





Accounts receivable



54,793


26,626





Inventories



365,267


444,706





Other current assets



58,454


45,040





   Total current assets



777,658


574,337





Property and equipment



220,458


261,924





Operating lease right of use assets


670,323


754,537





Goodwill and other intangibles



67,939


116,685





Other non-current assets



33,650


48,044





   Total Assets



$        1,770,028


$      1,755,527















Liabilities and Equity










Accounts payable



$           178,541


$         157,822





Current portion long-term debt



24,860


14,896





Current portion operating lease liabilities


199,392


141,233





Other current liabilities



88,047


87,511





   Total current liabilities



490,840


401,462





Long-term debt



186,049


60,244





Long-term operating lease liabilities


593,723


671,047





Other long-term liabilities



38,552


38,153





Equity



460,864


584,621





   Total Liabilities and Equity



$        1,770,028


$      1,755,527























 

 















GENESCO INC.



Store Count Activity






























Balance




Balance





Balance




02/02/19

Open

Close


02/01/20


Open

Close


08/01/20



Journeys Group

1,193

8

30


1,171


3

5


1,169



Schuh Group

136

1

8


129


1

3


127



Johnston & Murphy Group

183

3

6


180


2

2


180



Total Retail Units

1,512

12

44


1,480


6

10


1,476









































 











GENESCO INC.



Store Count Activity






















Balance




Balance





05/02/20

Open

Close


08/01/20




Journeys Group

1,171

2

4


1,169




Schuh Group

127

1

1


127




Johnston & Murphy Group

181

0

1


180




Total Retail Units

1,479

3

6


1,476





















 

 















GENESCO INC.



Comparable Sales



















Quarter 2



Six Months






Aug. 1,


Aug. 3,



Aug. 1,


Aug. 3,






2020(1)


2019



2020(1)


2019



Journeys Group



NA


4%



NA


5%



Schuh Group



NA


0%



NA


1%



Johnston & Murphy Group



NA


1%



NA


0%



  Total Comparable Sales



NA


3%



NA


4%
















Same Store Sales



NA


1%



NA


3%



Comparable Direct Sales



144%


20%



105%


17%
















(1) As a result of store closures in response to the COVID-19 pandemic, the Company has not included second quarter or




   year to date Fiscal 2021 comparable sales, except for comparable direct sales, as it believes that overall net sales is a




   more meaningful metric during this period.
























 

 













GENESCO INC.





COVID-19 Related Adjustments





(in thousands)





(Unaudited)


















Quarter 2


Six Months








Aug. 1, 2020


Aug. 1, 2020















Goodwill impairment



$                -


$       79,259





Incremental retail store asset impairment(1)


1,002


3,736





Trademark impairment(1)



-


5,260





Release of Togast earnout(1)



-


(441)





Excess inventory(2)



2,469


4,277





Non-productive compensation(3) and (4)


1,443


4,688





UK property tax relief(3)



(3,934)


(5,489)





Incremental bad debt reserve(3)



643


3,065





Other(3) and (5)



1,092


894















Total COVID-19 related adjustments


$         2,715


$       95,249















(1)Included in asset impairments and other, net on the Condensed Consolidated Statements of





   Operations.










(2)Included in cost of sales on the Condensed Consolidated Statements of Operations.





(3)Included in selling and administrative expenses on the Condensed Consolidated Statements of





   Operations.










(4)Certain compensation paid to furloughed workers and commission based associates, net of the 





     CARES Act, UK and Canadian government relief.









(5)Includes primarily severance and increased cleaning and personal protective equipment expenses in 




   the second quarter and first six months of Fiscal 2021 and is partially offset by the reversal of 





   percentage rent for the first six months of Fiscal 2021.



























 

 

Schedule B















Genesco Inc.



Adjustments to Reported Earnings (Loss) from Continuing Operations



Three Months Ended August 1, 2020 and August 3, 2019















The Company believes that disclosure of earnings (loss) and earnings (loss) per share from continuing operations and operating income (loss) adjusted for the items 



not reflected in the previously announced expectations will be meaningful to investors, especially in light of the impact of such items on the results.



















 Quarter 2 






 August 1, 2020 


 August 3, 2019 







 Net of 

 Per Share 



 Net of 

 Per Share 




In Thousands (except per share amounts)


 Pretax 

 Tax 

 Amounts 


 Pretax 

 Tax 

 Amounts 




Earnings (loss) from continuing operations, as reported



$      (18,924)

($1.33)



$          793

$0.05
















Asset impairments and other adjustments:












  Retail store asset impairment charges


$          1,733

1,313

0.09


$         731

451

0.03




  Loss on lease terminations


-

-

0.00


1,044

717

0.04




  Change in vacation policy


(616)

(463)

(0.03)


-

-

0.00




  Gain on Hurricane Maria


-

-

0.00


-

2

0.00




  Total asset impairments and other adjustments


$          1,117

850

0.06


$       1,775

1,170

0.07
















Income tax expense adjustments:












  Tax impact share based awards



1,129

0.08



(54)

0.00




  Other tax items



(471)

(0.04)



547

0.03




  Total income tax expense adjustments



658

0.04



493

0.03
















Adjusted earnings (loss) from continuing operations(1)and(2)


$      (17,416)

($1.23)



$       2,456

$0.15




























(1)The adjusted tax rate for the second quarter of Fiscal 2021 and 2020 is 23.0% and 45.2%, respectively.




















(2)EPS reflects 14.2 million and 16.0 million share count for the second quarter of Fiscal 2021 and 2020, respectively, which excludes common stock equivalents 


    in the second quarter of Fiscal 2021 due to the loss from continuing operations and includes common stock equivalents in the second quarter of Fiscal 2020.














 

 









Genesco Inc.



Adjustments to Reported Operating Income (Loss)



Three Months Ended August 1, 2020 and August 3, 2019












 Quarter 2 - August 1, 2020 





 Operating 

 Asset Impair 

Adj Operating



In Thousands 


 Income (Loss) 

& Other Adj

 Income (Loss) 



Journeys Group


$        10,160

$          (263)

$            9,897



Schuh Group


(6,838)

-

(6,838)



Johnston & Murphy Group


(18,243)

(96)

(18,339)



Licensed Brands


(1,222)

(39)

(1,261)



Corporate and Other


(5,851)

1,515

(4,336)



Total Operating Loss


$       (21,994)

$        1,117

$         (20,877)



  % of sales


-5.6%


-5.3%












 Quarter 2 - August 3, 2019 





 Operating 

 Asset Impair 

Adj Operating



In Thousands 


 Income (Loss) 

& Other Adj

 Income (Loss) 



Journeys Group


$        11,329

$             -

$          11,329



Schuh Group


39

-

39



Johnston & Murphy Group


1,518

-

1,518



Licensed Brands


(251)

-

(251)



Corporate and Other


(9,673)

1,775

(7,898)



Total Operating Income 


$          2,962

$        1,775

$            4,737



  % of sales


0.6%


1.0%
















 

 










Schedule B














Genesco Inc.



Adjustments to Reported Earnings (Loss) from Continuing Operations



Six Months Ended August 1, 2020 and August 3, 2019















The Company believes that disclosure of earnings (loss) and earnings (loss) per share from continuing operations and operating income (loss) adjusted for the items 



not reflected in the previously announced expectations will be meaningful to investors, especially in light of the impact of such items on the results.



















 Six Months 






 August 1, 2020 


 August 3, 2019 







 Net of 

 Per Share 



 Net of 

 Per Share 




In Thousands (except per share amounts)


 Pretax 

 Tax 

 Amounts 


 Pretax 

 Tax 

 Amounts 




Earnings (loss) from continuing operations, as reported



$    (153,548)

($10.86)



$       7,263

$0.43
















Asset impairments and other adjustments:












  Retail store asset impairment charges


$          4,775

3,541

0.25


$       1,038

663

0.04




  Trademark impairment


5,260

5,153

0.36


-

-

0.00




  Goodwill impairment


79,259

79,259

5.60


-

-

0.00




  Loss on lease terminations


-

-

0.00


44

28

0.00




  Release Togast earnout


(441)

(323)

(0.02)


-

-

0.00




  Change in vacation policy


(1,232)

(914)

(0.06)


-

-

0.00




  Gain on Hurricane Maria


-

-

0.00


(38)

(24)

0.00




  Total asset impairments and other adjustments


$        87,621

86,716

6.13


$       1,044

667

0.04
















Income tax expense adjustments:












  Tax impact share based awards



1,129

0.08



(54)

0.00




  Other tax items



(3,161)

(0.22)



489

0.02




  Total income tax expense adjustments



(2,032)

(0.14)



435

0.02
















Adjusted earnings (loss) from continuing operations(1)and(2)


$      (68,864)

($4.87)



$       8,365

$0.49




























(1)The adjusted tax rate for the first six months of Fiscal 2021 and 2020 is 25.8% and 36.1%, respectively.




















(2)EPS reflects 14.1 million and 16.9 million share count for the first six months of Fiscal 2021 and 2020, respectively, which excludes common stock equivalents 


    in the first six months of Fiscal 2021 due to the loss from continuing operations and includes common stock equivalents in the first six months of Fiscal 2020.













 

 










Genesco Inc.




Adjustments to Reported Operating Income (Loss)




Six Months Ended August 1, 2020 and August 3, 2019














 Six Months - August 1, 2020 






 Operating 

 Asset Impair 

Adj Operating




In Thousands 


 Income (Loss) 

& Other Adj

 Income (Loss) 




Journeys Group


$       (26,923)

$          (526)

$         (27,449)




Schuh Group


(21,924)

-

(21,924)




Johnston & Murphy Group


(27,827)

(192)

(28,019)




Licensed Brands


(3,723)

(78)

(3,801)




Corporate and Other


(97,615)

88,417

(9,198)




Total Operating Loss


$     (178,012)

$       87,621

$         (90,391)




  % of sales


-26.6%


-13.5%














 Six Months - August 3, 2019 






 Operating 

 Asset Impair 

Adj Operating




In Thousands 


 Income (Loss) 

& Other Adj

 Income (Loss) 




Journeys Group


$        30,305

$             -

$          30,305




Schuh Group


(5,389)

-

(5,389)




Johnston & Murphy Group


6,624

-

6,624




Licensed Brands


178

-

178




Corporate and Other


(19,672)

1,044

(18,628)




Total Operating Income 


$        12,046

$        1,044

$          13,090




  % of sales


1.2%


1.3%



















 

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