Genesco(US:GCO)2025-06-12 13:43Financial Performance - Net sales increased by 3.6% to $474.0 million in Q1 Fiscal 2026 compared to $457.6 million in Q1 Fiscal 2025, driven by a 5% increase in comparable sales[47] - Gross margin rose by 2.3% to $221.2 million, but as a percentage of net sales, it decreased from 47.3% to 46.7%[48] - Selling and administrative expenses increased by 0.5% to $249.0 million, but decreased as a percentage of net sales from 54.2% to 52.5%[49] - Operating margin improved to (5.9)% in Q1 Fiscal 2026 from (7.0)% in Q1 Fiscal 2025, reflecting decreased expenses as a percentage of net sales[50] - The pretax loss narrowed to $29.7 million in Q1 Fiscal 2026 from $33.1 million in Q1 Fiscal 2025[51] - Net loss for Q1 Fiscal 2026 was $21.2 million, or $2.02 diluted loss per share, compared to a net loss of $24.3 million, or $2.23 diluted loss per share, in Q1 Fiscal 2025[53] Segment Performance - Journeys Group net sales increased by 5.1% to $272.6 million, with an 8% increase in comparable sales[59] - Schuh Group net sales rose by 3.9% to $95.9 million, benefiting from a 1% increase in comparable sales[64] - Johnston & Murphy Group net sales decreased by 3.0% to $76.8 million, primarily due to a 2% decrease in comparable sales[66] - Genesco Brands Group's net sales increased by 7.5% to $28.6 million in Q1 Fiscal 2026, driven primarily by increased sales of Levi's footwear[68] Tax and Expenses - The effective income tax rate increased to 28.5% in Q1 Fiscal 2026 from 26.7% in Q1 Fiscal 2025[52] - Johnston & Murphy Group's operating margin decreased by 230 basis points to reflect increased selling and administrative expenses as a percentage of net sales in Q1 Fiscal 2026 compared to Q1 Fiscal 2025[67] - Genesco Brands Group's operating margin improved by 610 basis points to 2.4% in Q1 Fiscal 2026, attributed to decreased selling and administrative expenses and improved gross margin[69] - Corporate and other expenses decreased to $7.9 million in Q1 Fiscal 2026 from $8.8 million in Q1 Fiscal 2025, reflecting lower professional fees and performance-based compensation[70] Cash Flow and Capital Expenditures - Cash used in operating activities increased by $67.3 million in Q1 Fiscal 2026 compared to Q1 Fiscal 2025, totaling $101.0 million[73] - Cash used in investing activities rose by $12.5 million in Q1 Fiscal 2026, reflecting increased capital expenditures related to retail store investments[74] - Cash provided by financing activities increased by $83.1 million in Q1 Fiscal 2026, driven by higher net borrowings[75] - Total capital expenditures for Fiscal 2026 are expected to be approximately $50-$65 million, with 70% allocated for new stores and renovations[82] Share Repurchase - Genesco repurchased 604,531 shares of common stock at a cost of $12.6 million during Q1 Fiscal 2026, with $29.8 million remaining under the share repurchase authorization[83] Interest Expense - Net interest expense rose by 50.4% to $1.3 million in Q1 Fiscal 2026, primarily due to increased average borrowings[71]