Foot Locker-FL Q4 Earnings Beat Estimates, Comparable Sales Rise 2.6% Y/Y

Core Insights - Foot Locker, Inc. reported fourth-quarter fiscal 2024 results with revenues falling short of estimates while earnings exceeded expectations, indicating a mixed performance [1][4] - The company achieved positive comparable sales and gross margin improvements, driven by strategic initiatives in fiscal 2024 [2] Financial Performance - Adjusted earnings per share were 86 cents, surpassing the Zacks Consensus Estimate of 73 cents and increasing from 38 cents in the prior-year quarter [4] - Total revenues were $2,248 million, a decrease of 5.7% year-over-year, missing the Zacks Consensus Estimate of$ 2,328 million [5] - Comparable sales rose by 2.6% year-over-year, with global Foot Locker and Kids Foot Locker sales growing by 3.6% [5] Margin Analysis - Gross profit was $663 million, up 4.6% year-over-year, with a gross margin rate increase of 300 basis points to 29.6% [6] - Selling, general and administrative (SG&A) costs as a percentage of sales decreased by 10 basis points to 22.3%, aided by cost optimization and disciplined management [7] Store Operations - In the fourth quarter, the company opened 7 new stores and closed 47, while remodeling or relocating 21 stores and refreshing 160 locations [8] - As of February 1, 2025, Foot Locker operated 2,410 stores across 26 countries, with 224 franchised stores in the Middle East, Europe, and Asia [9] Financial Snapshot - The company ended the fiscal fourth quarter with cash and cash equivalents of$ 401 million, long-term debt of $441 million, and shareholders' equity totaling$ 2.91 billion [11] - Merchandise inventories were $1.53 billion, reflecting a 1.1% increase from the previous year [11] Future Outlook - For fiscal 2025, revenues are expected to decline by 1% to grow by 0.5%, with comparable sales projected to increase by 1% to 2.5% [13] - Gross margin is forecasted between 29.3% and 29.7%, while SG&A rate is expected to be between 24.3% and 24.5% [14] - Adjusted earnings per share are projected to be between$ 1.35 and $1.65, with capital expenditure estimated at$ 270 million [15]