Q2 Losses for Foot Locker
NEW YORK – Foot Locker is predicting losses in the second quarter of 2007, blaming late season clearances on old inventory. The New York-based athletic retailer headed off negative publicity with an outline of strategic initiatives, including early closures of U.S. stores, more store openings in Europe, and changes in senior management.
Losses are expected to be $0.17-to-$0.20 per share, the company said in a statement. “During the second quarter, we made the strategic decision to liquidate slower-selling merchandise in our U.S. stores more aggressively than we had planned at the beginning of the quarter, with an objective of improving our inventory position before the start of the fall season,” said CEO Matthew D. Serra. “The financial impact of implementing this important strategy was the primary reason for the projected net loss for the second quarter of 2007. We expect our international units will produce a double-digit division profit increase versus last year’s comparable period.”
To deal with a number of private equity inquiries, the company has retained strategic assistance from Lehman Brothers.
